What did Dave Ulrich ever do for us?

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Our latest research on the first 18 years of the Ulrich model has certainly stirred a lot of interest, not least when Dave Ulrich himself waded into the debate. My interest in producing this study was driven by a passion to help HR deliver more commercial value from their people. Models and management theories can provide valuable context and direction to help HR. But when they are delivered blindly without reference to the context in which they operate, they can become dogma.

We looked at large multi-national organisations with an average employee base of over 20,000 and HR functions larger than 100 people – complex beasts by anyone’s standards. Now that the Ulrich model has been central to HR for nearly a generation, we wanted to know how well organisations were being served by the model. And most importantly for the future of HR, we wanted to pick out what differentiated those that had been successful.

In a response to our research Ulrich has made the entirely reasonable point that a lot of new research and development has been done in the field since Human Resource Champions was published in 1996 and that HR thinking has evolved. Whilst this is true it belies the fact that the HR model spawned by his work continues to be a dominant force in HR and the enduring blueprint for the majority of large HR organisations.

In fact, the first thing we found was a whole series of measures pointing to the positive impact of the Ulrich model: 77% said the model has had a positive influence on HR; 90% felt they had greater HR expertise and 92% said they were more efficient and commercially focused than ten years ago.

But this was not the whole story. Whilst the Ulrich model has had a strong positive impact this has not been consistent across all the components of HR. For example, whilst nearly a third of organisations described their HR operations as ‘world-class’ only around 17% described their talent management processes in the same way. It pointed to a ‘skewed’ implementation of the model that over-emphasised the importance of HR operations at the expense of talent management.

In conversation with some of the participants it was easy to see why.

Many firms highlight pressures to control HR costs as being the primary driver for HR transformation, leading to a strong focus on administration. The large budgets expended on shared services and supporting technology also tended to focus management on these areas. There was also a sense from some senior HR professionals that streamlining a few processes and losing some administrative staff was the ‘easy part’.

Developing the processes to raise performance standards across the organisation was by far the trickier challenge to pull off.

Human Resource Champions remains one of the most influential management books of the last 20 years. Without it many of us, myself included, would not do the jobs that we do. It arrived at a time where HR struggled to gain credibility because of its failure to deliver on the basics. David Ulrich’s contribution has had a profound effect on the quality of the service HR provides.

However, in most organisations HR represents only around 1% of the total workforce and any organisation that is fixated solely on reducing HR costs will be forever limited to savings from this pool. Far better to place the proper emphasis (and investment) on those processes that have the potential to raise the performance of the other 99% – and generate value on the bottom line.

As Dave Ulrich himself says, ‘The fundamental question we continue to ask is how can HR professionals add value to a business?’ On that I’m sure we all agree.


 

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