Session 2: Human Resource Business
Partnering
Anjali Singh
Challenges
▪ Challenges to the business that would necessitate the recasting of HR function:
❑ Globalization
❑ Value chain for business competitiveness and HR services
❑ Profitability through cost and growth
❑ Capability focus
❑ Change
❑ Technology
❑ Attracting, retaining, and measuring competence and intellectual capital
❑ Turnaround is not transformation
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Ulrich Model
❑The two axes depict focus and
activities for the HR professional.
❑Focus ranges from longterm/strategic to shortterm/operational.
❑Activities range from managing
processes to managing people.
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Concept of Business Partner
Role
Strategic HR
Metaphor
Strategic Partner
Infrastructure Role
Administrative Expert
Managing Employee
Contribution
Employee Champion
Management of Change Change Agent
and Transformation
Deliverables
Strategy execution
Activities
Aligning HR strategy with
business goals,
conducting
organizational
diagnoses.
Administrative efficiency Efficient design and
delivery of HR systems,
continual reengineering
of work processes
Increased employee
Securing employee
commitment and
commitment and
contribution
competence, managing
employee contributions
Capacity to change,
Identifying and framing
Building trust
problems, building trust,
creating action plans
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HR Business Partnership:
❑ The HRBP model indicates a movement by the HR department to participate in strategic planning in
contrast of the present and future goals of business.
❑ It implies a shift in sole focus from traditional HR duties such as benefits and payroll administration
and industrial relations.
❑ According to a 2013 survey by Towers Watson, close to 50% of businesses globally have shown
preference for Ulrich’s ‘three-legged’ model of shared services, HR centers of excellence and a team
of HRBPs.
❑ Ulrich model ‘is far and away the most prevalent of the available options’.
❑ The Ulrich HRBP model synthesizes the strengths of earlier models while addressing their limitations:
❑ Provides actionable roles (e.g., Strategic Partner) that integrate HR into business strategies.
❑ Encourages HR to use analytics and measurable outcomes to demonstrate its impact on
organizational success.
❑ Balances employee advocacy with business goals, making HR both people-centric and resultsdriven.
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Three-legged Model
❑Certain aspects of the Ulrich model have come
to be presented as a ‘three-legged stool’ or
‘three-box’ model for HR.
❑The ‘three-legged model’ of HR rests on three
key elements:
❑ HRBPs -Strategic HR professionals who
work with management to provide tactical
guidance on people issues.
❑ Shared HR services - A centralized team
accessed by employees and managers that
handles routine administrative services
and inquiries.
❑ HR centers of excellence - Specialists that
address more complex situations and
requests. They support management in
implementing HR programs and policies.
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Human Resource Business Partner Competencies
(C^3HST)
❑ Credible activist: HR professionals who are credible activists build trust with others through business acumen.
They are conscientious about their relationships with colleagues and business partners, and invest in these
relationships.
❑ Strategic positioner: HR professionals who are strategic positioners are knowledgeable about external business
trends and are able to translate them into internal decisions and actions.
❑ Capability builder: HR professionals who are capability builders help to define and build an organization's
capabilities by integrating individual abilities into the organization.
❑ Change champion: HR professionals who are change champions ensure that isolated organizational actions are
integrated and sustained through disciplined change processes.
❑ Human resource innovator and integrator: HR professionals who are human resource innovators and
integrators use their knowledge of historical HR research to innovate and integrate HR practices into unified
solutions.
❑ Technology proponent: HR professionals who are technology proponents are aware of how technology has
changed the ways in which HR people think and do their work.
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Model
Harvard Model (Soft HRM)
Strengths
Weaknesses
- Focuses on the human aspect - Overemphasis on soft aspects
of HR, emphasizing commitment, like employee well-being, often
congruence, competence, and
neglecting direct business
cost-effectiveness (Four Cs).
outcomes.
- Considers multiple
- Difficult to operationalize in a
stakeholders (e.g., employees,
results-driven environment.
management, unions,
government).
- Incorporates situational factors - Lacks measurable metrics for
and long-term consequences of HR success.
HR decisions.
Michigan Model (Hard HRM)
- Treats HR as a means to
achieve organizational
objectives.
How Next Model Improves
- Michigan Model (Hard HRM):
Shifts focus to measurable
outcomes, efficiency, and
aligning HR directly with
business strategies.
- Ignores the humanistic aspect - Guest Model: Balances "hard"
of HR, treating employees as
and "soft" HRM by integrating
mere resources.
employee motivation and wellbeing with business strategy.
- Risks employee disengagement
and high turnover.
- Emphasizes the "human
resource cycle" (selection,
performance, appraisal, rewards,
development).
- Strong alignment with
- Overly prescriptive, assuming
organizational strategy and
rational decision-making.
productivity goals.
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Model
Guest Model
Strengths
- Combines strategic integration with
employee satisfaction.
Weaknesses
- Often idealistic, relying on
assumptions about the link
between employee commitment
and organizational outcomes.
How Next Model Improves
- Warwick Model: Introduces
contextual adaptability by
incorporating external and
internal organizational factors.
- Emphasizes outcomes such as
- Implementation is complex due
commitment, flexibility, motivation, and to its abstract nature.
quality.
- Connects HR strategy to business
performance (profit, ROI).
Warwick Model
- Focuses on both external
(socioeconomic, legal, technological)
and internal (culture, structure,
leadership) factors.
- Overly academic and
- Ulrich Model: Simplifies HR's
theoretical, with limited practical strategic role through clear
applicability.
actionable roles (HRBP) and
defined competencies (I3CST).
- Encourages adaptability to dynamic
environments.
- Does not provide concrete
frameworks for integrating HR
with core business operations.
- Provides a broader, holistic view of
HRM.
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Human Resource Business Partner: The Definition
❑ A Human Resource Business Partner is someone who “works along with senior managers, providing
the link between business and organizational strategies, providing support and challenge to the
senior team and developing credible initiatives in a setting of ongoing cost reduction” Holbeche L.
(Aligning Human Resources and Business Strategy, Butterworth-Heinemann. Oxford).
❑ CIPD definition says:
HR business partnering is a process whereby HR professionals work closely with business leaders
and/or line managers to achieve shared organizational objectives, in particular designing and
implementing HR systems and processes that support strategic business aims. This process may involve
the formal designation of ‘HR business partners’ that is HR professionals who are embedded within the
business, sometimes as part of a wider process of restructuring of the HR function.
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The Benefits of HR Business Partner Role
▪ HRBP provides a single window for the internal customer. The intimacy with the customer helps the
HR professional to command necessary influence to get desired commitment/buy-in on common HR
solutions.
Advantages of HRBP are as under:
1. The HR practitioner becomes a more strategic contributor.
2. HRBPs are able to more easily select and implement HR practices.
3. Allows HR partners to utilize their ‘unique’ knowledge and skills to support and drive change in
people management practices.
4. Be well placed to support local managers in considering the people consequences of changes to
strategy or policies.
5. HRBPs can also work with line managers on HR service delivery.
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The Implementation of the HRBP Model
❑ A 2004 study of 20 large American companies by PricewaterhouseCoopers’ Saratoga Institute found a
median ratio of 1 HRBP for every 1,000 employees.
❑ According to a CIPD survey, nearly 40% of survey participants from large organizations in United
Kingdom described their HR function structure as the three-legged model (referred to as the Ulrich
model), including business partners, specialists, and shared services.
❑ The Indian HR domain is abuzz with freshly minted ‘HR business partners’, ‘HR generalists’, and ‘HR
strategic partners’, and the practice has evenly spread in the hard-core manufacturing sector in the
same way as in the service sector, IT and ITES, the MNCs, and the SMEs.
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Challenges for Human Resource Business Partner
1. HR professionals found it ‘difficult to step away from day to day activities, in which they had been
involved for many years’, whereas the business partner’s role has ‘given freedom from previous
generalist work and enabled a more strategic focus.’
2. Bottlenecks in the reporting structure of the HR department.
3. Business’s adverse mindset, formed in response to the HR generalist’s current administrative role,
prevented it from accepting the strategic dimensions of the HRBP role.
4. Issue of finding proficient professionals equipped with relevant competencies, and an easy
acceptance of line managers.
5. Perception of key stakeholders.
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Models for Business Partnership
1. Business partners as process consultants working alongside the Line, with specialist and
transactional HR provided centrally or outsourced.
2. Business partners as process specialist providers working alongside the line, with transactional HR
reporting to them.
3. Business partners as process consultants working along with the line, with specialist and
transactional HR provided centrally and a local HR advisor as a focal point for transactional issues.
4. Business partners working alongside the line on specialist and transactional issues using a process
consulting approach.
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Human Resource Business Partner Role
Some activities that HRBPs are likely to be involved in include:
❑ Organizational and people capability building
❑ Longer term resource and talent management planning
❑ Using business insights to drive change in people management practices
❑ Advising on the people implications of organization change, making recommendations
❑ Intelligence gathering of good people management practices internally and externally, so that they
can raise issues of which executives may be unaware
Look at the job description of an HRBP in an IT firm in Bangalore in the book.
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Human Resource Business Partner Role–Skills
1. Managing critical relationships
2. Center of excellence
▪ Policy
▪ Consultancy
▪ Services
3. Support services
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Measurement of HRBP Effectiveness
Dave Ulrich (article on ‘Measuring human resources: An overview of practices and a prescription for
results’) suggests ways in which HR can become a valuable accessory to for business decisions.
1. Establishing the linkage between specific HR practices and business results.
2. Use balanced scorecard to weave HR issues into business measures.
3. Audit HR practices, professionals, and function
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1. Establishing the Linkage Between Specific HR
Practices and Business Results.
Two seminal studies indicate a connection between business outcomes and HR practices.
1. First study an overall quality of HR index was developed for each firm being studied based on the
aggregate ratings of all HR activities adopted by the firm and then related to four financial measures:
market/book value, productivity, market value, and sales. All four financial measures increased
dramatically with the quality of HR practices.
2. Second study drew on research that identified high-performance work practices across a number of
firms and worked to show their relationships with financial performance of 968 large (more than 100
employees) publicly traded firms. Examined the impact of higher work performance practices on
three organizational performance measures: turnover, productivity, and financial results.
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2. Balanced Scorecard for HR
Employee
Investor
Customer
Productivity
People
Process
Ratio: output/input
Feel, do, know
How do we get things done
Revenue per employee
satisfaction
Leadership
Cost per employee
commitment
Innovation
Unit produced per employee
competence
Speed/cycle time
Turnover/reward
Learning
Grievance
Unity/shared mindset
Absenteeism
Equity
❑Ulrich reports certain experimentation to develop employee
measures on three people dimensions:
❑ productivity
❑ people
❑ process
Source: Dave Ulrich (Article on ‘Measuring Human Resources: an overview of practices and a prescription for results’
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3. Audit HR practices, professionals, and function
On practices, all key HR practices could be audited on suitable measures. For example, performance management practices
could have the following measures:
❑ Acceptance of appraisal processes by employees
❑ Effectiveness of appraisal processes for dealing with poor performers
❑ Percent of employees receiving performance appraisal
❑ Percent of employees whose compensation is performance contingent
❑ Percent of the total salary at risk
❑ Speed of salary action processing
❑ Average merit increase granted by classification
❑ Ratio of salary to competitor salary
❑ Trends in health care costs to national averages
❑ Extent to which measurement systems are seen as credible
❑ Labor costs per revenue dollar
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Human Resource Business Partner as an Internal Consultant
▪ As an internal consultant, an HRBP is required to master three key competencies:
❑ Project management skills.
• Contribution is expected more in helping line in forging effective teams, identifying competencies and
through management development.
❑ Internal coaching skills
• Coaching helps in two ways: by impacting the bottom‐line success of a business and by aiding employee
development.
❑ Ability to provide solutions
• Credibility of HR as an internal consultant rests largely on the resolution of critical business issues, accurate and relevant
counsel to senior management at all times.
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Differences between Internal and External Consulting
Aspects
Focus of attention
Internal Consultants
On desired outcomes from the project, maintaining one’s job and
External Consultants
On desired outcomes from the project, on retaining current and all
long-term relationships with other members.
clients, and short-term relationships with members.
Client’s perception of consultant skills
As another member with known roles, skills, and performance.
As a specialist having strong expertise.
Source of credibility with client
From consultant’s authority, known performance and quality of
From consultant’s reputation and apparent expertise.
Biases of consultant
relationships.
Influenced by the culture of the organization, and desires and
Influenced by the personal and professional backgrounds.
Consultant’s knowledge base
personalities of other members.
Already knows much about the organization, in addition to having
In addition to certain professional knowledge, has to learn about the
certain professional knowledge.
organization ‘from scratch’.
Client’s perception of consultant
As a member of the organization who also might be part of the
As an outsider, a ‘hired gun’ who is not part of the problem.
Client’s acceptance of consultant
problem.
Depends on the top leadership’s support of the project, consultant’s
Depends on the top leadership’s support of the project and the skills
authority, and client’s relationship with the consultant.
of the consultant to get buy-in from the members’ influence of
Depends on the top leadership’s support of the project, consultant’s
consultant.
Depends on the top leadership’s support of the project, and on the
Influence of consultant
authority and expertise, and client’s relationship with the consultant. consultant’s interpersonal skills—the consultant has to learn about
power and politics in the organization.
Range of influence
Can often readily involve various resources throughout the
Operates within the scope and terms of the contract with the client.
Options outside the project
organization.
Cannot readily opt out of the project.
Can leave the project per any terms of the contract.
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Thank You
kjsim.somaiya.edu
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