89% Of CEOs Say CHROs Should Be Central To Long-Term Growth. Only Half Are Creating Conditions To Let Them Do So

Susannah Yule, managing director of North America, YSC Consulting
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‘There is no question that CHROs in companies of all sizes need a seat at the decision-making table,’ says consultant Susannah Yule.

How can chief executives and other C-Suiters truly incorporate HR’s perspective in the organization’s overall strategy for profitable growth? And why do they need to?

Susannah Yule, managing director of North America for YSC Consulting, an Accenture-owned leadership consulting firm focused on driving organizational change, has plenty of thoughts on the subject. She spoke with StrategicCHRO360 about why HR is critical to the C-Suite, what CEOs and CHROs should be doing together and why tech is like a Formula One race car.

According to a recent Accenture survey, 89 percent of chief executives say CHROs should play a central role in ensuring long-term profitable growth, but just half of those CEOs are creating conditions that allow CHROs to do so. What’s the case for a CHRO playing a central role in ensuring long-term growth, and what are the conditions that they need to do so?

To ensure a company’s long-term growth, there is no question that CHROs in companies of all sizes need a seat at the decision-making table. Fundamentally, the CHRO and broader HR team are responsible for ensuring an organization has the talent it needs to deliver on its business strategy—and that the necessary talent is retained.

Particularly in times where the job market is loose, organizations that fail to build the proper talent attraction and retention strategies will be hard-pressed to achieve their long-term growth goals due to high turnover and a shortage of experienced professionals. 

To maximize impact, CHROs need a CEO with a genuine belief that a robust strategy built around talent and people is fundamental to achieving business success. Often, C-Suite leaders will say they believe these things in theory, but do not put them into practice.

For example, a good CEO will not tolerate company leaders undermining the people agenda or not investing their time and resources in leading people. This is not all on the CEO and CHRO, however, as middle managers are the ones who engage with the employees they directly supervise. Every leader of a company should be engaged and fully immersed in a business’ people strategy to achieve long-term business goals, and it is up to the CEO and CHRO to set the foundation for the middle management of a company. 

Why are CHROs uniquely positioned to unlock the organization’s power in tech, data and people?

A key part of the CHRO role is to build connections within an organization. The job of a CHRO is one of a few that spans the entire C-Suite and organization, whereas oftentimes other C-Suite roles have a narrower remit.

By its nature, the HR function services every part of the business, and therefore takes an interest in finding value in the intersection between parts of an enterprise that may be seemingly disconnected to leaders in other positions. This element of finding connections is key because there may be no obvious connection for the CTO, for example, between technology, data and people, but CHROs are required to look for these types of connections all the time.

Technology and data mean nothing without strong backing and implementation from the people of an organization. A strong technological and data function in and of itself brings nothing to an organization. It is the people of an organization that translate data findings into insights and inspire the adoption and efficient leveraging of technology. And while people are crucial to technology’s effective implementation, they can also be the biggest resistors to change.

Any difference in technology and data processes can be resisted by the people or an organization, so a multi-faceted approach is required to move and inspire people to adjust. This begins with a company culture, as it should be evolved to be able to handle and adapt change agents.

How important is the human factor in all of this? Beyond technology and data, how crucial is the CHRO’s role in embracing and retaining talent while allowing employees to grow within an organization?

Technology wants nothing for your organization. A crucial mistake that businesses make in adapting technology is that they think the latest and greatest will be a “magic bullet” of change and success for your organization. Technology and data, and the processes around them, can be fantastic enablers for organizational success, but the people are the ones who must adopt it and successfully drive change.

Think of technology and data like a Formula One race car—if you have the best car, but one of the worst people driving it, what use is the car? Business strategies should be focused on hiring the best driver as much as the best car, and that is where the CHRO can come into play. 

Moving beyond technology and data alone, involving the CHRO in all business decisions can allow the leadership of an organization an opportunity to spot unintended consequences of decisions on the people agenda and culture. From an internal communications perspective, CHROs may also understand messaging barriers that can cause ripple effects within an organization.

Ultimately, there are people implications for every business decision, and with people being the ultimate barrier and enabler to long-term success, it is crucial they are involved in these decisions. For example, if you are changing the way you sell your product to customers, you likely need to train, hire and reward people differently. Key business decisions cannot be made, and strategies cannot be implemented without the input of a CHRO.

What advice would you give to CEOs who are looking to foster “high-res” CHROs within their organization? How can they empower them to get the best out of the company’s current workforce?

There are several ways that CEOs can empower CHROs to effectively lead the people strategy of a company, with some of them mirroring ways that CEOs more generally inspire the rest of the C-Suite.

First, CEOs should treat CHROs as a member of the executive team first, and the CHRO second. This strategy can be applied to all the CEO’s direct reports. Empowering leaders to step out of their swim lanes when they feel as if they have something to add to the conversation is important, as they won’t stray away from their area of expertise if they don’t feel licensed to step outside of their comfort zone.

A business strategy without a people strategy to back it up is pointless. CHROs must have pull in any organization looking to be successful, because it is the people of an organization that have the drive, commerciality and compassion to deliver on the business strategy and goals outlined for them.

A third key for CEOs to foster “high-res” CHROs is to leverage them as an internal coach to the entire C-Suite. Community is more important than ever for talent retention in today’s workplace, and it is the people of a company who build that community and leverage others to rally around a common goal. The CHRO can be a key driver within the C-Suite to building that community, and supporting talent retention goals, which are so instrumental in maintaining a successful business in 2023. 

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