Human Resources : Administrative or Organizational Development

We have a personality issue. And with “we”, I mean “we” as Human Resource professionals. Are we a department that is responsible for the paperwork that comes with hiring, firing and making the workforce happy (benefits), or are we a department that is responsible for a timely delivering a workforce to the organization that has the right aptitude, skills and behaviors to deliver the service or product that the organization is delivering?

Only when we can understand the role the organization believes HR should play, we as HR can create an organization that delivers great value to the organization. Let’s take a step away from this topic and look the university systems. No matter where you look in world. Universities don’t seem to create one program where you will learn about payroll, benefit programs, organizational behavior, employee development and the legal site of HR. But we are trying to get one person with a multitude of talents. A simple test shows you what I try to explain:

You can hire a student from any of the HR Programs and they are not able to answer all two simple questions:

  1. What is the cost of an employee that works on the production line for one hour?
  2. If we increase sales by 50% what impact would this have on our workforce, and what should we do to handle this?

The professional that can answer the first question probably has a business management background with a focus on financial management. The professional that can answer the second question probably also has a business management background but has more a focus on Organizational Behavior.

When you are designing your HR function you might want to ask yourself, what does the company value the most (this is not necessary what is proven to be the best focus), is it the financial/administrative site of Human Resources, or is it the fact that HR is involved in figuring out how to deliver the best talent at the right time at the right place to the organization?

When you believe that your Human Resources is responsible for creating a high performing workforce, then focus on creating a function that has all those skills, and then move the administrative site of HR to the function that has all the expertise and talent to do the administering this right: The finance department. Your new organizational will have the following responsibilities.

Human Resources – Organizational Development

  • Branding & marketing the employer of choice
  • Organizational design (including load calculations)
  • Employee development
  • Organizational development
  • Succession planning
  • Talent Acquisition
  • Community relations

The administrative function will be placed under finance and responsible for the following:

Finance Department – Workforce Administration

  • Processing onboarding documents including offer letters
  • Benefits administration (including vendor management)
  • Time & Attendance
  • Payroll
  • Compliance
  • Producing analytical reports
  • Producing and monitor costs

When you are a growing organization and are wondering how to expand your capabilities, you will find that it is a lot easier to get the most out of your HR Function when you build goals and objectives that are either focused on administration or on organizational development.

As any department has strong ties to all shared services. The HR Department should maintain strong ties to all the supporting departments as well, a few to name are marketing, facility management, it and finance.


The topic of this blogpost was triggered by a blog post Mirjam read on the website of Harvard Business Review: It is time to split HR by Ram Charan

Are you looking at redesigning your HR Function? – give Mirjam a call or send her a quick note.