Why is the human resources department often seen as overhead by the leaders of organizations? Lacey Halpern joins the podcast to discuss why the perception of the HR department has actually shifted from overhead and the department of “no” to a function that can significantly impact the growth of an organization. Lacey and Brandon discuss the many ways that HR professionals have become more strategic over the years and how business leaders have begun making investments in their human resources to grow their people.
Tell us what you think!
Brandon: Welcome to the HR for Small Business podcast, this is your host Brandon Laws. With me, again, is Lacey Halpern of Xenium. Lacey, good to have you back!
Lacey: Happy to be here!
Brandon: So today I invited Lacey on and we wanted to talk really about HR and its role on the leadership team. It’s changed over the years, I think. The HR department is seen as the department of “no”, very compliance oriented, pushing paper around. I think our opinion, definitely as HR consultants at Xenium, it’s a little bit different and I wanted to get your perspective on it. So, what is the perception of HR, especially in the companies we’re working with?
Lacey: You know, you’re right that it has changed. I think it used to be seen as pretty administrative. I think it’s shifted and HR really does have a seat at the table with the
leadership team and I think the perception, at least with the clients that Xenium’s working with and the clients that I’m working closely with, is that we’re a partner and the value really is in that business are looking at their people as a resource. Especially with the challenges that many companies are facing right now of retaining their talent and finding good talent, they’re really leaning on the HR team to support with that, whether it’s recruiting or retention strategies.Brandon: I’m curious to get your thoughts on when you think there was a shift, because even before—I mean, I’ve been with Xenium for 7+ years, and it seemed like even before then there was a shift when HR was still seen as that non-strategic sort of paperwork oriented department. Overhead, we hear that a lot, when CFOs kind of look at their role in the company, what they’re seeing is overhead. But that has totally shifted. When did that shift?
Lacey: That’s such a good question! You know, I feel like, especially in the last two years, it’s felt very different. I’d say maybe 4 or 5 years ago is when we really started to see a shift. Some of that could be related to the talent crunch, so the economy maybe shifting a little bit. I think businesses are focusing more on culture and we’ve seen that really strongly in the last two years, the value of HR comes in supporting that and integrating culture into the people practices that they have. It’s hard to say, you know. I think the clients that we’re working with especially see the value because they’re buying HR-as-a-service. So for the organizations that maybe aren’t working with an outsourced HR provider, maybe they have been slower to get onto that movement. So I’m not quite sure exactly when, but especially the last two years.
Brandon: Can I make a prediction of when I think it was? I think when we came out of that recession in 2008, 2009. Specifically 2009, the end of it I’m thinking, is when leaders of companies started really looking to HR for not only layoffs and whatnot, but really restructuring how we utilize the people and the resources. It’s sort of like reallocating what we already have and doing more with less. I kind of feel like leadership and HR really teamed up at that point, and it took a really tough time to make that shift.Lacey: Yeah. And I think sometimes the crisis is what brings people together—teams and departments. And absolutely, businesses were doing more with less. I think HR people supported owners in evaluating who are the most critical people that we need, and supporting through those reductions and forces. We even saw, though, that after that, with less people, do we really need to have a full time HR person? And so I think there were shifts even in those positions and they were either outsourced, because they weren’t needed full time, or eliminated. And so, as businesses needed to grow, I think HR became a resource too.
Brandon: Yeah, I think I would even take it a step further in how people look at HR. I look at HR the same way I look at marketing and my role. A company has to want to invest in marketing and sales, for that matter. Same goes with HR. I think you have to be forward-thinking. It can be a very strategic department and duty and I think it starts at the leader level to really want to put those resources in and make an investment in HR and people and the processes and all those things.
Lacey: Yeah, I’m thinking about the future, too, you know, because you think about big organizations—the Nikes, the Intels, those companies that have really defined HR roles, so people that are just focusing on recruiting or talent and those focusing on more of the administrative side of HR and people. I have clients that are small in comparison to those businesses that have even identified—We have plans to grow, we’re going to hire part time recruiters to focus on that because we want to invest in the future of our business and make sure that we are assigning and aligning talent to those areas where we know we need it. I think that has been a shift, too, in companies really saying, What are we going to need going forward? And thinking about HR as a piece of the company that can help the business grow and be more profitable—I think that’s changed too.
Brandon: So with that said, you have, let’s say there’s an HR person listening to this podcast or there’s a leader of a company that’s listening to this podcast that’s been screaming from the top of their lungs forever saying, We need HR, it’s going to get us to the next level! How do they get heard and how do they get that seat at the leadership table?
Lacey: I think it happens lots of different ways. Crisis. That moment where we need support. So a company that’s in growth mode. A person can’t, you know this is why we see value or our clients see value from working with us is that there are so many different facets of HR and so many different pieces to the pie, and to have one person hold all of that? You can’t have somebody be an expert in all areas. Somebody might have strengths in relating to people and more of the employee relations but not the administrative side. So when things get overloaded I can see that that’s where people show value or where HR becomes more valuable. Another way that you can, if an HR person’s listening to this podcast and you want to know how to get a seat at that table, I think just being knowledgeable about some of the things, the pain points for the business you have and having business acumen, that helps too. Being smart, being savvy, paying attention to what’s happening with the business, being connected to the sales and the marketing team to know what’s coming down the pipeline so that you can support in finding talent strategies to meet customer demands, that stuff is important too.
Brandon: So if you think about HR and what they’re focused on now, what should they be focusing on if they want to be seen as strategic and not seen as “overhead?”
Lacey: The needs of the business. Really paying attention to what does the company need, what do the people need, what would support retaining our people so we can meet our customers’ demands, where’s the company going, being mindful of the company’s 1, 2, 5 year business plan because if we can get ahead of the curve so that it’s not crisis mode and we’re not cleaning up messes. Training managers, adding value by having the leaders in the organization be equipped to handle the unexpected stuff that comes up, I think that’s how you do it.
Brandon: So if you think of your own role, in the consultant role you work with many different types of companies, from size to industry, they have different needs, right? So it varies. I want to know, from your perspective, the spectrum of how people value and/or perceive HR and how you’ve sort of made progress with your clients and getting them to think about HR differently.
Lacey: Yeah! That’s such a big question. So maybe I can talk about the different ways that the companies I’m working with are valuing it. I guess the first thing I think about is
where is that company in terms of their life cycle? So, I have some new businesses, I work with a lot of companies that are either start-ups or they’ve not been in business for more than 10 years. Those companies are trying to get their infrastructure set up, so the value is in having access to and resources from someone who’s a subject matter expert in it and an administrative team here so that the right work is on the right desks. Having access to knowing what other businesses in the Portland metro area are doing to share best practices, I think there’s value in that. I think one of the ways that I have gotten that seat at the leadership table with so many of my clients is just by building relationships. Taking a genuine interest in what they do, learning about what they do, spending time with them. So often I think, and I don’t know why this is, but HR folks feel chained to their desk, staying in their office, Come see me if you have an issue. But I would challenge those people to get out on the floor, spend time with the employees, learn about their jobs, learn about the struggles that the supervisors and managers have. I think when you take a genuine interest in people and what makes them tick and what their struggles are and getting to know them as human beings, you are seen as a resource. People want to go to you. Having that foundation of a relationship, that is what I think has really solidified the work that I’m doing with the companies.Brandon: Yeah, I think that’s a good point. HR could sit back and sort of have their little department and silo, but the way I would always think of HR was how they are the Human Resources, they are a layer of support for all those departments. I think your point is a good one in that you really need to build rapport and communicate really effectively with all the other departments because they, kind of like the way our culture committee is here at Xenium, we’re a very good bridge between leadership and the departments, or all the people. And I think HR generally should be that.
Lacey: Absolutely, yeah. To be the liaison and communication funnel between employees and supervisors. I see my role as to help people feel good about the work that they’re doing and to give them the tools and resources to do it, because usually what happens, especially I think with supervisors and managers, is they were high performing people, high performing employees in their roles, and they’ve been promoted. That’s the ideal. A lot of companies have the philosophy of wanting to develop their people and I think sometimes people get promoted too quickly and they don’t have all the tools to successfully lead other employees. I find that HR can show value in helping those people to do well! People genuinely go to work to do a good job, I really believe that, and I think HR can support by adding an objective—the third party consultant kind of helps with that—I think a really good HR professional that is seen as a valued resource is objective. And has strong boundaries but is also relatable and understands the business, I think that’s the most important thing, really understanding the business. Especially when you’re internal and you’re there all the time. That’s sometimes the challenge that I find is when you’re
working with lots of different companies, how do you get really a lot of good information and understand their business? And, it’s having conversations, spending time, asking good questions, those things are important.Brandon: It’s interesting because I think, and in talking with people, just from my perspective—I’m not an HR person but in talking with people who are in HR or about their perception of HR—I think employees for the most part think HR is always on the side of the employer. And then the leaders of the company also see HR as one of the employees or a nonstrategic, overhead type of role. I think we’re slowly moving away from that to where it’s now a neutral third party, sort of how a mediator or arbitrator would be, they really are this neutral party trying to get win-win on both sides. And really, as we’ve focused on training and development and all of those things, I think people are starting to really look at HR as a development-focused department.
Lacey: Yeah, I agree. I think the more HR professionals can have conversations with owners and demonstrate impact and really show, you know, This is what I’m hearing from employees and managers, this is what I think we need, this is how it aligns with the business goals. Being able to talk about that, having enough business acumen—and I will admit, I didn’t go to school for business, I have a psychology degree and I got into this because I like people and I like talking to people and learning about people. I think there has to be a balance, and so I’ve had to learn some of the basics. I think when you have a foundation and you care about people, you’re interested in business, I think you can be really successful and make a huge impact for the company you’re working with.
Brandon: That’s well said. Well, I wanted to keep this discussion short but it was a fun one! I appreciate you joining the podcast, Lacey.
Lacey: Absolutely, anytime!
Brandon: For the listeners, thanks for the download today! Hope you got a lot of value from it. You can follow us on Twitter, the handle is XeniumHR. We’re also on LinkedIn and you can download on iTunes and whatnot, so we’re kind of everywhere. But we appreciate you following us, and until next time!