In our work with HR clients over the years, we have identified 5 distinct Stages of development that the Human Resources function grows through in organizational life. The Stages go from the administrator function in a small business or start up to a C-Suite office and seat on the executive team in a large organization. Each of the Stages coincides with the growth of the business, the number of people employed and the capabilities of the leader of the HR function. There are instead certain crisis points that indicate when it is time to begin looking to bring the right HR talent aboard to deal with the crisis. At other Stages, it is important to redefine the HR function and decide what needs to be built, i.e. HR team, HR department, strategic partner. We have worked in very large companies with few and many HR employees and in smaller companies with none. The challenges that both the leaders and the HR employees face are symptomatic of needed growth and development of the function, leaders and HR employees. There is no magic number of employees that a company should have before they have to shift from Stage to Stage. While crisis points do occur because of increasing numbers of employees, the pervading attitude toward human resources as the company grows is also a key factor. The presentation describes the five stages of development that HR goes through and each of the crisis points that indicate the need for leaders to evaluate what it is the organization needs to shift to the next Stage.

1. Leadership systems that
create powerful companies
The Five Stages of Human Resources Evolution
From Administration to C-Suite
Presented by: Heather Hilliard & Anne Dranitsaris, PhD
Behavioral Change & Leadership Experts

2. What you will learn
 Normal growth trajectory of human resources
 Stages of development of human resources in
organization life
 Normal crisis points during development
 How to navigate the Stages and take human
resources to the next Stage
 Implications for HR practitioners

3. While to many, it may seem that
moving HR through the Stages is a bit
like pushing a rock uphill, it doesn't
have to be that way!

4. Stages of HR Development
 5 distinct Stages of Development that the Human
Resources function grows through in organizational life
 Stages go from administration to a C-Suite office and seat
on the executive team
 Each Stage coincides with the:
 growth of the business
 readiness of the executive team / entrepreneur
 number of people employed
 capabilities of the leader of the HR function

5. Stages of HR Development
 Each Stage has a crisis points that indicates when it is
time to:
 bring the right HR talent aboard
 redefine the HR function
 decide what needs to be built, i.e. HR team, HR
department, strategic partner.
 The challenges that both the leaders and the HR
employees face are symptomatic of needed growth and
development of the function, leaders and HR employees.

6. 5 Stages:
from Administration to C-Suite
Stage 1:
Infancy
Stage 2:
Foundation Building
Stage 3:
Building the HR Team
Stage 4:
Building the HR
Function
Stage 5:
Strategic Human
Resources

7. Infancy
 Start-up or small business
 Leader or leaders are workers
 Focus on survival of the business
 HR is done by the owner/leader
or Administrative Assistant
 Outsourced support for accounting, payroll, hiring
 No defined practices, systems, policies
Stage
1

8. Crisis of Growth &
Stuck Point
 Growth of the business leads to:
 Leader spending too much time resolving
employee conflict
 Turnover due to wrong hires
 Lack of policies and processes
 Employees salaries determined by need
 HR delegated to inexperienced or untrained
employee leads to more issues
Stage
1

9. To Move to Stage 2:
Recognize the need to:
 Determine company policies & procedures
 Create job descriptions and salaries
 Standardize recruitment practices based
on job requirements
 Hire an HR Generalist to:
 perform administration of HR
 support recruitment
 handle employee conflict
Stage
1

10. What Gets in the Way
 Promoting a non-HR person to set
up and run the new HR function
 Hiring a new HR grad to minimize
costs instead of investing in
experience
 Not defining “how” HR should
actually work
Stage
1

11. Foundation Building
 Administration of policies and procedures by
standardization
 Employee manual
 Policies for time off, vacation, etc.
 Process for writing up employees, i.e. late, failure
to comply, etc.
 Standard policy for raises, cost of living, 2 – 3
percent, etc.
 Safety policies
Stage
2

12. Crisis of Growth &
Stuck Point
 Growth leads to:
 Unpredictably, chaos,
confusion
 Firing weakest employee;
stuck in rehire cycle
 Failure to manage
performance
 Leaders blame employees,
employees blame leaders
Stage
2

13. Crisis of Growth &
Stuck Point
 Growth of the business leads to:
 Too many employee issues to deal
with
 Too much time spent in hiring, no
time for onboarding
 Turnover due to lack of definition,
poor management
 HR Generalist feels they can
never do enough
Stage
2

14. Shift HR to Stage 3
Recognize the need to move from HR administration
to a defined functional area by:
 understanding how people practices limit
organizational cohesiveness and growth
 aligning to the needs, vision and values of the
business
 linking performance management with company
goals
 deciding on an HR identity with clear mandate,
functions and services
Stage
2

15. What Gets in the Way
 Leaders want to keep it ‘fun’
 No clear HR framework or design
 Leaders absenting themselves
from HR program design
decisions
 Too much emphasis placed on
policy and not enough on
performance
 Staying reactive
Stage
2

16. People & Culture
Employee
Experience
HR Core Services Full Suite HR
What should
‘HR’ look like?
Building an HR Identity
Stage
3

17. Crisis of Growth &
Stuck Point
 Growth of the business leads to HR having
to deal with negative results of:
 inexperienced and ineffective managers
 off-the-shelf performance management & incentive
programs
 Much reinventing the wheel & solving same problems
 Leadership doesn’t participate in decision making on
HR programs (leaves HR on own too much)
 Management wants HR to solve people problems
without spending any money
Stage
3

18. To Shift to Stage 4:
 See HR as critical to the growth of the business
 Leadership recognizes that they must participate in
programs
 See the value in investing in people’s training and
development
 Recognize issues are due to not taking a holistic
approach to aligning people, systems and processes to
organizational goals
 Stop blaming individuals for issues that are systemic in
the organization
Stage
3

19. What Gets in the Way
 Not defining HR; letting the work or
external factors define the function
 Promoting existing HR Generalist
without development support
 Adding more HR generalists to
cover the workload vs. HR
specialists
 Not building a plan that focuses
HR’s efforts and outcomes
Stage
3

20. Alignment of the HR
Function
 Recognition that HR is a business function that must be
aligned with business goals
 HR leader must be able to influence leadership team
 Ensure HR policies and programs are followed and that
overall performance is aligned with goals and objectives
 Oversee cohesive systems and people practices
throughout the organization
 HR hub: ensures communication between management
& employees, as well as planning, directing, and
coordinating work tasks to achieve business goals
Stage
4

21. Crisis of Growth &
Stuck Point
 Senior HR leaders fall short of really understanding
the business challenges
 Focus on policies and programs that are impractical
or even irrelevant to the bottom line of the business
 Lack of centralization of HR activities throughout the
organization
 Failure of leaders & managers to align themselves
with HR function or use advice from HR, creating
significant challenges for HR when goes wrong
Stage
4

22. Crisis of Growth &
Stuck Point
 Lack the assertiveness to drive their agenda
 Lack the business skills to build a business
case for necessary programs or changes and
as a result, are easily dissuaded or rebuffed
 Champion the needs of employees to senior
management; run the risk of creating and “us
vs. them” position, with HR siding against the
leadership team they are a part of
Stage
4

23. To Shift to Stage 5
 Leader of the Human Resources Department has to
make a significant change in the way they lead
 shift from champion of employees to a business leader
who is responsible for HR
 ensure all of their functional areas add value to the
bottom line
 Determine how to maximize the company’s human
capital and lead their managers in a way that ensures
HR is seen as a strategic business partner
 Leaders need to understand when HR is not
embedded in the organization, it is not as successful
as it can be
Stage
4

24. What Gets in the Way
 Failure to take an holistic approach
to the business of HR
 Lack of understanding
organizational identity and what it
needs HR to be
 Inorganic approach: focusing on
best practices programs vs.
solutions to business needs
 Inability to overcome resistance of
leaders to develop
Stage
4

25. Integration of Human
Resources
 HR in the organization has evolved organically and an
integral part of the business identity
 HR Leader is a business leader first; focus on business
metrics, reporting and analytics and how human capital
affects bottom line results
 Integral part of strategy execution, helping to move
strategic objectives to action plans throughout the
organization.
 Create a competitive advantage through workforce and
talent systems
Stage
5

26. Integration of Human
Resources
 Work with the executive team to determine business
goals, objectives and strategies
 Enforce a comprehensive planning process and ensure
work is organized and executed, delivering administrative
efficiency to ensure that costs are reduced while quality is
maintained
 Identify desired behaviors, aligning processes and
evaluating performance against it espoused culture
 Advise, counsel, coach, challenge and mentor the CEO
and their peers on the leadership team
Stage
5

27. What Gets in the Way
 Not educating executives first
before presenting plans
 Personalizing executive
decisions
 Lack of change management
 Use of subjective vs. objective
language
Stage
5

28. Growing Your HR Function
 Whatever the Stage of Development
your Human Resources is at, it is
critical that you identify it and take
steps to build a solid, cohesive
function that will serve you as your
business grows
 Not making the investment in your
human capital can create significant
blocks to organizational performance,
regardless of the size

29. Why Caliber Leadership
Systems?
Our experience helping organizations set up the HR
function to create greater alignment of people to goals and
business outcomes allows us to come into an organization
of any size and assess what needs to happen to secure
HRs ultimate place as a strategic business partner or
service centre, adding value to people and bottom line
performance.
At Caliber, we show business leaders how to cut
through the noise in order to build powerful
companies and amplify their business results.

30. Why Caliber Leadership
Systems?
 We help by...
 Facilitating strategy development, business planning and retreats
 Building authentic, high performing leadership teams
 Designing & implementing organizational structures
 Designing & implementing HR framework
 Leading cultural change
 Designing & implementing succession, performance, reward &
recognition systems
 Leveraging personality assessments
 Selecting candidates for key roles
 Providing individual coaching and career counselling

31. Questions?
For more information, contact us:
Heather Hilliard
hhilliard@caliberleadership.com
416.406.3939
www.CaliberLeadership.com
www.StrivingStyles.com