I watched a CEO eliminate his entire HR department because it had become “a barrier to getting things done.”
His logic was simple: Remove the barrier, remove the problem.
I get it. I’ve seen HR departments create friction. But here’s what I’ve learned: Removing a department and solving a problem are not the same thing.
If hiring is broken, the work doesn’t disappear when the department does. It just gets distributed to people who don’t know how to do it.
I worked with a company that did exactly this. They eliminated their HR person, figured everyone could just handle hiring as needed. Within six months:
- Hiring took twice as long because three different managers had three different processes
- Compensation decisions happened inconsistently (same role, different pay)
- Nobody owned compliance, so they missed filing deadlines
- Managers spent 10+ hours a week on HR stuff instead of running their business
They didn’t solve the problem. They just made it everyone’s problem.
Here’s what was actually broken: They had zero structure around who owned what.
Not the HR department. The system.
Structural problems look like “nobody knows who decides compensation” or “hiring standards change depending on who’s interviewing.” When you have that, removing a department doesn’t fix it. It just spreads the chaos.
Before you eliminate a function, diagnose what’s actually wrong. Is it the person, or is it that you’ve outgrown your system?
One requires firing someone. The other requires building structure.
Get the diagnosis right. Otherwise you’re just moving the problem to your operations team, your sales team, or your managers’ home office at 11pm.