ANALYSIS OF THE ROLE OF STRATEGY 1

Running head: ANALYSIS OF THE ROLE OF STRATEGY

Analysis of The Role of Strategy in the Strategic HR Organization

By
Dave Ulrich, Wayne Brockbank, & Dani Johnson
People & Strategy
Volume 32, Issue 1, pp. 24-31, in 2009

Joffre J. Miller

Wayland Baptist University

October 21, 2009

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Abstract

This paper provides a review of The Role of Strategy in the Strategic HR Organization,

by Dave Ulrich, Wayne Brockbank, and Dani Johnson, who are affiliated with Ross School of

Business, University of Michigan; an article published in People & Strategy, Volume 32, Issue 1,

pp. 24-31, in 2009. Examined was the ability of Human Resource Management (HRM)

executives to synergize themselves with the firm’s senior executive management team in a

strategic role, where they can best contribute leadership and decision making competencies.

Specially studied was the ability of Human Resource Management executives to contribute to

both strategic implementation and formation. The work is supported by extensive data collected

from a Human Resource (HR) Competency study where the roles of senior HR Executives were

studied during 2007. This study was built on prior research with revised constructs that coincide

with the changing nature of business as a whole.

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Analysis of The Role of Strategy in the Strategic HR Organization

Overview

During the last twenty years the Human Resource Competency Study (HRCS), lead by

Professors Dave Ulrich and Wayne Brockbank of the RBL Group and the Ross School of

Business at the University of Michigan, sought to answer the important question: “What are the

abilities and knowledge required to be successful as a Human Resource Management

professional, particularly at the executive level?” More specifically, “What is Human Resource

Management’s ultimate job?” Ulrich, Brockbank, & Johnson (2009) have contended that Human

Resource Management’s ultimate job is “…To link the human side of business with business

strategies and organizational capabilities” (p. 26). In 2007, the fifth study was conducted

throughout the United States and Internationally, utilizing more than 10,000 participants and

assisted by many organizations, including the Society of Human Resource Management

(SHRM). This round (a fifth in a series which lasted 20 years) was the largest global study ever

conducted on HR competencies. The following briefly describes the HR competencies

highlighted in the study:

1. The Credible Activist must be respected, admired and most of all, listened to. He or

she must be willing to take a stand or position on important issues, even at the risk of

becoming unpopular;

2. The Culture and Change Steward not only appreciates and embraces the company’s

culture, he or she must be able to communicate and articulate it in a way in which

employees can understand;

3. The Talent Manager and Organizational Designer not only ensures that an

organization attracts good talent today but that it continues to develop this talent,
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thus, guaranteeing that the right knowledge, skills and abilities needed to embrace

continuous change and innovation are retained;

4. The Strategy Architect knows how to make the right change happen by sustaining

strategic agility and engaging the customer;

5. The Operational Executor ensures that all aspects of managing employees and the

organization are met through the implementation of policies and procedures and the

advancement of HR technology; and

6. The Business Ally contributes to the success of the business by serving the value

chain (who customers are, and why they choose to buy they company’s products or

services) and interpreting social context (that is, knowing the social context or setting

in which their business operates) (Brockman, 2005; Ulrich et al. 2009, Ulrich, D.,

Brockbank W., Johnson, D. & Younger, J., & Sandholtz, K., 2008)

These six factors have been placed into two main categories, which are represented by

two vertical arrows pointing upward representing: (1) People and (2) Business. See Figure 1 on

the next page (Ulrich et al. 2009).

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An example of the HR Professionalism model is shown in Figure 1. “This model suggests that

HR professionals must master competencies dealing with both people and business (large

arrows).”

Figure 1. HR Competency Illustration (Ulrich, D., & Brockbank W., 2007)

Ulrich et al. (2009) contended that HR professionals have been more comfortable with

the people side of the model versus the business, and asserted that the following of either of these

two paths independently of the other may lead to failure. Although these competencies are

covered in detail in HR Competencies: Mastery at the Intersection of People and Business, by

Ulrich et al. (2008). In The Role of Strategy in the Strategic HR Organization, the main focus of

the article was the Strategic Architect role, specfically: (1) The Definition of a Strategic

Architect, (2) The importance of the Strategic Architect role to become effective HR

professionals, and (3) The proposal for successfully filling the role (Ulrich et al., 2009).

Ulrich et al. (2009) have further divided the Strategic Architect Role into two sub-sets

which are: (1) Sustaining Strategic Agility and (2) Engaging Customers.
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Ulrich et al. (2009) defined an HR Strategic Architect as a professional who is able to

shape, share, and deliver the business vision internally or externally in order to best situate an

organization in the marketplace. HR Strategic Architects help to identify industrial structures and

trends, while simultaneously forecasting obstacles, assisting in facilitating strategic clarity, and

most importantly, helping to link internal actions and processes to the expectations of its

customers. Ulrich et al. (2009) asserted that the “Strategy Architect factor” was supported by the

following behaviors and functions:

(1) Establishing strategy;

(2) Possessing a clear vision of the future;

(3) Offering optional insights on business issues;

(4) Identifying external customers;

(5) Utilizing customer information as the basis for integration; and

(6) Having the ability to articulate purpose and meaning of the organization to business

leaders.

The two sub-sets, previously mentioned, of the Strategic Architect Role are described as follows:

(1) Sustaining Strategic Agility is the ability of HR professionals to comprehend

organizational strategy and align it with HR policies and procedures.

(2) Engaging Customers, involves, for example:

a. Ensuring customer information is dispersed accordingly throughout the

organization;

b. Visiting customers in order to obtain evaluation of company’s performance;

c. Internal and external branding with customers, shareholders, and employees;

d. Helping to facilitate and integrate different business functions; and

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e. Eliminating low-value-added work.

Ulrich et al. (2009) concluded their article by providing five ways in which HR can become an

HR Strategic Architect:

(1) Facilitating the strategy creation process. Ulrich et al. (2009) citied a 1995 study by

Worley, Hitchen & Ross and stated, “While HR professionals historically did not provide the

content for business strategy; they frequently have had opportunities to facilitate the strategy-

formulation process. When these opportunities surface, seize them (p.29)!” Libby Sartain,

author of HR from the Heart asserted, based on her real world HR executive experience, that you

must “know your place” stressing the importance of knowing when to speak and knowing when

to keep your mouth shut (Finney & Sartain, 2003). She also suggested that HR executives create

their own agenda of HR issues that are related to important business trends and report on them

regularly (Finney & Sartain, 2003). Sartain further asserted that in order to make a real

substantial difference as an HR Executive you must first adapt, earn trust, and gain credibility

(Finney & Sartain, 2003). The short of this is that you may not have the opportunity to “seize.”

You may have to earn respect first!

(2) Helping clarify and articulate strategy. This is simply getting the word out. By

articulating strategy as a story, it can be communicated inside and outside of the organization.

(3) Ensuring that HR practices are aligned with the strategy of the company. This

includes staffing, training, establishing standards, communication, and organizational design.

According to a study by William Joyce, Nitin Nohria, and Bruce Roberson entitled “What Really

Works? HR’s Role in Building the 4+2 Organization, “HR can lead the process of building a

shared strategy throughout the organization” (Ulrich, D., Losey, M., & Meisinger S., 2005).
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Conclusion

David Ulrich and his associates have provided five updates to the Human Resource

Competency Study (HRCS) since 1988. The 2007 study confirms what most HR professionals

already know as far as the knowledge, skills and abilities to do their job and the areas in which

they are deficient. The competencies have been the foundation of the HR profession and

continue to evolve. The fact that there have been five updates to the study since 1988 shows the

rapid, continuous evolution of the field. Ulrich’s focus brings to light an important weakness

that spans HR practitioners worldwide; that deals with their lack of business competencies. HR

must not only possess business competencies necessary to the organizations bottom-line, Baron

& Kreps (2005) have suggested that knowledge in economics, sociology, and psychology are

equally important. Developing a framework that simply divides competencies into two broad

vectors boarding his model (“people” and “business”) appears to be somewhat short cited and

lacks the capability to strategically analyze an organization. Baron and Kreps (2005) suggest

that HR follow a framework similar to that of Michael Porters Five Factors for analyzing

business:

(1) Social, political legal, and economic environment;

(2) The workforce;

(3) The organization’s culture;

(4) The organizations strategy; and

(5) The technology of production and organizational work (p. 19).

Using this framework looks beyond Ulrich’s two vectors of people and business, and

incorporating a broader more strategic view.

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The Human Resource Competency Study (HRCS) successfully answered their original

thesis question, “What is Human Resource Management’s ultimate job?” when they concluded

that it is “…To link the human side of business with business strategies and organizational

capabilities” (Ulrich et al., 2009). Berkley (2005) showed concurrence with Ulrich when he

stated, “…”HR professionals need business acumen and skills, performance metrics are

imperative for HR practices, and there has to be a balance with concern for people and concern

for the organizational bottom line, not one extreme or the other” (¶ 20).

Ulrich et al. (2009) made a point that many HR practitioners have had opportunities to

assume HR strategic roles of which they have not taken advantage. This learner tends to agree

with (Berkley, 2005) who asserted that organizational leaders are also to blame for the lack of

involvement in that they have at times kept HR out of the inner circle which would have

provided the most opportunity to make a strategic contribution.

Ulrich et al. (2009) also asserted at the beginning of the article that the distinction between

“…strategic formation and execution has become increasingly blurred…” (p. 25). Baron &

Kreps (2005) prior to this article’s publication, had already asserted that the HR strategic role fell

into three distinct categories: (1) formulating HR strategy including the development of general

policies, (2) implementing these strategies, and (3) record keeping and compliance of law. They

carefully defined each of these areas, eliminating any “blur” as mentioned above (Baron &

Kreps, 2005). The reality is that strategically, the HR profession still has a lot of progress to be

made. Despite all the hype about competencies and the importance of HR to have a “seat at the

table,” “a study by PricewaterhouseCoopers found that about 27% of the responding companies

included HR managers when starting [implementing of] their strategic planning cycles”

(Dressler, 2003, p 12).

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In order for HR to become true strategic partners with the company that they are employed

by; it is more than obvious that they must be equally involved in strategic formulation and

implementation (Ulrich et al., 2009), but more opportunity needs not only be “seized” by the HR

practitioner, but also “created” by the executive staff they work for (Berkley, 2005).
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References

Baron, J. N., & Kreps, D. M. (2005). Strategic human resources: Frameworks for general

managers. New York, NY: Wiley.

Berkley, R. (2005). Teaching guide for “Why we hate HR” by Keith H. Hammonds Fast

Company, August 2005. Retrieved October 8, 2009, from

www.shrm.org/Education/hreducation/Documents/Why_We_Hate_HR_Teaching_Guide

_FINAL_4-06.pdf

Dessler, G. (2003). Human resource management. 9th Edition. Singapore: Prentice Hall.

Finney, M. I., & Sartain, L. (2003). HR from the heart: Inspiring stories and strategies for

Building the People Side of Great Business. New York: Amacom/American Management

Association.

Grossman, Robert. "New competencies for the cew HR." HR Magazine 1 July 2005: 58-62.

Ulrich, D., & Brockbank W. (2007). Human Resource Competency Study. Retrieved October 08,

2009, from http://sitemaker.umich.edu/hrcs/executive_summary

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Ulrich, D., Brockbank, W., Johnson, D. & Younger, J., Sandholtz, K., (2008). HR competencies:

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