Why Business Owners and HR Professionals Alike Need COO Skills to Drive Continued Success

Organizations today are faced with compounding challenges: staff resigning at unprecedented rates, extreme competition for new talent, an ever-evolving world of compliance and regulation, an agile market of technology, supply chain challenges stretching across ranges of industries, and more. What these challenges come down to is that most organizations are forced to do more with less. Each individual within an organization is being asked to stretch to the next level of development, and fulfill a plethora of “other duties as assigned”. While the traditional approach is for HR to be the facilitator of these assignments, more forward-looking organizations have realized that HR should be the star player – filling their own “stretch assignment” by fulfilling the organization’s operational needs from within their own role.

Even a decade ago, Deloitte published a report on the emerging role of the HR COO. Then, they foretold: “In the months and years ahead, more and more CHROs will embrace the HR COO model as they strive to crack the code for operational excellence in HR service delivery. Recognizing that even the best people cannot excel in a sub-optimal operating model, they will make the call that only leaders can make — to change the operating model of the HR organization to harness the power of how.”

In the years that have passed, more organizations have embraced the approach, and key HR leaders have seen the value in supporting their organizations through taking a broader, more operational approach to leadership. Below are four key COO skills that will support any HR professional in better serving the operational needs of their organization.

1. Visualize Problems and Solutions

A strong operational leader needs to be able to visualize not just the problems of the organization, but also the solutions. An organization’s HR leader has a perfect perspective for this, as they already have a full understanding of the company’s structure, talent, roles, and key objectives. Taking the role one step further merely requires the HR professional to get involved in the challenges in other areas and ask questions. Their unique perspective and understanding of the full organization will allow them to visualize the problem from a high-level view, and help articulate a practical solution that others may not see.

2. Use Data to Drive People Operations KPIs

HR professionals cannot be afraid to learn the numbers driving the organization. While it is appropriate for the controller to be in the driver’s seat here, the HR professional must work closely with the finance team, understanding the budget and the financial statement to use key data to make decisions. Without a personal understanding of this data, they’ll always be relying on someone else’s recommendations, rather than empowered to wholly make their own people operations decisions, setting the appropriate KPIs for their organization.

A few examples of KPI data that is important to track, analyze, and use are –

1. Turnover/Attrition Rate
2. 90-day quit rate
3. Employee engagement index
4. Training Impact Score

These are just a few examples of KPI’s. Keep in mind there is a difference between leading and
lagging KPI’s!

3. Create, Develop and Manage Systems

While technology may have a separate home within the organization, once again, the key HR leader who wears an operational hat must truly be involved in systems-related decisions. When implementing a new system, the HR leader is in the driver’s seat. If a system is already in place, the HR leader should be in tune to the needs of its users, recommending development needs, and ensuring it is well-maintained. Again, if the leader is relying only on the expertise of another team, they are forgoing the chance to truly own their own decisions for the organization.

4. Analyze the Operations of the Business

In all circumstances, HR should be a key business partner to the organization’s executive team. This is critical not only to the success of HR, but to the success of the organization. Involving HR in operations analysis benefits HR by:

● Shining light on talent management needs
● Allowing the opportunity to recognize top performers
● Gaining insight into individuals who may be flight risks
● Recognizing functional or organizational issues that may need restructuring
● Recognizing employee relations issues that may need attention

Well beyond those benefits, involving HR in operations analysis benefits the organization by:

● Gaining a new perspective on key business issues
● Ensuring that there is an “unbiased” voice at the table, who does not represent a particular department or product
● Allowing for holistic solution finding that incorporate all areas of the organization
● Having a voice at the table who truly understands the talent of the organization, and can offer recommendations to fill short-term talent needs for special projects or initiatives

5. Gain insight on the P&L

There are many reasons why it is beneficial for an HR professional to not only familarize
themselves with financial statements, but also make sure that People Operations expenses are
tracked and measured as well. Some of the key financial benchmarks that can be applied to and
visualized are –

● Talent and Recruitment Expenses
● Training (includes onboarding training and ongoing training)
● Labor cost (includes the cost of workers’ compensation)
● Overtime – It’s important to distinguish if your overtime is due to unfilled positions or increased absences that require other team members to fill in, or if the overtime is driven by business growth that is stretching resources and capabilities.

Overall, HR professionals who “stick within their box” of HR are not serving their interests or the interests of their organization. The more that HR leaders can gain a broad perspective and a larger role as key partners in the business needs of the organization, the more the organization is sure to benefit.