Strategic Human Resources

There is tremendous momentum for organizations, including credit unions, to effectively use the skills and talents of HR leaders to achieve strategic goals. Opportunities exist and HR executives have to step up and demonstrate their skills and abilities to earn respect and their place in executive management.

Information remains vital in the decision-making process. HR departments and leaders have access to vast amounts of data relating to employees and performance. HR executives’ ability to interpret information and assist leaders with making effective decisions in support of an organization’s mission, vision and values is critical.

HR in the C-Suite

Results-driven CEOs and executives in the credit union sector who recognize the value HR professionals can add to their organizations’ operations will find a competitive advantage. Their talents, when used effectively, can play a key role in the battle for talent and market share. It is within the HR leader’s ability to identify, manage and leverage an organization’s human capital that this can be accomplished.

Surveys indicate that more strategically focused HR executives are emerging and being embraced by organizational leaders. The advancing strategic role of HR has led to the development of the title chief human resource officer, or CHRO. Individuals in this position are involved in corporate strategy and planning, particularly in the area of human capital and overall HR management.

Studies bear out the move of HR executives toward and into the C-suite: About half of all company leaders say they include them in strategic discussions. This is according to a survey by The Economist, “CEO Perspectives: How HR Can Take a Bigger Role in Driving Growth”. It is clear that progress is being made, but there is certainly room for improvement.

Culture Guardians

In their expanding role, HR executives have become the keepers of the “corporate culture.” Through training and benefits programs, they ensure employees are aligned with the goals and mission of the organization. This is a vital process, beginning when individuals are first hired. Employees who understand their role and the organization’s mission from the outset are more effective and productive.

Understanding the needs of employees as well as the programs HR offers should be part of an organization’s core culture of helping employees enjoy coming to work. Health and financial wellness programs, for example, must be adopted and utilized. Organizations that don’t properly support staff with programs are dismissing the importance of culture. Within organizations, individuals must feel whole first in order to perform at their full potential. Health issues and financial challenges, as well as other internal and external factors, play a part in reaching this state. More HR leaders are recognizing this and focusing on it to bring greater value to their organizations.

The process of understanding employees’ needs begins when they are hired. At McGraw-Hill Federal Credit Union, for example, each new hire completes a survey conducted by an independent firm to determine their specific needs.

This information and our Annual Employee Opinion Survey allow HR to take actions to support employees, enabling them to be as productive as possible. The survey asks questions in key areas including team building, effective communication, training, salary administration, career opportunities, job satisfaction, fair compensation, core values and employee management relations.

The results are compiled by an independent vendor and recommendations are provided. The CU leverages these findings by implementing a minimum of three recommendations annually. This has resulted in annual increases in the overall employee satisfaction rating. A few suggestions that have been applied include formalizing “Jeans Friday”—a low-cost and easy policy change to adopt— and a new employee onboarding program. This two-week schedule positions employees to meet expectations specific to their job responsibilities and to contribute immediately to organizational culture and core values.

Connecting Employees and Managers

HR executives also play an important role in ensuring there is a connection between management and employees. Understanding and communicating with employees allows leaders to more effectively plan both short- and long-term strategies.

HR helps them to harness employees’ power and potential. Employees benefit as well by understanding their organization’s direction. The best HR executives are those who take ownership of this process and nurture understanding from both the top down and the bottom up.

Working closely with executive management, HR can help them understand employee needs in order to enhance productivity. The information needed to make these decisions must come from HR executives who are diligent in their analysis and review of employee data.

HR executives today are working more closely with management to project the corporate mission, culture and vision to help employees feel good about themselves and the work they are doing. In the CU space this translates into quality engagements with members and enhanced productivity.

Financial Wellness

At McGraw-Hill FCU, a culture-driven process has been adopted and positive outcomes are being achieved. One of our key missions is having employees understand the importance of financial wellness and this is promoted by HR as a significant part of our corporate culture.

Every employee must go through Certified Personal Finance Counselor training and certification. This training includes study sessions and exams with trainers from The Institute For Financial Literacy. The program, which was implemented two years ago, gives employees a unique and common shared experience.

With an equal level of personal financial knowledge, the CU’s team is better positioned to deliver a consistent, high level of financial wellness service to our membership. Also, the expanded knowledge-base allows the team to more easily communicate with each other and better understand their own financial position.

The expanded financial literacy allows employees to speak more knowledgably about our products and services. When employees discuss products and services that they are not only familiar with but actually use themselves, the outcomes are significant. Members feel comfortable in their experiences with the organization and employees recognize that they have provided important value.

When staff takes the time to explain strategies, we see members’ greater participation and utilization of products and services. It is clear that when staff is genuinely engaged with members, both credit union and members benefit.

The Role of Data

Expanding the role of HR will take more than being able to recite statistics and data about employees and productivity to gain a seat at the decision-making table. The C-suite must value those who can interpret raw data and explain how it relates to strategy.

For HR leaders to be accepted, they need to communicate in clear and concise terms, and they must address both current issues and future objectives. Data is vital but presenting it in such a way that it can be easily understood and acted upon strategically is key.

Often, HR leaders are focused either on the data, the analytics or the tactics of their jobs. They need to elevate their discussions to a more strategic level to show that their activities align with the CU’s strategic goals. Communicating effectively and presenting the right information clearly establishes the confidence the C-suite needs in order to allow HR to sit at the table and talk about changes in corporate strategy and direction.

Employees Are Important

In organizational management, HR leaders have a unique perspective because they have a view into everyone’s world. The focus on identifying employees as assets on the corporate balance sheet and assessing their value is important.

It is HR’s duty to keep in perspective that employees are the ones who deliver products or services. For the most part, these are the individuals who interact with members and these relationships are valuable.

Organizations must accept that employees are not a commodity or an expense but an asset that must be nurtured. HR leaders are bridging the gap and justifying changes in approaches while validating how employees should be seen by both top as well as middle management.

Today savvy HR professionals are constantly on the lookout for low-cost and no-cost benefits, programs and services for employees. It has long been established that benefits programs reap rewards for organizations in terms of employee health, satisfaction and productivity. HR executives are using technology, researching and implementing new programs and strategies to improve motivation, performance and customer satisfaction.

As HR actions become more integral to strategic planning, everything the modern HR officer does needs to be quantified in terms of the impact on companies’ finances and strategic goals. By doing this, the HR executive can develop a more important position with corporate leadership.

All the steps noted in the previously mentioned survey from The Economist are about initiative, about HR officers seizing opportunities to play a more important role in corporate management.

Some companies make it easier than others. Zappos, the hugely successful online shoe retailer, has a flattened structure that encourages employees to be part of the strategic conversation. Most of the solutions employed by the company have grown out of suggestions from the staff.

There is a lot of work to be done. According to The Economist survey, 39 percent of CEOs at the large companies talk to their HR chiefs less than five hours a month. Getting more face time with the CEO and CFO is a surefire way to improve the status of the HR department.

The workplace environment is changing and it is clear that the important role HR executives are playing is on the rise. With extensive data and a keen understanding of organizational objectives as well as talent, HR leaders are well positioned to take on greater responsibility today and in the future.

Shawn Gilfedder is president/CEO of $310 million/20,000-member McGraw-Hill Federal Credit Union, East Windsor, N.J. Gilfedder, a CUES member, is a nationally recognized leader in promoting initiatives that drive profitability through financial wellness in the workplace. He shares his expertise and commentary on Twitter at @ShawnGilfedder.