Building a Better HR Team

If you’ve ever imagined a "dream team" of human resource professionals, a collection of diverse talent drawn up to have maximum impact on organizational results, it may have had similarities to the People Operations department at Google, the fast-growing technology company in Mountain View, Calif.

Google’s HR team is built on what Laszlo Bock, vice president of global people operations, calls the "three-thirds" staffing model. Roughly one-third of the team’s employees have HR backgrounds and bring expertise in client relations as well as specialty skill areas such as employment law, and compensation and benefits. This group also has what Bock calls high-level "pattern recognition" skills, or the ability to identify organizational trends and anticipate issues even before they’re on line units’ radar. An example would be predicting ebbs and flows in hiring and attrition.

Another third have little or no human resource experience and were recruited from strategic consulting firms or Google line functions such as engineering or sales. Most in this group are embedded within business units. Staff in this subgroup have "tremendous problem-solving skills and knowledge about how everything outside of HR works," Bock says. "If you can find people with that skill set, plus an aptitude for people-related issues, we’ve found they partner very well with traditional HR employees."

The final third is a workforce analytics group featuring people who hold doctorates in statistics, finance, organizational psychology and other areas. These analysts help make determinations on matters such as setting compensation levels that will retain top talent for maximum periods and conducting the right number of interviews to ensure selection of the best job candidate.

Subteams within this third group also conduct more-esoteric research. For example, they explore cognitive heuristics—the mental shortcuts that people use in making decisions or solving problems but that can also lead to biases.

This group also examines ways to counter influences such as the halo effect—a job candidate considered good or bad in one category is assumed by hiring managers to be similarly good or bad in other categories—and the recency effect, in which too much weight is given to an employee’s most recent performance in yearly evaluations.

Analytics specialists also focus on predictive modeling, or using principles of mathematics and psychology to determine the profiles of people who will be most successful at Google and those likely to leave the company prematurely based on their changing behavior patterns.

"This group helps us prove what we do in People Operations works and contributes directly to Google’s business results," Bock says.

Power of Cross-Pollination

While the three-thirds model might appear to set up walled-off silos in the department, Bock encourages regular interaction and knowledge sharing among HR team members.

"Those with traditional HR backgrounds get a problem-solving structure and understanding of the business more quickly from their peers, and those without HR backgrounds get up to speed on pattern recognition techniques and human resource specialties faster," Bock says.

What are the practical or bottom-line payoffs of this cross-pollination? Bock offers the hypothetical example of a compensation analyst who has carved out a successful career in HR but rarely interacts with line managers in business units.

"What if a manager comes to that analyst and says, ‘My best person just got a job offer. How should I handle it?’ " Bock says. "A traditional comp person might point to the benchmark salary data and say, ‘Our policy is we can offer an X-amount salary increase to encourage that person to stay.’ But if you’ve never been on the ground with operations managers, you might not understand the need to get more creative, and think more holistically, in finding ways to keep your very top talent."

Generalists or Specialists?

While you may not have the budget or the cachet to build a Google-like team in your organization, experts say it’s nonetheless important to regularly examine whether you’ve created the right mix of functional specialists and business-savvy generalists in your department.

Peter Cappelli, a professor of management and director of the Center for Human Resources at the University of Pennsylvania’s Wharton School, says the recession created a new demand for HR to assess operational and people decisions in terms of return on investment. Challenging economic times also brought pressure for HR to reduce its own costs. Those factors combined to make the "generalist" model—where well-rounded HR professionals with strong business knowledge and proven consulting skills are deployed to operations units—more attractive to many organizations.

Rather than creating large employee groups with deep functional experience in areas such as organizational development, modeling or reward management, Cappelli says, it can be more effective and cost-efficient to build an acceptable level of specialist skills in HR generalists and then contract for vendor or consultant expertise if needed in specialty areas. That’s because specialist HR skills are not always needed on a continuous basis; often they’re needed only for particular phases of certain initiatives.

Google operates with a similar model but with a stronger reliance on internal rather than external experts. "What we want is for our HR generalists in business units to be conversant in specialty areas like talent assessment or organizational development," Bock says.

Going into the Field

At Dallas-based Southwest Airlines, Jeff Lamb, senior vice president and chief people officer, had one overriding mission when he assumed his job five years ago: to develop a stronger team of HR generalists and get them closer to his line customers. As Lamb studied his organization’s structure and history, he concluded it had become too siloed and distanced from business units. He sought to retrain and relocate existing HR specialists into the field to help Southwest’s managers better address people-related challenges.

The multiyear project has trained recruiters, facilitators, compensation specialists and other carefully selected veterans of the department to be valued partners and consultants to line employees. Given Southwest’s unique corporate culture, Lamb felt it would be easier to embed known quantities in the field—those that had proved to be good fits for the culture—rather than recruit generalists from outside the company and have them "parachute" into operations groups.

"We have built those generalists from the ground up and now have 12 of our managers embedded in internal line departments," Lamb says. Those generalists have skill sets including business acumen, strong relational skills and a strategic aptitude. "With the fast pace of change in the airline industry, we’re focused on seeing beyond today and thinking differently about the future, so strategic skills and a continuous improvement mind-set are important in our field generalists," he says.

Lamb has made three other key staffing moves during his tenure. He hired a manager with considerable international experience, an expert in the increasingly complex field of executive compensation and a talent development director to spearhead a new organizational development initiative.

One element of that initiative has been identifying and channeling resources to pivotal roles, or those Southwest jobs with the biggest impact on the bottom line. "For example, one of those key roles might be the hedging strategist that hedges our airplane fuel," Lamb says. The goal is to develop strong talent pipelines and retention strategies for those critical jobs.

Old-School Career Ladders

If a recent study co-authored by Cappelli on the attributes of top HR leaders is any indication, the human resource function may be falling back into more-traditional career ladders and roles following changes triggered by the red-hot labor market of the 1990s. The study, Who Gets the Top Job? Changes in Attributes of Top HR Leaders and Implications for the Future, examined traits of human resource executives in Fortune 100 companies in 1999 and again in 2009.

One of the study’s key findings challenges the commonly held belief that organizations are seeking HR executives with broader functional experience than in the past. Only 21 percent of companies reported looking outside the HR function for a human resource leader in 2009, down from 30 percent in 1999. This suggests that companies continue to seek out HR specialists, not business strategists, to lead their departments, Cappelli says. But it may also indicate that more HR leaders already possess wider business knowledge, acquired from their own on-the-job learning or additional schooling, and don’t require additional time as line unit managers to receive it.

"The traditional human resources career path seems alive and well, maybe even more so than in the past," Cappelli says. "In the 1990s, we saw more external hiring in HR departments in part because of new challenges specific to tight labor markets and finding people for certain jobs. While there is continuing pressure to be cost-effective in HR, labor markets are slack and there haven’t been any particularly novel challenges of late."

Indeed, some senior leaders want no more from HR than to continue mastery of its so-called "dial tone" role, says Phillip Weiss, a former human resource executive and now a consultant with P.A. Weiss Inc. in Houston. That means focusing solely on time-honored specialties such as compensation and benefits, recruiting, and downsizing assistance, albeit with a lean-and-mean cost structure.

"When you pick up the phone, you expect to hear a dial tone, and you usually don’t call your carrier to thank them for providing it," Weiss says. "But when that tone isn’t there—in HR, the equivalent might be failing to deliver paychecks accurately and on time—people tend to get upset."

Training Key to New Skill Sets

Turning HR specialists into effective generalists and business partners, or giving generalists the appropriate level of specialist skills, doesn’t happen overnight. Companies such as Google and Southwest Airlines have intensive development programs to prepare HR staff to assume new roles.

Google’s goal is to accelerate the development of key people operations staff. "The traditional way to develop mastery in HR is to work at maybe six or seven companies over 20 years, or perhaps in the same company for a few decades," Bock says. "At our company’s rate of growth, that kind of development is simply not fast enough."

One way Google speeds development is through a yearlong "base camp" training initiative that features a combination of HR specialist training, an MBA-like curriculum and "the type of training new hires might receive at a top-tier consulting firm around working with clients, communicating effectively with senior executives and solving business problems," Bock says.

The instruction is designed for those who have been in HR for at least two years, and it is taught exclusively by People Operations department employees. A finance module, for example, is taught by a 26-year-old member of the compensation team with a degree in finance and previous experience working for a bank. "We deliberately put people with different experience levels, functional areas and geographies together in the same classes, since we want them to teach and learn from each other," Bock says. "That has the added benefit of knitting employees from different people functions together in a positive way."

Unlike most organizations, Google aggressively recruits top MBA graduates who might otherwise not consider a career in human resources. How does the company lure these prospects? There is the prestige of Google, of course, but Bock and others also tell candidates they likely will be able to advance their careers faster than in traditional units like marketing or finance, and there also is the opportunity for greater influence.

"We tell talented MBA graduates that this is a chance to actually shape and revolutionize the way work happens in the company, to build and innovate in this profession in the same way sales, marketing, operations or other functions have innovated over the past few decades," Bock says. "HR is still essentially doing talent reviews the same way they were done 40 years ago, and doing compensation the way it was done 20 years ago. That opportunity to effect change proves compelling to top talent."

Web Extras

• SHRM article: Agility Can Pay Dividends (SHRM Online Organizational & Employee Development Discipline)
• SHRM book summary: HR Competencies by Wayne Brockbank, Dani Johnson and Dave Ulrich (SHRM, 2008)
• SHRM webcast: Using Analytics to Drive HR Strategy
• SHRM education program: HR Generalist