Getting a Seat at the CEOs Strategy Table

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Getting a Seat at the CEOs Strategy Table
North Central Florida Chapter of the Society For
Human Resource
Management
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A little background

• Last 3 months
• Merrill Lynch
• Fidelity
• Bayer
• Verizon
• BankAmerica
• SunState FCU
• PGA Tour
• Mayo Clinic
• Blue Cross
• Enterprise Florida
• Wachovia
• eBay
• Volvo
• another 20 or so smaller firms and govt.
  clients
  

• Last 3 years
• GE
• IBM
• US Navy
• Wharton, Harvard, Rutgers
• Allstate
• State Farm
• PPG
• HP
• Motorola
• Kinko's
• JJ
• Toyota
• Pepsi
• Ford
• 120 others

Not an expert just a lot of exposure
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To get the HR perspective

• Southwest Airlines
• Harvard
• Royal Dutch Shell
• Infosys
• Wind River Holdings
• Merrill Lynch
• Pepsi
• PGC
• Skinner Nurseries
• GE
• NZMP
• Verizon
• Qualcom

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The last time I was here

• I talked about a few things that some of you
  loved!!
  
• I talked about a few things that some of you did
  not like
  
• Let me take a moment and cover a few of those key
  ideas to put tonights discussion in context

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This did not make you very happy!
Human resources strangles us with rules, cuts
our benefits, and blocks constructive change. It
has to do better.
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You shouldnt just have a seat at the table you
should be the one who helps build the table.

• Connoisseurs of Talent!
• Organizers of Genius
• Rigorous Recruiters of Excellence
• Agents of the Rock Stars of talent
• HR Strategy Business Strategy

When you are seen as the key source for bringing
in and growing world class talent you will have
incredible power because you will add massive
bottom-line value.
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Microsoft

• Total World Domination
• The Top 5
• Bet the Company
• Require Failure
• Managers are Qualified
• Perform, Perform, Perform
• Shrimps vs. Weenies
• Stop the Insanity

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Lessons from 7 top CEOs
Dell, Welch, Gerstner, Grove, Gates, Kelleher,
Walton 696 B

• Have an outside-in perspective
• Be deeply passionate about your job
• Understand the importance of culture
• Create or adapt next generation products,
  processes and solutions
  
• Implement the best ideas regardless of origin

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From What the Best CEOs Know by Krames
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Jack didnt have a vision!
GE Talent Machine
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Charlie Trotters Leadership Philosophy

• Hire Only the Best
• Teamwork
• Communication
• Highest Standards
• Innovation
• Truly Delight Customers

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199367B277,000E180C (8.3B)

• 2005
• 91B
• 329,000E
• 164C
• 7.9B
• 10 / F500

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The IBM 16 Billion Dollar Strategy

• Collaborative Partnerships with Customers
• Drive Unique value and GROWTH through Innovation
  and Creativity
  
• Invest in People
• Leverage Talent / Knowledge through Communication
  and Trust

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2005 p/T _at_11.9B p/FGMDCVWBMW
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The Toyota Way

• Challenge
• We form a long-term vision, meeting challenges
  with courage and creativity to realize our
  dreams.
  
• Kaizen
• We improve our business operations continuously,
  always driving for innovation and evolution.
  
• Genchi Genbutsu
• We go to the source to find the facts to make
  correct decisions, build consensus, and achieve
  our goals a our best speed
  
• Respect
• We respect others, make every effort to
  understand each other, take responsibility and do
  our best to build mutual trust.
  
• Teamwork
• We stimulate personal and professional growth,
  share the opportunities of development, and
  maximize individual and team performance.

Best People!!!!
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When land was the scarce resource, nations
battled over it. The same is happening now for
talented people.Stan Davis Christopher
Meyer, futureWEALTH
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PROBLEM 1

• Talent is damn hard to find

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YOU have to be the key to talent in your
organization

• Do you have a list of 20 wildly talented people
  you have lunch with every 60 days?
  
• Are you the very first person that all of your
  associates call if they meet someone of towering
  competence?
  
• Do you hang out with cool people and go to places
  where talent is abundant?
  
• Do you have your sights set on another dozen
  super talented people youd like to poach from
  your competitors or other industries?
  
• Are you reading, studying and learning everything
  you can about best practices and benchmarking
  for finding and developing talent?
  
• Do you treat talent acquisition, development and
  maintenance as THE most important aspect of your
  job?

20 on Admin 50 on Workforce Management
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By the way

• Say the right thing.
• Measure the right thing.
• Get rid of the social workers.
• Serve the business.
• Make value, not activity.

In other words, you need to be a very talented
business person, who just happens to have an
incredibly high level of expertise in HR.
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VERY Serious Students

• of their organization
• of their industry / profession
• of their people / peers / managers
• of effective life skills
• of their own leadership interactions
• and especially of themselves
• A word or two about how much to study and what to
  study

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Five Foundations of Effective Strategy

• Study
• Experience
• Vision
• Insight
• Execution

2
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The problem with strategic thinking?

• It takes a lot of TIME
• Study
• In Search of Excellence, Good to Great, Built to
  Last, Results Rule, The Leadership Challenge, Who
  Says Elephants Cant Dance, A Great Place To
  Work, The Toyota Way, Lessons in Excellence, What
  Really Works, Small Giants, Think Big Act
  Small, What the Best CEOs Know, The 12 Simple
  Secrets of Microsoft Management, Tough
  Management, Practice What You Preach, The Art of
  What Works, The Four Pillars of High Performance,
  The Leadership Challenge, The Rise and fall of
  Strategic Planning, In Search of Excellence,
  Credibility, The Discipline of Teams, A Passion
  for Excellence, Liberation Management, The Wisdom
  of Teams 25 _at_ 7,000p
• Experience More than just your industry, your
  company, your job, and your personal experience
  
• Vision 20 of your time on reflection,
  observation and creative thinking

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Remember

• Talent Rules!!!!
• You need to FIND talent
• You need to GROW talent
• You need to BE talent

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That is what I had to say

• Now lets take a look at what a number of CEOs
  and senior-level HP executives from around the
  world have to say.
  
• I asked them this one simple question What does
  it take for HR to get a seat at the CEOs
  strategy table?

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Deborah Straight VP of HR at Southwest Airlines

• Understand your organizations business
• Spend time every day talking with sales,
  production, quality, customer service, and
  accounting. Make sure you know what is going on
  in that bigger world. Know your customers, the
  cost of your products and services and how you
  are meting your monthly financial goals.

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Share responsibility of the business goals

• The business goals are your goals too. You
  contribute to inventory turns, you supply the
  best people who are trained in the business ,
  motivated by their work, rewarded by the company
  and led by effective management. You need to be
  very knowledgeable about the business and ask
  questions that will push or improvement and
  innovation by all.

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Know the HR business thoroughly

• You people rely on you for correct, insightful
  and highly strategic information and advice. You
  must be reliable, trustworthy and knowledgeable.
  Let people down and theyll stop coming to you
  for advice and information.

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Run the HR department like a business

• Measure outcomes and goal achievement , not work.
  The keys are deliverables and ROI. If you cannot
  clearly show that HR contribute directly to
  increased profitably, revenue and market share
  no one will take you seriously at an executive
  level.

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Have a unique opinion

• Express your thoughtful opinions backed with data
  and study. You have to understand the numbers.
  How else can you offer a solid, intelligent
  opinions on the business direction? Learn
  everything you can on the business processes and
  competitive environment and back up everything
  with water-tight research and real data.

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Learn and grow every day through every possible
method

• Seek out experienced mentors on the business side
  of the house.
  
• Attend HR conferences, meetings and events.
• Attended leadership and management conferences.
• Attend at least 40 hours of professional
  development and business training every year.
  
• Seek out people who will ask you questions and
  challenge your beliefs.

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Parker Smith

• 5 operating companies, 17 subsidiaries a little
  shy of a billion in total operating revenue.
  
• HR should be one of the most strategic aspects
  of the business, and a good HR person is worth
  their weight in gold I just do not see them
  very often.
• Problem they do not understand how the business
  works. Yes, they know benefits and 401Ks but
  they do not deeply grasp the interconnected
  processes of the business and how they can
  specifically reach across the enterprise to
  positively impact all of those processes.
• HR is in a unique position to manage the White
  Space

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Manage the White Space
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Dave Ulrich from The HR Value Proposition

• HR, or any area be it marketing, finance,
  manufacturing deserves more attention and
  resources if and only if it creates value.
  
• Weve concluded that value is defined by the
  receiver NOT the giver.
  
• The Five Factors for Strategic HR

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The Five Factors

• HR must understand the external world. HR
  professionals should have a solid grounding in
  finance, technology, economic and regulatory
  issues, the effects of globalization and
  workforce demographics.
• HR must effectively serve all key stakeholders.
  Employees and managers are the traditional two
  but HR must also be able to directly measure how
  they add real value to customers and investors as
  well.
• HR must create the practices around people,
  performance management, information and workflows
  and align these practices with the corporate
  goals -- to shape the organizations identity.
• HR must have a clear strategy and structure in
  place to deliver value to all stakeholders in the
  business.
  
• HR professional must possess the right skills and
  competencies to ensure they embark on the right
  actions to deliver the intended value.
  

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Kevin Van DykeCEO of Skinner Nurseries

• When I tell my HR person I need someone to run
  the new 100 million dollar division we are
  opening in Texas I need more than suggesting what
  papers we should run an ad in.
• I need very strategic and insightful ideas about
  the kind of person that should be running that
  part of our company and five or six incredible
  candidates that are all eminently qualified.
• And what I really need is someone who thinks
  about this a year in advance and is already
  networking like crazy to line up a list of top
  talent before I have to even ask about the
  position.

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Carl Rapp CEO of PGC

• My entire business depends on me having, growing
  and keeping the absolute best people period.
  Gerry (VP of HR) knows the business as well as I
  do. He comes to all key meetings, knows our top
  customers and is very respected in the industrial
  gearing industry. He has a probably 30 of the
  best people at other companies just waiting for
  an opening here and gives me great ideas on new
  products, marketing and advertising. I could not
  run the company without him.

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Bob LaneDirector of Global Strategic
PlanningRoyal Dutch Shell - London

• When the guy or gal in HR proves to me that they
  have truly valuable ideas and suggestions that
  I cannot get from anyone else in the organization
  -- I will refuse to have any important meetings
  without them involved.

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Siddharth Chaturvedi Infosys - Bangalore, India

• I define strategic HR as the linking of human
  resources with strategic goals and objectives in
  order to improve business performance and develop
  an organizational culture that fosters
  innovations and flexibility.
• The new breed of HR managers need to understand
  and know how to measure the monetary impact of
  their actions, so as to be able to demonstrate
  the value added contributions of their functions.
  
• HR professional become strategic partners when
  the participate in the process of defining
  business strategy by asking questions that move
  strategy ahead and when they design HR practices
  that align with the key business strategies to
  deliver measurable competitive advantage and ROI.

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Andrew McLean from the Harvard Business School
Future / Strategic Focus
Change Agent
Strategic Partner
Process (hard)
People (soft)
Employee Champion
Administrative Expert
Day-to-Day / Operational Focus
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Functional vs. Strategic Performance Metrics

• Emphasizes administrative efficiency as
  performance standard

Emphasizes strategic impact as performance
standard
HR function is primarily a cost center
HR professional is primarily a strategic partner
Can relay on current HR competencies
Requires advanced HR competencies
Focus on HR activities
Focuses on business outcomes relevant to line
managers
HR owns only HR
HR shares responsibilities for human capital
performance with line managers
Requires no understanding of strategy
Irrelevant if not driven by strategy
Results in HR being managed like a commodity
Results in HR being managed like a unique
strategic asset
Increasing marginalization and outsourcing of HR
to low-cost vendor
Outsourcing not easy because HRs contribution is
firm-specific and based on more than cost control
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What did it all say?

• You must deeply understand how the business
  works.
  
• You have to add value that no one else brings.
• You have to be able to clearly measure the real
  impact you have on revenue, profitability and
  market share.
  
• You have to be thinking about where the business
  will be five years out but putting in the place
  today the plans, process and people that will get
  it there.
• You will get a seat at the table when you
  personally add so much value that they wouldnt
  dare have a strategy meeting without you there
  --- regardless of what your title might be.

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• The greater danger for most of us is not that
  our aim is too high and we miss it, but that it
  is too low and we reach it.
  
• Michelangelo

Thank You Questions?
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