Albi, France
I happened to share a flight the other day with the Group HR Director of a Korean manufacturing company. He was on his way to the UK for a meeting with colleagues from subsidiary companies around the world.
We talked about the state of the Asian economy and the growth of trade unionism in several Asian countries, then he confided in me his concern that he still had no place on his corporate main board. I asked how other group Directors saw HR and he paused. “that, I guess, is the kernel of the nut”. he said.
We discussed how HR was managed in his 6,000 strong workforce company. He explained that the company had grown quickly in recent years and recruitment had really been important. They did not use agents, but did all the recruitment processes internally. Then I asked about day to day management. “Did all locations have an HR function? “He nodded “Yes, at least one generalist”.
“And do they report to you?” I replied.
There was another pause. “ Not strictly speaking.” he confided. “So” I asked “what happens if there is local issue about leave or health and safety or someone has to be dismissed? That must happen all the time?”
He nodded “yes it does, but I and my head office team do not get involved”.
“So”, I reflected, your company is highly decentralized?”
He coughed and looked out of the window. The aircraft had taken off and had just reached its first cruising altitude. Hot towels were making their way down the aisle. With a sigh he said “It is not supposed to be. I am supposed to be in charge – but line managers are impatient”
I looked at him in the eye as he turned back towards me. “So things are done always in a hurry and with little regard for little things like the law and the labour market,” I remarked, with a touch of irony.
“Yes, and it keeps going wrong. You should see our legal bills.” He exclaimed, realizing too late he had raised his voice. Luckily the jet engines were surging again as we climbed higher.
“So what about tracking pay markets around the world?” I enquired.
“Yes, I have a compensation officer for that, but the Finance Director does not like the bills from commercial survey companies so we have to glean data from the Internet and magazines.“
Where, I thought, had I heard this story before? Back in the late 80s before MBA’s had even touched on HR issues and instead of the internet companies had been over-dependent on recruitment agencies for salary data. Selling HR inflated data made the recruitment process easier and hiring fees higher.
I gave my new friend my card. He glanced down at it and asked “So what do you do?” I looked back and lifted up my freshly poured orange juice “ We make your life easier, less risky and HR decisions quicker – but only if you are master of your department” – I suggested rather cheekily. “We can also take a slice out of those lawyer fees.”.
He called one of the cabin crew and asked for another pillow. I could see a melancholy glisten in his eyes. “ Even if I wanted to save money I could not, lawyers are like doctors and Finance Directors cannot argue with their costs. But we have fudged for so long and I cannot see us changing”.