This Week's Herman Trend Alert

HR in Normal 2.0

  The Herman Trend Alert

October 23, 2002

The Next Generation of CEOs

For some of our readers, this Herman Trend Alert may seem far-fetched. For others, it will be a welcome perspective. We see a transformation coming that could drive significant changes in the way companies do business, but there are obstacles to be overcome.

We forecast that, in the next generation of corporate leadership, human resource professionals will rise to the top positions: Chief Executive Officer, President, Chief Operating Officer, Executive Vice President. Movement from human resources into these vital roles has been practically non-existent. In fact, we were not able to find a single case of a Chief Human Resource Officer becoming CEO of a major company.

The financial wizards who have led corporations down the path to destruction are losing favor on Wall Street. Even more importantly, they're losing favor in the boardroom. More independent boards want sustainability, not just flash-in-the-pan, short-term results. Boards and stock-rating analysts are increasingly concerned about an organization's capacity to build a stable workforce of strong talent. Strategic staffing and inspired leadership will build and sustain high productivity. With profits dependent on high performing employees, employers must attract, engage, and hold critical talent. Human resource issues-and executives-are increasingly vital to corporate achievement.

GE's Jack Welch, in a recent speech to an international human resources conference, was astonished at the minimal response when he asked his audience how many held equal positions with chief financial officers. He emphasized the importance of this parity. Such positioning would provide opportunities for upward movement of human resource executives.

The major obstacle to higher level involvement of human resource professionals is their lack of comprehensive business knowledge. One professional recruiter of senior executives asserted that there are fewer than 50 human resource executives in the entire United States who really understand business management enough to move into a higher generalist role.

The Society for Human Resource Management is taking steps to teach members about business theory and practice, but current executives must take responsibility for their own education-formal and informal. Those interested in moving up will seek mentors at senior levels to accelerate their growth.

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