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No Turning Back: The Future of Human Resources

Now that the economy looks like it has turned the corner, many Human Resource professionals are settling back into their role as sideline supporters of the executive team. That could be a big mistake according to Phillip Gennis, Vice-President, Recovery and Reorganization, Grant Thornton Limited who presented to the IPM session in Toronto last October. In his view it is more important than ever for HR professionals to seek out and maintain an active presence in the corporate suite.

Philip H. Gennis,
Grant Thornton
Gennis noted that while all senior corporate roles have changed as a result of the globalized economy and market volatility, none have changed as much as the corporate Human Resource officer. Where Human Resources was once seen as a clerical arm of the enterprise responsible for staffing and personnel issues it has now become an important part of change management, leadership development and organizational change.

The Human Resource role has changed because it had to. In every difficult situation that has arisen in recent years from downsizing to restructuring to mergers and acquisitions, the need to manage the people side of the business has been recognized as integral to its success. The corporate leadership of the best managed companies knew this and invited their senior Human Resource people to every strategic team in order to use their experience and expertise to the enterprise's full advantage. Those who didn't see the wisdom of bringing their Human Resource people on board likely lost significant market share and many of their key people.

But just because we may have survived some of the most challenging times in the corporate world doesn't mean that Human Resource people are less valuable to the leadership team. Some CEOs may be a little skeptical and some Human Resource professionals may be reluctant, but now is the ideal time to keep your seat in the boardroom if you already have one or open the door wider so that you can finally get the recognition you deserve.

In order to accomplish this, Gennis says the most important thing that a Human Resource professional can do is to take the time to understand the business. And the most important aspect of the business to the other corporate leaders is the bottom line. It may take some time but if you want the respect then you have to learn the lingo.

This includes having a basic understanding of the company's financial status and being able to read financial statements which help explain how the company is doing to outsiders. You don't need to comprehend all of the nuances in the statements but you do need a comprehension of some of the key items like the balance sheet, the difference between gross and net profits and terms like Return on Investment (ROI) if you are going to be able to participate fully in all corporate discussions.

Having a good financial base can also give you the ability to know fairly early on when the company is in financial trouble. These include persistent operating losses, lack of budgeting, and over-spending on unnecessary items not related to the core business. It can also help you spot troubling trends that could impact on the operations including problems with technology or equipment and over ambitious expansion or acquisitions. A good Human Resource manager should be able to also identify problems on the people side of the business at an early stage. Things like having little delegation of authority, a lack of a succession plan, and turnover of key personnel should be warning signs that things aren't going well and also give you the opportunity to think about and propose solutions in a language that the corporate suite will understand and pay attention to.

Gennis also proposes a number of other actions that you as a senior Human Resource manager can take to increase your visibility and influence with the management team or Board of Directors. In addition to knowing the finances, you also need to be seen as a real help to the management team and not a hindrance. This could include getting rid of all paper forms and automating everything you can. It sounds simple but as Gennis says "Every time your executive team sees a form from you, it thinks bureaucracy", and that's not the message you want to send.

You should also help to coach and mentor the other managers and assist them in making difficult decisions. They don't want someone who will tell them no, you can't do that. They want someone who will help them succeed. In addition, you should keep track of your own team's performance and report regularly to the Board or management team. This might include reporting on the ROI of your rewards and recognition program or your management training program in language that the corporate suite understands and likes to hear.

Gennis' final piece of advice is to develop a thick skin and be prepared to fight to protect or preserve what you believe in. Even if you lose, your fellow executives will learn to respect you and may even take your advice more seriously in the future.

The Behaviour and Process of Knowledge

As the Boomer generation prepares to retire, businesses that fail to successfully execute a knowledge transfer strategy are compounding a significant risk. At the same time, many businesses have struggled with successfully delivering Knowledge Management and Business Intelligence solutions. If your business has failed to effectively solve the problems of Knowledge Management (or worse yet has not even attempted to understand its organizational knowledge) then resolving the needs of knowledge transfer between Boomers and other workers is bound for failure.

Much of the pain that has been felt around Knowledge Management and Business Intelligence initiatives can invariably be attributed to efforts or projects that treated symptoms and not causes. In other words, if knowledge requires an understanding of what needs to be learned, then surely the work that is done and the behaviours behind the work creating knowledge is central to any effort to transfer knowledge.

Carmien Owen,
Consulting Inc.
Albert Einstein once defined insanity as, “doing the same thing over and over again and expecting different results.” It is proposed that for an organization to unravel the knowledge conundrum, the right questions must be asked to determine what workers do and what information is needed to make informed business decisions. If all you have are answers, and those answers to this point have failed to resolve the challenges of transferring knowledge from retiring boomers to their successors, then you may be on course to exemplify Einstein’s definition of insanity. Or to put it more simply, perhaps it’s time to start thinking differently about what causes knowledge and what organizational knowledge actually is?

Einstein also said that, “no problem can be solved from the same level of consciousness that created it.” With that in mind a question to start with might be: What leads to knowledge walking out of the door and retiring? In other words, understanding how an organization arrived at their current knowledge predicament can yield a lot of insight. Building an understanding of the risk of knowledge retiring comes from understanding what behaviours and work activity lead to the creation of knowledge in the first place.

Let’s consider the following cultural symptoms. As a consultant working within different environments I get to hear all sorts of interesting stories. Here are some signs, to my mind, that the culture may resist sharing knowledge or coping with change (let alone predictably capturing knowledge from Boomers before they retire). On your first day on the job you’re told, “We don’t change here…” Retiring employees with 30+ years of service are ‘worn out’. Projects that are clearly designed to demonstrate meaningful improvement in the organization evoke reactions along the lines of: “Won’t that mean I lose my job?” or, “What’s my value if what I do is automated?” How people behave has a considerable influence on the creation and retention of knowledge. When we’re in the middle of creating it we take a lot of what happens for granted. People get very used to becoming invaluable for the knowledge they have. Many organizations, particularly those with a heavy hierarchical emphasis, will often have managers and employees who make a career out of hoarding knowledge and information to protect their positions and careers.

However, understanding how behaviour influences knowledge is only half of what you need to know to understand knowledge management. Another Einstein quote that comes to mind; “a man should look for what is, and not for what he thinks should be.” The most meaningful knowledge from the organization’s perspective is created through the creation of the product or services that they sell. What does this mean? Imagine an organization structured as silos (multiple functions/departments, each with their own cultural tendencies around sharing information). Now consider that each organization behaves, works, and creates knowledge differently. If an organization wants to assess knowledge management, then it must assess that which is inherently responsible for the creation of knowledge in the first place: The organization’s processes and information.

One only has to consider Einstein’s genius to understand what needs to be done to stop knowledge walking out the door. Managing knowledge won’t be accomplished by doing the same thing the same way again and again. The level of awareness around the problem of knowledge can only be raised by answering the questions: What do people do? What information do they need? And when an organization makes an effort to understand what people do and the information they need, it should be very careful look for what actually is, not a subjective opinion of what it thinks it should be.

Organizational knowledge is created through the people that deliver the products and services provided to customers. Such knowledge is at its heart a product of the work done, or the repeatable processes, and the information required to ensure that the work gets done. Information within an organization can be broken down into two simple categories: Information needed to do the job and information needed to ensure the job gets done. In other words, to understand how knowledge is created an organization must understand how it works. In the next article we will explore how knowledge can be derived through an understanding of processes, statistical process control, quality management, and information architecture.

Carmien Owen, Collaboration Consulting Inc.,; 780-691-2662

NOTE: Carmien Owen will be presenting on “Retiring Boomers
& Knowledge Transfer” at IPM’s Edmonton Fall Workshop on
October 21, 2010. For more details, click here for more details


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