The truth about the HR department

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Channel 4 Chairman Luke Johnson had a go at the HR function in yesterday’s FT. As well as repeating the usual gripes, he injected a whiff of conspiracy theory into his polemic.

Of course, senior executives understand that HR is powerful – a bit like Mossad or the CIA.

What? Is he serious? In many organisations HR has no representation at executive team level. In general, it lacks the political clout of other support functions, such as Marketing, Finance and even IT. Senior HR managers are forever bemoaning their lack of power and influence.

Luke goes on to tell us how this powerful HR freemasonry works::

Those in personnel know everyone’s salary and bonus and all their disciplinary records. Wily office politicians cultivate them, since they help decide who gets a pay rise and promotion, how contracts are drafted, how individuals are treated if there is a restructuring and so on.

Well, yes, HR people have access to all that information but they can’t use it without breaking confidence – a sacking offence in most organisations. Even using the knowledge of other people’s pay in your own salary negotiations was considered a breach of confidence in the companies where I worked. It is also true that HR gets involved in restructuring and drafting contracts but this is usually at the behest of the senior management. More often than not, HR simply carries out decisions made elsewhere in the company.

Luke has some other complaints too.

Typically an apparatus builds up around divisions such as HR to expand their role and cost more money. For example, compensation consultants are hired to come up with justifications for paying everyone more.

Really? When I was a compensation and benefits manager my job was to reduce the company’s pay bill. By demonstrating, using robust data, that many managers were overpaid against the market, we could justify much smaller pay increases and performance linked bonuses, secure in the knowledge that people would not carry out their threats to leave. There is nothing like evidence for refuting someone’s claim to be underpaid.

This bit amused me too.

Experts are drafted in to devise an appropriate corporate social responsibility agenda – whatever that is. All this paraphernalia is accepted as essential good practice by modern-thinking corporate management. I think most of it is expensive, bureaucratic hogwash.

Presumably, then, we can’t take this page on the Channel 4 website too seriously, given that the company’s chairman reckons the whole thing is a load of crap.

OK, there is some truth in Luke’s assertion that HR functions are over-staffed with people who don’t appear to contribute much to the bottom line. But why is that?

Some years ago, a friend of mine was doing some consultancy work with a group of senior executives. In one conversation they began to complain about how useless their HR function was.

“Why don’t you just sack ‘em all then?” asked my friend. At this point, the executives began to back-peddle furiously, as the realisation dawned on them that, with no HR people in the company, they would have to take responsibility for all sorts of unpleasant things.

Which gives us a clue as to why, despite rumours of their demise, HR functions persist in most organisations. Many managers are not good at managing their people. There is a lot of stuff they don’t like doing. Even the good managers like to have some support when dealing with awkward issues like disciplinaries and grievances,  the bad ones just pass the buck on to HR.

Could it be that large HR functions exist not because, as Luke Johnson claims, they are an all poweful self-perpetuating secret police but because they are covering up for the deficiencies of middle and senior managers?

To any chief executives or directors who think they have an over-sized and useless HR function I would say this: If they are that crap, why haven’t you fired them yet?

If an organisation is carrying passengers anywhere, whether in HR, IT or any other function, the chief executive and the board are ultimately responsible. Either sack the HR people or let them get on with their jobs. And if you decide you can’t get by without them, perhaps you should ask yourself why?

Luke Johnson claims to have uncovered “the truth about the HR department” when actually he has come nowhere near. He has simply written a blustering tirade which is a mix of well rehearsed anti-HR complaints and his own personal prejudices, some of which, like his dislike of employment legislation and high payoffs for failed executives, can hardly be blamed on the HR function. 

The real truth is that senior managers have colluded, and continue to collude, with the growth of large HR functions. At their best, HR functions provide crucial support to executives but, in many organisations, they also act as a convenient scapegoat and as somewhere for managers to pass the buck. For this reason alone, they will be with us for a long time yet.

Update: Personnel Today’s Jo Faragher is not impressed either.

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