This book takes a managerial approach to human resources and HR strategy. All managers—regardless of their functional area, their position in the hierarchy, and the size of the firm for which they work—must deal effectively with HR issues because these issues are at the heart of being a good manager. Furthermore, there has been a clear trend in the last decade or so of reducing the size of the Human Resource Department and instead delegating many of the traditional HR duties (such as talent search, selection, and training) to line managers. Part of this trend may be explained by an attempt to reduce “overhead” but perhaps more importantly by a belief that line managers should be empowered and take ownership over major HR decisions in their units.

The role of a company’s human resources department is to support, not to supplant, managers’ HR responsibilities. For instance, the HR department may develop a form to help managers measure the performance of subordinates, but it is the managers who conduct the actual evaluation. Stated another way, the HR department is primarily responsible for helping the firm meet its business objectives by designing HR programs, but managers must carry out these programs. This means that every manager is a human resource manager.

Companies can take certain steps to foster an effective partnership between managers and the HR department.184 Specifically, companies should:

• ▪ Analyze the people side of productivity rather than depend solely on technical solutions to problems. This requires that managers be trained in certain HR skills and that they value human resources as a key element in organizational performance.

• ▪ View HR professionals as internal consultants who can provide valuable advice and support that improve the management of operations.

• ▪ Instill a shared sense of common fate in the firm rather than a win/lose perspective among individual departments and units.

• ▪ Require some managerial experience as part of the training of HR professionals. This requirement should make HR staff more sensitive to and cognizant of the problems managers face.

• ▪ Actively involve top corporate and divisional managers in formulating, implementing, and reviewing all HR plans and strategies in close collaboration with the HR department.

• ▪ Require senior HR executives to participate on an equal basis with other key managers from the various functional areas (marketing, finance) in charting the enterprise’s strategic direction.

Companies should also periodically conduct an HR audit to evaluate how effectively they are using their human resources. The audit, which is typically conducted by the HR department, deals with a broad set of questions, including:

• ▪ Is the turnover rate exceptionally low or high?

• ▪ Are the people who quit good employees who are frustrated in their present job, or are they marginal performers?

• ▪ Is the firm receiving a high return on the money it spends on recruitment, training, and pay-for-performance plans?

• ▪ Is the firm complying with government regulations?

• ▪ How well is the company managing employee diversity?

• ▪ Is the HR department providing the services that line managers need?

• ▪ Are HRM policies and procedures helping the firm accomplish its long-term goals?

The HR audit addresses these and other important issues systematically so that effective programs can be maintained and ineffective programs corrected or eliminated.