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Outsider Pick for Human Resources Chief Stirs Debate

Other companies have taken the path of GM and hired non-HR professionals to lead a corporation’s human resources department.

October 27, 2009
One aspect of General Motors’ culture makeover—its decision to replace its longtime head of human resources with an engineering executive—has once again prompted debate over when and whether a non-HR executive should lead HR.

On July 30, GM announced that Katy Barclay, who had been global head of HR since 1999 and had been with the company since 1978, would retire. Mary Barra, an executive with an engineering background, replaced her October 1. The leadership change angered many HR professionals when it was announced.

“Would GM take an HR professional to run an engineering department? Or finance? This is taking HR back to the middle ages when ‘anyone can do “personnel,” ’ ” read one comment posted to the story about the change on Workforce Management’s Web site.

Other companies have taken the path of GM and hired non-HR professionals to lead a corporation’s human resources department, says Dave Ulrich, a management professor, consultant and author of several books on HR’s role in organizations. He recently co-authored HR Transformation: Building Human Resources From the Outside In. “You bring someone in from a line of business when you want to tailor HR to where the business is going,” Ulrich says. Ulrich says executives who consider filling the top HR spot with a non-HR professional say they tend to look at people with a background managing a company’s operations.

An example Ulrich cites is Pedro P. Granadillo, an executive with Eli Lilly and Co. who had managed the quality of the pharmaceutical company’s manufacturing operations before taking over HR.

Granadillo brought the ethos of operational efficiency to many of HR’s transactional functions. “He used to say, ‘I want results of every HR initiative,’ ” Ulrich says.

“The downside is that HR is a body of knowledge,” Ulrich says. “I bet [Barra] is not current on compensation laws and benefits policy. The good news is they solved some of those things.”

GM refused Workforce Management’s request to speak with Barra.

Barra joined GM in 1980 as a General Motors Institute student and later, on a company scholarship, earned her MBA from Stanford University. She has extensive experience in operations and has worked in corporate communications, engineering and manufacturing. She was a plant manager in Detroit, and as executive director of vehicle manufacturing engineering she was responsible for many aspects of global vehicle production.

In 2008, she was appointed vice president of the company’s global manufacturing engineering. Her experience, GM chief executive Fritz Henderson wrote in a letter to the editors of Workforce Management, makes her “exactly the kind of leader to take on a role like this if excellent HR processes and staff are in place.”

Gerald Meyers, a former CEO of American Motors and a professor at the Ross School of Business at the University of Michigan, says the choice to replace the head of HR with an engineer reflects the prevailing culture of the company, which is dominated by engineers and finance experts. He says that an outsider often can prod organizations and departments to change, especially if they come from successful organizations within the same industry, such as Toyota or Nissan.

“You don’t need an army of new faces,” he says. “But you need to have a burr under the saddle, people who take nothing for granted and know how to say no.”

Meyers adds: “What I think they need more than anything else is fresh thinking.”

Workforce Management, October 19, 2009, p. 30 -- Subscribe Now!