David, many people think they know about HR but what really is it?
HR can be very complex, yet it can also be simple. It is about effectively managing the people aspect of the business. I often hear managers say if it wasn't for the people aspect, business would be easy. Yet it is the people that make their business successful. While that sounds simple, businesses that achieve their goals and objectives do so through their people. So if managers are experiencing a number of people hassles they need to obtain a better understanding of what is causing the hassles.
So how do managers reduce people hassles and achieve the best from their people?
Managers that practice the right mix of HR policies, procedures and systems for their business and practice them well will have a more highly engaged workforce. They will reduce people hassles, and achieve the best from their people.
Those businesses that do not have the right mix or practise them well, will continue to experience people hassles, experience poor productivity, lose capable people and profitability will decline.
I liken it to baking a cake. When baking a cake you initially decide what type of cake you want to bake. You then select the ingredients in certain quantities, mix the ingredients, and bake for a certain time at a certain temperature and you will have baked a cake. If you want an orange cake you probably wouldn't add chocolate as an ingredient unless you want a chocolate orange flavoured cake. This is a simple analysis, yet HR is a similar concept.
That's an interesting concept. I am intrigued as to how baking a cake can be related to HR?
Initially you need to understand the business strategy- that being the cake you are going to bake. You then select the right mix of HR procedures you need - that being the cakes ingredients. You then practise these ingredients well, that being the time and temperature the cake is baked at.
The ingredients for HR come from three areas:
1. Strategy,
2. Operational, and
3. Compliance practices,
and the three are intertwined.
From a strategic viewpoint managers need to effectively link their business strategy with their human resource strategy. I often see managers go off on tangents because they do not link the two strategies. From a big picture viewpoint managers need to identify if the strategy is for growth, stability, retrenchment or a combination. Once this is understood managers then have direction. They understand what type of cake they are going to bake. Managers that have a plan will help them to stay focussed on the path to achieving their overall business strategy. The strategy will assist to identify which operational procedures will be best for the business.
Secondly from an operational viewpoint managers need to understand where the business is currently, and identify which HR practices will achieve their overall business strategy. Similar to baking the cake it is choosing which ingredients are required to achieve the type of cake you want to bake. For HR it is choosing what recipe will assist to achieve the overall business strategy.
So what operational procedures are there to choose from?
There are a number of the procedures businesses will need to have to achieve their goals and objectives. These include
- Effective recruitment system
- Effective employee induction
- Performance management system
- Effective communication
- Recognition and reward strategies
- Individual and team development strategies
- Effective payroll system
- Career planning and development, and
- Managing human resources
With each one, there are a range of methods to achieve an outcome. It is selecting the best way for a business to achieve the desired outcome. If there is something lacking it will impact on the business in other ways.
A simple example of this is position descriptions.
Business that do not have positions descriptions for their people invariably means their employees do not have a clear understanding of what is expected from them and how their performance is going to be measured. When this occurs a psychological agreement is in place between the manager and employee. The problem with psychological agreements is that the expectation changes but often the other party does not know of the change. That is when people become frustrated, whether it be the manager or the employee.
With having nothing written down it is difficult for the manager to manage performance objectively and provide effective feedback. It is hard for the manager to talk specifically about what a person is doing well or not so well.
The manager most likely has to spend more time speaking with employees because they do not do the things the manager wants.
While processes are important it ensuring they are linked with the outcome you are looking to achieve.
Lets take performance management for instance. Implementing a performance management system is an important HR strategy , but what do managers want from it. Our experience suggests it is not the system itself but what the system can do for the business. That being:
- Standards and values for improved culture
- Excellent performers receiving recognition
- Non performers improving performance or being weeded out
- Reduced people hassles
- Increasing retention level of excellent performers
- Increased capability of people
- Sustainable competitive advantage
- Improved profitability
So if you do not have a good performance management system as part of the ingredients it will affect the overall result for the business. You most likely will not get the best from your people because there are not clear expectations. Compensating by adding additional ingredients will not help all that much.
So what you are saying is that managers need to have the right ingredients or HR practices to get the outcomes they are looking for?
Yes, and it's understanding which HR practices (either new or with improvement) will make a difference to the business. Often managers are that close to the business they are unable to see the forest through the trees. They are unable to easily identify which HR practices will improve their business.
That's where Successful Business Strategies assists managers by identifying what would make a difference to their business and ensuring systems are implemented effectively. By asking specific questions and with considerable experience, I identify what will help the manager and business to achieve their goals and aspirations. Once the right ingredients or processes have been selected they need to be implemented and practised well.
What happens if managers do not have the time or experience to implement the processes?
Well not much happens to benefit the business. The combination of being time poor and not knowing how to go about implementing procedures means little happens. I find in today's environment managers are endeavouring to wear a number of hats with HR just being one of them. Some managers are quite good at understanding the need for effective HR strategies but time is a scarce recourse. Others find it too difficult. So while having a process is important the process is not of much use without it being implemented. I often find businesses have processes but they do not work because they are not effectively implemented. Furthermore we ensure that while the HR process is implemented we perform checks to ensure the process is working and aligned to achieving expected outcomes.
We need to remember the reason why things go wrong is largely due to the system or lack of system. Many people state that systems account for 95% of the reasons why there are problems and the people part of it is 5%
That's interesting. David are you saying that people only account for 5% of the problems?
I know this sounds like an incredibly low percentage however going back to our cake, if we have mixed all the right ingredients and we bake at the right temperature for the right time, the cake will have a very high likelihood of turning out how we expected. If we have the wrong ingredients the cake will not turn out how we expected no matter what temperature or how long we cook it. You have to have the right ingredients and they have to be of good quality.
Admittedly the range of outcomes is greater with people, having said that your likelihood of success is far greater if you are practicing the right combination of HR practices.
While I covered strategy and operational ingredients there are also compliance HR
- requirements that businesses need to practice. OHS, and Industrial Relation requirements, are to key compliance requirements. Effectively managing these requirements reduces business risk.
So you have covered HR strategy, operational and compliance requirements, are there other areas which are important to having a highly engaged workforce?
There are a range of other areas which are fundamentally critical to business success. These include:
- Leadership style
- Leading by example
- Treating people right
- Having respect for employees
- Ability to motivate employees
- Seeking employees ideas
- Making employees feel important
- Listen to what team members have to say
- Being accessible to staff
- Understanding capability of employees and the team
- Managing diversity within the team
- Managing employee relationships
- Understanding the culture of the business
Remember more often than not, people join organisations but leave managers. In many instances it the little things we do on a daily basis that either helps to build a successful team or creates roadblocks in achieving the businesses potential. Treating people right goes along way to developing a successful team to go the journey.
You mentioned when baking a cake an important component is time. How does this relate to HR?
HR is a journey and you need to practise the right mix of HR practices well. It can take time yet some areas can produce a quick result. It is where practices are embedded into the organisations culture that it can take time and if you want a different result you have to do things differently.
Let's go back to performance management for a moment. With performance management and appraisals senior management need to make sure appraisals are facilitated well. There are many companies where managers facilitate performance appraisals because it is a requirement of the role. Often managers tick a box to say it has been done, it does not mean it has been done well. So while there may be systems in place senior management need to ensure they are being practised the way they are going to achieve the desired result. Performance appraisals not facilitated well can have a negative rather than a positive benefit. While I have spoken about performance appraisals this applies to all systems. So the time component is the ability to implement and practice systems well.
While we assist with providing and implementing best practice HR processes and systems, our key focus is strategic. We focus on ensuring the processes and systems are working to achieve expected outcomes and are contributing to achieving the managers and businesses overall goals and objectives.
What do you find are the key challenges of HR for managers?
With the number of hats managers are wearing we are finding the key challenge for managers is ensuring everything in the business is getting done. The next challenges are managing team member relationships and understanding how best practice HR can accelerate business performance and take the business to the next level.
For many being so close to the business and not seeing the forest through the trees is a challenge. If you are unable to see key issues you do not even look at rectifying problem areas. There is a saying "You can chose to do something about something you know about, but cannot do anything about something you do not know about".
In summary how will Human Resource Management help businesses?
HRM will benefit businesses by increasing employee engagement, resulting in improved productivity and profitability. And the real benefit to managers is less people hassles, less stress and more time to spend in other areas. The time can be spent in other core areas of the business or it may enable as it has for a number of our clients, to improve their lifestyle.
So what businesses come to you for assistance?
The people that come to us for assistance are managers of small to medium size businesses who recognise they could be doing better than what they currently are. Often managers are not sure what HR practices will benefit their business yet they know they need better HR systems. Managers have employee problems, including retention, motivation the wrong staff in their business. Many managers also want to grow and develop their business but are unsure how they can best do this through employees.
In many instances you can have two similar businesses, yet they achieve vastly different results. A highly engaged and motivated workforce will achieve improved results. Lets face it business owners are in business primarily to enable them to have the lifestyle the wish to live. I don't know of any companies that employ people for the sake of employing people, they do it because it helps to achieve their business objectives. Therefore having a motivated, team will achieve higher levels of customer service, foster productivity gains, have great communication all resulting back into improved profitability.
I suggest businesses give us a call because if they leave it too late the pain can get too great. When I talk about the pain being too great it I mean business risks are high or appointing administrators or liquidators. We can help businesses to get the best from their workforce and have a successful business and it best for managers and their business to seek our assistance earlier rather than later.
Thanks David
Article courtesy of David McGillivray and interviewer, Lorraine Pirihi, the Productivity Queen.
Courtesy of the Recruiting Blogswap, a content exchange service sponsored by CollegeRecruiter.com, a leading site for college students looking for internships and recent graduates seeking entry-level jobs and other career opportunities, and posted on Resumes to Jobs.
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