Most company annual reports include the statement, “our employees are our most valued asset”, or something similarly trite.  Sometimes, the affirmation is attributed to a sincere looking CEO who is seeking our trust.  Other times, the phrase just appears as a faceless PR testimonial.  It has become standard “boilerplate” phrase and cynically we do not attach much significance to it. 

If employees are such a valued asset, why do many companies seek to minimize their interactions with their staff?  For example, companies outsourced the entire employee benefits function because they were tired of the headaches.  Thus, companies have offloaded dealing with their most valuable asset – their own employees - to a disinterested third party, usually offshore.  The focus for these companies is cost reduction.  Let’s stop pretending that it’s about taking care of the valued employees and their families.  It’s about time that CEOs and HR leaders lived up to the hype. 

The current trend of wholesale HR outsourcing is dangerous and thank goodness, a few companies are starting to recognize it.  De-emphasizing HR activities harms the bottom-line, immediately or eventually.  Paradoxically, CEOs and senior executives highlight that their greatest challenges are organizational and people issues.  However, they try to get rid of their people issues though wholesale HR outsourcing. 

For example, some companies have outsourced their global mobility activity but this is not always the right thing to do.  At a high-tech company implementing large systems worldwide against tight deadlines, global mobility was critical to success.  It is definitely not a good practice to outsource mission critical elements! 

Throw the problems over the fall?  No wonder business leaders have such a huge credibility problem.  In the end, CEOs and HR leaders must retain control of the activities that have a direct impact on the company’s results, and their success.