What's the Difference & Who's in the C Suite?

So after many conversations at SHRM10, Twitter, HCI and other venues, I've decided to write a post about my views on the differences between human capital management (HCM) and human resources (HR).  I think there are many different debates on which does what and how a HC/HR organization should be designed.  Considering I'm neck deep in the design and implementation of this now, I thought I'd share some of my views and rationale on the topic.

Fundamentally, I see human capital and HR as two very different functions. My organization is a human capital organization, first and foremost.  My background is primarily from business management, with strong knowledge in a range of HR and human capital functional areas.  As the Chief Human Capital Officer for a joint venture, and as the VP of Human Capital for a consulting practice, my role is one in the same.  My focus is to ensure that our People Strategy Aligns with the Business Strategy.

Under the HC umbrella I have four key areas:  Recruitment, Talent Management, Human Resources, and Workforce Planning.   The reason I divided it up this way is that each of these areas has unique skill sets and goals.  Recruiting includes sourcing, vetting and screening candidates, assessments, interviewing, and selection.  Our Talent Management group includes several subsets: onboarding, training, performance management, retention, etc.  HR includes all of the transactional activities associated with our people (I9s, FMLA, benefits, etc.).  Workforce Planning pulls all of this full circle so that we're looking at the metrics to report the "as-is state" plus predict future state activities. 

All of those areas roll up to help strategically create a gameplan that aligns our people with the business strategy.

May people are asking questions about why HR doesn't have a seat in the C suite.  My simple answer is that HR shouldn't - it's one transactional piece in the HC arena.  Human Capital should be in the C suite.  This doesn't mean, however, that some heads of HR don't have what it takes to be in the C suite.  What I'm suggesting is simply this...  someone who has only been heading up transactional HR activities needs to rebrand themselves to show a broader depth of knowledge, and strategic ability, to look at more than the HR transactions happening in an organization.  This rebranding takes the form of becoming a true Human Capital practitioner - with a strong focus on business principles and concepts.  Successful CHCOs/Chief People Officers, etc. have a strong understanding of the business and a solid understanding of all of the various components of human capital - well beyond just HR.

Personally, I've also found that great HR Directors are rock stars at process oriented procedures and fact finding (data and details).  I greatly value these people because they provide data and process-based structure.  The nature of that kind of work is not always conducive to the extremely strategic and entrepreneurial nature of CHCO/CPO work. 

For all of these reasons, and a few others, I'm not a proponent of the head of HR being in the C suite.  It is the true Human Capital Officer who serves the strategic needs of the business with a strong team of recruiters, talent managers, HR managers and workforce planners behind them.