Category Archives: HR leadership

Limiting Your Human Capital Risk

After seeing invites to a number of previous events, I finally was able to carve out some time yesterday to get to Argyle’s Human Capital Leadership Forum in New York.

I was especially interested in hearing the first main speaker, Orlando Ashford, senior vice president of human resources at Marsh & McLennan Cos., who opened the conference with a talk on “Managing Human Capital Risk.” Considering MMC is in the risk-management business and the allegations of price-fixing that plagued the firm roughly six years ago (an $850 million settlement was eventually reached), Ashford seemed to select a topic that’s near and dear to MMC on at least a couple of fronts. (Ashford joined MMC in 2008, coming there from Coca-Cola.)

Unfortunately, Ashford didn’t have much to say specifically about MMC, but he did a fine job detailing some ways HR leaders can help businesses mitigate human capital risk, which he summarized as the ability (or inability) to “attract, develop and retain key personnel and to create an organization whose employees are optimized to create value for the business.”

Ashford shared several examples of human capital risk, but not surprisingly cited CEO succession as the most critical. (MCC has had three CEOs in the past six year, with its current CEO, Brian Duperreault, taking the helm in 2008.)

Succession is extremely important across the entire enterprise, he said, but has to start  with CEO succession. “Most boards agree that one of their most important roles is choosing the next CEO,” he said, “but, on average, boards spend less than two hours per year on CEO succession.”

To be sure, this is a process that’s owned and managed by the board. But as Ashford reminded conference attendees, it’s also one that frequently involves HR, beginning with putting in place processes that enable discussions around succession to happen.

Sam Zell’s Tribune Co: The HR Factor

A really disturbing front-page story on the NY Times the other day profiled some of the goings-on at Chicago-based Tribune Co., the storied media giant that was taken over by real-estate mogul Sam Zell back in 2007. As the story notes, it’s all been downhill—WAY downhill—for the once-proud Tribune Co. ever since. Zell chose to make the purchase (piling enormous debt onto the company in the process) right before the newspaper market cratered.

The company filed for bankruptcy protection less than a year after Zell bought it, yet he and his management team were still able to persuade the bankruptcy judge overseeing the case to sign off on more than $50 million worth of bonuses for top managers earlier this year.

Possible financial shenanigans aside, the story’s big revelation (based on interviews with numerous former Tribune employees) is the allegedly depraved corporate culture that Zell and his people have allowed to flourish at the company.

Two former Tribune execs told NYT writer David Carr that Randy Michaels, one of Zell’s hand-picked minions to run the company (who has a history of sexual-harassment claims filed against him at his former employer), met them in a bar soon after joining the company and is accused of offering a female bartender $100 to show him her breasts. (Michaels has denied doing this).

Michaels and his lieutenants at one point allegedly stood on a balcony overlooking a work area and made loud remarks about the sexual attributes of various employees, within hearing distance of everyone. There’s plenty more, of course.

But for me, what really takes the cake is this little gem, from a rewritten version of the company’s employee handbook that was apparently one of the new team’s first priorities, according to the story:  

“Working at Tribune means accepting that you might hear a word that you, personally, might not use,” the new handbook warned. “You might experience an attitude you don’t share. You might hear a joke that you don’t consider funny. That is because a loose, fun, nonlinear atmosphere is important to the creative process.” It then added, “This should be understood, should not be a surprise and not considered harassment.”

Wow—management actually went ahead and redefined harassment. Brilliant! So the obvious question is: Where was HR when this new handbook was approved and distributed to employees? How could any HR leader possibly sign off on this?

For a quick answer, I checked the archives of our People section and discovered that Luis E. Lewin served as Tribune’s senior VP of corporate human resources from 2000 to 2008. In other words, Lewin (who’s currently the CHRO at Purdue University) left Tribune right as Zell and his team were in the midst of making their changes at the company.

I don’t know Mr. Lewin or the actual circumstances of his departure, but I’d really like to think that it was because he would not be part of a management team that apparently had so little respect for the employees who worked there. I’d also like to think that most HR leaders would, upon failing to convince a CEO that their policies were similarly misguided, do the right thing and tender their resignation.

Times may be tough, but principles are priceless.

In Honor of HR Excellence, Humility and Class

Excellence in HR leadership was honored once again Thursday night at the 2010 HR Executive of the Year and Honor Roll Awards dinner in Chicago. The humility and class of the winners were also a large part of the fare.

Accepting his award as the 2010 HR Executive of the Year, Google Inc.’s vice president of people operations, Laszlo Bock, honored in return the people and culture of his company that has made his unique leadership possible and has turned Google’s HR function into a flagship for all HR practitioners to follow. “One of the nice things about the Google culture,” said Bock, “is it keeps you humble.” He jokingly referenced one colleague “who heard I was going to win this award, and she said, ‘For what?’ ”

Yet on a more serious note, Bock lauded his company for valuing freedom and transparency, “and giving people the knowledge that makes them free” — a poignant tribute from a man who, as a boy, fled with his ethnically Hungarian family from the despotic reign of Romanian dictator Nicolae Ceausescu to come to America.

“Fundamentally, everyone wants freedom and meaning in what they do, and I am humbly proud to work for a company that recognizes that,” he said.

The dinner, presented by Human Resource Executive(R) magazine and sponsored by Monster, also honored HR Honor Roll inductees Mark Fogel, vice president of human resources and administration for Leviton Manufacturing Co. Inc.; Julie Wood, chief people officer for Crowe Horwath; and Stephen R. Fussell, senior vice president of human resources for Abbott.

Each Honor Roll winner was equally eloquent in praising the HR teams that brought them to that podium. Fogel — recognized for making the HR function at Leviton more strategic and globally focused — likened his good fortune to football, where “some have to block, some are on special teams, yet me, I’m lucky enough to be the quarterback who gets the ball to the right people to carry it down to the end zone.”

Wood, honored for cutting millions in payroll costs while still implementing programs to support both employees and the business, talked about the passion “any leader of any team feels about what we do every day.”

“I feel my team truly does understand the importance of people strategies at our firm,” said Wood.

Fussell too — recognized for having the vision and guts to both streamline and implement programs that eventually saved Abbott $100 million — thanked the staff behind him.

“Any successful chief human resource officer worth his or her salt understands we’re simply a reflection of the visions and the talents of the team we work with,” he said. “Every day I’m reminded by the people I work with that [human resources] is truly honorable work.”