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People Management: Why organisations(and HR) keep making the same mistakes andhow to put them right… [Expanded edition for...
People S i                                      P   l Science®                                                   ®        ...
Smart. Smarter. Smartest...Professional Services www.valuentis.com www valuentis com‘The leading humancapital management  ...
‘ISHCM’          Eight faculties:            Enterprise Governance and Leadership            Evidence‐based Management (Eb...
Fact 1“Organisations don t exist without people. Organisations don’t               people.”
Fact 2“Everything that happens within anorganisation is down to the people it employs past, present and future.”
Fact 3“People are simultaneously ASSETS and“     l      i  l        l            dRESOURCES from an organisational        ...
Fact 4“Organisations spend considerable sumseach year carrying out financial audits; but     y        y g                 ...
Overall factThus, the oft-misguided question of‘How valuable are our people to the                          p porganisatio...
About today             today…  “So today I’m going to talk about some  common people management problems               l ...
What organisations (HR) keep getting          wrong (this is a short ‘shortlist’)…1. Employee engagement: its concept and ...
What organisations (HR) keep getting          wrong (shortlist)…1. Employee engagement: its concept and application      p...
1. Employee engagement: its             concept and application...common problems             ... do differently          ...
EMPLOYEE ENGAGEMENT:“Employee engagement is an ‘outcome-based’ concept. It isthe term used to describe the degree to which...
Or another way to look at it                           it…      Fully  congruent    Knows what to               do/achieve...
Staff engagement:               The challenge for organisations       Fully   congruent     Knows what to                 ...
When I talk about models and frameworks -here’s one as an examplehere s           example…      VaLUENTiS 5D Employee Enga...
Engagement is and always has been aMULTI DIMENSIONAL constructMULTI-DIMENSIONAL construct….      VaLUENTiS 5D Employee Eng...
A look back at The original Sears                                 g           model…“Arguably the simple model that set th...
Employee engagement and                 Organisation Performance today:We veWe’ve now moved on from the Sears model…      ...
What organisations (HR) keep getting          wrong (shortlist)…1. Employee engagement: its concept and application      p...
2.         2 The use of employee surveys...common problems ... do differently• Viewed as a reactive       • Adopt more pro...
Remember (?) The Employee survey   expertise model                HIGH uman capital management                           M...
HIGH                                                              20/20                                       MYOPIC      ...
HIGH                                                      MYOPIC                20/20                                     ...
Employee surveys and engagement:              Ten Best practices from the field...(I)View or apply employee surveys:1. As ...
Employee surveys and engagement:              Ten Best practices from the field...(II)View or apply the employee survey pr...
What organisations (HR) keep getting          wrong (shortlist)…1. Employee engagement: its concept and application      p...
One for the road.....                     road“If you cannot measure it, you cannotimprove it.”Original source attributed ...
3. Evaluation/measurement of people             management...common problems ... do differently• Managers have patchy     ...
3. Evaluation/measurement of people           management“But h t d“B t what do we mean when we talk of                    ...
HUMAN CAPITAL MANAGEMENT:“Human capital management is the term which is used todescribe an organisation’s multi-discipline...
Evaluating People management in yourorganisation: Our HCM ‘radar/clock’ (you’ve seen                       radar/clock (yo...
3. Evaluation/measurement of people          management“This ll t t d“Thi all started way back with a challenge           ...
And then we did things like The HCR              Standards (GHCRS2006)                                                  HC...
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
HRD summit 2011 people management   why organisations... dist vers
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HRD summit 2011 people management why organisations... dist vers

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N J Higgins presentation at HR Directors Summit 2011 on People Management

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Transcript of "HRD summit 2011 people management why organisations... dist vers"

  1. 1. People Management: Why organisations(and HR) keep making the same mistakes andhow to put them right… [Expanded edition for distribution] People Science® 24th January 2011Nicholas J HigginsCEO, VaLUENTiS & Dean, Int’l School of Human Capital ManagementDrHCMI MSc Fin (LBS) MBA (OBS) MCMIHR Directors Summit 2011ICC Birmingham
  2. 2. People S i P l Science® ® Analyse, Advise, Implement, Educate www.valuentis.com Professional Services‘Winners of World Finance100 award’ (www.WorldFinance100.com ) www.ISHCM.com ADDED INSERT
  3. 3. Smart. Smarter. Smartest...Professional Services www.valuentis.com www valuentis com‘The leading humancapital management specialists’ ‘PEOPLE SCIENCE®’ Organisation Intelligence to improve organisation performance • Human Capital Management Evaluation • Employee Engagement • Talent Management • Workforce Productivity & Performance • Predictive Analytics • HC Forensics & Risk • HR Function ROI Analysis • Organisation Measurement • Management Education • Organisation Strategy SOLUTIONS ADDED INSERT
  4. 4. ‘ISHCM’ Eight faculties: Enterprise Governance and Leadership Evidence‐based Management (EbM)  g ( ) Human Capital Management Human Capital Measurement Employee Engagement HR Leadership HR L d hi HR Operational Excellence Employment law... ...1 Masters HCMI practitioner qualification p q 4 executive programmes 6 practitioner programmes 80 short course modules Unlimited customised combinations... Unlimited customised combinations One outstanding value  proposition ADDED INSERT
  5. 5. Fact 1“Organisations don t exist without people. Organisations don’t people.”
  6. 6. Fact 2“Everything that happens within anorganisation is down to the people it employs past, present and future.”
  7. 7. Fact 3“People are simultaneously ASSETS and“ l i l l dRESOURCES from an organisational gperformance perspective and potentialLIABILITIES from a risk perspective.” perspective.“This is t the heart of h“Thi i at th h t f human capital it lmanagement.”
  8. 8. Fact 4“Organisations spend considerable sumseach year carrying out financial audits; but y y g ;spend very little in comparison on peoplemanagement effectiveness and/or HCMaudits/evaluations.”
  9. 9. Overall factThus, the oft-misguided question of‘How valuable are our people to the p porganisation?’ is the wrong question.The question should be ‘How valuableare our people management practices?’and ‘How do we know?’ How know?
  10. 10. About today today… “So today I’m going to talk about some common people management problems l t blencountered over the years and what to do about them” [Note that this is a very short shortlist for the workshop] ADDED INSERT
  11. 11. What organisations (HR) keep getting wrong (this is a short ‘shortlist’)…1. Employee engagement: its concept and application p y g g p pp2. The use of employee surveys3.3 Evaluation/measurement of people management4. Performance management5. The ‘people competency’ of line management5 Th ‘ l t ’ f li t6. The role of HR (‘customer-agency dissonance’)
  12. 12. What organisations (HR) keep getting wrong (shortlist)…1. Employee engagement: its concept and application p y g g p pp2. The use of employee surveys3.3 Evaluation/measurement of people management4. Performance management5. The ‘people competency’ of line management5 Th ‘ l t ’ f li t6. The role of HR (‘customer-agency dissonance’)
  13. 13. 1. Employee engagement: its concept and application...common problems ... do differently ff• Lack of working definition g • Select or build• Inadequate definition • Understand the concept• Not measured adequately • Adopt design or construct• Management lack • Requires Communication, understanding of concept Education and or its impact Reinforcement (CER)• Little use of models to • Map operational ‘outcome support application systems’ (mensuration)• N t embedded as core Not b dd d • C Can only exist if other l i t th management practice problems overcome
  14. 14. EMPLOYEE ENGAGEMENT:“Employee engagement is an ‘outcome-based’ concept. It isthe term used to describe the degree to which employeescan be ascribed as ‘aligned’ and ‘committed’ to anorganisation such that they are at their most productive.”VaLUENTiS International School of HCM
  15. 15. Or another way to look at it it… Fully congruent Knows what to do/achieve but Fully Could do more unlikely to productive achieve it More likely to Less thanIndividual sIndividual’s have optimally degree of performance/ Job gets done productive - capability Could do more Alignment issues ‘well’ Likely to have More likely to performance, High have objective attitudinal probability of and/or and/or wasted effort/ ‘potential’ behavioural frustration Incongruent issues issues Continuance Degree of Affective Commitment © VaLUENTiS Ltd 2002-11
  16. 16. Staff engagement: The challenge for organisations Fully congruent Knows what to do/achieve Could do Fully but unlikely to more productive achieve it “Only one box in nine reflects the constant ‘high More likely to Less than bar’ challenge forIndividual’s have Job gets optimally p y performance/ productive - organisations in i ti i degree of done capability Could do more optimising Alignment issues ‘well’ engagement across the Likely to have performance, More likely to High probability workforce on a attitudinal have objective of wasted daily basis” y and/or and/or ‘potential’ effort/ behavioural issues frustration Incongruent issues Continuance Degree of Affective Commitment © VaLUENTiS Ltd 2002-11
  17. 17. When I talk about models and frameworks -here’s one as an examplehere s example… VaLUENTiS 5D Employee Engagement Framework Line-of-Sight Work Environment Organisation operating ti culture Reward (equity) ( q y) Development p © VaLUENTiS Ltd 2002-11
  18. 18. Engagement is and always has been aMULTI DIMENSIONAL constructMULTI-DIMENSIONAL construct…. VaLUENTiS 5D Employee Engagement Framework [ p [expanded] ] Line-of-Sight Work Environment Objectives awareness Cultural elements Behaviour alignment Team dynamics Role ‘fit’ Organisation Communication Performance management Resources Feedback operating culture Local management Organisation design Capability Physical environment Performance/talent management ‘Corporate’ Leadership Remuneration equity Communication Career progression Bonus/incentives Decision rights g p Competencies Benefits Work values Succession planning Trust Role equity Job/ Role architecture Recognition Training/ Learning Promotional aspects Coaching/ Mentoring Reward (equity) Development © VaLUENTiS Ltd 2002-11
  19. 19. A look back at The original Sears g model…“Arguably the simple model that set the engagement movement alight. Its now Arguably nearly 20 years old. Also note the (now) flawed use of employee satisfaction ” ( ) p y Employee Revenue Retention GrowthInternal Employee External Customer Customerservice Satisfaction Service Satisfaction Loyalty quality Value Employee Profitability Productivity Putting the Service-Profit chain to work Heskett, Jones, Loveman, Sasser Jr & Schlesinger , , , g Harvard Business Review Mar-Apr 1994
  20. 20. Employee engagement and Organisation Performance today:We veWe’ve now moved on from the Sears model… model Example ‘Macro’ model NHS version 1.11Leadership Leadership Trust Shareholder Employer Employer && performance value brand brandggovernancegovernance Human Human Work values Safety Work values Portfolio mix Capital Capital External Patient Line-of-sight Clinical External Customer Quality of RevenuePractices Practices Line-of-sight X-selling Satisfaction treatment t eat e t Satisfaction services Growth Development Staff St ff Employee Individual/ Patient focus Development Individual/ Service Value Engagement Engagement team Value Reward Reward team Prompt service Portfolio mix Productivity Productivity Proposition Patient Work environment Work environment Environment Proposition Customer UseProfitability of Resources X-selling experience Loyalty Community Service Staff Employee Retention Retention Compliance Compliance ‘Local’ ‘Local’ Managementt Management M Cost control Cost control © VaLUENTiS VBM Analytics methodology 2008-11
  21. 21. What organisations (HR) keep getting wrong (shortlist)…1. Employee engagement: its concept and application p y g g p pp2. The use of employee surveys3.3 Evaluation/measurement of people management4. Performance management5. The ‘people competency’ of line management5 Th ‘ l t ’ f li t6. The role of HR (‘customer-agency dissonance’)
  22. 22. 2. 2 The use of employee surveys...common problems ... do differently• Viewed as a reactive • Adopt more pro-active, single event integrated application• Response rate over-focus • Focus on ‘end’ perspective• Inadequate and/or • Understand your HCM unbalanced questioning ‘model’ and ‘QS’ design• Overly PR based • It’s about your staff It s• Management • Too many B-players complacency requiring ‘baseball bat’(!) baseball bat (!)• Failure in follow-up • Adopt clear inclusive actioning/comms process through ‘line’ [Added note: QS = Question-statement – technical term for questionnaire response item]
  23. 23. Remember (?) The Employee survey expertise model HIGH uman capital management MYOPIC 20/20 foresight tise m expert c BLIND UNFOCUSEDHu LOW HIGH Survey design & measurement expertise © ISHCM 2006
  24. 24. HIGH 20/20 MYOPIC foresight tise uman capital management expert Result: organisation has Result: sufficient in- misleading oor depth, robust erroneous knowledge to act interpretation upon p BLIND UNFOCUSED Limited insight Result: end up due to c with ‘garbage limitations of in-garbage out’ HCM syndrome knowledgeHu LOW HIGH Survey design & measurement expertise © ISHCM 2006
  25. 25. HIGH MYOPIC 20/20 foresight tise uman capital management expert 16% 8% 51% 25% Hu c BLIND UNFOCUSED LOW Survey design & measurement expertise HIGHSample: 147 employee surveys. All organisations with over 750 employees. ISHCM research team. Study carried out 2006-7
  26. 26. Employee surveys and engagement: Ten Best practices from the field...(I)View or apply employee surveys:1. As part of a wider enterprise driven focus on people management2. With the appropriate importance (not as a tick-box exercise)3. As organisational feedback/diagnostics as opposed to just garnering opinion, using a robust engagement framework in the process4. As an embedded annual/quarterly process not as one-off interventions5.5 With the importance of science in understanding the data and the various systemic relationships that provide greater understanding and drive more sustainable interventions Source: Employee Engagement: Factors of Successful Implementation Journal Of Applied Human Capital Management, Volume 2 Number 1 2008
  27. 27. Employee surveys and engagement: Ten Best practices from the field...(II)View or apply the employee survey process:6. As a ‘means to an end’ and not the other way around7. With emphasis on post-survey practice/intervention8. NOT as a means of just benchmarking externally (but they see the advantages of benchmarking internally)9. In NOT over-focusing on the response ratio recognising that it’s just one element10.As mandatory, i.e. don’t postpone the process just because something negative may have recently happened, i.e. it’s not about internal or external PR Source: Employee Engagement: Factors of Successful Implementation Journal Of Applied Human Capital Management, Volume 2 Number 1 2008
  28. 28. What organisations (HR) keep getting wrong (shortlist)…1. Employee engagement: its concept and application p y g g p pp2. The use of employee surveys3.3 Evaluation/measurement of people management4. Performance management5. The ‘people competency’ of line management5 Th ‘ l t ’ f li t6. The role of HR (‘customer-agency dissonance’)
  29. 29. One for the road..... road“If you cannot measure it, you cannotimprove it.”Original source attributed to Lord Kelvin 1824-1907, pioneer g pof physics and thermodynamics, first UK scientist appointedto the House of Lords.Since used by many to illustrate the same point in differentways, i.e. substitute ‘improve’ with ‘manage’.
  30. 30. 3. Evaluation/measurement of people management...common problems ... do differently• Managers have patchy • Introduce DCLR understanding of HCM g programme g• Lack of in-situ design • Apply HCM elements to operational models p operational situations p• Default to single • Need to use blended dimension benchmarking QUAL QUANT QUAL-QUANT framework• Over-focus on data • Measurement must be collation rather than its outcome focused rather use than input focused• Lack of internal expertise • Get ‘external’ help external [Added note: DCLR = shorthand for Design, Communicate, Learn, Reinforce]
  31. 31. 3. Evaluation/measurement of people management“But h t d“B t what do we mean when we talk of h t lk f ‘people management’?”[whilst acknowledging the employee engagement elements shown earlier] ADDED INSERT
  32. 32. HUMAN CAPITAL MANAGEMENT:“Human capital management is the term which is used todescribe an organisation’s multi-disciplined and integratedapproach to optimising the capabilities and performance ofits management and employees.”VaLUENTiS International School of HCM
  33. 33. Evaluating People management in yourorganisation: Our HCM ‘radar/clock’ (you’ve seen radar/clock (you vethis before, right?) TRAINING & DIVERSITY DEVELOPMENT TALENT EMPLOYEE MANAGEMENT 813 CENTRICITY EMPLOYER REWARD BRAND 674 599 416 657 615 HR RETENTION GOVERNANCE 742 431 684 487 HR RESOURCING 642 OPERATIONAL 603 594 EXCELLENCE 628 ‘Out-performing’ ‘O t f i ’ (world class) ‘Out-performing’ PERFORMANCE LEADERSHIP (peer) ORIENTATION Comparable ‘Comparable’ 796 (peer) ORGANISATION ORGANISATION ‘Under-performing’ DESIGN CLIMATE (peer) ORGANISATION COMMUNICATIONS
  34. 34. 3. Evaluation/measurement of people management“This ll t t d“Thi all started way back with a challenge b k ith h llset by one of our earliest clients – could we report a people management (aka HCM) construct on one page?” p g ADDED INSERT
  35. 35. And then we did things like The HCR Standards (GHCRS2006) HC Productivity Statement CONTRACTED RESOURCE ye 31st Dec 2005 ye 31st Dec 2004 Total number of FTE days contracted in year 3,530,340 3,401,289 Total number of FTE vacation days taken in 336,987 333,144 year TOTAL NUMBER OF CONTRACTED FTE 3,193,353 3,068,145 Human Capital Operating Statement DAYS AVAILABLE WORK RESOURCE ADJUSTMENT FTE days gained through recorded overtime 61,932 65,371 work (+) FTE days lost to illness (-) 18,431 19,016 FTE days lost to work-related illness/injury (-) 2,773 2,816 FTE days lost to industrial action (-) ye 31st Dec 249 2005 ye 31st 167 2004 Dec OPERATING INCOME as lost under miscellaneous FTE days recorded 763 % 1,075 (-) Revenue (£000s) 1,057,016 1,015,020 ACTUAL NUMBER OF CONTRACTED FTE 3,233,069 3,110,442 FTEs DAYS WORKED 16,352 16,047GH RS2 6 HCR 2006 PeopleFlow® Statement p Revenue per FTE 64,641 63,253 PRODUCTIVITY OPERATING COSTS FTE day (optimal) HCI*Revenue per £192.96 £185.42 Total operating costs (£000s) (actual) HCI*Revenue per FTE day £190.59 904,371 £182.90 815,094 A Guide to the Human Capital People HCI*Revenue per FTE day differential costs (£000s) STAFFING Human Capital Intensity (HCI) EMPLOYER-EMPLOYEE RELATED INDICES 532,181£2.37 ye 31st Dec 2005 58.85 % £2.52 464,317 ye 31st Dec 2004 56.96 Employee engagement index No of full-time staff at start of year 69.2 14,011 68.5 13,865 Reporting Standards OPERATING INCOME ATTRIBUTABLE Employer brand index TO Number of part-time staff at start of year (FTE HC (HCIR per FTE) eqv) 38,041 1,932 71.3 36,029 71.0 1,491 Number of CAPITALtMANAGEMENT eqv) N HUMANother at start of year (FTEINDEX b f th t t f ) 104 175 (GHCRS2006) FullVB-HR Rating time equivalents (FTEs) at start of year Performance HC ANCILLARY PEOPLE COSTS (APC) £ BB-BB-R 16,047 Sustaining + % £ BB-B-R 15,531 Sustaining + % Training & Development costs (£000s) STAFFING MOVEMENT 8,176 % 7,342 £ % Recruitment costs (£000s) in period (+) Number of FTEs recruited 2,314 1,427 2,954 1,874 Health & Safety costs (£000s) during period (+) Number of acquisitioned FTEs 740 - 691 - HR functional and related costs (£000s) 6,254 1,427 1,874 6,879 Outplacement voluntary leavers (FTE) in period (-) Number of costs (£000s) 256 996 1,065 53 Number of FTEs made redundant or outplaced 35 217 in period (-) Total 17,740 17,919 Number of FTE retirements in period (-) 91 76 1st Edition Number of FTEs outsourced in period (-) HC LEVERAGE (HCIR/APC per FTE) 35.06 - 32.26 2006 Full time equivalents (FTEs) at end of year STAFFING MISCELLANEOUS 16,352 16,047 Mean tenure (years) 5.2 52 5.3 53 Mean age of workforce 34 34 Retirement population 5,391 5,304
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