John Lennon was a great musician and a bad business person. Anyone reading the recent Rolling Stone piece on “Why the Beatles Broke Up” would be struck by this. But the fact that Lennon hired bad management, broke up the group and did other generally silly things doesn’t really matter. Given his body of work, the fact that he wasn't Jack Welch doesn't seem important.
Great artists are rarely great business people. For every Picasso there are a hundred John Lennons. This doesn’t seem to prevent great artists from existing, and some times even thriving. But HR may be standing in the way of John Lennon joining our band. This is a subject I hope my compatriots at Talent Camp will discuss, even though I may not be present.
As we have discussed before, business tends to look at work in vertically integrated slices. A job title and level covers an increasing scope of capabilities. A Vice President of HR may be expected to have a great eye for talent, the capability to negotiate complex contracts, the analytical ability to assemble complex compensation structures and the knack for coaching CEOs to greatness. Everyone takes for granted that as one climbs the ladder that they have demonstrated proficiencies in an ever greater number of areas. HR writes job descriptions, selects talent, manages performance and compensates people based on this deeply held assumption.
But this vertical integration means that we never get someone who is great at just one or two things. And this is preventing us from developing agile, competitive and productive organizations.
Imagine an HR leader who has just one competency: coaching. Whenever a search firm is looking for talent, they always land on this person, because they have been a long-time leaders at a very successful company. And yet, as the firm digs into the individual’s back story, they hear a long string of complaints: doesn't understand compensation, bad manager, doesn't understand technology, etc. We know where this story ends: the search firm passes the individual over and heads to the vertically integrated example of "executiveness."
But what if this leader is the John Lennon of coaching: the best in the business? This leader gets the CEO to do the right thing nine times out of ten. In fact, the reason that their company is so successful is because this leader has John Lennon's ability to create hits, but instead of writing and playing a guitar, our theoretical leader creates hits through their unique coaching ability.
Because this mythical hit maker doesn't fit the mold of the vertical genius HR is likely to pass them over. How would you compensate them? Where would they fit in your organization? Who would they report to? How would you measure their success? What the heck would you do with John Lennon?
This is why the HR of the future will have to change the structure of the organization. In the creative age, no company will be able to turn away John Lennon. And the company that puts in systems and supports that turn your average Joe's into John Lennons will have competitive advantage.
Finding, unleashing and commercializing these talents will be the key to sustainable innovation. HR won't care that the “John Lennon of Coaching” can't manage a team, program a system or develop a compensation plan. Why would they? There is a "John Lennon of compensation" and a "John Lennon of systems". Expecting someone to suboptimize what they love and are good at so that they can climb a ladder that requires a broad spectrum of adequate mediocrity will be (must be) a thing of the past.
Many will point out that the present business structure of hierarchically stacked positions with every greater vertical integration won't support this vision. They are right. HR will have to become "system architects." But the system that will be established isn't going to be easy.
The system we need is a series of interconnected nodes, a network, not a hierarchy. People will be able to access the nodes given the problem they are trying to solve or opportunity they are trying to create. This networked-based system is often dismissed as being unworkable due to its chaos and inherent risk. But these naysayers fail to understand that the present miltary-type organization is simply unsustainable. It creates too much waste. It pays people for delivering a whole host of capabilities, none of which are world-class or market leading. Organizations simply can't afford to pay for something which adds little value.
Unfortunately, HR is largely engaged in other conversations. Engagement to prevent the coming recovery exodus, moving jobs offshore to help the CEO with their operational cost obsession and helping the CFO meet the street's expectations by changing compensation plans seem to be at the top of most HR leader's list of priorities. Unfortunately this will leave them at a significant disadvantage when the CEO finally realizes that none of what they are doing will help their organization compete on value in a global market.
HR's obsession should be creative productivity: increasing the creative commercialization opportunity of their talent investments. Here are some questions that such a new "creative productivity-centric" HR organization might ask:
- What is a person’s unique capability? Where are they “John Lennon”?
- What is the value of that unique capability to the business?
- What does that unique capability say about a person’s purpose (their sense of direction towards achieving a larger goal)? How has this been exhibited through previous work (the portfolio)?
- How does that purpose align to the organization’s purpose?
- Assuming that the purposes align, that the capability is unique, and that the business can effectively commercialize that capability to achieve its purpose, how will that individual’s work be integrated and supported so that they are as productive as possible?
- Assuming that you can solve for all that, how do you connect that “John Lennon” node into a network that will both utilize that unique capability AND challenge that individual to constantly grow and extend that capability into other areas that could be of value? How do you set up a structure that gets the maximum unique creative value from that node?
- And finally, how do you compensate that individual for the value they add (not the position they hold) in a way that is uniquely meaningful to the individual (give them a uniquely compelling return for the successful investment of their capability)?
Notice that these questions do not even remotely touch on identifying managers, putting people in boxes in an org chart, training, engagement exercises, detailed global compensation plans, performance management, feedback, employee relations, benefits programs, back-office systems or any of the other standard tasks of today's HR department.
And yet, only HR is really positioned to do this work. A functional manager cannot possibly see their way to this future vision, since they suffer from the problem of vertical integration even more than the HR professional. And executive leadership is heads-down worrying about operational cost management and the other obsessions identified above. Finance, IT? Only HR is ever called on to even think about topics like this.
And after all is said and done, it boils down to this tension: the opportunity of an incredible future of value and innovation being held back by the reality of a transactional and misguided present. How do we all help get HR to that new future? How do we help create a million John Lennons with a million different unique value propositions, helping our companies commercialize creativity and build global advantage?
This is what I am hoping gets discussed at Talent Camp.