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 businessstrategyDr. Sorab Sadri and Prof. JayashreeSadri
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 strategytwo way linkage:mutual influencepassing ships:independent HRand businessstrategiesintegrativebusiness strategyinforms HR actions
Linking business & HR strategyFactors that affect this linkage:Planning process■ formal or informal■ deliberative or emergentDegree and timing of HR involvementExtent of challenge permittedLegitimate areas for HR inputExtent of HR’s alignment with business -broad objectives and current imperatives
Understanding the decisionmaking processIf decided byformal processesIf matters aresettled beforehandIf real actionhappens atoperational levelGet a seat at thedecision makingtableBuild coalitions,work to influenceoutside meetingsEnsure you havebusiness partnerseffective at BUlevel
Stakeholder management board executive committee senior managers line managers teamleaders/supervisors employees employeerepresentatives external suppliers government bodies other agencies what is their stake? what are their goals? what are theirexpectations? how will change affectthem? what do they knowalready? what influence dothey have? what power do theyhave?
Characteristics of strategic HRA philosophy underpinning peoplemanagementSeeing people as a competitiveresource
Making the case: what HumanCapital HR can deliverImproved utilisation of talentHigher productivityReduced costsBetter service deliveryOrganisational integrationAligned culture & organisational valuesGreater employee engagementStronger employee proposition etc
LineManagementCompanyCultureEmployeeCommitmentCustomersatisfactionwith serviceCustomerspendingintentionChange insalesEmployeeAbsenceService-Profit-Chain Model
Characteristics of strategic HRA philosophy underpinning peoplemanagementSeeing people as a competitiveresourceA planning approach to resources■ numbers■ skills■ potentialAdds long-term rather than shortterm valuein line withbusiness need
Characteristics of strategic HRIntegrated – brings togethermultifaceted activities
Characteristics of strategic HRIntegrated – brings togethermultifaceted activitiesComprehensive – covers the entireoperation (at BU or corporate level)High value added – focuses on businesscritical issuesBuilds social capital – helps sharing,networking and relationships
Characteristics of strategic HRIntegrated – brings togethermultifaceted activitiesComprehensive –covers the entireoperation (at BU or corporate level)High value-added –focuses businesscritical issuesBuilds social capital – helps knowledgesharing, networking and relationshipsAnticipates change – through horizonscanning and internal sensing
Connecting business & HRstrategiesBusinessstrategyHRstrategyBusinessplansImple-mentationMonitorInternaldriversExternaldrivers
How is people & businessalignment achievedWhat is theorganisation’s bigidea?What are thebusiness priorities?What are thepeople priorities?How do they link?BigideaBusinessprioritiesPeoplepriorities
Establishing people prioritiesWhat causes people to come to work,be motivated and perform?What stops them frombeing effective?
A model of capabilityability:skills, trainingeducationmotivation:engagementinvolvementapplication:ODproductmarketstrategyaccess:resourcingrecruitmentsuccessionDeploymentDevelopmentIndividual capabilityOrganisational 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 currentand for future jobs?What is its demographic shape?How committed are employees?■ attendance■ productivity■ staying or leavingWhat are collective relationships like?To what extent is employee potential beingharnessed?
What stops HR succeeding?Human capital not recognised as asource of advantageWeak organisational leadershipPoor teamworking across organisationBusiness strategy poorly definedThere is little forward planningPeople resources assumed to beunlimited, free or fully trainedResources are hoarded & not shared
HR’s own problem areasObstacles tosuccess:■ time■ capacity■ focus■ capability■ positioning■ organisation
HR’s own problem areasObstacles tosuccess:■ time■ capacity■ focus■ capability■ positioning■ organisationRelationships withmanagement notworking.The villains:■ HR – not letting go■ the line – nottaking it up■ senior mgt –sending wrongsignals
ResultsInadequate HR service performanceConcentrating on low value tasksHR policies are disjoined & inconsistentThey serve functional not organisationalneedsWeak functional leadershipPoor internal reputationHuman capital not exploited, developed
What should HR do?Review your retention model■ right level of wastage?■ numbers, types, qualityWhy dotheyleave?Why dotheyjoin?Construct a workforce planEstablish the supply/demand balanceAre the right people, in right jobs?Review your recruitment model■ able to attract - all types?■ brand■ proposition
A strategic review ofrecruitment and retentionMarket availabilityOrganisationalimpactHLH LOutsourceCommoditiseAttract &retain
Different propositions fordifferent groupsHire Exploit FireAttract RetainNurture
What should HR do? (2)How well are employees aware of■ the bigger picture?■ their job?■ what success looks like?How doyouknow?Are you able to motivate staff?■ degree of engagement■ what motivates them?■ what demotivates them?■ what impact does pay and performancemanagement have?
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 organisationstructured?■ Employees moved to meet businessneeds?
What should HR do? (4)What is the organisation’s■ Ability to change/innovateHow good is the organisation’sgovernance structure?How strong (and respected) are theorganisational values, eg■ On diversity?■ Whistleblowing?■ Meritocratic progression?
Measure people and HRfunctional performanceThrough for exampleCritical success factors/areasKey performance indicatorsService level reviewsCustomer surveysEmployee attitude surveysProcess mapping/activity analysisAudits/reviews (incl... quality)ScorecardsBenchmarking