Proposal to ‘Split HR’ Sparks Lively Discussion

A recent proposal by a Harvard Business Review columnist to “split HR” into administrative and organizational strands has sparked a wave of responses across the internet — and generated great observations and productive ideas for how HR professionals can meet new demands and move into the future.
Ram Charan’s brief but provocative article, titled “It’s Time to Split HR,” generated more than 200 reactions in the article’s comment section alone. The article, which appeared in the July/August issue of Harvard Business Review, also got responses this week from HR expert Josh Bersin, SHRM CEO Hank Jackson, and professor and HBR contributor Dave Ulrich.
Charan clearly struck a nerve with his readers. Few commenters agree with him, but that’s almost beside the point: his proposal has energized a lively debate that was already brewing among HR professionals, and so far it’s fruitful.

Two basic points emerge from the responses: 1) that even among those who disagree with his proposal, Charan is well-respected for his expertise and decades of experience as a business advisor, author and speaker; and 2) that the HR sector does indeed need reform and improvements.

What Does It Mean to Split HR?

Charan argues that today most HR managers are “process-oriented generalists” with broad skills in internal operations but they struggle to “relate HR to real-world business needs” — and that’s a big problem for a company’s overall strategy.
His suggestion to split HR is “radical,” he writes, “but it is grounded in practicality.”

“My proposal is to eliminate the position of CHRO and split HR into two strands. One — we might call it HR-A (for administration) — would primarily manage compensation and benefits. It would report to the CFO, who would have to see compensation as a talent magnet, not just a major cost. The other, HR-LO (for leadership and organization), would focus on improving the people capabilities of the business and would report to the CEO.”

Charan ends his column by saying that although he anticipates opposition to his proposal, “the problem with HR is real. One way or another, it will have to gain the business acumen needed to help organizations perform at their best.”

Empower, Embed and Engage (But Don’t Split)

A common thread among commenters is a recognition that HR departments as they’re now commonly organized are underutilized and undervalued. But most commenters seem to agree that splitting HR into two departments won’t solve this issue. Instead, they propose a variety of solutions — generally, that HR must be empowered by top brass to make decisions and that HR needs to do a better job of embedding and engaging within all functions of a company.
Here are some of the more thought-provoking ideas to come out of the “Split HR” response, from comments directly on Harvard Business Review’s website and from response blogs.
Libby Sartain, commenter: Be the sounding board
HR needs to own the talent agenda 
and be the sounding board, but perhaps our role as partners is evolving. We 
should be leaders, not service providers. We haven’t all convinced our leadership teams that we are up for the task. But great progress has been made, because CEOs finally realize that a talent architect/advisor is more important than the financial sounding board in many present day organizations.
Harsha R., commenter: Create a realm of specialists
I think HR has to become smarter about what it wants to be. When I tell people, “I work in HR,” they either think I’m a recruiter […] or think I’m the right person to talk to about interpersonal issues. I do neither. I’m a specialist within a generalized function. […] If HR is to truly differentiate itself like the finance organization […] shouldn’t it become the realm of highly-specialized experts?
I hope that if HR progresses to become the world of specialists and I introduce myself that people are curious to ask more like they might a Finance professional.
Carol Anderson, TLNT: Infuse HR with an operational mindset
Get HR out of the office. This is a Catch-22 because HR has tremendous demands on their time, too. But talking with leaders and employees provides insight that is critical to adding value back to the organization.
And, don’t just float the conversation on the surface. Ask hard questions of the employees, listen carefully to their responses, and follow-up.
Being in the proverbial ivory tower is bad enough for leaders, but when HR sits in isolation behind a desk, that is a serious problem.
Jonathan Magid, commenter: Dissolve HR
The solution is in fact to dissolve HR as currently conceived. Charan’s proposal has merit to be sure, though I would prefer to see the functions distributed so that payroll and non-executive compensation go to finance, employee relations goes to legal, HRIS to IT, and all the strategic HR functions align under a leader like the HR-LO leaders Charan describes.
Sarah, commenter: Engage HR in the overall company mission
…as much as HR holds itself back, by not hiring strategic-minded people who “get” metrics, it is also held back by those around it. Kind of like how no one listens to the folks in fiscal/finance until they’re told there’s no money to do something, and how security and facilities management types are in the gutter except just after a natural disaster or terrorist incident. We as a department don’t “do” the thing that the organization as a whole “does,” and that’s not going to stop being true for the most part.
Which is to say, I don’t think this is an HR problem as much as it is a “how you run organizations and think about all the functional teams in each organization, and how they’ve been trained to think of each other.” Splitting one department into two will solve about as much as any other faddish re-organizational effort.
George Chernikov, commenter: Leverage Big Data
By evolving into data scientists, HR will finally have the credibility and the functional identity that it has been seeking for so long.
Eugene Chang, commenter: Make engagement a CEO-level priority
Some CEOs take on the CHRO role themselves, which is truly the optimal scenario – how better to lead the organization than to take on the difficult task of taking a personal interest in, developing and leading your people.
Mindy Hall, LinkedIn: What’s the business problem we are solving?
At a minimum, HR professionals should be able to link anything they are doing back to a business problem they are helping to solve; if they cannot, they are doing the wrong work.
Morag Barrett, commenter: Seek diversity
The best CHRO and HR teams we partner with are those that welcome, encourage, and actively pursue talented leaders from all backgrounds, not just those “born and bred” HR professionals.
amalobo, commenter: A sports analogy
HR is to business as soccer is to American professional sports. All the best athletes in the U.S. prefer the money (yes, money), fame, and opportunities that football, baseball, and basketball (ok, maybe hockey too) all provide. Unless soccer finds a way to get a bunch of those athletes it will always have problems. Same thing for HR; until it finds a way to lure the best “athletes,” they will all go to marketing, finance and operations.
Did Charan’s article spark discussion in your office or professional group? What do you think – should HR be split? How is your company running HR to align with strategic business goals?
Inspiring a culture of employee appreciation and success will always be fundamental job of HR, split or not. For a step-by-step guide with practical tips to get you started on building a vibrant culture of appreciation, download our FREE e-book, “Workplace Gratitude.”
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