What Would an Agile Human Resources Department Do?

Human Resources may not be what comes to mind when you think Agile. In fact, Human Resources is often used as the butt of the joke in many companies. Scott Adams has famously skewered HR many times in the past with Dilbert comic strips like the one below.

Dilbert - Agile Human Resources 1996

This view of Human Resources is limiting and not very accurate. Consider the example of Human Resources at Netflix. Patty McCord was the Chief Talent Officer at Netflix and her book Powerful, Building a Culture of Freedom and Responsibility describes the strategic partnership she shared with CEO Reed Hasting through the growth years of Netflix. The policies created by the HR team at Netflix were innovative and a key enabler to growth and agility.

Even if you aren’t Netflix, there HR can still lead agility. There are two key ways that HR can embrace agility. While the first is helpful and necessary, it is the second way that will have the deepest and most strategic impact on enterprise agility.

The Agile Human Resources Team – Using Agile to Deliver HR Services

The first way that HR can leverage agile is in the delivery of their services. That is, the HR department can use agile ways of working to support their customers.

This starts with a focus on the customers of the department and a deep understanding of their needs. So who exactly are the customers and what do they need? I’m no expert in this area but the following seem to be the obvious ones:

  • Employees – Develop employees (talent development).
  • Managers and Leaders – Legal compliance. Recruit and retain. Measure engagement. Develop talent. Establish policies for consistency.
  • External Customers and Stakeholders

Once the customer and needs are identified, HR can use typical agile ways of working to satisfy their needs. This includes frameworks like Scrum or Kanban.

In my experience, Kanban tends to be a more effective tool for department-like work. Scrum is better for cross-functional teams who can plan and execute in iterations and that is not how a typical HR team works.

Kanban is big on making work visible and managing changing priorities which is perfect for HR work. The HR team can use Kanban to complete high-priority work or shift their team around to respond to changing needs.

HR as the Enabler for Organizational Agility

While being an Agile Human Resources Department is great, the real leverage and impact come from being an enabler for organizational agility. What does that mean exactly? How can HR enable agile?

First, let’s distinguish between “doing agile” and “being agile”. HR may help with both but the real benefit is being agile. And that is where HR can shine.

There are at least 5 areas for HR to consider as shown in the diagram below. Let’s walk through each of these to see some examples of how HR improves agility.

Agile Human Resources is an enabler of organizational agility

General HR Policies

Flexible dress codes may be the last thing that one thinks of when they think of agile. After all, what bearing could dress have on my ways of working?

Flexible dress is just one example of empowering employees – of giving them autonomy. We can certainly dictate a dress code. I remember hiring on at IBM in 1985 and needing a blue suit and red tie. I wore a suit to work every day at IBM, even though I was not in a customer-facing role. Did that help my performance? No, I don’t think so. It was just one way for the organization to dictate to me and control me. IMB may have perceived or anticipated a benefit but I as an employee did not.

Other examples include time reporting, vacation time, and expense reporting. Most organizations have established elaborate rules for these that are intended to protect the organization and perhaps to keep things fair. What if instead of elaborate rules for reporting time worked or requesting time off, what if were to simply trust in adult behavior. Take off the time you need. Stop reporting your time each week.

Some leading organizations have already stopped restricting vacation times and now offer unlimited vacation time. That list includes Netflix, LinkedIn, Visualsoft, Evernote, and Github. Market leader Netflix says:

Workers are entrusted to take as much time off as they need. There’s no tracking of days and no restrictions – it’s totally up to them – so long as their line manager has a general idea of where they are and when they’re planning to go.

Agility in the Hiring Process

How can HR apply agile to the hiring processes? Here are a few simple examples of what others have done.

In agile organizations, teams are the basic building block. Most work gets done by cross-functional teams and people are expected to work in teams. This stands in contrast to most traditional organizations which are organized around functional silos. There are a few obvious implications:

Hire for Teams

Let Teams Hire

Provide Low-Risk Ways to Test

Agile Performance Reviews

Reviewing and rewarding people is another key area that HR supports. To do this in an agile way, some organizations have tried the following:

  • Including Team Performance as part of individual performance.
  • Letting Team Members review each other
  • Separating Performance Reviews from annual compensation and bonus discussions.

Agile Job Descriptions and Career Paths

You would be surprised how many organizations I’ve worked with who adopt the Scrum Framework, train and recruit Scrum Masters but lack any sort of job description or career path for that agile role. Or they try to adopt the Product Owner role from Scrum but already have project managers, program managers, and product managers.

If you are going to use Scrum, you should make some accommodations for those roles. There should be a job description and an appropriate career path. The project management career path is NOT appropriate for Scrum Masters, which is another common mistake that I see.

The other key concept with career paths is to support skill-building and advancement along technical paths. People should not need to wait for their manager to die or retire before they can be promoted. After all, there will always be a limited number of manager and leader positions. And using agile ways of working pushes decision-making down to the team reducing the need for managers and putting more people into working roles rather than overhead roles.

So using a promotion to management as a carrot for advancement is a failing strategy. Better to provide a path for people to advance and be rewarded for building their skill sets and learning more areas of the business.

While on the topic of Talent Development, an Agile HR department will stress continuous learning and development. We want to foster an environment of curiosity, learning, and experimentation. Some agile teams leverage a 20% rule. It is implemented in different ways. Some dedicate at least 20% of the teams’ time to learning. Others allow people to work on whatever they want for up to 20% of their time. In any case, there is an expectation that some portion of an individual’s time is up to them to use (another example of allowing autonomy).

One way that some organizations provide options is to allow people to sign up for gigs or short projects. There is a project board where opportunities are posted as “gigs” and people are allowed to sign up.

Agile Rewards

Another area where HR can make an impact is rewards. There are several facets to rewards but a key one is aligning rewards to agile ways of working and in particular, working in teams. After all, teams are the basic building block of agility.

One of the first agile transformations that I was involved in was in a financial services firm. A large portion of each individual’s annual compensation was their bonus. There was a bonus pool and it was divided based on individual contribution. As you might imagine, this led to all kinds of gaming activity and competitiveness to see who could maximize their individual bonus at the expense of others. That single policy undermined all the work to create cross-function, self-organizing teams who collaborated for the best customer solution.

Another aspect of rewards is paying people for growth and development. In an agile context, that usually means secondary skill development. Everyone brings with them a deep primary skill such as business analysis, accounting, Python development or automated testing. For strong agile teams, we want to recognize and reward growth in secondary skills. Those secondary skills complement the primary skills and provide flexibility and agility for teams to deliver end to end. The growth in skills taps into people’s intrinsic motivation and serves as a reward in itself.

Finally, consider paying people based on what it would cost to retain them. As radical as it sounds, this has been the policy at Netflix since it was founded. Netflix encourages employees to go out and see if they can get a better offer at another company. They believe that to get the best talent, they need to pay top of market and offer what it would take to retain each employee.

Summary of Agility in the HR Department

Certainly, the Human Resources department can leverage tools like Scrum or Kanban to deliver their services. The real leverage exists in being the enabler of enterprise agility.

This article originally appeared here and has been republished with permission

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