SYNCHRONY
REINVENTING HUMAN RESOURCES
American business is overdue for a reset. Our corporate culture, historically resistant to change, must now face a critical reinvention – beginning with how we think about Human Resources (HR). Originally established to counteract exploitative labor practices and prevent unionization, HR emerged as a safeguard for fair treatment and equitable workplace conditions. However, over time, it has lost its way. HR departments have shifted from their foundational purpose and have too often now become barriers to progress rather than champions of corporate excellence and transformation consistent with that required to support winning in the market for a company.
LESSONS FROM THE PAST
HR gained prominence during the post-Industrial Revolution era. At a time when labor unions arose in response to unsafe working conditions, grueling hours, and minimal pay, HR was envisioned as the corporate answer to labor grievances. It aimed to protect employees while preserving management’s ability to operate efficiently. However, in practice, the balance tipped too far. Overprotection and underperformance - both by the employees and the managers - began to undermine the system.
For instance, in one Fortune 100 company, while in a senior management role, I witnessed an HR team only approve performance standards set at just 80% of the average for an underperforming employee. How can a business justify this to shareholders who demand peak performance? The cracks in the system widened, revealing an environment where mediocrity flourished, poorly trained managers ascended, and businesses struggled to maintain momentum.
A BROKEN EMPLOYMENT MODEL
The idea of “if you are a lousy company, you won’t survive” is one that HR has lost. As they intervene to ensure fair treatment from biased or uniformed management, they have lost the grit necessary to maintain a team that performs above industry standards. This “lousy” reality is also rooted in the lack of training managers have and the ill-placement of managers in management positions.
The erosion of the “employment-at-will” principle further complicated matters. This doctrine - allowing employers to hire or terminate employees for any reason or no reason - was meant to ensure agility in staffing. Yet, businesses have increasingly relinquished this flexibility, instead adopting rigid policies that jeopardize continuity and efficiency.
Simultaneously, employees gained the same freedom to leave at will, often leaving businesses scrambling to fill critical roles. Add to this the reluctance to maintain ongoing recruitment pipelines, and companies found themselves ill-equipped to respond to turnover. The result? Disrupted operations, diminished customer service, and a growing corporate handicap.
A PATH FORWARD: PRINCIPLES FOR REINVENTION
To reset and thrive, American businesses must adopt bold strategies to restore balance and effectiveness in HR and broader operations. Here are actionable principles for transformation:
Recruit Continuously for Critical Roles: For positions where vacancies hinder performance, recruit year-round. Maintain a pool of qualified candidates to ensure readiness for sudden departures.
Eliminate Underperformance: Address the bottom quartile of employee performance annually. Implement a policy of removing the bottom 10% of performers while leveraging technology and outsourcing to fill gaps efficiently.
Rebuild HR with Excellence: HR departments should be staffed with top-tier talent. Stop relegating average employees to HR roles and demand measurable outcomes, such as reduced cycle times for filling vacancies and resolving complaints.
Leveraging Outsourcing: Outsource non-core functions to enhance agility and focus internal resources on strategic initiatives. Outsourcing accelerates work delivery and improves results.
Integrate AI in Talent Acquisition: Use AI tools to streamline resume screening, pre-employment assessments, and interview scheduling. This ensures hiring managers have better options, faster.
Set Performance Metrics in HR: Hold HR accountable with defined metrics, such as time-to-fill vacancies, employee development success rates, and complaint resolution speed. Slow HR processes lead to festering issues.
Ensure Leadership Readiness: Screen managers for emotional maturity and train them in conflict resolution. Leadership arrogance and self-absorption must not be tolerated.
Standardize Onboarding with Technology: Use technology to ensure consistent onboarding experiences. Address issues promptly and reinforce strong corporate values from day one.
FORGE THE FUTURE OF AMERICAN BUSINESS
American businesses can no longer afford to operate with outdated HR models and underperforming cultures. To remain competitive in a rapidly evolving global economy, companies must take a hard look at their structures and processes. By embracing continuous recruitment, demanding excellence from HR, leveraging new technology, and holding leadership accountable to higher standards, we can forge a new path forward. This is not merely a reset but a reinvention - one that restores the agility, efficiency, and innovation that built American business in the first place.