The HR strategy of an 80-year-old startupApril 17, 2019
Tracy Keogh, chief HR officer for HP Inc., closed Day 2 of the 2019 IMPACT conference with a compelling story about the development of an HR strategy for the company—including the elimination of titles, the creation of a growth mindset, and a holistic approach to using tools.
In 2015 Hewlett-Packard split into HP Enterprise and HP Inc. in order to make both entities more agile and innovative. Keogh and her colleagues had to allocate 270,000 employees among the two new organizations within four months—no small task in a global organization. In China, for instance, each employee needed to sign a new offer letter and have it notarized, so the company sponsored “signing parties” to do it en masse. In the US, offer letters could be sent and returned via email. Unfortunately, as she joked, most employees thought the offer letters were spam and deleted them.
With the launch of HP Inc., Keogh became the CHRO of a company that retained Hewlett-Packard’s 80-year history with a mandate to operate like a $50 billion startup. She realized immediately that none of the HR processes that had worked for Hewlett-Packard were right for HP Inc. Her first agenda item, therefore, was the creation of an overall HR strategy that was driven by the business strategy.
As Keogh noted, any HR strategy takes into account several elements:
- Company mission and vision
- Business strategy and objectives
- Company culture and values
- Degree of strategic impact required from HR
- Speed of change of industry
- Resources available to HR
- HR talent skills and capabilities
- HR strategies of competitors
- Personal experience / preference of the head of HR
The HR strategy, in turn, drives the people strategy, which includes critical functional areas:
- Talent acquisition
- Recognition and rewards
- Talent management
- Learning and development
- Performance management
- Culture and engagement
Taken together, these pieces create an organization’s HR brand.
In devising the HR strategy for HP Inc., Keogh said, “We wanted to be employee-centric, which doesn’t sound revolutionary, but for us at that time, it really was.” She worked to ensure that the strategy was clearly aligned with the business; simple to understand, implement, and measure for evaluation; cascadable across the organization; and adaptable and responsive.
With the HR strategy in place, Keogh engaged the entire HR organization to create people strategies across five workstreams:
- Talent acquisition
- Talent and learning
- Rewards and recognition
- HR labs (including analytics and future of work)
- HR brand
She asked each to evaluate the current situation, outline an approach, and offer recommendations and next steps. One controversial recommendation was the elimination of titles. “We found titles were really getting in the way of people’s growth and development,” she said. “We had people who were saying they wanted to be an EVP or an SVP. I call that eyes on the scoreboard, not on the ball.” She shifted the organization to content-based titles that describe what people do. “There were some tears,” she recalls. “People get emotional about titles.” When employees expressed concern that customers would not call them back if they didn’t have a sufficiently elevated title, she did concede that people could use VP titles externally as appropriate—but they no longer held sway in the organization.
Another change was the elimination of ratings from the performance management process. To ease the change, she put in place very rigorous feedback and development mechanisms, as well as a slider tool to help leaders determine how to allocate resources in the absence of ratings.
Essentially, Keogh said, she and her team reinvented all people processes across the company. And the numbers speak for themselves: In FY18 HP Inc. had $58.5 billion in revenue and approximately 55,000 employees, and ranked 58th on the Fortune100 and 24th on Fortune’s list of best workplaces in technology. Four years after its launch, HP Inc. still has the heart and energy of a startup with the brain and muscle of a Fortune 100 company. And Keogh continues to lead an HR strategy that takes its people where the business needs to go.
Stay tuned for more Insights from IMPACT 2019 all week, and follow the conference conversations on our Twitter handle: @Bersin.
Originally published at Capital H blog