What value do HR leaders bring to the C-suite?
HR leaders in the C-suite bring valuable insights on employer brand development, employee retention, M&A due diligence, and more.
While some companies still view HR as a cost center, the past couple of years have prompted a shift in the way a lot of organizations think about HR. That’s because the value HR provides has been especially visible – and critical – since the beginning of the pandemic.
Hiring, retention and employee engagement were all even more challenging than usual because of the many factors at play. As a result, we now see more executives reaching out to HR for input on managing the shift to remote and hybrid work, flexible schedules and changing employee expectations.
During all this change, many companies were continuing with mergers, acquisitions and growth. Of course, HR can add value to these processes, too, when executives know how to access it.
In this post, we’ll look at some of the ways HR can support your organization’s growth by working with the executive team. And, as you’ll see, having HR leaders in the C-suite for important conversations can prove valuable.
Adding value to the M&A process
Consulting with HR managers in the C-suite can help executives navigate mergers and acquisitions more successfully. That requires a change from the way the M&A process is typically handled.
Traditionally, there’s not a lot of transparency when acquisitions or mergers are in the works, because either party can back out until the deal is signed. That secrecy is understandable, but leaving HR in the dark means missing some valuable contributions.
In this version of the M&A process, leaders don’t bring in HR until the day of the deal and then ask them to hit the ground running with minimal background information on the target company. That may seem like the most discreet approach, but it leaves the HR team with no runway to plan an onboarding process to welcome employees from the acquired company. They also may miss the opportunity to ensure both cultures are prepared for the change and plan for what they want the culture to be post-M&A.
Consequently, the acquiring company may appear disorganized. That can erode new employees’ confidence and prompt them to start looking for jobs elsewhere.
By contrast, when executives bring HR leaders into the loop earlier in the M&A negotiations, HR can start planning the best way to merge the two organizations’ cultures in a way that supports retention and an easier transition when the deal is signed. For example, if HR sees that the two organizations have very different cultures and ways of communicating, they can plan surveys, teambuilding activities and meetings to start creating a new culture that better serves both groups.
Earlier communication with HR also gives the team more time to set up an onboarding process that gives acquired employees the information they need at a time when they’re likely to feel worried or unsure about their roles. Making a good first impression – one that’s informative and welcoming – can reduce the risk of losing acquired employees after the deal closes.
Waiting until the last minute to notify HR of a merger or sale also deprives the C-suite of due-diligence insights that HR can provide about the target company’s:
- Compliance: Does the target have good records of its hiring and promotion practices, as well as DEI data and responses to claims?
- Employee learning and development records: Has the company invested in training its talent, and what are their skill sets?
- Existing policies and procedures: How did the target company do things? Will there be a big learning curve for those employees post-acquisition?
- Potential liabilities: Are there pending wage or EEO claims against the target company that could result in lawsuits, shareholder concerns and negative publicity?
By bringing HR into the process early on, executives can gain more information to help them value the deal, limit risk exposure and negotiate favorable terms.
Building the organization’s employer brand
HR can also make the organization more attractive to new talent and help retain employees by working with the C-suite to enhance the company’s employer brand.
It’s easy to think of brand awareness as solely a marketing function, but employer brand includes HR and leadership elements such as:
- How applicant rejections are handled
- How the company responds to employee and applicant reviews on employer-rating websites
- How leadership responds to feedback from employees
- How well the C-suite communicates the company’s mission, vision and values – and how employees contribute
The HR team can serve as a liaison between the executive suite and employees on these issues, to facilitate communication and craft a consistent message. This matters for employee experience, and it can also help surface feedback from front-line employees that can help your organization serve customers better. That can drive growth and a better bottom line.
Leveraging HR technology to build value
Investing in the right HR systems for your business can support growth by helping your organization:
- Maintain compliance
- Create a better employee experience
- Develop talent more effectively
- Facilitate scaling
Exactly what your organization needs depends on the size of the company and the size of the HR team, and the HR team can help identify the best software for their needs.
For example, the right HR solution can help your team add value by:
- Aiding compliance by documenting employee information in a consistent and confidential format
- Mapping and facilitating employee learning paths for talent development and succession planning
- Improving the onboarding process for new employees
- Making it easier for employees to check and access benefits
- Using the system’s data and analytics to identify processes or issues that are working and those that need improvement
A good HR technology solution can also help organizations get more value from their HR team by automating some processes and streamlining others. That can free HR leaders to find more ways to add value and help the company grow.
As we’ve seen, having HR leaders in the C-suite for critical discussions can provide important insights, guidance and support as a company grows and changes. To see more best practices for growing your business efficiently and successfully, download The Insperity guide to managing organizational growth.