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Will Hutton

Will Hutton

Principal, Hertford College, Oxford University and chair of the Big Innovation Centre

Tuesday 17 Sep 2013
Link between commercial performance and HR is holy grail

Link between commercial performance and HR is holy grail

The link between commercial performance and HR input has been the holy grail for the most forward looking of the HR community. It’s the link that binds together investment in people, and the reward for the organisation of that focus.

In the current environment we have

  • an improving economy, and thereby improving employment prospects, with pent-up colleague churn imminent
  • a continued trend to look at business on a global basis, stretching existing capabilities
  • an increasing pace of change, requiring broader and deeper skillsets in each individual to remain effective in the workplace.

All of these changes mean that investment in people; the right investment in the right people is more critical than ever before.

It’s a time for HR of huge potential to change, of huge rewards to draw the right links and reach the right conclusions. As the economy changes, the balance of power between employer and employee will change enormously over the coming few years; and those companies, those leaders, who are on the front edge of this thinking are the ones who make the biggest impact. As the balance changes, employees can more readily ask how they will be supported on their journeys through life; these questions will come; our question is how we respond when they do.

Those at the leading edge of HR are finding ways to draw a clear line-of-sight between revenue and HR action. We are working with a number of organisations where the HR leadership are developed in their thinking along these lines. The sorts of questions this drives are difficult, and require evidence, not guesswork, to clarify.

For example,

  • How does HR-initiated-activity drive colleague engagement?
  • How does engagement improve customer experience or Net Promotor Score?
  • How does customer experience drive revenue (and profit)?

This final question is often measured and modelled within marketing and finance departments, but they have no idea of how to think about the first two.

We would encourage you all to try and define the analysis in your own organisation that defines these links clearly. It will allow us all to have clear, incontrovertible reasons why investing certain things in certain groups of people are the right thing to do. Without this, colleague churn will rise, employee stretch will remain inadequately supported, employees will not recognise changes in their environments quickly enough and thereby business results will suffer.

The upside of this is that the rewards for those of us who do this well are substantial. The pace of change means that outcomes can very dramatically in a short period of time. As a reader of things like HR Most Influential, you are already proven yourself to be open to think, to change, to learn. This is the most important part of that journey. We look forward to journeying with you.

Nick Laird, chief commercial officer, Ceridian UK