The document discusses applying HR standards and metrics to promote sound HR governance, risk, and compliance. It outlines how the South African Board for People Practices (SABPP) has developed national HR standards for South Africa involving 468 HR leaders. The standards address strategic HR management, HR risk management, HR measurement, and other areas. The document argues that establishing consistent HR standards can improve HR practices, address inconsistencies, and help optimize human capital in businesses.

1. APPLYING HR STANDARDS & METRICS TO PROMOTE SOUND HR GOVERNANCE, RISK, COMPLIANCE13thAfrica Corporate Governance Conference
Marius Meyer, CEO: SABPP
24 November 2014
@SABPP1

2. Welcome to South Africa

3. Where can you get the slides?
OPTION 1: FAST WAY
•www.slideshare.net/SABPP
•Twitter: @SABPP1
•Blog: hrtoday.me
OPTION 2: SLOW WAY
•Via email tomorrow

4. Agenda
•Clarifying the need for national and international HR Standards
•Identify HR metrics to measure bottom-line impact of HR
•Managing people risks in business
•Creating an ethical organisationculture
•Conclusion

5. Maslow’s needs in 2014

6. Critical questions
1.How many of you would like to eat in a restaurant without standards?
2.Or stay in a hotel without standards?
3.Or send your child to a school (or pre- school) without standards?
4.Or get operated in a hospital without any standards?
5.Or fly back home on an airline without standards?

7. Then when it comes to HR …
Why do we continue to manage people and govern the most precious part of our organisations (i.e. people) without standards?

8. Top facts about HR
•Human Capital is the biggest concern for CEOs (PwC).
•Only 18% of CEOs feel confident that they have the right people in place to execute strategy (CEB).
•Human Capital is the biggest risk in business (HCI Africa).
•Skills crisis is the top obstacle to economic growth.
•Strikes cost SA R197 million per day.

9. More facts about HR
•SA losing R12 billion a year due to absenteeism.
•Only 5% of employees understand business strategy.
•World-wide only 13% of employees actively engaged.
•Companied with engaged employees outperform others by 202% (Dale Carnegie).
•Companies with good HR Practices outperform others by treating HR as critical business function, these companies are 105% more profitable.
•Average ROI on wellness programmes: 300%.

10. OperationalManagement Consistency in the Management of People
One of the toughest things to be is consistent

11. Example of inconsistency – paternity leave
•South Africa –3 days
•Ghana –5 days
•Cameroon –10 days
•Kenya –14 days
•Australia –14 days
•Sweden –60 days
•UK –12 months (parents sharing)

12. Why a national HR Standard?
•We need to improve the quality of HR practice.
•Inconsistencies –practices, sites, business units, companies, industries.
•Too many bad examples of things going wrong –Marikana, Medupi.
•Raising the bar for the HR profession and business impact.
•Optimising human capital in business.

13. 468 HR Leaders developing HR Standards for South Africa

14. HR Standards Facilitators
Kate Dikgale-Freeman Michael Robbins Linda Chipunza

15. BUSINESS STRATEGY –HR BUSINESS ALIGNMENT
❶Strategic
HRM
❷Talent
Management
❸HR Risk
Management
HR ARCHITECTURE
HR VALUE &
DELIVERY PLATFORM
❹ Work- force
planning
❺
Learning
❻
Perfor- mance
❼
Reward
❽
Well- ness
❾
ERM
❿
OD
⓫HR Service Delivery
⓬
HR Technology
(HRIS)
Prepare
Imple-
ment
Review
Improve
⓭HR MEASUREMENT
HR Audit: Standards & Metrics
H R C O M P E T E N C I E S
SABPP HRM SYSTEM STANDARDS MODEL

16. Global approaches to standards
•Production and safety lead –ISO standards
•Professional standards –accounting
•Top global companies –their own standards
•Canada –HR Standards & Metrics
•USA –HR Metrics (SHRM)
•ISO HR project started
•South African National HR Standards

17. International interest

18. ❶STRATEGIC HR MANAGEMENT STANDARD
DEFINITION
Strategic HR Management is a systematic approach to developing and implementing long-term HRM strategies, policies and plans that enable the organisation to achieve its objectives.
SABPP (2013)

19. STRATEGIC HRM PROCESS
Framework of HR policies & programmes
Environmental scan (PESTL)
HR structure, service model and capability development
People strategy
HR strategic agenda
Organisation’s strategic intent
HR strategic agenda
HR business plan
People strategy
Allocate roles & responsibilities (line/HR/support functions)
MONITOR & EVALUATE

20. Strategic HR: It is all about alignment

21. HR RISK MANAGEMENT
DEFINITION
HR Risk Management is a systematic approach of identifying and addressing people factors (uncertainties and opportunities) that can either have a positive or negative effect on the realisation of the objectives of an organisation.
SABPP (2013)
❸

22. Risk / Readiness Profile

23. H R RI S K S –8 African countries
•Safety -accidents
•Skills shortages/gaps
•Incompetence
•Employee disengagement
•Strikes & poor employment relationships
•Fraud/corruption
•Stress
•Staff turnover
•Low staff satisfaction – impact on customer satisfaction
•Cyber security
•Conflict/disputes
•Diversity problems
•Sexual harassment
•Expatriate issues
•Non-compliance

24. 181 babies died in state hospitals last year.
Human errors, faulty equipment & cover-up by senior medical staff were key factors.
Infection-control nurse retired, and her post not filled.
Critical shortage of nurses & clinical engineers who are responsible for maintaining ventilators.
Senior doctors presented inaccurate stats to their bosses to cover up poor management practices.
Doctors failed to alert DoHto the crisis, even though a few nurses had raised the alarm to management.
Public sector case study

25. STAFF COMPLAINTS:
Shortage of nurses, leading to overworked staff being vulnerable to human error.
High baby-to-nurse ratio –babies not getting adequate care and attention.
Specialist doctors consult junior doctors on the phone without personally accessing high-risk cases.
Inadequate training for medical staff.
30 May 2010
If you don’t manage HR risks

26. HR risks –people risk, governance and compliance

27. HR RISK MANAGEMENT PROCESS
Assessment of risk tolerance for each risk
Identify and evaluate impact of HR risks
HR practices, programmes, metrics to manage risks
HR Risk Map
HR Risk Register
Organisation’s risk management structures and processes
HR Risk Register
HR Risk Management Plan
HR Risk Map
MONITOR & EVALUATE

28. ⓭HR MEASUREMENT
DEFINITION
HR measurement is a continuous process of gathering, analysing, interpreting and presenting quantitative and qualitative data to measure and align the impact of HR practices on organisational objectives, including facilitating internal and external auditing of HR policies, processes, practices and outcomes.
SABPP (2013)

29. HR MEASUREMENT SYSTEM
MONITOR & EVALUATE
What are the drivers behind those issues?
What issues do we need to manage (risks/opportunities)?
What are the outcomes specified in the SLA?
How can we measure those in a Balanced Score Card?
METRICS
METRICS FOR PEOPLE MANAGEMENT IN THE ORGANISATION
METRICS FOR HR EFFECTIVENESS/
EFFICIENCY
How can we measure those drivers?
Management system & resources to collect and report
Financial and operational reporting systems in organisation

30. HR manager’s response to metrics?

31. Key Human Capital Metrics
•Revenue per employee (Revenue/FTE)
•Profit per FTE (Revenue-Operating cost/FTE)
•Human Capital ROI (benefits-costs/costs)
•Leadership quality index
•Employee engagement score
•Employee satisfaction score
•Organisation climate score
•Employer of choice index
•Human capital risk index (less than 10% risk)
•HR customer satisfaction score

32. The need for consistency and quality

33. POSITIONING GRC IN COMPANIES
GOVER- NANCE
RISK
COM- PLIANCE
LEADERSHIP
MANAGEMENT
CULTURE
CONTROLS

34. Triple bottom-line: 3 P’s
PEOPLE
(Social)
PLANET
(Environment)
PROFITS
(Financial
performance)
S U S T A I N A B I L I T Y

35. “Good human resource management is imperative for good governance”
Mervin King

36. HR governance defined:
is the act of leading, directing & controlling the HR function to promote sound corporate governance in pursuit of the overall business goal of economic, social & environmental sustainability

37. Workplace behaviour

38. OOPs !! What if ? the pilots had not read the Instruction book

39. What if ? The ground staff didn't think that house keeping was an important issue
Who insured it and will they pay ??

40. RISK Reporting

41. GUIDELINES FOR HR GRC
•Transform HR management to HR governance by taking full responsibility for GRC in the HR space, but with a clear link to overall GRC and business strategy
•Identify all stakeholders and engage with them
•Design and implement a robust HR risk management plan
•Develop HR standards –good HR practices
•Infuse HR governance in your organisation
•Evaluate the impact of HR on the bottom-line

42. RATING SCALE TO ASSESS HR
PROBLEMATIC
MEDIOCRE
EXCELLENT
HighRisk
Medium Risk
Low/noRisk
HRpractice is non-existent, has a low uptake or is applied poorly. Little, no or poor results are evident. Requires urgent attention to move to medium risk over short or medium term.
Some pocketsof excellence, but they are isolated, and applied inconsistently in certain parts of company. Some occasional positive results comparable to typical average HR standards. Should be addressed before it becomes problematic.
HR leading practice is well infused,aligned and integra- ted across the company and applied consistently with clear results. Comparable to world- class standards. Should be maintained, reinforced or used as a model for other companies.

44. SUSTAINABLE PERFORMANCE
“Whether a company sustains exceptional performance depends first and foremost on whether it continues to have the right people in power.”

45. Ethics Management Process …
Develop or revise code of ethics & processes
Build an ethical culture
Integrate ethical standards
Assess ethics risk and opportunities
Report & Disclose
Reference: Ethics SA www.ethicssa.org

46. National HR Governance Strategy Alignment
HR Professional Standards:
•HRMS (13)
•HRMSAS (13)
•HRPPS (30+)
HR Products/Services:
•CPD
•Mentoring
•Professional registration
•Research
•HR Academy –QCTO
•Curriculum standards
HR Metrics:
•National HR Scorecard
•HR Service Standards
HR Auditing:
•Internal Audit
•External Audit
King IV:
HR Governance
ISO: HR
Integrated
Reporting
HR Competencies

47. Conclusion
HR standards are needed to improve the consistency and quality of HR management.
Consider the SABPP approach, process and methodology, but develop your own HR standards for your country.
Best wishes with your HR governance work.
For more information, contact us on executiveoffice@sabpp.co.za

48. Let us build well governed HR functions
professional@sabpp.co.za(Professional Registration)
xolani@sabpp.co.za(Professional Services)
kenneth@sabpp.co.za(Stakeholder Relations)
penny@sabpp.co.za(Research)
naren@sabpp.co.za(Learning & Quality)
marius@sabpp.co.za(Strategy inputs)
voice@sabpp.co.za(Social media)
Website : www.sabpp.co.zaBlog: hrtoday.me
New office: 8 SherborneStr, Parktown, South Africa
Tel: +27 11 482-8595 Fax: +27 11 482-4830
Cel: 082 859 3593 (Marius Meyer)