Enlightened Leaders Believe “Every Business Decision is an HR Decision”

September 24th, 2014
Written by: Elizabeth Richards

A number of times in my discussions with TPO clients—CEOs, Presidents, CFOs and Executive Directors of small- and mid-size organizations—they’ve said something along the lines of the headline above: “Every Business Decision is an HR Decision.”

They’ve learned, in some cases by trial and error over many years, that you should not simply invite an HR person in after an in-depth strategy and planning review has concluded and say, “OK, here’s what we’re doing.” An enlightened leader understands that business decisions always have an impact on people—the two can never be disconnected.

As 2015 planning season is upon many of us, it’s a great time to discuss how leaders can factor the people impact into the process of determining business priorities. Here are three common scenarios:

• Gut: There’s the instinct and experience of the leader who can assess the impact of each business priority on the employees. This “non-approach” tends to be ad hoc and inconsistent—and therefore not a fully predictable and high quality method.
• Consensus: Good leaders will ask their direct reports to assess the impact of business decisions on their people. But due to the various perspectives and skill sets on the leadership team, this “distributed” approach introduces even more inconsistency than the Gut method above.
• Ask a Pro: Include in the strategy and planning process someone who has worked at the intersection of business and people. Not just anyone with an HR title or certification—but someone who has a strategic perspective and knows the types of impacts, outcomes and pitfalls that can result from a range of business decisions.

I bet you can guess which approach TPO recommends. You got it—“Ask a Pro.”  Keep that in mind when scheduling your 2015 planning and budgeting process—while you’re making all of those business decisions that are also HR decisions.