Canadian HR Reporter

SEPTEMBER 8, 2014 CANADIAN HR REPORTER & STRATEGIC CAPABILITY NETWORK Leading in a volatile business environment How do HR leaders need to adjust to complex, ever-changing landscapes? By Liz Bernier It's tough enough for HR executives to hold the top spot — but what happens when the ground they're standing on is continually shifting beneath their feet? Today's business environment is increasingly volatile, uncertain, complex and ambiguous — a "VUCA" environment, if the ac- ronym developed by the military is applied. So how can HR leaders adjust to achieve success in such diffi- cult and uncertain terrain? at was the central question of a 2015 global Aon Hewitt study of 45 CHROs entitled Learning to Fly. ere's no denying we are liv- ing in a very volatile environment, said Neil Crawford, partner and Canada talent practice director at Aon Hewitt in Vancouver. "We think things are going fine, and then they change on us. And I think that's the essence of the con- versation today is how do we cope in that kind of environment?" he said at a Strategic Capability Net- work event in Toronto. e study is a good stepping-off point for that conversation, said Crawford. In consulting with a group of HR leaders, the key ques- tion asked was "Are we setting our- selves up for success within HR?" "Maybe we need to go and spend some time looking at this question, looking a little bit at where things are and where we might be going," said Crawford. "In 2015, we talked to 45 CHROs, a good gender balance… 33 per cent of the global Fortune 500 was included in this study, representing over three million employees," he said. "We covered a lot of industries, we covered a lot of ground in terms of understanding what the perceptions of current CHROs look like, where they think there are concerns, and what success looks like and what are the key capabilities." e study indicated that out of all the behavioural competen- cies required for future CHROs, "thinking strategically" ranked as the most important at 84 per cent, followed by "business knowledge" at 65 per cent, "driving change" at 65 per cent and "influencing oth- ers" at 59 per cent. One of the key findings was this concept of a VUCA environ- ment, said Madeline Avedon, as- sociate partner, talent, rewards and performance at Aon Hewitt in Toronto. "CHROs all felt they were deal- ing with the impact of a VUCA environment, and in a more pre- dictable environment, the human capital strategy, the HR strategy they were working on could sup- port and follow a business strat- egy. But in a VUCA environment, that is just not possible and it's not successful." ey talked about having an integrated human capital strat- egy with the business strategy, she said. "There are so many interde- pendencies that are created in a VUCA environment, so really it was about understanding the ca- pabilities and needs of the orga- nization, thinking future-focused, and being able to create that in- tegrated HR and business strat- egy," said Avedon. "Basically, in a VUCA environment, the need for HR is just that much more." So what does it take to be a suc- cessful HR leader in that environ- ment? ere were four themes that came across all the interviews in the survey, she said. ose four themes were different HR experi- ences, global mindset, exposure to the business and changing industries. Having global experience stood out as a key factor that helped many leaders learn how to cope with volatility and uncertainty, said Avedon. "You don't know the network, you don't know the contacts and you really need to understand how to network differently and what the rules are, because they're different. So that was a really ca- reer-defining experience for many of them," she said. It's about looking at the business agenda and saying, "What's the HR piece of that?" said Crawford. "And how can we function at this level to fashion the right agen- da to move forward? How do we integrate the HR and the business knowledge? And analytics is really about that. It's about bringing data that we haven't brought together and getting new insights from it," he said. "There is a really important piece here around networking with the board and some of those relationships, and around people having exposure to the board early in their career… It builds the confidence." What do leaders have to say? An important hallmark of an HR leader is the ability to question, said Adrianne Sullivan-Campeau, vice-president of HR at AllState Canada in Markham, Ont. Dur- ing her interview process, the CHRO said, "Your job is to ques- tion," she said during an executive panel at the Strategic Capability Network event. "at shifted the mindset for me to say, 'You are not contributing as an HR person, you are contributing as one of my ex- ecutives, so my expectation is that you bring to the table everything is your arsenal." Despite the dramatic changes that have been seen over the past few decades, there are some ele- ments of being an HR leader that have stayed the same, said Emree Siaroff, senior vice-president and CHRO at Stantec in Toronto. "I don't think things have changed… I think a lot of the whats and the hows have changed, but what I don't think has changed is the whys," he said. "If we contin- ually look back to why we do the things that we're doing… when I look back 20 years ago… the whys were the same. "As long as you keep your eye on the why, and all this stuff is swirling around you, you're going to get through it. You might need to learn a new tool or a new way, but as long as you stay focused on the why… you're going to get through it." HR leaders take risks every sin- gle day, said Karen Trenton, senior vice-president of HR at Sherritt International in Toronto. "It's taking that risk to really put yourself out there to understand the business," she said. "Challeng- ing people to put themselves out there and really learn the business is where the value is." Over the last 10 years, each business judges success based on the HR person in place, said Sullivan-Campeau. In that way, the business tolerance for risk might be tied to the individual HR competencies. But it is industry- and people- specific, said Siaroff. "Some industries totally get it and see the value, while others, leaders think, 'What's the big deal?'" he said. "When you can show the value and you can show the outcomes, that's when people say, 'I get it. at makes sense to me.'" The biggest change relates more to evolving board account- ability, expectations around peo- ple and how the human capital of the organization has changed, said Trenton. "Each (board member) that comes in comes in with a very different idea of what the human capital makeup should be, and they're also looking out very much for the shareholders and have very different expectations than they did eight years ago." "e whats and hows have changed but I don't think the whys have changed." Credit: Rawpixel.com/studio0411 (Shutterstock)

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