In Conversation with Professor Ram Charan on Changing role of HR in Today’s Scenario

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In an exclusive telephonic conversation we had the privilege to interact with Professor Ram Charan. He is a world-renowned business advisor, author and speaker; he has spent the past 40 years working with many top companies, CEOs, and boards around the globe.


In his work with companies including Bank of America, Novartis, Verizon, Aditya Birla Group, Max Group, Yildiz Holdings, UST Global, Fast Retailing (Uniqlo), Longfor and two of the four largest digital companies in China, he is known for cutting through the complexity of running a business in today’s fast changing environment to uncover the core business problem. His real-world solutions, shared with millions through his books and articles in top business publications, have been praised for being practical, relevant and highly actionable — the kind of advice you can use Monday morning.

Professor Charan has coached more than a dozen leaders who went on to become CEOs. He reaches many more up-and-coming business leaders through in-house executive education programs. His energetic, interactive teaching style has won him several awards, including the Bell Ringer award at GE’s famous Crotonville Institute and best teacher award at Northwestern. He was among Business Week‘s top ten resources for in-house executive development programs.

Ram has authored or coauthored over 25 books since 1998 that have sold over 2 million copies in more than a dozen languages. Three of his books were Wall Street Journal bestsellers, including Execution (coauthored with former Honeywell CEO Larry Bossidy in 2002), which spent more than 150 weeks on the New York Times bestseller list. He also has written for publications including Harvard Business Review, Fortune, BusinessWeek, Time, Chief Executive and USA TODAY.

Ram was elected a Distinguished Fellow of the National Academy of Human Resources and has served on the Blue Ribbon Commission on Corporate Governance. He has served on the boards of Hindalco in India, Emaar, Austin Industries, Tyco Electronics, and Fischer and Porter. His newest book, Talent Wins, coauthored with Dominic Barton and Dennis Carey (Harvard Business Review Press, March 2018), is a guide to radically rethinking the management of talent, because  human capability is the ultimate determinant of a company’s success.  Especially in this digital age.

Q- What is your HR philosophy and how do you see the role of HR changing in the current scenario?

My view is that how you acquire, allocate, develop and deploy talent is at least as important to a company’s success as how it manages its finances. Your ability to manage talent well is a leading indicator of success; financial performance is a lagging indicator.

Having the right talent at the right place is a major part of a winning formula, just like having the right funding at the right time. We recommend that the CEO, the CHRO and the CFO work together to synchronize their activities, so the allocation of talent and funding work hand in hand. They should also review operations jointly every month or every quarter to assess financial performance and people together. They should answer together why the numbers are falling short or exceeding expectations. What people and organizational issues explain that performance? They should discuss together what external change they see, where new opportunities are, where to take some risk and what funding and human capability is needed.  In companies that have begun to practice this kind of joint effort, it is working very well.

Q- You had quoted once that “the role of HR should be eliminated”, do you yet suggest the same?

No, absolutely not, I had said HR should focus on leadership and organization as opposed to administrative functions. HR transactions can and will be automated. In large companies they have taken 60-65% of HR people who focus on transactions out of the main HR department. The other 35% of HR people are focusing on leadership and organizational issues.  They are building their capability in those areas.

It is important for people in that role to have worked in another business function, like business development, auditing, marketing or finance.  Some progressive companies are moving people with a business background into HR, and moving HR people into other parts of the business for several years.  The best HR people will have a mix of business understanding and expertise in HR, and that combination will be a requirement to be CHRO in some cases.

Q- What are the implications of rapidly evolving digital technologies for HR professionals?

HR people need to understand that technology is being used to add value in all functions, including HR. It can be especially useful in three areas:

  • Ensuring the right people are in the right jobs through more precise assessment of skills, performance, and learning.
  • Finding High Potential leaders and individuals, and speeding their development to increase the competence of the organization.
  • Designing the organization and incentive system of KPIs–jointly with the CEO, CFO, or operating partners—for high quality & fast decision making.
Q- In your opinion, what are top traits of successful Human Resource Professionals?

First of all, they would not define themselves as HR professionals but rather as business leaders with expertise in HR.  CEOs, CFOs, and marketing people don’t identify themselves first and foremast by their profession.  They are part of the engine that runs the business.

An HR person needs to think of himself or herself as an integral part of the management team, someone who can contribute to the business more broadly. You have to take responsibility for finding talent, developing talent, deploying talent for the specific needs of the business, which means you need a full picture of the business goals and challenges. A great HR person will be able to collaborate with the CFO and have the skills to make talent work, organizational work, compensation work as a competitive advantage.

Q- Any concluding remarks?

This is the time for HR to rise. HR is needed in a very big way, more than ever, because talent is scarce and precious.

HR should join the team, work with integrity, and become an invaluable partner to management. Now is the time.

Thank You Professor Ram!

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