HR and Business Performance are Interconnected

Paul-Olivier Raynaud-Lacroze, Senior Vice President Global HRBP Chief Commercial Officer & local HRBP Organizations, dormakaba

This article is based on an interview with Paul-Olivier Raynaud-Lacroze, senior vice president of global HRBP chief commercial officer and local HRBP organizations at dormakaba.

Change in the Role and Position of the HR

I mainly knew the HR function as an employee working in R&D and corporate strategy before I ventured into human resources. I'm not a technical expert in HR per se. I entered the field later and immediately added a business dimension to my role. However, this aspect depends on the company and how it views the HR department. Is it seen as a specialist in labor law and pure administrative function, or does the organization consider HR a true business partner? I don't think companies that stick to the former view, where HR is seen as purely administrative, are heading in the right direction.

Developments Emphasizing More Business-Oriented Role of HR

Several factors make HR management strategic. It has to do with the new generation, which is entirely different. When I started, I had an engineering degree and theoretical knowledge. Today, new generations have digital skills that older employees do not possess. There are aspects of the job they need to learn and others that come more naturally to them than to their managers. There are also many questions about the role of work itself. Does it make sense to produce as much ‘stuff,’ or even more, today with pressure on the environment? Some employees wonder if they should remain in a capitalist production system or if they should consider non-profit activities or those where profit is less important. HR management tends to become more individualized in our Western societies. Finally, the issue of demographics is becoming paramount. The birth rate in the West and many other countries, especially China, is declining, and fewer young people are entering the job market. So, relying on a country like China as an ‘infinite’ reservoir of labor no longer seems to be a solution. We'll have to see if India or certain African countries can play that role one day. We find ourselves in a situation where we still need human ingenuity, but the new generations are rarer and less malleable. This situation makes HR more strategic. Some companies have simply understood this earlier than others.

Areas of Human Resources Are Most Mobilized for Business Performance

The key is organizational design, that is, how to put the right people in the right positions, and it's a complex science. The answer varies from one position to another and from one company to another. For example, it's easy to think of employees as a cost. A salary is visible; it can be calculated. But how do you calculate the contribution of a person or a team? The added value of a team is difficult to quantify. This brings us to the importance of recruitment and the involvement of HR in this key process. There is a lot of talk about artificial intelligence in recruitment. It's an interesting advancement, but data inevitably escape calculation. Perhaps a person's skills seem like a good fit on paper, but how does the algorithm take into account the team, the manager, and the company culture? It seems ambitious to imagine being able to isolate recruitment solely based on skills without considering the environment. To draw a parallel with a football team, it happens that very good players are not successful in different clubs. So, I think the human touch and the involvement of HR professionals are essential for good recruitment. As HR, we are the guardians of culture, which plays out a lot through recruitment, promotion, and the overall organizational design. That said, HR is a difficult role to define, especially because this cultural aspect is intangible, and it also has a behind-the-scenes advisory role.

One of the contributions of HR is to develop an external perspective, to be able to analyze skills organizations, and understand compatibilities

Qualities of a Business-Oriented HR Function

One of the contributions of HR is to develop an external perspective, to be able to analyze skills organizations and understand compatibilities. And to ensure that all of this resonates with the business strategy. In my case, I've been fortunate to have a career that has led me to hold several roles beyond HR: marketing, strategy, and R&D. This allows me to have a very comprehensive view of the company's activities. When I attend meetings with managers from different business units, as well as with executive teams, it allows me to see their challenges and determine what solutions HR can provide. In my opinion, the ideal is to have a varied career and a minimum level of knowledge about the different parts of the company. Even though the role requires in-depth knowledge in certain areas, spotting talents in other functions and attracting them to HR positions for a few years is a plus. Likewise, HR professionals should immerse themselves in other professions. We have long had the image of the HR department in its ivory tower, but the connection to the field and other departments allows the HR function to further highlight its contribution to the business.

Business Aspect Leading To Challenges for HR

As in many organizations and companies, there is an intensification of processes, especially through digitization. There are many changes that are happening faster and faster, but human time remains fixed. We must manage the balance between these accelerations but also explain that sometimes the social body needs time to assimilate transformations. In short, we do not evolve as fast as our technologies as a species, which leads to a lot of pressure. I mentioned earlier the need to be well-versed in the different department's issues. It is true that today's HR directors are required to develop a wide range of skills and competencies (marketing, finance). These are challenges, but they also make the job interesting.

Example of a Project Where HR Played a Role in Improving the Company’s Performance

It's fairly typical, but training leads to greater efficiency. We had launched new IT tools, thinking that employees would quickly embrace them. In reality, it wasn't that simple. When we introduced intensive training, we saw a clear improvement in operational performance. Recently, I was also in charge of sales excellence in Europe, and we implemented training programs for all sales teams. We conducted statistics across countries to confirm the effectiveness of the approach, and the teams that had benefited from the program were up to 15 percent more productive. We counted the number of projects won per year to determine the increase in performance.

In conclusion, I would add that the key point is the relationship between the HR department and the company's general management for this business vision. That is to say, will the HR Director be considered a true business partner rather than being confined to a purely administrative role? This relationship is crucial for aligning HR with the company's strategic goals and ensuring that HR is seen as a valuable contributor to the business.