Creating A Strategic Alliance Between The CFO, CTO And CHRO
Andrew Watson, Chief Technology Officer at MHR, explains the importance of creating a strategic alliance between a company’s CFO, CTO, and CHRO.
The future of HR has been a topic of discussion for some time. The conversation often focuses on issues such as; why HR representatives don’t have a seat on the board; or whether the term ‘Human Resources’ still fits. While interesting ideas, they take airtime away from the critical HR issues and future challenges that have a real impact on businesses.
In a rapidly evolving landscape, the discussion needs to move to:
- What actions and skills are required from HR leaders?
- How do they ensure that businesses can keep up with everything including:
- legislative changes that require technical change
- the paucity of staff
- the expectations of candidates and employees consuming the workplace experience
Evolving expectations of HR professionals
Historically, HR leaders may have operated in silo, seeing their role as being purely about people and not considering the interplay with other areas of the business. Similarly, this likely is how others in the business also perceived their role to be, creating a sense of self-fulling prophecy for those in the HR team. This has led to a lack of essential skills, such as commercial awareness and technical expertise, among HR professionals, which is simply no longer acceptable.
In many businesses, people costs will be over 50% of the overall cost base. HR leaders have a responsibility to understand finance and develop both HR and financial intelligence as key skill sets to support the business objectives thoroughly. Therefore, they must be able to answer questions such as, ‘how much is the cost of an average hire?’ and ‘how much did the new dependent’s leave policy cost last year?’ and ‘what is the true costs of staff turn-over to sales and customer retention’.
HR leaders should also be technically savvy, having at least a moderate understanding of IT. They should be able to provide guidance and advice on issues pertaining to the systems and applications in use for HR, whether that’s understanding the underlying data and its context or how systems integration can support a more relevant digital process. The technical skills provide today’s HR leaders with the information and confidence to challenge what is possible and what should be acted upon in the HR systems domain.
Consequently, to gain a more well-rounded understanding of the financial and IT aspects of their role, and to set their business up for success, today’s HR leader should be working towards bridging silos and partnering with the CFO and CTO.
When the sum is greater than its parts
By joining forces and being able to rely on the expertise offered by the CFO and CTO, it is not just HR leaders that stand to benefit. Improved communication, understanding and collaboration enable issues to be avoided, and where they do occur novel solutions to be implemented.
In other cases, it is not uncommon for HR or payroll projects to be led by the CFO in isolation from HR. Without collaboration between the CFO and HR, there can be a lack of consideration of the change management required by the people in the business or the requirements for HR to store and access data.
This disjointed approach can lead to wasted time and resources. Instead, what is needed is a formidable triumvirate of success. Within this robust alliance, the CFO, CTO and CHRO should be able to feed off each other to constantly reinvent the workplace. It is only through this collaboration that they will be able to drive the people agenda and shape the way the business operates to fuel recruitment, retention, and collaboration.
Collaboration is the key to future success
The last few years have brought about many new developments in the way in which people work, how workers consume the workplace experience, and businesses operate, really bringing it home how quickly things can change and the need for organisations to be able to keep up with that. As a result, all businesses should be looking to the future and exploring the skills that will be needed to keep pace with the changing demands of employees, a globalised workforce and the aftermath of the pandemic, including what has been slated as the great resignation.
The old behaviours and practices will not suffice and will simply spell the demise of many companies who are unwilling to change. Creating a strategic alliance between the CFO, CTO and CHRO will allow these individuals to work together to plan and deliver a very different working environment to futureproof the organisation and set it up for continued success.