While companies increasingly recognize the importance of human capital, determining how best to nurture their people is less straightforward.
Although some take the tried and trusted Human Resource approach, leading with a Chief Human Resources Officer, others lean towards a more principled approach that focuses on Talent Management under a Chief People Officer. Yet again, some companies choose to manage their talent from an operations perspective, and they appoint a Chief Administrative Officer to take point.
But how much do we understand about these roles and the functions that underlie them?
Do these roles exist as true alternatives — or are they more in the nature of complementary positions that might find relevance within the same organization?
What follows is a discussion of these important roles, including their duties, required skills, and qualifications, and where they fit within the “people” function of companies.
The Chief Human Resource Officer (CHRO) is the head of the traditional Human Resource (HR) department. HR is the broadest function that covers every aspect of an employee’s lifecycle, from initial recruitment to disengagement, and the CHRO chairs this unit. Perhaps, due to this, the CHRO can be said to have the most demanding job of the people function.
The CHRO is a C-suite member responsible for developing and executing HR strategy in line with core organizational goals and strategy. Their duties encompass recruitment, talent management, performance management, compensation, training and development, change management, and succession planning.
They have vast responsibilities that touch aspects of every other business unit. Together with the HR team, the CHRO is responsible for:
Because of their sizable portfolio, the CHRO often carries extensive experience in executive HR roles. While they don’t need to have prior experience as head of HR, experience in talent management and designing and implementing HR initiatives is critical.
Compared to the CHRO, a Chief People Officer (CPO) has a more streamlined and targeted focus. The role developed in response to an increasing need for workplaces that attract and retain top talent.
In an age of lofty candidate expectations and fierce competition for top talent, companies can no longer escape with doing the bare minimum for their people. As a result, job seekers and employees are demanding a better workplace experience and a keener focus on their needs. They want to be recognized for the valuable assets they are, and they insist that this reflect in their everyday work environment.
As a result, the role of the CPO was born to provide what can best be described as a champion for employees. The CPO is primarily charged with leading a focus on human capital. They support companies by implementing the best strategy and processes that help them find exceptional employees and keep them happy.
While CPOs are generally advisors or consultants, they may also be required to execute solutions. Their job includes optimizing, and in many cases planning, people-centered activities like talent acquisition, talent management, performance management, and professional development to benefit the company’s bottom line and employee satisfaction.
Their duties include the following:
Due to their people-focused role, CPOs are frequently a part of the HR function or often have an HR background. In fact, some consider the CPO to be the highest HR role because they arguably focus on the most critical HR duty – hiring and retaining happy and productive employees.
Unlike the first two roles, Chief Administrative Officers (CAOs) are less people-focused and more operations-driven. Their job is to oversee companies’ day-to-day operations, monitor output, and ensure high service delivery.
While the CPO and CHRO face inwards, the CAO’s duties are largely outward-facing. They have charge over company departments discharging core consumer-facing tasks, and it is their responsibility to tie operations to customer service. They set or oversee daily tasks and make sure each department does its part to accomplish the company’s day-to-day business.
In many ways, the job of a CAO seems similar to that of a COO. Both roles are operations-driven, and, as members of the C-suite, they both report to the CEO and board of directors and work closely with senior management. However, that’s where the similarities end. While the CAO role is regarded as more permanent and inflexible, the COO is chameleon-like, molding to fit whatever requirements the CEO or board have regarding the role.
The duties of a CAO include the following:
While the roles of CPO, CHRO, and CAO include apparent areas of overlap, there’s enough distinction amongst their duties to set them up as distinct positions. Therefore, apart from a need to specifically assign recruitment to one of the CPO or CHRO, each office can coexist in the same organization.
That said, this is likely a luxury that only large organizations can enjoy. In smaller organizations, it’s more likely that a single office will carry out the duties inherent in each position, or the CAO role may be farmed out to HR in conjunction with line managers.
Our hands-on executive recruiters have experience working with private, public, pre-IPO, and non-profit organizations. Clients are typically $50 million in revenue to Fortune 1000’s or have assets between $500 million to $15 billion. Successful placements span the entire C-Suite – CEO, Chief Operating Officer, Chief Financial Officer, and include vice president, general counsel, and other director-level leadership roles.
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