HR should report to the CEO

In about 13 percent of companies (for smaller companies the number is 22 percent), the head of HR reports to the CFO (CFO Research Services, 2003).

Per job description, the CFO represents a primarily financial orientation and creates value by saving money or cutting costs. In such an arrangement, it is easy for HR to simply become an extension of accounting with HR programs and processes being implemented for their cost-effectiveness and ease of administration.

Reporting to a CFO is reasonable when HR is focused on transactions, strives to cut costs, and/or works well with metrics. But, the first two conditions are losing relevance since HR has automated and outsourced the majority of transactional processes to various vendors thereby improving efficiency and lowering costs. In fact, HR function expenditures currently account for less than 1 percent of the company’s total operating costs (BNA/SHRM Survey and analyses of 740 publicly held firms).

Instead, HR should focus on maximizing the strategic value of the workforce. After all, total payroll expenses equal between 60 to 70 percent of operating costs.

Thus, the best firms separate the HR function from Finance and require the HR Director to report to the CEO, who, per job description, seeks to generate money by investing in high ROI resources.

Internal Blogging

Besides stay interviews, internal blogging is an excellent communication platform to increase performance and retention.

Internal blogging encourages business conversations, team building, project management, knowledge sharing, cross-shift communications, and provides a window of opportunity to learn what employees think about their company*.

Companies that support internal blogging have seen improvements in their products, processes, and quality of service as a result of employees being more communicative, more involved, and more outwardly focused. Other benefits of internal blogging include:
• Employees enjoy their work more,
• Employees connect more with people outside their teams, and
• Employees share and receive information on a whole in a new scale.

Furthermore, the best employee blogs allow for open brainstorming and problem-solving and thereby improve efficiency across the organization.

For these reasons, internal blogging has a great potential to become another “HR best practice”. However, before your organization can deploy internal blogging, it must be considered either this framework is appropriate given your organizational circumstances.


* Wright, Jeremy (2006). Blog Marketing. New York: McGraw Hill.

Holiday Countdown

With 10 days of public holidays and an average of 10 days for annual leave, healthy employees in China work 241 days a year. This comes up to 1,928 working hours; 241 lunch hours in-between working hours and up to 582 hours of traveling time (to and from work).

Yet, quite a few employees go to work counting their next upcoming days off from their employer. Comments like the following are not unusual: “Another two days to go before the weekend”, “I already booked the flight, another three weeks to go”, “We just came back from our holiday and now must wait 7 weeks for Labour Day Holiday”, etc.

All too often, holidays are the key impetus for satisfaction in employees’ professional life.

Understandably, holidays are something to look forward and a break from a routine. But, employers should learn to distinguish between holiday excitement and holiday relief. After all, they expect employees to arrive back from their holiday revitalized and not sorry to be back at work.

A reluctance to return may signal that the company does not challenge, inspire, and motivate the employees. Leaders and managers should change a defunct culture by designing meaningful work experiences so that employees view 31% of their life each year as a contribution rather than a sacrifice.

Outsmart the Proverbs

„Jak cie widza, ... to pracuj” – When they see you, ... then work (Original: How they see you, that's how they perceive you.)

„Kto pod kim dolki kopie..., ten szybko awansuje” -- Who digs a trap for others, ... gets promoted faster (Original: Who digs a trap for others ends up in it himself.)

„Gdyby kozka nie skakala, ... to by nie dostala podwyzki” -- If the goat didn't jump, ... she wouldn’t receive a pay increase (Original: If the goat didn't jump, she wouldn't have broken her leg.)

Service Orientation

In China, businesses still do not quite get the change necessary to bring about high quality customer experiences. Employees’ behavior remains inadequate despite the rising customer expectations. Weak organizational cultures are responsible for this poor understanding of customer care amongst employees.

To overcome employees’ poor service orientation, leaders should define the desired culture along with specifications of how people should behave. While the former will dictate how customers perceive the company’s culture, the latter will drive employees’ behavior.

As an example, visitors to a Disney theme park experience the friendly Disney culture. This means that Disney employees smile, make eye contact, answer questions cheerfully and accurately, offer to help anyone who looks lost, or try to bring laughter to tired or irritable children.

Complexity of Customer Service

What makes for great service at a restaurant? Which type of service would you prefer and ascribe to under the following scenario?

Scenario: Hotel Restaurant in Bali
You and your friend sit down at a restaurant and then the waiter serves both of you. He comes to your table several times in order to take an order, deliver the drinks and dishes, and present the bill. During this entry time, you are engaged in a heavy conversation with your friend. So, should the waiter do his job:
1. Without really calling for too much attention from you and your friend or
2. Gain your attention every time by interrupting your conversation with a friendly “excuse me Sir/Madam” followed by the name of the item ordered as he places it in front of you.

Do you:
1. Fully appreciate the politeness and continuous attentiveness or
2. Think the waiter is a bit annoying or
3. Feel that his sincerity is not genuine because of this constant and robotic-like politeness.

Balinese staff’s frequent interaction with either an “excuse me” or “hello” accompanied by a smile and eye contact may be part of the local culture or behaviors that were taught and reinforced through a behavioral training to offer a high level of customer service. As for the latter, L&D managers were quite successful at promoting a pre-defined level of hospitality.

An important point to realize is that when substantial resources are exerted for teaching, improving, and “reinforcing” customer service, the L&D team should strive to understand the company’s customers and their expectations first. Then, the most important question remains; what kind of service is warranted, appreciated, needed, and wanted by the customer group? Customer service is only excellent in the eyes of the beholders.

New Words to avoid Old Connotations

Semantics and the need for connotation free terms cause us to increasingly relate to workforce as talent. Words direct our actions, help us to persevere, and can even cause a shift in thinking.

In the 90’s, management’s policy-arm “Personnel” evolved into what is now commonly referred to as “HR”. At the same time, the department was expected to go beyond the administrative role and instead provide human resources management with essential functions of recruitment, training, performance appraisal, C&B, etc. However, HR did not deliver what the “new name” pledged while the need to create value through people intensified and skill shortages escalated during the first decade of 21st century.

As a result, to breakaway from the traditional role of support and administration, many organizations crafted novel offices as the one of Chief People Officer, People Performance Process Owner or a Talent Director, etc. Some went even further to separate L&D units from HR altogether while leaving HR responsible for the numerous routine tasks connected with talent management as completing forms, collecting documents from staff on-time, and organizing Christmas parties and staff breakfasts.

If these new functions (regardless of the name they may operate under) do not deliver results, then we will be brainstorming new names once again. Hopefully, next time it won’t just be old wine in a new bottle.