Our work with clients often provides us with insight into what the best-run organizations in the world are doing to enable their future growth. While many of these organizations are focused on initiatives and activities that leverage a unique and rare set of competencies to address the threats and opportunities relevant to their industry, there are a couple of items that surface in almost every organization.
First, we often hear some variation of “people are our most valuable asset.” This is not surprising given that the nature of our work depends on the client believing that their people truly matter in the firm’s ability to execute its strategy. Patrick Lencioni’s latest book The Advantage highlights the importance of organizational health in strategy execution and in organizational growth. He also differentiates between the “smart” stuff (strategy, marketing, and finance) and the “healthy” stuff (alignment, engagement, and morale). Our experience bridging the divide between the “smart” and the “healthy” stuff has shown that too many organizations are still outsourcing the engagement of their people to the HR department. This naturally begs the question, if people are our most valuable asset, why are we making it one function’s responsibility to connect them to the business in a meaningful and impactful way?
The second area of focus that is common among many clients is the need for an increased emphasis on innovation within the business. Innovation is one of those words that gets interpreted many different ways depending on the day, the industry, and the client. What is common is that most innovation efforts are focused on things like new products and services, more efficient ways of doing things, and perhaps the pursuit of a new business model. Rarely are these efforts focused on finding new and better ways to inspire, empower, and engage our most valuable asset – our people.
“Why HR Still Isn’t a Strategic Partner” helped me find a connection between these two areas of focus that I hadn’t recognized before. HR has spent a lot of time and energy over the past 10+ years trying to transform itself into a true business partner by getting itself better aligned with the strategic direction of the business. Unfortunately, not enough of this activity has centered on creating the conditions where innovations in management and leadership can flourish. Driving innovation focused on new management and leadership models will not only transform the function, but transform the business.
Businesses today need a management model designed to meet the demands of a rapidly changing, increasingly unstable environment where competitive advantage can disappear almost as soon as it is achieved. Leadership and management innovation must address and ultimately answer how to harvest knowledge to sow the seeds of creative destruction for your competition, how to make innovation everyone’s responsibility, and how to stoke the emotional fires of your employees in order to instill the passion and pride of purpose necessary for them to be in the game versus on the sidelines. Adaptability, innovation, and engagement are the essential organizational attributes for survival and success in the “new normal.” Information is pervasive, so HR must focus its efforts on innovating a model that the functions of the business can drive for leading and managing and that creates the conditions for employees to translate all available information into knowledge, insightful urgency, and results-focused action. In this way, HR is not only helping drive the strategy of the business, but also ensuring that the rest of the organization takes ownership for the innovation process.