Creating Continuity

Heading up HR at Penske was a smooth transition for Ken Hurley, who’s focused on creating a function that meets the needs of the business

When Ken Hurley came into the position of senior vice president of human resources at Penske six years ago, he felt it was time to turn the department’s functionality on its head. Hurley described the human resources department at that time by saying it “functioned more as a kind of traffic cop than anything else.” Hurley wanted to move toward a service-delivery function that would help facilitate the growth of the business. It was more important to focus on achieving business goals than it was on just keeping the company out of trouble, Hurley says.

This approach might be unexpected from a former lawyer. “It’s probably a little ironic that I came from a lawyer background, but my focus is not at all on compliance,” he says. A former labor relations attorney, Hurley says his transition to human resources was a case of being in the right place at the right time. That place was vice president of labor relations at Penske, a position under which he reported to the then senior vice president of human resources.

This was preceded by six years as a labor relations attorney for a boutique law firm in San Francisco, followed by related positions at Kindred Healthcare. “I enjoyed labor relations a lot and wanted to do more of it, but in a law firm setting you don’t get to do much hands-on work,” he says. “You have to go in-house with a company.” Eventually, Hurley became Kindred’s head of employee relations, a growth opportunity he attributed to his legal background. “I’d done a lot of employee law in California, so it was easy for me to do the employee relations then,” he says. Moving to Penske in 2004, it was after four years in his labor relations role when Hurley took advantage of his boss’s retirement. “I raised my hand and they gave me a shot at this job.”

Today, Hurley heads up the department where, along with seventy-two corporate associates and an additional thirty human resources professionals in the field, he’s responsible for Penske’s 21,000 employees worldwide. Hurley modestly chalks it up to his having transformed the labor function in his previous position. “I was more aggressive and had more of a business-operational focus to our relationship with the unions,” he says. (Penske was 50 percent unionized when Hurley arrived.) “I tried to reform the relationship to one of respect rather than friendliness.” He also helped operational leaders achieve long-desired goals brought to the bargaining table, moving the unions out of expensive union health care plans to the company plan, saving Penske upwards of $30 million.

Although his labor relations and legal background prepared him well in many respects—“In labor relations you’re spending nearly all of your time speaking directly with employees and line managers of the business, so you learn how incredibly important communication is in running an organization of any size”—there were of course a few gaps in Hurley’s human resources knowledge. Along with joining a number of executive human resources associations, he says, “I just kind of went to school on the job.”

It was the knowledge from his previous experience that gave Hurley the freedom to learn what he didn’t know. “I didn’t have to pay a tremendous amount of attention to the compliance side, because I know what to look for,” Hurley says. “So that enabled me to focus on the business side.” This freedom also came in handy with regard to recruiting. With the company hiring 4,000–5,000 people per year, Hurley’s first task on the job was to centralize the recruiting process. “We have over 3,000 managers around the country … so we had 3,000 different processes for recruiting,” he says.

Centralizing also came into play regarding the human resources department’s use of technology. One of Hurley’s priorities has been to reduce the number of applications—previously each HR function had its own individual application—and marry as many as possible under a single platform. Hurley runs Penske’s account management systems on the Taleo platform to centralize data and use it effectively. Hurley also created a human capital analytics team three years ago, tasked with drilling down on turnover and retention and other actionable analytics.

Using a variety of methods and a budget of $17 million, Penske’s training program implements technology alongside classroom training. Hurley says the company’s current challenge is figuring out how best to leverage the former, since the staff is so widely dispersed: Penske operates in 1,000 different locations. “It’s just incredibly difficult, inefficient, and expensive bringing people into classrooms,” he says. “How do we get the training out closer to the people?” Currently, Hurley and his team are focusing on the power of social media to assist in this challenge.

Getting connected to the 20,000 people at Penske begins by looking at the goals established at the senior management level. Hurley then uses that as an enabling function. “I look at those goals and develop where HR’s high-level goals will be for the year and then work with my direct reports,” he says. “And then that works all the way down the chain of command.”

Working closely with the company’s leadership to make sure his department’s goals are aligned with the business defines Hurley’s overall approach. Getting his department as close as possible to the business is his mission internally. “My goal is to be as aggressive as we can in really being more businesspeople than professional HR people,” he says. “I want our people to be able to converse at an equal level with our businesspeople.” Despite being in different departments, Hurley sees everyone in the company as having the same purpose. “In this company more than any other company I’ve seen, it’s all about the customer,” he says. “So I try to ingrain in my folks that if we, as an HR group, teach and coach our managers to treat their people well, their people will treat their customers well.”

Treating his human resources team well has resulted in a crew that’s “excited, engaged, and really believes and cares about what we set out to do,” says Hurley. Six years ago, when he came into the position, the department was the second lowest scorer in engagement—within two years, it was the second highest. “I just set the goal post and just turn ’em loose and see what they can do. And I think they enjoy working in that kind of environment.”