Managing The Difficult Road Ahead H R Response N S Rajan

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Managing The Difficult Road Ahead H R Response N S Rajan

  1. 1. Managing the Difficult Road Ahead: HR Response NS Rajan Partner, Human Capital
  2. 2. The difficult road ahead… The intent of the HR function is to align with business needs and enable the human capital within the organization to provide sustainable competitive advantage by sourcing, nurturing and maximizing potential. In difficult times, like a global economic slowdown, it is imperative for the HR function to respond to challenges not anticipated afore. Businesses, in these times are beset with the need to enhance operational efficiency, enable cost optimization and even evaluate competing strategic choices. HR can indeed play a pivotal role in responding to these new challenges by recognizing the likely impact of the environment on business, to proactively take decisive action and reassess the focus areas that require attention. On the difficult road ahead, some thoughts are shared on how HR can make a difference across the value chain. Page 2
  3. 3. The economic scenario presents a unique set of challenges for HR… Business challenges HR challenges • The Rising Cost of Capital – • Rightsizing the organization and global underperforming investments, reduced mandate to freeze hiring access to capital, liquidity crunch • Preparing the organization to • Falling consumer confidence – falling proactively handle people crises consumer spending, customer’s • Low availability of skills and talent to inability to pay handle changing business environment • Inflationary concerns – impact of rising • Harnessing leadership capabilities energy and other input costs which will drive companies out of • Pressure on margins recession • Decreased equity valuations – • Balancing employee salary expectations fluctuation in the capital markets and and business costs reduction in market capitalization • Stagnation/drop in employee • Uncertainty in political and employment productivity environment • Falling employee engagement levels Page 3
  4. 4. The Evolving HR Mandate HR Building Blocks HR Strategy Organization Workforce Talent Delivery of Employee Design Planning Management Talent Engagement & System Management Communication System HR Strategy and Policy Formulation Execution of Talent Strategy HR Imperatives HR strategies Organizations need to be Identifying, Preserving the fabric of the need to adapt to designed for agility and Developing and organization through the market flexibility Rewarding high sustained employee conditions performers in a engagement and regular underperforming communication market is the key Successful management of downturn though HR Optimization Page 4
  5. 5. HR strategies need to adapt to the market conditions… Key Issues Key Action Steps • Slowing demand creating top line • HR strategy to reflect the new cost pressures for business focused business strategy • Businesses looking at reduced HR • Implement high impact HR budgets as a cost management Interventions and prioritize strategy expenditure • Preparing business case for continuing • Account for HR costs on people investment in HR programs programs and tie them to financial returns • Evaluate automation / outsourcing of certain HR functions Focus on: HR Strategy, In sourcing & outsourcing models for workforce and investment in HR Technologies Page 5
  6. 6. Organizations need to be designed for greater agility & flexibility Key Issues Key Action Steps • Underleveraged synergies due to a • Restructure the organization in structure that may have been designed order to adapt to the new business for rapid growth and expansion environment • Underutilized resources due to a • Realign reporting relationships and economic slowdown delegation of authority for swift decision making • Slow response time of the organization • Review of workforce planning as per to changing external environment changed business projections • Pressures to reassess workforce • Examine alternatives such as strength redeployment/planned sabbaticals/ job sharing/ rightsizing Focus on: Build organization structure to manage efficiency and speed rather than scale Page 6
  7. 7. Identifying, Developing & Rewarding high performers in an underperforming market is the key… Key Issues Key Action Steps • Low availability of critical skills and • Identify critical skill sets and develop a talent to manage a challenging focused talent retention and business environment development program • Building and maintaining a robust • Identify high potential employees and leadership pipeline focus on strengthening their • Developing new competencies and capabilities skill sets deemed critical to the • Create a fungible workforce to enable changing economic and business quick re-deployment scenario • Drive a performance oriented culture • Realigning and restructuring salary / • Enhance linkage between individual employee cost performance and variable pay Focus on: Identify, Develop and Reward high potential talent, to institutionalize a Performance Oriented Culture Page 7
  8. 8. …while preserving the fabric of the organization Key Issues Key Action Steps • Managing anxiety among employees • Evolve a two way communication strategy • Driving greater sense of ownership, to keep all employees and stakeholders responsibility and accountability among updated about the business objectives employees • Encourage an organizational culture that • Falling employee engagement levels embraces learning and holds managers leading to reduced productivity and employees accountable for the results • Managing expectations during the • Asses employee engagement levels and rightsizing process drive innovative employee engagement practices • Retaining the employer brand • Engage in a Corporate Employer Branding exercise to reach a broad array of audiences Focus on: Sustained Employee Engagement Activities & Employee Communication Page 8
  9. 9. Human Capital Human Capital India has a competent team of Human Resources Professionals with consulting experience straddling multiple industry sectors and geographies. The team has partnered numerous business leaders to define HR strategies and manage their workforce functions. NS Rajan Partner, Human Capital ns.rajan@in.ey.com

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