About four decades ago, during the manufacturing era, human resources as a function was more about industrial relations or IR. In those days, very few business leaders actually realised the value of the HR function.
Those were the times when the HR was considered as more of an administrative function. In fact, many people thought it hardly added any value to the business.
However, with mass labour protests, unrest and union strikes, businesses came to realise how important the HR function is when it comes to business continuity.
From IR to ER
When the Indian economy opened up, the influx of IT services firms and technology companies changed the meaning of HR. From IR, it came to be associated with ER, that is, employee relations. After all, people became the primary assets for businesses, especially in the services sector, where businesses are mostly people- oriented. This increased the value of HR.
Technological advancement
As per Avadhesh Dixit, CHRO, Acuity Knowledge Partners, things have really changed in the past few years. In fact, he believes that the value of HR was high in the past too, but the changes brought upon by technological advancement and new working models, have caused organisations to rely more on the HR for support in handling the changes. Therefore, the value of HR has increased manifold.
“Those who say that HR does not add value, probably do so because they have witnessed the incompetency of some of the people or leaders associated with the HR function at some point, and not because of the function itself”
Anil Gaur, chief people officer, Akums Pharmaceutical
From the backend to the centre
“In the last three decades, given the extent of changes, HR has gained value. Thanks to the pandemic, those who thought HR was just an administrative function or that HR personnel worked only at the backend, have come to realise that HR is driving businesses at the centre,” says Dixit going on to add, “It is the HR that is driving the agenda of adapting to different working models and maintaining productivity”.
However, there still exist some professionals or business leaders under the misconception that HR does not add real value to the company.
“I have not come across business leaders who fail to understand the value of HR, especially nowadays. Those who say that HR does not add value, probably do so because they have witnessed the incompetency of some of the people or leaders associated with the HR function at some point, and not because of the function itself,” clarifies Anil Gaur, chief people officer, Akums Pharmaceutical.
Taking orders vs being proactive
There are two types of HR leaders or professionals. One kind will actually make the effort to understand the current business challenges, align themselves with other business leaders and bring solutions to the table whenever needed. The other kind will just take orders and fail to add real value. “Unless one makes an effort to talk to other business leaders, understand their people issues and offer solutions to them and the organisation as a whole, and ask the right questions, one will remain an order-taking HR,” says Asit Kumar, CHRO, Lendingkart.
“No one will underappreciate or disrespect a person who makes the right efforts. As an HR person, this must start with you,” adds Kumar.
“No one will underappreciate or disrespect a person who makes the right efforts. As an HR person, this must start with you”
Asit Kumar, CHRO, Lendingkart
Is the HR more valued in IT and services sectors?
Quite often we assume the HR would be more valued in the IT and services sectors, as they have more people-oriented businesses, maintain large workforces and consider people to be their true assets. Is this actually true?
“I think this is a myth. Are we trying to say that in the manufacturing sector, people have no role to play? Wherever there are people, HR will have value,” asserts Dixit.
Cases of HR heads being killed or attacked by the unions or labourers in the manufacturing sector are many. What happened in companies such as Honda and Maruti Suzuki, where HR heads were the target of disgruntled workers, is still fresh in everyone’s minds. These are not freak incidents. If people at the bottom of the pyramid are unhappy and ignored, such cases will only become more common.
Even Gaur believes that while the value of HR does not vary, the expectations from the HR leaders may differ. They will be different for the manufacturing sector and services sector, depending on the business requirement.
“Thanks to the pandemic, those who thought HR was just an administrative function or that HR personnel worked only at the backend, have come to realise that HR is driving businesses at the centre”
Avadhesh Dixit, CHRO, Acuity Knowledge Partners
“For instance, in a services business, the performance of value of the HR may be measured on how fast they are able to fill vacancies as the demand increases. In the manufacturing space, however, they are measured on how they maintain the same level of productivity and output with less number of people,” explains Gaur.
All HR leaders believe that most of the progressive organisations will never undervalue or underappreciate HR as a function. However, a lot depends on the culture of the organisation too. If people still believe that HR does not add value to the business, they probably need to become more aware of the current scenario and the manner in which the business landscape is changing.