Rogers - Impacts of the Global Recession on HR Strategies
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The document discusses the impacts of the global recession on HR strategies. It identifies 5 big trends: growth in emerging markets, labor productivity and talent management, global flows of goods/information/capital, natural resource management, and the increasing role of governments. It then discusses how companies are responding to these trends through their HR strategies around hiring, compensation, employee relations, performance management, training and development, and attrition/turnover. The key insight is that more companies need to become more global to be competitive, and HR needs to find ways to help make that happen and show CEOs how HR can help.
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Rogers - Impacts of the Global Recession on HR Strategies
- 1. Impacts of the Global Recession Impacts of the Global Recession on HR Strategies Presented by Donald P. Rogers, PhD, SPHR, GPHR Director, Master of Human Resources Director Master of Human Resources Rollins College
- 2. Purpose & Methods Purpose & Methods • Get You Thinking Get You Thinking • Identify Post‐Recession Trends • Discuss Implications i li i
- 3. The Big Insight The Big Insight • More Companies must be More Global More Companies must be More Global to be Competitive • HR must find ways to help make that HR must find ways to help make that happen • CEO d ’ k CEOs don’t know how HR can help h HR h l
- 4. HR Strategies HR Strategies • “…a strategic approach to people a strategic approach to people management that focuses on the issues that are critical to the organization s that are critical to the organization’s success” • Accounting for People Taskforce (UK)
- 5. Organizational Success Organizational Success • Rebuilding • Growth • Renewal l
- 6. Critical Issues Critical Issues • Recession – The Slow Return • Unfulfilled Expectations – Anger – Mistrust • Cautious Optimism
- 7. People Management Strategies People Management Strategies • Hiring • Compensation • Employee Relations l l i
- 8. Danger Points Danger Points • Performance Management Performance Management • Training & Development • Attrition & Turnover ii &
- 9. Five Big Trends Five Big Trends • Growth in Emerging Markets Growth in Emerging Markets • Labor Productivity & Talent Management • Gl b l l Global Flows of Goods, Information, & fG d f i & Capital • Natural Resource Management • Increasing Role of Governments g
- 10. Growth in Emerging Markets What Companies are doing to capture Growth Building Local Presence Developing Local Partnerships Recruiting Local Talent Developing Local Talent 0 10 20 30 40 50 60
- 11. Labor Productivity Labor Productivity • Increasing emphasis on high value goods & g p g g services changing labor mix – Competencies • General Management General Management • R&D • Strategy – Productivity d – Labor Costs • Age demographics favor emerging economies Age demographics favor emerging economies • Education demographics favor developed economies
- 12. Global Flows Global Flows • Flows of goods information & capital will Flows of goods, information, & capital will remain open, but will not grow much • Capital Markets will become more Capital Markets will become more integrated • I f Information flows will benefit customers i fl ill b fi more than producers/providers and much more that intermediaries h i di i
- 13. Resource Management Resource Management • Major Strategic Issue but not a major HR Major Strategic Issue, but not a major HR Issue (no role for HR) • Very different levels of post recession Very different levels of post‐recession, strategic importance by industry
- 14. Role of Governments Role of Governments • Levels of public debt may have negative Levels of public debt may have negative impact on GDP growth in Europe & North America – Less Leveraged Growth • Governments pursuing national interests pursuing national interests rather than shareholder interests may reduce freedom of action in Asia, Russia, reduce freedom of action in Asia Russia Brazil, & Middle East
- 15. Spending • Consumer spending in emerging markets Consumer spending in emerging markets is more optimistic • Consumer spending in developed Consumer spending in developed markets is more reserved • B i Business spending in both kinds of di i b h ki d f markets is more optimistic • Government spending is more optimistic & much more pragmatic
- 16. Hiring • Increased demand for skilled labor Increased demand for skilled labor • Shortages of skilled labor in emerging markets • Skills Gaps
- 17. Compensation • Employees still focused on improving still focused on improving their standard of living • Demands for improved quality of life Demands for improved quality of life becoming more common in China, India, & Brazil & Brazil • Government support shifting away from ‘at risk’ compensation in China, India, ‘ i k’ i i Chi I di Russia, and EU
- 18. Employee Relations • “What are they going to do? Quit?” YES! What are they going to do? Quit? YES! • Increasing demands for protection from market volatility market volatility • Increasing support for unionization • Increasing expectations of voice & respect
- 19. Performance Management Performance Management • No more “and other duties as needed” No more and other duties as needed – More prescribed performance expectations – More stable expectations More stable expectations • Longer performance timelines • More group performance expectations • Less use of ‘pay for performance’ • More use of long term contracts (5 in 3)
- 20. Training & Training & Development • Global Skills Shortage Global Skills Shortage • Global shortages in general management, R&D, strategy, technical skills R&D strategy technical skills • Can’t hire, must train • Most countries teach technical skills on‐ the‐job (entry level is pre‐apprentice)
- 21. Attrition & Turnover Attrition & Turnover • Emerging markets requiring much more Emerging markets requiring much more sophisticated (and expensive talent) • Costs of attrition & turnover escalating in Costs of attrition & turnover escalating in emerging markets • L Less job‐shift gaming in China, India, & j b hif i i Chi I di & Brazil • More spending on ‘quality of work life’
- 22. The Big Insight The Big Insight • More Companies must be More Global More Companies must be More Global to be Competitive • HR must find ways to help make that HR must find ways to help make that happen • CEO d ’ k CEOs don’t know how HR can help h HR h l
- 23. Our Job is to Tell Them! Our Job is to Tell Them!