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Gilt Group CEO in HBR January 2012 Edition

Updated on February 2, 2012

In the latest edition of the Harvard Business Review you will find a fascinating article with Kevin Ryan, the CEO of Gilt Groupe.

Gilt Groupe is an upmarket version of Groupon, Cudo and Deal of the Day group buying web sites. The Gilt Groupe offer usually offers premium products and designer goods (mainly fashion) at prices well below retail but still right up to date in fashion trends. The brand has also expanded into travel (Jetsetter), food and wines (Gilt Taste), men’s apparral (Park & Bonds) and local services and experiences (Gilt City).

Gilt is based in New York’s Silicon Alley, has 850 employees, revenue of US$500 million, 3.5 million members and sells into 90 countries.

Kevin Ryan joined Gilt from the DoubleClick brand and has built Gilt into a recognised premium group buying business.

Strategic Human Resources Management

The key statement in the article was when Ryan was discussion strategic Human Resources management (SHRM). He poses the question of whether the head of HR is one of the most important people in the company. He goes on to say that the role of Human Resources GM is a truly strategic role and it needs a seat at the decision making table.

Many organisations that I have worked with over the years have had a mixture of SHRM and HR policy.

The first time that I really experience a strategic HR manager was when I worked at the South Australian TAB. Glenn was our HR executive and a key element of the Executive team. He inputted into the strategic direction of the business to ensure that TAB offered the most capable people at the right time to allow the business to attain the strategic intent.

But in many other businesses HR did not have a voice at the table. Without having a truly strategic HR element into the executive development of a firm can lead to:

  • Poor decision making around people that can lead to poor industrial relations. At TAB we experience strikes, but not against management, but against the State Government’s decision to sell the business
  • A lack of delivery on the strategic intent of the business due to a lack of knowledge and buy in by the HR team. This can lead to poor HR policies, poor recruitment and poor future proofing
  • Human Resources is perceived as being a cost centre rather than an area of the business that requires funding to enable a better outcome for the business and a better result
  • Lack of talent management
  • The organisation can grow too quickly without having the right people at the right time which can lead to poor underlying results
  • Disconnect between intent, aspirations and targets verses reality of what the workforce can deliver

The other element to consider is that while many organisations do have a Human Resources Executive as a part of the Executive team; is that GM really strategic? SHRM is about being strategic in the first instance to help build the strategic intent of the firm.

By being involved in the strategic intent and having a voice at the table and then fulfilling on this promise, then (and only then) is the role strategic.

Is Your HR General Manager Strategic?

Ryan challenges in this article to think through our management structures to ensure that Human Resources are a truly strategic department within your business than can help drive and implement the organisations strategy.

As managers this challenges us to think through whether:

  • Our business structure is right and whether Human Resources have a voice at the Executive table
  • Is the HR Head one of the most important people in the business and if not, why not?
  • If the HR Head is not strategic then how can we fulfil the strategic intent of the organisation and what risk can this bring to fulfilling the plan?

The full article can be found at the HBR website in the January magazine edition.


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    • charmike4 profile image

      Michael Kromwyk 5 years ago from Adelaide, South Australia

      Thanks JvR! You are right about IT, too many times this key strategic role is ignored by Exec teams (at their peril). I'll inbox you to set up a time for a 'Coopers'or three with you! Cheers Michael

    • profile image

      John van Ruth 5 years ago

      Hey Michael, I love reading your take on key HBR articles.

      There are obvious good lessons here for all companies and unless we remind ourselves of the strategic importance of key roles of HR and IT they often get relegated to just being another cost centre.

      Well done. PS. would love to catch up for a beer some time.