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Put your Business Acumen to work as an advisor to your organization
In the business world, we've been conditioned to think that consultants are external professionals who are paid large fees under contract to come in and identify potential causes for a particular issue, provide support for developing solutions, or facilitate the implementation of a new initiative. Those responsibilities are what most of us consider consultation.
Now think about those responsibilities on their own, not attached exclusively to the occupation of consultant. How many of these responsibilities do you have within your organization?
You are consulting.
More specifically, you are an internal consultant to the various departments and leadership levels across your organization. Your success and the success of your organization depend on your knowledge of, skill in and ability to work with stakeholders to:
Why is proficiency in Consultation (the SHRM Competency defined above) so important to HR?
HR must support every department within the organization. At the same time, HR is increasingly being recognized as a strategic partner within the organization. Business leaders and executives are turning to HR for input on organizational strategy. One reason for this shift is their realization that the organization's human capital—its people—can quite literally make or break its success, both short- and long-term. And when leaders in an organization start talking about people, what is the first department they should think of? HR, of course!
Now more than ever, HR professionals play the role of internal consultant, which may require some of us to adjust our thinking or strategy. HR professionals today are responsible for understanding more than just HR. Unlike some occupations in which only occupation-specific technical knowledge is required, HR professionals must have a working knowledge of the areas they consult on, including multiple job families and business functions.
While the technical competency of HR Expertise is still paramount to being effective in your HR role, you must also be proficient in the behavioral competency of Business Acumen—the knowledge, skills and abilities needed to understand the organization's operations, functions and external environment, and to apply business tools and analyses that inform HR initiatives and operations consistent with the overall strategic direction of the organization.
The best consultants, internal or external, are able to tailor their Business Acumen to their organization by matching their technical knowledge to the industry or industries in which the organization operates. Today's most effective HR professionals recognize the importance of Consultation and Business Acumen and, more importantly, the relationship between the two. These are the HR professionals you'll see quickly advancing in their careers.
For example, let's say you work as an HR generalist for a national restaurant management group. In addition to your HR technical expertise, you'll need a strong understanding of the restaurant industry: its operations and different functions as well as the ins and outs of customer and food service. Further, you'll need to understand labor market trends and the competitive environment within which the restaurant group exists. Finally, you'll need to apply and integrate your knowledge with your understanding of organizational strategy (Business Acumen), in order to evaluate business challenges, support change initiatives, and develop HR solutions that meet—and exceed—the needs of your customers and other stakeholders. If you were designing a successful employee training program for this group, how important would it be for you to understand the operating structure and employee culture of the restaurant industry or to have had actual "front of the house" (e.g., server) or "back of the house" (e.g., chef) experience resolving conflicts between such employees?
How do you measure up? What other industry and general business knowledge would you need beyond HR Expertise to inform your systems thinking and contribute more strategically to the success of your own organization?
Remember, it pays to be honest with yourself when assessing your strengths and weaknesses. The good news is that it's never too late to start developing your competencies, and there's always room for improvement, regardless of your level of proficiency. Create opportunities in your current role to jointly practice the following behaviors.Business Acumen—Key Behaviors:
Ashley Miller, M.A., is senior specialist for HR competencies at SHRM.
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