Over the years the Human Resources Department has transitioned through any number of “latest thinking” management concepts and corresponding “buzz phrases” – from “matrix management” to “broadbanding” to “onboarding” and “headwinds”.  Each new approach seemed the brainchild of management consultants seeking to encourage what they called creative thinking and the latest strategies to improve the human factor.

Lately though a persistent theme has settled in that HR should become a “Business Partner” of the organization, in order to be taken seriously by senior management and enhance the value-added contribution of its programs.  This encouragement suggests that HR is not currently a player on the Senior Executive team – but needs to be.

 So what exactly is an HR business partner?  Several key criteria have been tagged as descriptors:

• Diagnose business needs
• Develop management’s capability to address HR issues
• Provide advice and a point of view
• The primary focus is driving the business forward
• To educate, motivate and influence others

Does the above describe the HR function at your company?  Is HR considered a business partner?

Your Father’s Personnel Department

Today most would chuckle at memories of the “old” Personnel department, whose primary responsibilities seem to have been tasks like recruiting, record keeping, arranging the blood drives, the safety shoe program and running the annual picnic / Christmas party.  The head of Personnel was rarely considered a “player” at management meetings.  Some in management claimed that the department was only a necessary evil.

That Personnel was viewed as the department focused on the interests of the employees.  Its management was staffed by employee relations generalists, was sensitized by the needs of employees and left the running of the business to the “businessmen”.  Personnel dealt with people.

Today, companies expect more.   Leadership expects less transactional administration and more strategic thinking.  Being labeled a “people person” is now considered a negative, a source of humor among recruiters.

What are the signs that HR is a true business partner at your company?

• Direct report to the President / CEO and listed as a member of the Senior Team
• Able to speak with credibility and respect at the management table
• Able to advance the value of HR to those holding negative biases
• Consulted by senior management on human factor issues
• Company decisions affecting employees are initiated by the head of HR

As a newly designated business partner-wannabe, Human Resources in many companies has transitioned away from the traditional role of caring for / representing the employees.  It has focused instead on utilizing the human capital to assist management in achieving objectives and driving business success.  However, the more successful HR has become as a business partner the greater the danger that employees will lose trust and confidence in HR, exactly because the focus has moved away from employees. 

As HR has developed a new stratagem, some might say a new identity, what has been the cost to the original mission?  What part of itself has been lost while chasing the role of business partner?

Danger Signs

Have a care that you don’t lose the heart and soul of HR – its caring connection about employees.  Don’t start looking at them as merely numbers on a spreadsheet or boxes on an organization chart.  There are other departments who already do that very well.

Is the HR function served or harmed by leadership that is “counting the chairs” on their way up the hierarchy?  These are typically fast-trackers who are not HR-trained, but only temporary visitors to the department for a “broadening” of their management experience.  Why is that acceptable for the HR function, but wouldn’t be tolerated in IT, Finance, Marketing, Engineering or Manufacturing?  Is the head of any of these other functions anything less than a seasoned expert in that profession? 

Why is HR viewed as different?  Why are other functions already presumed to be business partners?  Only HR is being challenged, remaining a newbie, on probation at best, at worst one step away from getting the coffee.

Lip service to the people department?  Even while sitting at the Senior Management table negative biases from the old days often remain:

• Remember the safety shoe program?  It’s hard to be taken seriously after so many years focusing on administration.  Does HR deal with important issues today?
• If the head of HR has only been appointed to gain experience toward their ultimate loftier goal, how serious can we take a temporary worker who is only passing through?
• HR is still perceived of as offering restrictive advice, what can’t be done; they remain the gatekeeper of corporate policies.  Being an advocate of policy doesn’t win friends.

From the employee’s perspective it is important to consider HR as the source and advocate of fair and equitable treatment, compliance with all regulations affecting employees, and their representative among senior management.

What if senior management doesn’t feel that way?  What if they want HR to become just another “business partner” concerned more about the bottom line – to the exclusion of the human factor?

Have a care that we get what we want – Business Partner – and then our employees choke on it as we lose our way.

 Chuck Csizmar, CCP is a member of WorldatWork, the Society for Human Resource Management (SHRM), the Small Business Resource Network and the Florida HR Planning Society. He has been published as a subject matter expert by Compensation and Benefits Review, Florida HR Review and Benefits and Compensation Solutions magazines, and is a regular contributing author for numerous professional association chapter newsletters.  He has been interviewed by The Human Capital Show and hosted teleconferences for ExecuNet.

Bob just turned in his resignation, handing you a paper with a single line of text; he was leaving in two weeks.  Cripes!  Bob is one of your best team leads, and his departure will leave a hole in your department that will be hard to fill, especially in the short term.

Is there anything you can do?

At this point the question of a counter offer will pop into every manager’s mind that has ever faced this dilemma.  Give Bob what he wants and he’ll stay – right?  Find out what he has been offered and promise the same.  Problem solved?

Not by a long shot.  It’s not that simple.

Bob may or may not decide to stay, but meanwhile other discontented employees will note your response, the relationship with Bob has already been damaged by his resignation, and any new “arrangement” might create internal equity trouble.  Productivity and morale could be impacted, no matter what happens to Bob.

Your solution might create even more problems for you.

What to do?  Let’s look at the implications of a counter-offer from both sides.

The Employee Perspective

If an employee has made the decision to leave, and subsequent actions have progressed to the point where an offer has been received, then mentally they have already left.  Any internal debate they might have had over making a change has already been resolved, and they are comfortable with their decision.  They may even be anxious to leave, as the new employer offers a fresh start, with new challenges, new faces, increased responsibilities and of course more money.

They may be enticed to stay by increasing their rewards package, but you cannot be certain.  Their true motivation may remain an unknown, leaving you to deal with only what they are willing to disclose. 

If the key catalyst for resignation is not rewards (i.e., friction with the boss, perceived dead-end job, dated technology, long commute, too much travel, etc. etc.) a counter offer focused on more rewards will miss the mark.

The Employer Perspective

If you extend a counter-offer, it will become known and discussed.  Employees may get the idea that such is the way to get a better deal with the company – by threatening to quit.

Those who accept counter-offers often leave anyway within 6 months – that is all the time you have purchased, as other unresolved issues would remain sources of continued dissatisfaction.   More money will not solve those problems, and typically counter-offers address only the money (easy fix?) issue.

Once an employee has resigned, even if later rescinded, their relationship with the company is forever altered.  It is unlikely that the company will have positive thoughts about the individual down the road, even if the immediate manager still loves them.  Career prospects will have taken a body blow.

If you extend a counter-offer and it is rejected, the same internal damage will be felt as if it had been accepted – so you better be careful before extending yourself.  Meanwhile, the employee is no longer considered loyal, and cannot be trusted to remain longer term.  They have been bought.

When could this work for you?

If an employee tells you they are thinking of leaving, vs. actually having an offer in hand, then you have more room to maneuver.  But the company should examine how they deal with threats – because other employees will be watching.

However, if your world will end if Bob leaves, or you need to buy time until a replacement can be put in place or a project completed, you may wish to consider negotiations.

Caution:  line managers may advocate a counter-offer more because their lives are made difficult by an employee’s departure than the business impact of the separation.

Doing it anyway

If you are planning to make a counter-offer, prepare yourself in advance by:

• Learning the nature of the offer you are competing against
• Ensuring your period of vulnerability is minimized
• Developing  a backup employee as soon as possible
• Deflecting employee criticisms over favored treatment, dangerous precedents, etc.  Word will get out, so you should have a story ready that rationalizes your decision.  You do not want to face a host of “what about me?” calls.

For those companies who may have a policy that allows managers to consider counter-offers, the approval process should be visible enough to ensure that the broader issues of business justification are discussed.  Personally affected line managers should not make the call.

A final caution: like a fine aged whiskey you should only sip at this practice and savor the mutual gain, not gulp it down and feel the burn.

Chuck Csizmar, CCP is a member of WorldatWork, the Society for Human Resource Management (SHRM), the Small Business Resource Network and the Florida HR Planning Society. He has been published as a subject matter expert by Compensation and Benefits Review, Florida HR Review and Benefits and Compensation Solutions magazines, and is a regular contributing author for numerous professional association chapter newsletters.  He has been interviewed by The Human Capital Show and hosted teleconferences for ExecuNet.