People at the heart of business: McKinsey’s global head makes an historic call - Preparing you for the future of work.

People at the heart of business: McKinsey’s global head makes an historic call

Dr Douglas Board discusses the book Talent Wins: The New Playbook for Putting People First by Ram Charan, Dominic Barton and Dennis Carey (Harvard Business Review Press 2018).

What stood out for you from this just-out, 180 page book?

Two facts demand attention. First, given the business stature of these authors (only Dennis Carey of Korn Ferry is of the HR tribe; Ram Charan is a board leader and author on governance, while Dominic Barton is global head of McKinsey), it’s rare to find reputations nailed so loudly to the need for HR to be the equal of finance at the leadership table. They specifically propose that CEOs should focus on creating a CEO/CFO/CHRO triumvirate (‘the G3’), a pattern to be repeated within individual business units.

Second, the book’s examples demonstrate that a G3 or close variant is not simply an idea. Prophetic CEOs have already made it part of transformation in global companies as different as Marsh, Tata, Aon and McGraw-Hill. Anyone who has bemoaned HR’s lack of clout should be making the most of this once-in-a-lifetime invitation to come to the top table.

Employee Engagement awards

How would you sum up the message of the book?

Much of this book’s argument is captured in the two concluding paragraphs on pages 165 to 166): “Talent is king. But running a talent-driven organisation isn’t suited for someone who wants to be king of the castle. It’s not about commanding people to do things. It’s not about judging who belongs where in the hierarchy. It’s not about underlings bringing you problems and awaiting your decree.

Instead, successfully leading a talent-first company requires agility, an ability to foster collaboration, calm decisiveness in the face of uncertainty, transparency and faith – specifically faith in the transforming talents of others. It requires enough ego to be comfortable with making the hardest decisions, and enough humility to defer to the brilliance of other people.”

If talent is “king”, what happened to cash?

Talent replacing cash as king would be a revolution. But the book’s lack of precision in defining ‘talent’ is disappointing. In effect, the authors are evangelical for a belief that two per cent of employees far outperform the rest. These two per cent – scattered throughout an organisation, not simply in hierarchical positions of authority – are then your ‘talent’.

Forgive the play on words, but what’s the other side of this coin?

Positively, this fervor challenges companies to throw off the machine-like treatment of people and pay closer attention to valuable human difference. However, the authors remain trapped in seeing only individuals when they look at complex, energetic constellations of people. Missing is the brilliance of teams or the interdependence between star performers and the equally vital central core of productive groups. Problems of excessive remuneration of ‘stars’ aren’t addressed.

The discussion of Facebook, including teams, shows tensions and the need for deeper thought: “After individual employees finish one project, they get to choose their next team. If they like it they can stay on the team. If they don’t, they can go look for something else ... to make this work, the company needs great managers. … it needs them to … ensure that the company’s values and behaviours are intact at the team level. (p. 61)

At Facebook, employees think ’solution’ before they think ‘profit’ (p. 67). Thanks to Zuckerberg’s clarity, everyone at Facebook knows where the company is headed.” (p. 63)

Recent events make this section read very differently from when it was written. If Facebook had a G3, Facebook users did not get a look in; nor did wider society. Those things need fixing. But in the meantime, let’s not miss a terrific opportunity to elevate the people agenda to the top of companies’ priorities, drawing on Charon, Barton and Carey’s historic call.

Any thoughts on how a different ‘G3’ could address this?

Ideally it should be the CEO, CFO and the head of a combined function bringing together all of the organisation’s relationships which matter: with employees, customers and potential customers, supply chain and wider communities. The Chief Relationships Officer would have responsibilities covering HR, marketing, supply chain and social responsibility.

Wouldn’t that be a radical shift?

Yes. I probably won’t see it in my lifetime! But the Digital Age is already bringing the convergence of employee and consumer brands – these need to fit together. The new function would have the power to rival finance: for the first time, investors would demand that all the G3 become executive members of the board, not just the CEO and CFO. Finally, we don’t have two chief officers for finance, one for money inside the company and one for money outside: so why do it for people and relationships?

To sum up, where do we go, starting from where we are today?

We should take up this book’s historic call to bring CHROs into the circle of power and replicate this within major business units. This is the next step beyond business partnering. But we shouldn’t fall into the trap of thinking that only 2% of the people inside your organisation really matter. All the people matter – certainly all of your employees do.

When not 2% but 98% of your employees are truly engaged in your business, then they will bring the voices of customers and communities with them, because that’s where most of your employees are – serving customers and living in communities. Closer to home, this month sees the first All-Africa Employee Engagement Conference & Awards being held in Johannesburg on 14th June, hosted by N2Growth Africa. Putting a people first paradigm on the business table in Africa is a timely challenge to the established order. This is a time for bold thinking and action, to shape a new era in business and management.

Profile: Dr Douglas Board (@BoardWryter) is an executive coach and a senior visiting fellow at Cass Business School, City University of London. He is head of Coachmatch Career Management and a board adviser to N2Growth Africa. http://africa.ee-awards.com.

This article appeared in the June 2018 issue of HR Future magazine.

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