I spend much of my time giving talks to companies, trade associations, and professional societies from the worlds of marketing, IT, and human resources. And whenever I talk to an HR audience, there's someone after the event who wants to talk to me about an article we published in Fast Company way back in 2005. The essay, designed to stir up discussion, was titled "Why We Hate HR"—and it's left a mark. To this day, human-resource executives want to praise it, denounce it, dissect it, and debate it. I guess that's a sign the essay succeeded—and that many HR leaders remain frustrated with their roles inside their organizations and determined to do more.
So here's a proposal. As this provocative essay approaches its fifth anniversary, perhaps it's time to change the debate. The real problem, I'd submit, isn't that HR executives aren't financially savvy enough, or too focused on delivering programs rather than enhancing value, or unable to conduct themselves as the equals of the traditional power players in the organization—all points the original essay makes. The real problem is that too many organizations aren't as demanding, as rigorous, as creative about the human element in business as they are about finance, marketing, and R&D. If companies and their CEOs aren't serious about the people side of their organizations, how can we expect HR people in those organizations to play as a serious a role as we (and they) want them to play?
This is a lesson I've learned and relearned from all kinds of companies that are winning big in tough economic circumstances. You can't be special, distinctive, compelling in the marketplace unless you create something special, distinctive, compelling in the workplace. Your strategy is your culture; your culture is your strategy. The most successful companies I know understand that the most important business decisions they make are not what new products they launch or what new markets they enter. What really matters is what new people they let in the door—who they hire—and how they create an environment in which everyone in the organization can share ideas, solve problems, and develop a psychological and emotional stake in the enterprise.
For example, business strategists rave about Cirque du Soleil and the ideas it has embraced to reinvent the circus and invent a whole new genre of entertainment. But Cirque is every bit as serious about the performers themselves as it is about the logic of the performances. It has developed the most creative and rigorous methodology for recruiting and evaluating new talent I have ever seen, and it is obsessed with making sure its talented recruits understand and embrace how Cirque works. It makes an explicit connection between the people it attracts and the product it delivers, between how it does business and who it invites to become part of the business.
Lyn Heward, Cirque's director of creation, explains it this way: "There are no stars here. The show is the star. That's why our evaluation goes deeper than a talent evaluation. We need to learn about the person behind the artist. How many somersaults you can do is not as important as an open-mindedness to our process, the tough-mindedness to get through the job, and what we call a 'fire to perform.' That's what we're looking for."
Or think about Pixar, the Hollywood hit factory. A few years back, when I first got to know Pixar, what struck me was not the power of its animation technology but the power of its culture—specifically, the mission-critical role played by Pixar University, a one-of-a-kind training complex in which all of the company's people, from security guards to programmers to finance executives, rub shoulders and learn together.
"Most companies eventually come around to the idea that people are the most important thing," says Randy Nelson, who spent 12 years as dean of Pixar University. "It's fine to have wildly talented individuals. But the real trick, the higher degree of difficulty, is to get wildly talented people to make productive partnerships." At Pixar, he concludes, the most urgent question is, "How do you do art as a team sport?"
Or consider the experience of DaVita, the kidney-dialysis provider. This company's remarkable business turnaround was driven almost exclusively by a transformation of how it approached the people side of the business. Under CEO Kent Thiry, one of the core themes of the culture is that "Everything Speaks." That is, even the most trivial issues—what its treatment facilities look like, how colleagues communicate with one another, small gestures of individual kindness or selfishness—send huge signals about the health of the entire organization. Another theme is "No Brag, Just Fact." Thiry and his colleagues know that plenty of companies with toxic workplaces talk a good game about the level of commitment among their people. But the only thing that matters at DaVita are the day-to-day realities of the quality of care it is delivering and the quality of the culture that delivers the care.
"Unless you figure out, together, how people should behave at work, and create the kind of language and rituals and systems you need to reinforce that behavior, you never get there," Thiry told me. "At DaVita, we do a lot to remind people that despite the crushing realities of their day-to-day professional lives, we want to treat each other differently. We want to care about each other with the same intensity that we care for our patients. "
So the next time you, as an employee, get frustrated with HR, or you, as an HR executive, get frustrated with your role inside the company, stop sweating the small stuff and start asking the big questions: Why would great people want to be part of your organization in the first place? Do you know a great person when you see one? Are you great at teaching people how your organizations works and wins? Does your organization work as distinctively as it competes?
If your company and its leaders can answer those questions, then you'll have an organization that is capable of winning—and an HR organization that everyone can love.
Reprinted from Harvard Business Review