Uber. Binary Capital. Google. SoFi. These are just four high-profile HR disasters that devastated victims of harassment and negatively impacted each company’s brand, morale, engagement, and ability to attract and retain talent.
While responsibility for the atrocious behavior behind these headlines lies with the perpetrators and those who enabled, facilitated and covered up these toxic incidents and hostile workplace cultures, a more strategic, better empowered HR department with C-suite representation could have helped. But according to research from HR software technology firm Namely, of 1,000 midsize organizations surveyed, only 7 percent have an HR executive in the C-suite.
The case for a CHRO
The importance of HR has increased dramatically in the past few years, as talent has become a No. 1 priority and one of a company’s most important assets, says Straz, Namely’s CEO.
“For decades, business leaders have considered HR an administrative or compliance function. Far too many people think that HR is simply ‘the complaint department,’” says Straz.
Many senior executives don’t value HR leadership as much as other C-level roles, or they see it as a need only when a company reaches a certain size or complexity, says Charlie Gray, CEO and founder of Gray Scalable, a custom HR technology solutions company. Or when HR disasters happen.
“Companies will instead have an HR director or VP that reports to their CFO, or COO, who would be responsible for driving people planning strategically, even though this complicates and often conflicts with their key responsibilities,” Gray says. “They often view HR responsibilities through a tactical lens — understanding that things like payroll, benefits, skills training and basic performance process are needed, but don’t always recognize the high-level strategic value of leadership development, people analytics, organizational planning and the other ways that the right HR leadership can provide game-changing contributions to a business.”
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