Abstract
It’s astonishing to note the fact that there is a growing shift in terms of managing the modern day business firms especially the trans-national corporations operating across the continents. This shift is not only confined to strategy domain but also to the operations which usually controlled by the finance experts. Conveying the message the sustainability of business is very much dependent on the availability of human resources who are qualified to create wealth in the proper business eco system leading to evolution of HR operations from periphery to the center stage. The recent appointment of a HR professional (Srinivas Kandula) as CEO of Cap Gemini Inc. to lead its India operations is certainly a curtain raiser towards a constructive debate on the possible outcomes in the direction. The traditional arguments like can HR be invited to Board room or not is no doubt outdated in the context of growing relevance for managing the human resources in a more competitive way benefiting the stakeholders. An attempt is made here by studying the pulse of corporate India for bringing to light the qualifying elements for conversion of HR into leaders of business world occupying the CEO chairs across.
Key Words:
Succession, Talent, Evangelist, Strategy, Transformation
Introduction
I was reading an article on Times Ascent on same topic .I have often heard that if you are from financial , operation and marketing background chances are more to become CEO , but if you have HR background chances are less . Well I think a HR professional should also get an exposure in marketing, operation and finance. In Japan as a management professional every individual gets a hand on experience in various functions. He/ She are not restricted to HR or Marketing only but in India its opposite one has to follow the hierarchy. If somebody is trying to shift his portfolio he has to face lot of problems, people often take it as a negative and opportunities will be less for shifting from marketing to HR, from PR to HR, from finance to HR. Sometimes we realize our strengths and weakness after working for some time and then we think what our potential is and where we fit ourselves better in an organization.
So at last we can say that a long road ahead to become CEO but he/she should be from mix background.
Generally, it is observed that the CEO’s position is occupied by either a finance, marketing or operations expert. An HR manager’s growth generally stops at that of an HR- Director. It is always considered that an HR expert is an expert only in his field and lacks technical knowledge in the other sectors like that of finance, marketing etc. Maybe, this was the story a few years before. The situation is now changing on a continuous pace.
With the advent of better management courses, students are getting better exposure and knowledge about various sectors of an organization. They also get an opportunity to work on different projects in different fields, analyze case studies etc. Thus, management students have now become ‘the Jack of all trades and the master of one’. The area they become masters of is the area of their specialization. Hence, this research paper also aims at understanding people’s perception whether ‘HR managers today can grow up to become the next generation CEO’s of the organization’. As such, the paper aims at understanding people’s perception of the importance of a CEO’s position and the skill sets required to be eligible to occupy the chair of the CEO.
Redefining the ‘CEO’ Element
A Chief Executive Officer (CEO) or Chief Executive is the highest-ranking corporate officer, administrator, corporate administrator, executive, or executive officer in charge of total management of a corporation, company, organization, or agency. The Chief Executive Officer is the head of executive management and responsible for the day-to-day running of the company. As such he/she is answerable to the Board and hence the Chairman. Typically, a CEO has a cadre of subordinate executives, each of which has specific functional responsibilities. These direct reporting relationships most often include a Chief Financial Officer (CFO), Chief Operating officer (COO), Chief Marketing Officer (CMO), Chief Information Officer (CIO), and a Director of Human Resources or the HR Manager depending on the size of the company.
A CEO’s first duty is setting strategy. Strategy tells the company what business they’re in and how they plan to make money doing it. When a CEO is good with strategy, everyone in the company knows what business they’re in. This brings us to the CEO’s next duty: building the senior team. All the executives report to the CEO, so it’s the CEO’s job to hire, fire, and manage the executives. When a CEO hires an excellent senior team, that team can keep the company running. That team can–and often does–even set strategy, though it’s the CEO who has the final “go-no-go” decision on strategy. The CEO’s third duty is setting the culture of a company. Some CEOs encourage people to work together, treat each other with respect, and make the company a nice place to work. A CEO’s final duty is capital allocation, a fancy way of saying “spending money.” Since the CEO signs the checks, they choose the projects that live and die. This is also why they can’t delegate strategy, because the projects that get money are the ones that determine the strategy. To recap, a CEO is responsible for everything. But even though they are responsible for everything, they only have four duties that can’t be delegated or shared. First is setting the company’s strategy. Second is hiring, firing, and leading the executive team. Third is setting the culture of the company. And last is writing the checks and allocating capital.
ROLE OF a HR MANAGER
The conclusion that one can reach at by careful observation of the all the above mentioned duties and roles of CEO in a particular organization; is that the H. R. Manager performs similar tasks and thus plays one of the most important roles in successful running of an organization.
After setting the company’s strategy and the mission or goal is established, the most important task for a CEO is to appoint people who are capable, skilled, learned and talented enough to imbibe the company’s culture so that the long term objectives and goals could be achieved. The H.R. Manager is the sole position in an organization to whom this task is delegated and he/she’s the one who’s responsible for decision making and appointing the right people at the right places i.e. “aces at places”. From what is mentioned above it could be even said that the role of a CEO is no longer that of a Chief Executive Officer, but the Chief Employee Officer. “Decision Making” is a huge term with a lot of definitions and is one big term which could be directly related to the CEO. It’s something which could be associated with “leaders” and not “managers”. Maybe that’s the biggest difference between the two. It is the only ‘bridge’ that gaps the distance between the role of an HR Manager and a CEO. The most important decisions of a company are taken by a CEO and probably the biggest of them (ensuring aces at places) are taken by the HR Managers.
A CEO’s many successors, for example, Operations Manager/Finance Manager, Marketing or Sales Manager are the ones which were chosen by a H.R. Manager. Perception of people regarding competencies and skill sets required by the CEO of an organization have changed to a great extent, ‘decision makers’ have been replaced by experts who bring more revenue, profit, market share, better standards and more customers. This highlights the fact that the most important and the biggest task i.e. appointing right people at the right places and tracking the training and development of each and every employee of the company, has become the most thankless one, the one which an H. R. Manager is directly and solely responsible for.
This is the prime reason why H.R. Managers are neglected when compared with the other respective department heads. The thin line of demarcation that separates an HR manager from that of a business manager will soon dissolve. The new HR manager is expected to be a business manager with all business manager capabilities. Professionals from other functions like finance, operations, planning etc also need to play a major role in HR. HR Professionals nowadays need to keep the global requirements in context in every decision they make.
Core issue
Since the role of a CEO is already known from above, the research project aims at understanding people’s perception of the importance of a CEO’s position and the skill sets required to be eligible to occupy the chair of the CEO. Generally, it is observed that the CEO’s position is occupied by either a finance, marketing or operations expert. An HR manager’s growth generally stops at that of an HR- Director. It is always considered that an HR expert is an expert only in his field and lacks technical knowledge in the other sectors like that of finance, marketing etc. Maybe, this was the story a few years before. The situation is now changing on a continuous pace. With the advent of better management courses, students are getting better exposure and knowledge about various sectors of an organization. They also get an opportunity to work on different projects in different fields, analyze case studies etc. Thus, management students have now become ‘the Jack of all trades and the master of one’. The area they become masters of is the area of their specialization. Hence, this research project also aims at understanding people’s perception whether ‘HR managers today can grow up to become the next generation CEO’s of the organization’.
Objectives of the paper
The core objective of this research paper is:
• To understand the perception of people about skill sets and competencies to be possessed by the CEO of an organization.
• To understand the views of people whether HR managers could be a suitable fit for the position of a CEO in the organization.
• Having specialized in HR, invoking a thought process in the minds of the people about considering HR managers to become the next generation CEO.
Limitations of the study
• 100 employed people would not reveal the exact perception of the entire population of employed persons.
• A sample size of 100 employed people covers only a small population size.
• The analysis of the research would be highly general since it would include a varied range of industries
• The research conducted is highly general in nature. The focus is not on a particular industry.
Let us now look at an analysis derived from the survey conducted with the help of a neatly designed questionnaire which contains the views of 100 different people working at different levels in various organizations belonging to various industries.
The Relationship Between HR Managers & CEO's
The relationship between CFO’s and HR managers is often tumultuous at best. However much of this friction can be simply avoided if the HR Manager understands the needs of a CFO and the ideology behind their thinking and actions.
“When CEO’s, CFO’s and HR Directors work together, they form the three points of a results inspired triangle that produce truly awesome results.”
There are four integral processes that must be undertaken in order to assimilate the views and productivity of both CFO’s and HR managers. Although these ‘strange bedfellows’ may often seem incompatible, the HR manager can bridge their differences through adhering to these four principles.
Understanding the World View of a CFO
In business, the CFO’s focus is on the hard data and the facts, figures and risk analysis essential to an organisation. They are responsible for providing accurate advice and strategies based on sound economics. Where the world of HR is governed by people and relationships, the CFO deals in numbers and accountability. As such, they have the unpopular task of confronting people with the kind of hard data that make others in the organisation face the cold realities of business.
When people are confronted with these hard facts and figures and discover discrepancies they make excuses, engage in avoidance, procrastinate with issues they don’t wish to face even may become manipulative and as a result the soft (intangible) issues becomes the hard issues to deal with.
CFOs deal with the black or white. They take these numbers to people, and have to deal with all excuses and negative behaviour which they are often ill equipped to handle. This is made doubly worse because they know the value of numbers and are conscious of how people candid stort them to avoid facing reality. They use numbers to serve the business in a helpful way and are the champions for this. This makes there job even more difficult and frustrating. Commonly their worldview about how to deal with people is very simplistic and they use whatever works with them to try and influence others, not realising how different approaches will work with different people. People often see the CFO as a “necessary evil” to their job but they are actually providing the entire organisation with a critical and valuable service through their analysis. This means they are unappreciated in their job role and what they have to offer is resented, resisted, rejected or ignored by many people. To communicate more effectively with CFOs, we must understand their position and why they often experience the worst in people.
What can HR do to build a strategic relationship?
The CFO reports to the CEO and the board against the strategic priorities of the organisation.
Everything must relate to these. If HR Managers enable CFO’s to experience the value they provide to the business by understanding the challenges CFO’s have and assisting them to deal with them more effectively, they have the foundation to building a successful partnership with the CFO. CFO’s have a strong grounding in risk assessment, analysis and control, they can be a very valuable asset to HR. HR practitioners are people and resources orientated, and must utilise these skills to be an asset to CFO’s. If HR use risk concepts in their rationale it will create a
common language with CFO’s. In doing this the CFO can experience the value of HR and it will make their job easier and enhance their effectiveness in the business. It will also enable the CFO to see what HR actually does for an organisation, and appreciate their function and effect more. If the CFO is able to understand people’s human resource issues and how they react to them their consequent relationship with human resources will improve immeasurably. They can then work together to strategically resolve issues within the organisation. In order for this to be successful the CFO needs to understand what HR is doing and how it directly aligns with strategic priorities and produces an economic benefit to the organisation.
HR must produce business case presentations for CFOs
The HR Manager must endeavour to show CFOs the financial leverage of HR activity and how they can save or produce more dollars for them. By relating HR activities back to economics, the CFO will better understand and appreciate their role. If you are going to invest in a development program what’s the return on that investment to the business. What does an unresolved conflict between two executives cost in terms of their performance? What is the cost of confusion? What is the cost of ineffectiveness? What is the cost of poor morale? When HR is good at identifying the cultural and behavioural links to financial performance and they identify the value for CFOs who have a bias for looking at the economic value of
activities.
When communicating with CFOs
Similar to producing case studies, HR practitioners must use analogies or metaphors that relate to the knowledge base of a CFO. As such, using accounting and economics metaphors that will make sense to them drawing on stories in business magazines that they read etc will work. This means HR managers need to learn about these matters and understand how important they are in a business. By explaining things to them in this way, you will be able to help them see both a correlation and a economic value of all activities undertaken. Don’t underestimate how much CFO’s care about people and their performance. They just use a different approach to achieve that. It is by facing people with the facts, with reality so they can make better informed choices. CFO’s often don’t realise not all people are wired like they are and make the common mistake HR also make of assuming we all think the same and therefore what works for me will work for them. We have to walk in the moccasins of the person we wish to influence and what works for them and then give it to them so they understand us.
Next generation of CEOs will come from HR department
India, like many other emerging economies including China, has seen explosive growth in the last few years. Well-established companies have diversified and are increasingly venturing further into unfamiliar and unchartered waters. This is true not only true of Indian family-run companies but also MNCs that have made India a test-bed for new products and services. This hyperactivity is creating both opportunities and challenges for the nation’s business leaders and – specifically the CEOs. Historically, broad macroeconomic trends have dictated which backgrounds were most desired for executives to be promoted to or hired as CEO. For a long time, it was your family background and educational pedigree that determined whether or not you had a shot at the top job. As the country’s population exploded through the 70’s and 80’s and marketing and distribution dictated a company’s fortunes, the heads of sales and marketing typically became the de facto choice of leader.
In the late 80’s and into the 90’s the emphasis on marketing soon gave way to finance as the focus shifted back to new ways of gaining competitive differentiation to drive profits. As factors like the cost of capital, how soon you could get it, and what the stock market thought of your management team became increasingly important, more and more CFOs moved up to become COO and eventually to CEO. Today, we are seeing a different approach to finding the ‘right’ person to drive organizations into the future, with an accent being placed more on their leadership style and competencies than on what functional stream they come from. Specifically, there is a definite emphasis on leaders with strong ‘people skills’ who can inspire their workforce to new levels of performance during periods of rapid change and even through crisis situations.
At the same time, the human resources function is the new differentiator as the ‘hunt’ for talent has become evolved into the ‘war’ for talent— not just in India, but globally. Perhaps not surprisingly, more and more HR directors and chief talent officers are being watched and even groomed for the CEO role as the emphasis on good people leaders and aligning talent management strategies with a company’s overall business strategies increases.
In May this year, Korn/Ferry International together with the Economist Intelligence Unit conducted a pulse survey of 50 Asia Pacific CEOs across industries . Most respondents listed ‘strong people development skills’ as a key competency that will become more important for the Asia Pacific CEO in the next three years. This was seen as being even more important than the ability to work across cultures or drive change. And, according to the survey, CEOs in the region are already are spending more time on staff management and development than on engaging with customers or strategic planning. These findings are in line with research that has been done in the past twelve months by several consulting firms globally and reflect the fact that businesses everywhere recognize people as their number one asset.
In this context, many HR directors are working directly with the CEO to make critical hiring decisions —ranging from staffing a newly opened manufacturing plant to finding a leader to run a recently acquired company on another continent. They also participate on strategic committees with the finance and IT teams to develop cost-cutting plans or people integration strategies. This exposure to some of the biggest issues in the company and the CEO’s thought process in handling them bolsters their already solid understanding of how to deal with people, and positions them well to become effective CEOs in the future. Finally, the HR head’s involvement in driving and enhancing the corporate culture through smart incentive and communications programs helps make the CEO’s ‘evangelist’ role easier. Once again, the core personal and interpersonal skills and other competencies such as integrity, flexibility and innovation demanded of the CEO today are already well-honed in the HR function.
HR directors who have been able to embrace their changing roles and enhance their skill sets and have carefully listened to the CEO while seated as their right-hand man are within striking distance of the ultimate suite. Although we haven’t frequently seen the HR director ascend to the CEO role yet, it is only a matter of time before the global marketplace , the talent scarcity, and a wave of talent converge to make this a more viable reality.
ANALYSIS OF THE QUESTIONNAIRE:
1. Do you agree that the position of a CEO in an organization is a highly prestigious and reputed position?
Response
Percentage
Yes
100%
No
Nil
2. If yes, then why?
Response
Nos.
CEO is responsible for the smooth running of the business
62
HOD of all departments report directly to the CEO
36
Planning, Execution, Growth and Development of the company are directly dependent on the CEO
54
CEO is answerable for the profitability of the organization.
52
3. Do you think the CEO of the organization can impact the success of the organization?
Response
Percentage
Yes
100%
No
Nil
4. Do you think a careful analysis and planning is required to select the CEO of an organization?
Response
Percentage
Yes
100%
No
Nil
Observation: 100% of the sample population considers the CEO’s position to be a highly prestigious and reputed position. They believe the CEO can impact the success of the organization and a careful planning is required to select the CEO. 31% thinks the CEO is important since he is responsible for the smooth running of the business.26% believes it since planning, growth, development are directly dependent on the CEO.25% thinks so since the CEO is answerable for the profitability of the organization and 18% because the HOD of all dept. report directly to the CEO.
5. Would the background of work (HR, Marketing, Finance, Operations etc) of a suitable candidate be an important factor in considering him/her to the position of a CEO?
Response
Percentage
Yes
74%
No
26%
6. Do you think the area of specialization of a CEO would matter depending on the type of industry under consideration?
Response
Percentage
Yes
72%
No
28%
7. Which industries do you think an HR manager would be an ideal CEO of?
Industry
Percentage
Service
62%
Finance
15%
Manufacturing
16%
Construction
2%
Any other (B.P.O.)
27%
Observation
74% of people believe that the background of work of an employee be it Marketing, finance, HR, operations etc is an important factor in considering the employee to the position of a CEO. We then asked the interviewees ‘why do they think so’? To this, we received a lot of varied answers which included that the background of work would help to know where the candidate needs to improve, training needs can be identified, decision making in that particular field would be easier, knowledge of one particular background would make him liable to undergo training at all levels, helps in knowing his capability to manage the company, they would be able to apply their knowledge properly, his background would portray his knowledge, intelligence and capability to run the company, being a CEO he would have to interact with various categories of people and deal with different situations, it would help him formulate strategy in establishment and running a successful company, the background of work would be their strength and they would ensure that their strength works in the greater interest of the organization.
Out of the 74% people above, 72% people think that the area of specialization (Background of work) would matter depending on the type of industry that is considered. We then provided them with various industry types (Service, Finance, Manufacturing, Construction and BPO) and asked which industry they think HR managers can be successful CEO’s of. To this, the maximum i.e 62% people think HR managers can be successful CEO’s of the service industry which includes retail, IT, fast food, airline etc. 27% people have voted for the BPO industry while the finance, manufacturing and construction have received 15%, 16% and 2% respectively.
8. Do you think HR managers can become successful CEO’s of an organization (present scenario)?
Response
Percentage
Yes
70%
No
30%
9. Would excess training programs enhance their skill sets and make them effective CEO’s of the organization?
Response
Percentage
Yes
74%
No
26%
10. With the kind of exposure students get today with specialized courses, do you think HR managers could be considered as next generation CEO’s?
Response
Percentage
Yes
80%
No
20%
Observation: 70% of the sample population feels that in today’s present scenario, HR managers can become successful CEO’s of the organization. 30% feels otherwise.
We then asked the 30% employees, ‘where do they lack’? To this we received various answers like HR managers lack in all areas other than HR, they lack technical knowledge, the concept of HR is very restricted as compared to other fields, HR managers are related only to human resource development, they lack financial knowledge which is very critical for a CEO to understand.
Out of 30% employees who feel that in the present scenario HR managers cannot become successful CEO’s of an organization 26% think that excess training programs could improve their skill sets and make them effective CEO’s. 4% are still of the opinion that today’s HR managers cannot become effective CEO’s of an organization. The interviewees were then asked that with the advent of management courses and the kind of exposure students get today, can HR managers of the future be considered as CEO of the organization or can HR managers be considered as next generation CEO? To this 80% of the sample population has replied in the positive while 20% have replied otherwise. We asked the 20% people, ‘why do they think so’? To this their answer was common that HR would always be good only in the human aspect of the organization. They could never have the required knowledge on finance and the technical aspects. Their role in the organization would always be restricted to the boundaries of human resources.
11. Among the following which skill sets do you think a CEO should possess?
Response
Nos.
Strategist
88
Leader
90
Decision Maker
93
Counselor
64
People’s person
82
Analyzer
81
Technically Sound
82
Motivator
79
12. What skill sets do you think are common between a CEO and an HR manager?
Skills
Percentage
People management
64%
Motivator
42%
High on soft skills
58%
Training & Development
58%
Technically Sound
6%
Observation: The skill sets that the sample population thinks a CEO should possess in the order of importance are as follows: leadership, decision maker, strategist, motivator, technically sound, analyzer, people’s person and a counselor. The skill sets that are common between a CEO and HR manager as felt by the interviewees in the order of importance are people management, training & development, high on soft skills, motivator. Only 6% of interviewees feel that ‘technically sound’ is a skill common between a HR manager and a CEO.
13. What according to you is the role of an HR manager in an organization?
Role
Percentage
Paper shuffling bureaucrat
6%
Manpower resource provider
68%
Police officer
8%
Performance consultant
54%
Business partner
36%
14. With the advent of management courses, do you think the role of HR has changed from what it used to be traditionally?
Response
Percentage
Yes
73%
No
27%
Observation: With the advent of management courses 73% of the interviewees feel that the role of HR has changed a lot from what it used to be traditionally. 68% of the sample population feels the role of an HR manager today is that of a manpower resource provider, 54% feels that his role is that of a performance consultant, 36% feels he is a business partner, 8% feels he is a police officer while 6% feels his role is that of a paper shuffling bureaucrat. We then asked the employees, ‘how do you think the role of HR has changed’. To this 73% of the interviewees answered that, ‘traditionally the role of a HR was more of a paper shuffling bureaucrat and that of a police officer who keeps an eye only on attendance and employees who enter the office premises late. But today, HR has traveled a long road ahead and is involved as a business partner and a performance consultant. They are solely responsible in setting the right people at right places’.
Findings
After the careful analysis of the questionnaire and referring to the observations, we can now interpret the findings, check whether we have achieved the objectives of the research and conclude on the issue of whether ‘HR managers can become next generation CEO’ (depending on majority votes of the sample population) as follows:
1. Since the CEO is a reputed and prestigious position of the organization, a careful analysis is required to select the CEO of the organization.
2. The background of work of an employee is important in considering him to the position of a CEO but it would depend on the industry under consideration. An HR manager can be considered to the position of a CEO in a Service and BPO industry.
3. The following are the skill sets that the sample population perceives a CEO should possess: Decision maker, Leader, Strategist, People’s person, technically sound, Analyzer and Motivator
4. The skill sets common between an HR manager and that of a CEO are people management, training & development, high on soft skills and good motivator.
5. The role of HR has changed from what it used to be traditionally. It has changed from a paper shuffling bureaucrat to that of a business partner.
6. In the present scenario, majority of the sample population (70%) feels that HR managers can become successful CEO’s and those who vote otherwise feel that their skills can be enhanced by effective training programs to be considered as present generation CEO’s of the organization.
7. With the kind of corporate exposure students receive today through advanced management courses, revised syllabus, case study analysis, various projects and interaction and networking skills that they possess, majority of the sample population (80%) feel that HR managers can be considered as the next generation CEO of an organization.
Recommendations
From the above analysis and conclusions of the research, I would like to provide the following recommendations to all the HR managers so that they can be considered to the most prestigious position of an organization i.e. the position of a ‘CEO’:
1. HR managers would have to widen their horizon of work and indulge into other business activities as well so that they are not restricted to the boundaries of HR.
2. They will have to prove themselves to the employees that an HR person is good not only in managing HR (Human resources) but also managing the other resources of the organization.
3. In order to achieve this, they would have to interact with other department heads on a regular basis to sharpen their existing knowledge in other fields and become ‘Technically sound’.
4. Also, provide training programs for themselves as and when possible in order to enhance their skill sets both behaviorally and operationally.
Next Generation CEO will come from HR department the Analysis says….
Conclusion
India, like many other emerging economies including China, has seen explosive growth in the last few years. Well-established companies have diversified and are increasingly venturing further into unfamiliar and unchartered waters. This is true not only true of Indian family-run companies but also MNCs that have made India a test-bed for new products and services. This hyperactivity is creating both opportunities and challenges for the nation’s business leaders and – specifically the CEOs. Historically, broad macroeconomic trends have dictated which backgrounds were most desired for executives to be promoted to or hired as CEO. For a long time, it was your family background and educational pedigree that determined whether or not you had a shot at the top job. As the country’s population exploded through the 70’s and 80’s and marketing and distribution dictated a company’s fortunes, the heads of sales and marketing typically became the de facto choice of leader. In the late 80’s and into the 90’s the emphasis on marketing soon gave way to finance as the focus shifted back to new ways of gaining competitive differentiation to drive profits. As factors like the cost of capital, how soon you could get it, and what the stock market thought of your management team became increasingly important, more and more CFOs moved up to become COO and eventually to CEO. Today, we are seeing a different approach to finding the ‘right’ person to drive organizations into the future, with an accent being placed more on their leadership style and competencies than on what functional stream they come from. Specifically, there is a definite emphasis on leaders with strong ‘people skills’ who can inspire their workforce to new levels of performance during periods of rapid change and even through crisis situations. At the same time, the human resources function is the new differentiator as the ‘hunt’ for talent has become evolved into the ‘war’ for talent— not just in India, but globally.
Perhaps not surprisingly, more and more HR directors and chief talent officers are being watched and even groomed for the CEO role as the emphasis on good people leaders and aligning talent management strategies with a company’s overall business strategies increases. In May this year, Korn/Ferry International together with the Economist Intelligence Unit conducted a pulse survey of 50 Asia Pacific CEOs across industries . Most respondents listed ‘strong people development skills’ as a key competency that will become more important for the Asia Pacific CEO in the next three years. This was seen as being even more important than the ability to work across cultures or drive change.
And, according to the survey, CEOs in the region are already are spending more time on staff management and development than on engaging with customers or strategic planning. These findings are in line with research that has been done in the past twelve months by several consulting firms globally and reflect the fact that businesses everywhere recognize people as their number one asset. In this context, many HR directors are working directly with the CEO to make critical hiring decisions —ranging from staffing a newly opened manufacturing plant to finding a leader to run a recently acquired company on another continent.
They also participate on strategic committees with the finance and IT teams to develop cost-cutting plans or people integration strategies. This exposure to some of the biggest issues in the company and the CEO’s thought process in handling them bolsters their already solid understanding of how to deal with people, and positions them well to become effective CEOs in the future. Finally, the HR head’s involvement in driving and enhancing the corporate culture through smart incentive and communications programs helps in making
the CEO’s ‘evangelist’ role easier. Once again, the core personal and interpersonal skills and other competencies such as integrity, flexibility and innovation demanded of the CEO today are already well-honed in the HR function. HR directors who have been able to embrace their changing roles and enhance their skill sets and have carefully listened to the CEO while seated as their right-hand man are within striking distance of the ultimate suite. Although we haven’t frequently seen the HR director ascend to the CEO role yet, it is only a matter of time before the global market place, the talent scarcity, and a wave of talent converge to make this a more viable reality.