Execs Don’t Have Faith, But HR Has Measurable Effect, Separate Surveys Find

Strategic HR: Talk of strategic HR apparently is just that: talk. At least that’s the case in the minds of many top executives, according to a new survey by Deloitte Touche Tohmatsu and The Economist Intelligence Unit. It’s not as if organizational leaders fail to appreciate the value of talent. The problem lies with perceptions (if not realities) that HR functions aren’t delivering what companies need. Although non-HR executives “believe people are vital to all aspects” of organizational performance, only 23 percent are convinced that the human resources function “plays a crucial role in strategy formation and operational results,” according to the research, based on responses from 531 executives.

In a counter view, the “skills and competencies of an organization’s human resource professionals have a measurable effect on its business performance,” according to a global study of 10,000 HR professionals and line managers. That research was conducted by the RBL Group and the Ross School of Business at the University of Michigan. Companies with top-flight HR professionals do a better job than their competitors at “managing change, gaining talent and meeting financial goals.”  Other findings: “[T]he skills of a company’s human resource professionals are more critical than ever, accounting for 20 percent of its business results,” while collectively, HR departments have a “25 percent greater impact” on business performance than individual HR people do.

—Garry Kranz