Knowledge Center: Article

Leadership Consulting

Does your CHRO think in PowerPoint—or in Excel?

1/18/2018 Heidrick & Struggles

Does your CHRO think in PowerPoint—or in Excel?

Talent is the ultimate differentiator in business, and HR serves the critical function of attracting, retaining, and nurturing top performers. A high-performing CHRO can make or break a company’s talent strategy and have an outsized influence on its culture. But not all CHROs are created equal.

Does your CHRO rely on data or on gut feelings?

Consider two energy companies we’ve studied. We’ll call them Company A and B to protect their anonymity.

Company A has a CHRO who thinks in terms of data, and Company B doesn’t.

The leadership of each organization gathers for their annual strategy meeting. They recognize that, despite volatile energy prices, the oil market in West Africa is poised to change dramatically over the next several years. For example, right now each company needs only a handful of employees in Nigeria, but in five years the business could require 1,200 people—mostly engineers. Further, each company knows it must better understand the region’s challenging, often opaque regulatory environment and strict local-content requirements.

The CHRO of Company A gets to work. She establishes a partnership with two local universities and the local government to launch education programs that will produce the high-caliber engineers the company needs. She begins working with real estate in the region to acquire the land. She helps ensure that the people are there when the company needs them.

Company B’s CHRO is more of a “gut feel” type. The market in Nigeria is unsettled, and despite the country’s promise, he sees no reason to dramatically alter the company’s talent strategy on unproven grounds.

Play forward a couple years and the results of these different decisions are striking. The reward for Company A in being proactive and navigating this change is $3 billion in new business and a stronger regional foothold in the industry.

What global companies want in a CHRO

Our experience working with CHRO candidates and companies looking to hire and develop them suggests that CEOs prioritize the following attributes in CHROs:

  • Relies on data—not gut feelings. A CHRO should not only understand but lead the charge to incorporate data analytics into the HR function.
  • Predicts employee behavior. Leading CHROs are fluent in the predictive analytics that have revolutionized talent attraction, retention, and management (including management of talent risk).
  • Understands how the company makes money. A successful CHRO is, in essence, the CEO of HR. He or she runs HR like a business and is constantly seeking new ways to gain a competitive advantage.
  • Acts, not reacts. What is the company’s core function? How might it change in the coming years? The CHRO and HR's talent strategy must stay ahead of these changes.
  • Is a “courageous consigliere.” Successful CHROs have the courage to speak up and tell the rest of the C-suite—particularly the CEO—when something is amiss.
  • Champions the company culture. A great CHRO understands the cultural attributes that best serve the business and actively works to create a high-performance environment.
  • Travels. Business knows no borders, and top CHROs deliver a global savviness and an ability to see into the future of global markets.

About the authors

Dan Kaplan is an alumnus of Heidrick & Struggles' New York office.

Colin Price is an alumnus of the London office.

A version of this article was previously published by Changeboard.

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