Reinventing the HR wheel

One of the major recommendations Talent Wins makes is to constitute the G3 — a triumvirate consisting of the chief executive officer (CEO), the chief financial officer (CFO ) and the chief human resources officer (CHRO) — who become the “core executive group” of the company. Excuse me? Did I hear you say the core executive group wouldn’t have the heads of the business verticals or geographies? Or, if the company is functionally organised, the heads of operations and sales? Even if this group’s primary role were limited to talent and finance as is suggested at one point (the customer is perhaps reserved for a future book), can we seriously contemplate a top executive body without the members of the leadership team responsible for most of that talent or for delivering the bulk of those financial results?

The G3 is the first of seven steps this “playbook” outlines. The others are to energise the board, design and redesign the work of the organisation, reinvent HR, scale up individual talent, create an M&A strategy for talent and drive the talent playbook.

In fairness, it must be admitted most of the book’s prescriptions are not so far removed from practical implementation as the formation of the G3 (though BlackRock’s 46-member Human Capital Committee, admiringly held up as a model, does come close). Many of the other suggestions have been part of standard good practice in managing talent for decades. Take the need to be selective in identifying and nurturing top talent. Any talent management programme worth the name exercises a high degree of selectivity. To elevate a virtually universal procedure into a unique-sounding imperative, Talent Wins brands it “the Critical 2 Percent”. An immediate disclaimer that the figure is merely a guideline brings us from revolutionary claim-land back to the way things are already happening. 

At the anecdotal level, the book holds promise of something genuinely novel in a few instances only. Unfortunately, these are also the examples in which specific details are most wanting. I was intrigued to read that Haier CEO Zhang Ruimin has broken down the organisation into two thousand micro enterprises called zhu jing yi ti, which are responsible for their own profit and loss (P&L), personnel decisions and resource management. However, I could find nothing that explained the basis of the vivisection or how Mr Ruimin managed to dovetail the activity of so many tiny units into a coherent organisational outcome. 

Similarly, predictive analytics may well be able to identify talent at different levels, reduce the chances of wrong role assignments and improve succession planning. Unfortunately, we are not vouchsafed a glimpse of how these benefits might be realised. In the area of compensation, once again, I eagerly pushed upon the door, promising radical change with the claim that “some companies, especially in the technology world, are doing away with performance-related bonuses”. Instead of finding more information, just a few paragraphs later, the door was slammed in my face by the contradictory statement that in Google “bonuses for the best performers are often five times higher than for the rank and file”. The discrepant advice remained unreconciled.

Specificity is a commodity in such short supply in the book that, in its place, pages have been packed with platitudes. Starting with the title, no one can gainsay statements like “a talent-driven company needs a clear but flexible approach to compensation and careers” or “the process of upgrading the capabilities of your people needs to be built into the daily fabric of your organisation”. But what does one do after admitting to the pious intent of these pronouncements?

In at least one case, the recommendation is so atavistic that one wonders whether time has stood still on one side of the Atlantic. It is true that HR was disadvantaged relative to Finance 20 or 30 years ago. But in the last two decades, most progressive organisations have been treating the CFO and CHRO on par. Talent Wins seems intent on fighting this long-won war. The first 12 pages of the book (essentially an executive summary) make no fewer than six appeals for parity between HR and Finance, followed by similarly plaintive pleas in the rest of the book.

The fact that the book has three authors doesn’t do much for its stylistic unity. For instance, the chapter on work design starts by emphasising that leading edge companies are organised for agility, platforms/networks and meaning. After explaining each of these in some detail, someone (presumably another of the authors) decides social architecture must be added to the list. Instead of recasting the original list to cover four principles, a subsection is simply tagged on with a perfunctory link sentence to the three earlier ones in its opening paragraph. Another impediment to the smooth flow of reading is the summary that ends each chapter with the sub-title “Getting Started”. Eleven of the 167 pages of the text could have been eliminated by cutting out this repetition.

Talent Wins is like a cruise liner. Most of the ports it visits are ones that readers taking passage on it have already seen many times, even if the captain insists on calling some of them by new names at times. Once the ship leaves the well-known havens of currently accepted best practice, however, it gets lost in a sea of wish-it-were-true waves and anecdotal foam.

The reviewer is CEO, Banner Global Consulting

Talent Wins

The New Playbook for Putting People First

Ram Charan, Dominic Barton and Dennis Carey

Harvard Business Review Press

180 pages; $30