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Summary HR from the outside in Chapter 1 complete
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Summary of Chapter 1 of HR from the Outside in van Ulrich.
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OO2: Samenvatting HR from the outside in HS1: Nextgeneration HR
HR-professionals almost in invariably define “business” as “HR Business” and are inclined to talk
about their current initiatives in leadership training, recruiting, engagement or rewards -> the areas
where they focus their attention on the job. These are important -> but are not the business but
support of the business.
Real business = external: context and setting in which the business operates, the expectations of key
stakeholders (customers, investors, communities, partners, employees), and the strategies that give
a company a unique advantage. HR-professionals must focus on the goals of the business. Take the
“outside/external” reality and bring it into everything they do, practicing their craft with an eye to
the business as a whole.
Focusing on the business of the business enables HR-professionals to add meaningful and
sustainable value. HR-professionals think and behave from the outside in, when they start and
ground their work with the business.
Working from the outside in shifts the emphasis in a number of subtle but important ways:
- Placement and promotion from the outside in
Customer expectations set the standards for bringing new hires into the organization and for
promoting people into higher ranks.
- Training from the outside in
Customers, suppliers, investors and regulators are invited to help design the content of
training to make sure that hat is taught meets external expectations.
- Rewards from the outside in
Customers help determine which employees are rewarded for their awards.
- Performance management from the outside in
The department gives key customers the opportunity to assess its performance review
standards and tell the company if those standards are consistent with their expectations.
- Leadership from the outside in
HR helps the company focus on developing a leadership brand, where external expectations
translate to internal leadership behaviours. Top companies involved customers in defining
competencies for their leaders.
- Communication from the outside in
HR makes sure that messages presented to employees are also shared with customers and
investors.
- Culture from the outside in
Define culture as the identity culture as the identity of the organization in the mind of key
customers, made real to every employee every day.
Outside-in HR is based on the premise that the business of HR is the business.
, The Business of the Business
HR must create and deliver value in business terms.
The appreciation on how a business operates requires a three-tiered approach:
1. Understand the context in which the business functions, including general societal pressures
that encourage or discourage it.
2. Understand the specific stakeholders who shape and sustain the business, including
customers, investors, regulators, competitors, partners and employees.
3. Understand the business strategy to uniquely position the business to serve stakeholders,
respond to general conditions and build a unique competitive advantage.
Business Context
Omnipresent information outside a company changes behaviour inside a company. When
informed HR-professionals tell about their business, they often have a relatively long list of
general trends that affect them.
Not handy -> organize and prioritize and contextual trends six categories:
1. Society
Personal lifestyles are changing with respect to families, urbanisation, ethics, religion
and well-being.
2. Technology
New devices and concepts enable access and transparency not only through
information but also in relationships.
3. Economics
Economic cycles shape consumer and government confidence.
4. Politics
Regulatory shift changes the expectations of government and personal lives. Political
unrest often signals a loss of confidence in government institutions.
5. Environment
The earth’s resources that provide energy for growth are limited and need to be
managed responsibly; social responsibility shapes how people behave.
6. Demographics
Changing birth rates, education, income levels affect employee and consumer
behaviour.
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