As the HR function becomes more strategic and high profile, HR professionals need to step up their game when it comes to business insights and achieving results.
What are the reasons for a CHRO to voluntarily quit a company? Though there could be several reasons for quitting, the most prominent ones are inability to directly connect HR efforts to tangible business outcomes, and inability to align the organisation around a change agenda that the CHRO was hired to drive.
The inability to align talent strategy with business goals is clearly a frustration for HR leaders. According to a survey by Korn Ferry, among 189 CHROs from across the world, 36 per cent of the respondents voted for the first reason, while 35 per cent opted for the second. Around 15 per cent of the respondents also cited ‘not being recognised for efforts’ as the primary cause for leaving the company. Having an incompetent team and unsatisfactory compensation were the other reasons.
‘Not being recognised for efforts’ is one of the primary cause for CHROs to voluntarily leave the companySimilarly, when the CHROs were asked about the reason why they would get fired from the company, 37 per cent felt it was personality issues or inability to work well with or lead others. Inability to directly connect HR efforts to tangible business outcomes and inability to align the organisation around a change agenda that the CHRO was hired to drive were the other primary reasons cited by 34 per cent and 21 per cent, respectively.
Joseph McCabe, vice chairman in Korn Ferry’s Global Human Resources Centre of Expertise, says, “HR leaders must understand the business challenges that occur as a result of these disruptions, including the impact on the business strategy, and be able to quickly adapt and act.”
“HR leaders need to create a culture of allowing people to take chances, to be agile and adaptable to meet the challenges of today and tomorrow,” McCabe added.
However, CHROs have a longer tenure in the company vis-à-vis other C-suite except for the CEO and CFO. The average tenure for a CHRO across industries is five years, while for the CFO the tenure is marginally longer—5.1 years. For the CMO and CIO, the tenure is 4.1 years and 4.3 years, respectively.
The average tenure for a CHRO across industries is five years, while for the CFO the tenure is marginally longer—5.1 years. For the CMO and CIO, the tenure is 4.1 years and 4.3 years, respectively.Interestingly, it’s with the CMO among the other C-suite members that the CHRO has the least working relationship—merely two per cent. Instead, they work closely with the CFO (35 per cent) and the head of lines of business (34 per cent).
The majority of respondent CHROs admit they are not using all available tools to align business and talent strategies. Two-thirds (64 per cent) said they do not have strong HR data analytics integrated into their business planning process.
When asked “What do you see most lacking when searching for top HR talent?” 41 per cent said it was business acumen and 28 per cent said it was the ability to turn strategy into action.
For most CHROs, aligning talent strategy to overall business strategy and employee engagement and retention were the primary reasons and concerns. However, for the board of directors, the primary task should be to work on executive compensation, succession planning and talent issues—clearly finances are top of the mind for the boards of directors.