"HR from the Outside In" - a book I highly recommend

"Outside-in HR is based on the premise that the business of HR is the business. This logic goes beyond the current state of the HR profession, where the focus is on connecting strategy to HR".

This is the first review I'm going to write in English, since a.Russian translation does not yet exist (unfortunately) and b.I know that some of my foreign friends would find this book particularly useful in their business practice.

Besides, it should be fun :) So let's start.

The full name of the book is HR from the Outside In: Six Competencies for the Future of Human Resources. It was published in 2002 and summarizes 25-year Human Resource Compentency Study built around the competencies necessary for an HR professional. The author, Dave Ulrich, is an acclaimed business researcher, professor (University of Michigan), and management consultant. Together with his colleagues from RBL group, Ulrich "collected information from more than 55 000 participants representing more than 3 000 businesses". The study started in 1987 and has evolved a lot, becoming increasingly global since 2002. Here is an interesting fact:

"...in the last 15 years (from 1997 to 2012), males in our data set have dropped from 70 percent to 38 percent, and females have increased from 30 to 62 percent. It is also interesting to note that the non-HR associates are 69 percent males, which means that often female HR professionals in our data set are working with male associates".

The core of the book is the Outside In approach. The idea is that an HR professional should shift his focus from the HR needs of the business to the needs of the business itself.

"...we see future-facing HR professionals looking outside their organizations to customers, investors, and communities to define successful HR. <...> HR effectiveness will show up in customer share, investor confidence, and community reputation, and HR credibility will be drawn from those outside the company as well as from those inside".

Ulrich claims that most of their HR respondents, when being asked "What is your business?", were telling about their job in the HR department. Very few of them were actually describing the company's business.

"Effective HR professionals recognize, accept, and act on a new normal in business. When faced with “tell us about your business,” they can respond by discussing global changes in context, stakeholders, and strategies".

This is why understanding the financial information, such as reports, income statements, and balance sheets become so important for the modern HR.

The core of the book is the description of 6 competencies developing further the idea of the Outside In approach. Ulrich discusses the importance of each one of them, their impact of business and ways to measure, develop and acquire them. These competencies are the following:

1. Strategic Positioner (how does an HR help to position the business)
2. Credible Activist (what does it mean to be a reliable HR professional)
3. Capability Builder (how an HR should define and build the capabilities/strengths of his/her business)
4. Change Champion (how an HR maintains the changes once they are initiated)
5. HR Innovator and Integrator (how an HR can improve the business and internalize the innovations)
6. Technology Proponent (how an HR can help to connect people through technology).

Interesting fact: although today it is hard to imagine a business running smoothly without technology, or an effective organization running without an HR Information System in place, back in 2012 there were not that many HR professionals who were much into it.

"The factors that have the greatest impact on business success are, in order of importance: • Connecting people though technology • Aligning strategy, culture, practices, and behavior • Sustaining change".

and

"At the factor level the technology proponent is interesting. The average effectiveness scores of these factors are the lowest among all domains. Yet the collective impact of these factors on business success is second only to the influence of the collective factors of the HR innovator and integrator domain on business success. And one factor, connecting people through technology, has more influence on business success than any other factor across all domains".

The last three chapters discuss the ways to develop personally and professionally as an HR professional and the ways to develop the HR department, and provide some more insights on the future of HR.

Overall, I highly recommend this book for its incontestable value of the fundamental approach to the HR function. It is not very new (5 years nowadays - it's quite a term) but it provides important guidelines to the HR which are still relevant and will have to be taken into consideration for the next ten years, for sure.

"These data provide a window into the emerging composition of HR departments. The new structure features a shift away from traditional administrative and employee relations work and away from a focus on union relations and contracts. It is a shift toward business success drivers of capability and culture building, leadership development, talent, and initiating and sustaining change".

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