OVER THE PAST decade, human resource (HR) management has evolved into a range of complex responsibilities and strategic activities that are central to creating an organisational culture of success. From the traditional job of identifying and recruiting the best available talent and partnering with managers to retain, develop and motivate people, the HR function has grown to involve working with senior management to suggest and change corporate policies. Margaret Leung, HSBC general manager, global co-head commercial banking, said that as the head of a business line in the mid and small corporate sector, she played a key role in executing the organisation's strategy and improve the bottom line. She said the human resources function must be clearly aligned with the business it supported and should ideally report directly to that business line or be embedded in it. Ms Leung said that in the past human resource management was seen as a pay-and-rations job and a low-value-added administrative function. In many businesses, technology had taken over and automated these administrative roles. Today in HSBC, HR occupies a more strategic position, undertaking higher value roles, influencing change and ensuring the organisation has the right employment environment. 'As a business line head, I see HR as a strategic internal business partner. HR firmly supports and promotes the group's strategy of 'managing for growth'. It aims to deploy appropriate levels of human capital investment into identified business areas to ensure the group's long-term earnings, profitability and shareholder value,' Ms Leung said. In Asia, HSBC top management takes a direct interest in the HR function and considers the management of human capital an important issue. 'Our chief executive officer is actually an HR champion and is directly involved in setting the HR agenda in the organisation across the region,' Ms Leung said. For example, HR needs to understand and ensure that its remuneration packages fit in with and promote business line objectives. Additionally, there has been a trend that has placed a high degree of responsibility for HR functions on the shoulders of business line managers. Ms Leung said this was a positive development as it involved the HR team directly in the planning and development of the business line. HSBC has a diverse number of business lines, each presenting its own needs and specialist characteristics. By integrating key elements of HR with the other responsibilities of line management, the goal is to ensure HR processes are in place to meet specific needs. 'This is not a one size fits all scenario. Our HR functions are appropriate to the business lines and local needs, which help us become the world's local bank,' Ms Leung said. Actions spoke louder than words, she said. 'You can write up mission statements all you like. But if you cannot deliver them as an HR function, you are not contributing to the strategic competitive advantage of the organisation. Execution can, in fact, be a greater challenge than strategy development,' she said. From a business line perspective, internal HR matters are black and white only in very few cases. Therefore, it is important that HR's responses be fair on the one hand and pragmatic on the other. Ms Leung said HR solutions should be kept simple and free of jargon. 'The last thing we want is for HR to become an organisational millstone impeding business line development.' For a business to remain competitive it must attract and retain talented people. Therefore, HR must keep up with market practices and reflect this in the design of its solutions. At times this can mean taking the lead, particularly where the market has yet to develop fully. For example, HSBC recently shifted to a market-related pay scheme and altered its internal job benchmarking to reflect market practice. This change introduced a flatter, more flexible management structure that is easier for the business lines to manage. It also provided greater flexibility, allowing the business to respond to changing business conditions and trends. In this respect, HR has been a facilitator of change and so benefited HSBC's business lines in Hong Kong and Asia. Ms Leung said that it was her responsibility, as the head of a business line, to ensure that the department recruited employees with the right skill sets and talents. HR also had a key role to play in the development and delivery of training. It was important that this be pragmatic, engaging and designed to fit the business line's changing needs. Succession planning was another important area where HR played a key role, Ms Leung said. 'We need to ensure we have the right talent, with the right experience, in the right role, at the right time. This is core to business growth and continuity.' She said it was HR's job to make sure that people were well-prepared over the medium and long term to run the bank in the future, and HSBC was recognised for its comprehensive and seamless succession planning. This was viewed as a critical component of what a good HR function should do in any organisation to help talented people advance. 'It may appear easy to some, but there is much work in the background to ensure this apparent seamlessness,' she said.