During one of the recent HR forums, it became apparent that “knowing the business” has become a chief mantra of HR Heads in China. It is one of the prerequisites for getting a "seat on the board" and being recognized as a Business Partner by business managers.
So, what does it mean for the HR Head to “know the business”? Well, it means that he/she can answer the following questions:
• Who are three of our competitors and what are their competitive advantages?
• Who are the five major buyers in the markets that we serve?
• Which customers represent 80 percent of our revenues and profits?
• Whom do the customers perceive as "best" in our industry?
• Why do our target customers buy from us? What are their buying criteria?
• What are our future customers' needs and expectations?
• How do we ensure that our target customers have a positive customer experience?
• What do we do to build connectivity or intimacy with our target customers?
• Can you describe the culture of our organization?
• What are the strengths and weaknesses of our organization?
• What are the economic, social, political, and technological influences that affect our industry?
• What future risks is our organization facing?
• What are the opportunities for the organization?
• What is the financial performance of our company and how has this changed over the past three years?
• Can you read a profit and loss statement?
Even if the HR Head can answer all of these key questions, it is still very important for them to apply this knowledge to their HR strategy and programs and to ensure proper execution with their HR team.
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