How HR drives cross-functional value at Electrolux

Megan Forgus from Electrolux says building “collaboration capability” in HR is critical to adding commercial value

Building “collaboration capability” in HR is critical to the function’s ability to improve commercial effectiveness and drive cross-functional value, according to Megan Forgus, director – HR & organisational development for Electrolux.

As part of a broader organisational shift within the global appliances group, she said HR has had the opportunity to move from driving team development within direct reporting lines, to improving cross functional effectiveness through working across different areas of the business.

“HR has a vital role in getting the business to understand what collaboration is, and how fundamental inclusivity is to successful collaboration,” said Forgus.

It is the cross-functional element in which each piece enables the whole to be greater than the sum of the parts: “I believe the momentum that comes from cross-functional effectiveness and the lift in productivity it drives has significant commercial value,” she said.

“There is a risk that the drive for more collaboration is seen as simply having more interests represented at the decision-making table which will be commercially detrimental.

“But the value HR can add is to guide the business into making the decisions which benefit from a collaborative approach, and to coach the business to be truly collaborative.

“This means that managers and leaders actively encourage and listen to meaningful contributions from everyone at the table; to ensure different perspectives are taken on board with an open mind, and that they and the other participants adjust their thinking in response to what they hear.”

This enables the broader Electrolux group to produce an outcome that is truly a collaboration of all inputs, and not just one that is driven by the loudest and most forceful advocates that might be present in the room, Forgus explained.

“HR has a vital role in getting the business to understand what collaboration is”

HR can also play an important role in driving strategic alignment and that commercial value in an organisation is best realised when all parts of the business are driving towards the same outcome.

Forgus said HR can make a profound contribution by ensuring the culture, business processes and systems, reward and recognition framework and workforce planning are all supporting the strategic direction of the business.

A misalignment, for example, between a bonus program and the key priorities of the company can be destructive to the business outcomes and the engagement of the workforce, she said.

Forgus also underscored the importance of HR to “simply be human”.

“HR’s contribution to a stable and engaged workforce is the core commercial value it can drive to ensure the long-term stability of the company and to instil a continual burning ambition in employees to ride the wave of change as a positive momentum, with everyone looking forward to how they can be part of making a positive difference,” she said.

Initiatives that are not always focused on improving productivity and the bottom line are crucial to this, and Forgus said the commercial value to the company of partnerships with corporate charities and initiatives driven by concern for the health, safety and wellbeing of employees should not be underestimated.

“The value HR can add is to guide the business into making the decisions which benefit from a collaborative approach”

Before Forgus took on the HR role at Electrolux for ANZ, she was a legal counsel for the company and said her perspective then was that HR was a back office, predominately administrative function like accounting.

“My experience of HR had been limited to the recruitment phase and the retrenchment phase, as I had been caught up in a major corporate collapse and an on-market takeover during the 1990s,” she said.

“Luckily for me, a colleague piqued my interest in the fundamental impact human resources can have on the success of a business.

“It made me realise that nothing gets done without the people, and I became intrigued to find out why the reputation of human resources was not matching its potential.”

In her first few weeks in the role, during a visit to Electrolux’s South Australian operations, her concern about HR was reinforced when Forgus was told “we only see HR when they arrive to retrench people.”

“This comment has driven much of what I have tried to achieve and I have always ensured my title contains a reference to development to encourage people to broaden their perspective of what HR can embody,” said Forgus, who explains that HR at Electrolux embraces health and safety, learning and development, corporate services and internal communication.

“I had the benefit of working with every part of the business in the day-to-day operations”

“I firmly believe a fundamental reason for the poor impression HR can have comes from a mismatch between employee’s expectations of the function and the role the business requires it to take,” she said.

“I have tried to achieve a better balance between these two things to build a business where people can thrive and not just survive.

“I think this is core to the role of the human resources function.”

Given her non-HR background, Forgus said enabling cross-functional effectiveness is one of the most important ways HR leaders can add more commercial value.

“As an in-house lawyer with whole-of-business responsibility, I had the benefit of working with every part of the business in the day-to-day operations,” she said.

“This gave me an insight into the capabilities required for successful management of the various areas.

“I also needed to step back and understand how all the areas interfaced with each other, to ‘join the dots’, where the ‘pass offs’ were and the interdependencies.”

Five steps to driving cross-functional value

  • Be holistic: use HR’s helicopter view to help the business join the dots so the “whole can be greater than the sum of the parts”
  • Be collaborative: guide leaders to have an open mind to the ideas of others so they are able to have insights and improve their own thinking
  • Be inclusive: ensure the business values productive diversity and knows how to enable everyone to make a contribution
  • Focus on alignment: check that your culture, business systems and processes, reward and recognition architecture and workforce planning actually support the strategic direction of the business
  • Be human: invest in programs that ensure your organisation is a place everyone wants to work

Image source: Hayden Brotchie