Or may be the Holy Grail for HCM is knitting together the measuring of human assets for reporting purposes and acting upon that information to drive how people are managed in the organisation. Simply producing the data is not enough, especially if it is overly influenced by traditional accountancy models. Proving to the world that business performance is affected by the management of people may be desirable for both internal and external consumption to ensure that employees place in the business is given its rightful place.
Hr's contribution to business
HR’s contribution to businessstrategy
Understanding strategicformulationNot always as per textbook: ■ intended strategies ■ emergent strategies ■ political strategiesHow does HR contribute: ■ operationalises business strategy ■ provides separate people thrust: • connected with organisational aims • disconnected: HR best practice model ■ is an integral part of business strategy
Types of linkage betweenbusiness & HR strategy business strategy integrative informs HR actionspassing ships:independent HR two way linkage:and business mutual influencestrategies
Linking business & HR strategy Factors that affect this linkage: Planning process ■ formal or informal ■ deliberative or emergent Degree and timing of HR involvement Extent of challenge permitted Legitimate areas for HR input Extent of HR’s alignment with business - broad objectives and current imperatives
Understanding the decisionmaking process If decided by Get a seat at the formal processes decision making table If matters are Build coalitions, settled beforehand work to influence outside meetings If real action Ensure you have happens at business partners operational level effective at BU level
Stakeholder management board what is their stake? executive committee what are their goals? senior managers what are their line managers expectations? team how will change affect leaders/supervisors them? employees what do they know employee already? representatives what influence do external suppliers they have? what power do they government bodies have? other agencies
Characteristics of strategic HRA philosophy underpinning people managementSeeing people as a competitive resource
Making the case: what HumanCapital HR can deliver Improved utilisation of talent Higher productivity Reduced costs Better service delivery Organisational integration Aligned culture & organisational values Greater employee engagement Stronger employee proposition etc
Service-Profit-Chain Model Line Customer Customer Company Employee Change inManagemen satisfaction spending Culture Commitment sales t with service intention Employee Absence
Characteristics of strategic HRA philosophy underpinning people managementSeeing people as a competitive resourceA planning approach to resources ■ numbers in line with ■ skills business need ■ potentialAdds long-term rather than short term value
Characteristics of strategic HR Integrated – brings together multifaceted activities
People managementintegrationverticalintegration business strategy reward employee training work culture leadership relations & devt orgn style horizontal integration
Characteristics of strategic HR Integrated – brings together multifaceted activities Comprehensive – covers the entire operation (at BU or corporate level) High value added – focuses on business critical issues Builds social capital – helps sharing, networking and relationships
Characteristics of strategic HR Integrated – brings together multifaceted activities Comprehensive –covers the entire operation (at BU or corporate level) High value-added –focuses business critical issues Builds social capital – helps knowledge sharing, networking and relationships Anticipates change – through horizon scanning and internal sensing
Connecting business & HRstrategies Internal driversBusiness HR Business Imple- Monitorstrategy strategy plans mentation External drivers
How is people & businessalignment achieved What is the Big organisation’s big idea idea? What are the business priorities? Business priorities What are the people priorities? How do they link? People priorities
Establishing people prioritiesWhat causes people to come to work, be motivated and perform? What stops them from being effective?
A model of capability Individual capability ability: motivation: skills, training engagement education involvementDevelopment Deployment access: application: resourcing OD recruitment product succession market strategy Organisational action
What are external influences?Conduct environmental scanning:what is the legal contexthow tight/loose is the labour marketare the right skills availableat what pricewhat is the output from schools, universities, etcwhat are the political priorities
What is the state of thecurrent workforce? What proportion is skilled for their current and for future jobs? What is its demographic shape? How committed are employees? ■ attendance ■ productivity ■ staying or leaving What are collective relationships like? To what extent is employee potential being harnessed?
What stops HR succeeding?Human capital not recognised as a source of advantageWeak organisational leadershipPoor teamworking across organisationBusiness strategy poorly definedThere is little forward planningPeople resources assumed to be unlimited, free or fully trainedResources are hoarded & not shared
HR’s own problem areasObstacles to success: ■ time ■ capacity ■ focus ■ capability ■ positioning ■ organisation
The ‘default’ operating model Corporate HR centres shared consultancy of expertise services pool BU BU BU BU BUbusiness partner business partner business partner business partner business partner
HR’s own problem areasObstacles to Relationships with success: management not ■ time working. ■ capacity The villains: ■ focus ■ HR – not letting go ■ capability ■ the line – not ■ positioning taking it up ■ organisation ■ senior mgt – sending wrong signals
Results Inadequate HR service performance Concentrating on low value tasks HR policies are disjoined & inconsistent They serve functional not organisational needs Weak functional leadership Poor internal reputation Human capital not exploited, developed
What should HR do? Construct a workforce plan Establish the supply/demand balance Are the right people, in right jobs? Review your recruitment model Why do ■ able to attract - all types? they join? ■ brand ■ proposition Review your retention model Why do they ■ right level of wastage? leave? ■ numbers, types, quality
A strategic review of recruitment and retention H Attract & retainOrganisational impact Outsource Commoditise L H Market availability L
Different propositions fordifferent groups Hire Exploit Fire Attract Nurture Retain
What should HR do? (2) Are you able to motivate staff? How do ■ degree of engagement you know? ■ what motivates them? ■ what demotivates them? ■ what impact does pay and performance management have? How well are employees aware of ■ the bigger picture? ■ their job? ■ what success looks like?
What should HR do? (3)How skilled are line managers in ■ Appraising performance? ■ Giving feedback? ■ Developing skills?How effectively are ■ Employees allocated to jobs? ■ How well are jobs/the organisation structured? ■ Employees moved to meet business needs?
What should HR do? (4)What is the organisation’s ■ Ability to change/innovateHow good is the organisation’s governance structure?How strong (and respected) are the organisational values, eg ■ On diversity? ■ Whistleblowing? ■ Meritocratic progression?
Measure people and HRfunctional performanceThrough for example Critical success factors/areas Key performance indicators Service level reviews Customer surveys Employee attitude surveys Process mapping/activity analysis Audits/reviews (incl... quality) Scorecards Benchmarking
Improve measurement People HR management efficiency efficiency People HR Management effectiveness effectiveness
Examples of measures in multi dimensional measurement Cost/Income Process metrics against RatiosCustomer views headcount Strategic alignment Human Capital Functional positioning
Human capital measuring & doing business goals HR policies & practices HCM measuring reporting acting managing internal external people business performance