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Crisis shows value of putting the human back into HR

During the Global Financial Crisis, boards turned to the CFO to help them navigate turbulent times. This crisis, though, it’s the HR team that has been in the spotlight. Baker Tilly experts look at the growing importance of the people function during Covid 19, and how HR professionals should position for the road ahead.

Business has learned lessons from many of economic disasters over the decades but there’s no blueprint for rebounding from a health crisis.

Organisations and employees suddenly faced new pressures in their professional and personal lives as the Covid-19 pandemic spread into every facet of life.

There was no easing into the new adjustments. Every change was rapid — new workloads, new skill requirements, remote working, home schooling, travel restrictions and being unable to see friends or family.

Kayla Flint, Director, Enterprise Solutions and Services at Baker Tilly US, says amid the chaos, human resources teams have emerged as central to solving complex problems — marking the next chapter in the profession’s change in perception from administrator to strategist.

“Historically, HR was stereotypically viewed as paper pushers, bringing people in and out, some gains were made over the years with many HR leaders gaining seats at the strategic table, but some remain  pushed to the back in terms of their organisational relevance,” she says.

“The pandemic has intensified the focus on people and HR has suddenly been shoved to the head of the table in all of these very strategic, highly important conversations.”
– Kayla Flint

“The pandemic has intensified the focus on people and HR has suddenly been shoved to the head of the table in all of these very strategic, highly important conversations.”

Baker Tilly’s larger clients in the US have teams of thousands of personnel, often operating in multiple geographies, including internationally.

And depending on the industry and structure of those companies, the ability to connect and interact with each worker ranged from excellent to non-existent.

“Many organisations don’t have visibility into their full workforce, especially globally, so they had challenges just accounting for everyone,” Ms Flint says of the early days of the pandemic.

“Where does this person sit? They’re tied to an office here, but that doesn’t mean that they actually reside there. When we call their desk and their work number, they are not there. How do we get in touch with them?

“After that initial panic, the shift was to how we can sustain operations once we know our employees are safe and accounted for. This is where we really started to see the importance of the Chief HR officer working alongside the CFO and the CEO to make big decisions.”

Some of those decisions had to be made swiftly, and without the usual change management structure that has become the hallmark of HR practice in recent years.

“The question from the executives might be, we are going to shut down this plant, what does that mean,” Ms Flint says.

“We might be changing operations, so we no longer produce widgets, we are switching to n95 masks. The question for HR is what does that do from a resource standpoint? How do we figure out if we have the right skills and competencies to support that shift in strategy?

“Very quickly the Chief HR Officer and their HR organisational advisors become very important.”

Reassessing risk, rethinking the social contract

Company risk registers are often focused on market movements and external actors but for this crisis, the greatest risk became the health and actions of personnel — right down to the cleaners wiping door handles and contractors serving in the company cafe.

It was an abrupt realisation, says Donal Laverty, Partner at Baker Tilly Mooney Moore in Northern Ireland, but it signals the importance of the human element of human resources.

“In the last crash, chief executives and boards turned to their financial directors to get them through the crash – but this time they’re turning to the people function,” he says.

“Organisations have suddenly become not just a place of work. The contract is not just an exchange of skill. It’s a social contract, a health contract.”
– Donal Laverty

“Ultimately, Covid is changing attitudes and behaviours and it is forcing organisations and individuals to respond.

“And that response is not just going to end when the virus recedes.

“Organisations have suddenly become not just a place of work. The contract is not just an exchange of skill. It’s a social contract, a health contract.”

Redefining the social contract between employer and employee might start with keeping your people safe, but it goes far beyond supplying PPE or the flexibility to work from home.

Instead, it requires a complete reimagining of what work means and how we expect people to behave and perform.

“I think HR needs to think about how the value proposition of coming to work has changed for an individual employee,” Ms Flint says.

“Many of the reasons people put forward as to why someone should join their company will no longer resonate right now. It is no longer about coming into the office, having a great working environment, being with a friendly group of people and working arm in arm with your clients.

“That might not happen again for some time.

“So people are now looking for stability, they are looking for remote options, and they’re looking for options where they might not be tied to a particular organisation, but perhaps can work from home in a contract position so they can be more flexible and nimble themselves.

“The individual employee is seeing themselves as a personal entity, and their personal situation is going to play a significant role in their choice of employer or work.

“Having to react to that will be a big responsibility of every organisation.”

Mr Laverty agrees, seeing HR as critical in keeping cultural ties from fraying and people from feeling disconnected or disengaged. It’s a situation made more complicated where offices are still at partial capacity or where some functions can work remotely while others must work face-to-face.

“For the human resource function, things are now harder, but you need to ensure that people still feel that they belong to the workplace and still belong to the organisation,” he says.

“If you look at the evolution of community, most of us have lost the sense of community in our outside life, and work is still the one remaining place that we belong to a community of people.

“Human resources is not just about productivity. Human resources is the guardian of the sense of community that makes organisations work.”

What does the future look like for human resources teams?

Working remotely from a home office, flexible working arrangements, video meetings with colleagues and clients – the digital transformation that was supposed to be part of the future of work.

The future arrived far quicker than anyone expected.

But there wasn’t really time to reset. It was a demanding set of circumstances, but the mentality was that the business wheels had to keep turning. People’s jobs were on the line.

Assessing the impact of the pandemic to the business was now viewed through a different lens that introduced new roles for human resources.

“It was a positive shift in the sense that the C-suite really started to rely on the Chief HR officer, but it’s a heavy burden and responsibility on the HR community.”
– Kayla Flint

However, it included responsibilities that most HR teams were not equipped for.

“It was a positive shift in the sense that the C-suite really started to rely on the Chief HR officer, but it’s a heavy burden and responsibility on the HR community,” Ms Flint says.

“Big companies have disparate HR processes globally. They have limited visibility into data and analytics.

“To be able to make some of these decisions, they have to understand how the organisation operates holistically, and they need to be able to see into all the different facets and functions.”

Mr Laverty agrees, pointing to a growing recognition among the best employers of personal wellbeing, mental health and now physical safety — all falling to HR to support.

“The role of human resources was already progressing  from a transactional and kind of administrative function pre-Covid. Covid has acted as a catalyst and has propelled HR and the organisations they support to put people as the centrepiece of the organisational strategy.

“And that is the opportunity to the human resource function itself, because of the traditional criticisms of HR — that it doesn’t bring value, that it doesn’t understand the bigger picture of the organisation, that it just focuses on this process of the policing force.

“The challenge is for HR also to pivot.  It successfully got people out of organisations back in March, it might have brought them back and then sent them out again. The challenge now is to get people to keep them engaged as we go into this next new normal.”

HR team at work

It successfully got people out of organisations back in March, it might have brought them back and then sent them out again. The challenge now is to get people to keep them engaged as we go into this next new normal.”

Baker Tilly’s work has been to support clients in making rapid change, while also helping HR teams learn from what other organisations are doing and how different strategies are working or have failed.

But one of the fastest growing areas of demand has been in boosting the human capital capacity within clients, so they can better handle rapid change.

Ms Flint says developing self-sufficiency is almost always a goal from clients, for whom knowledge transfer and skill building are high on the agenda.

“Don’t do it to us, do it with us, that’s what clients are asking us as consultants,” she says.

“Help us to understand the process that you’re employing. Help us to understand the skills that you’re using to help execute these changes in our company.

“We’re focusing on a knowledge transfer along the way, so that at the end of whatever change we’re implementing, they feel like they can sustain it, but that they could replicate and make changes of similar scale and scope in the future if they needed to.”

“That skill building and that knowledge transfer, I don’t think we get out of any conversation without a company asking for that.”

What does an effective organisation look like post-Covid?

There is nothing normal about the disruption that people and organisations have endured this year and the recovery phase is still playing out.

But it is this adaptability to respond that will be a mark of an effective business, says Mr Laverty.

There is no returning to the way things were and the new effective organisation will be one that continually transforms, that not just recovers but finds a way forward with purpose.

“Whether you call it the new normal, the next normal, the never normal, whatever you want to call it, fundamentally organisations have changed and are going to continue to change,” he says.

“A driving force of that change are those people who are leading the organisational design and the effectiveness of the people functions.

“We’re moving away from the ‘reacting to’ stage and getting into coping with the new normal.”

Baker Tilly has identified eight key traits of an effective organisation, from its innovation and creative thinking to its collaborative and inclusive culture. Effective companies are forward thinking, agile and fast — but most importantly, focused human-centred.

That means looking not just at sales, outputs and inputs, but at the people who do the work, the people who buy the goods and services, and the people who are affected by the business in any way.   

The last six months has seen more companies talk in terms of human-centred leadership and Mr Laverty says it’s a trend that must continue.

“The human piece has to come back into it again,” he says.

“Organisations of the future are going to be tech in the centre, but they’re going to be human on the outside.

 “Sure, technical and digital advancements will still drive efficiency, but the last eight months has really taught us about the value of the humanity, the contact, the touch, all of those pieces.

“This is where human resources really has the chance — a once-in-a-generation chance — to get in there and make a difference.”

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Meet the experts

Kayla Flint

Baker Tilly United States

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Donal Laverty

Baker Tilly Mooney Moore

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Kari Viglasky

Baker Tilly Canada

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Anthony Blaney

Pitcher Partners Australia

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Jannik Bayat

Baker Tilly Germany

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