Monthly Archives: February 2004
Stop the Press !
Fast Company Now notices Me !:
“In response to an entry yesterday, FC Now reader Gautam cites some research done by Timothy Butler and James Waldroop. While Fast Company explored barriers to success with Butler and Waldroop several years ago, their earlier work on ‘job sculpting’ might be a useful parallel read to George Erman’s thoughts on motivation.”
Leading corporations will be increasing their investment over the next three years to measure how people practices such as low turnover, diversity and the engagement of their employees contribute to the bottom line, concludes a report from The Conference Board released today.
The report is the result of a working group of leading companies and is co-sponsored by PeopleSoft, a leading provider of application software for business. It is based on a survey of 110 human resource managers in major companies based in the United States and Europe.
While 40 percent of survey participants consider senior management support to have been high for human capital measures during the past three years, 76 percent predict an increase in top-level backing during the next three
The report defines human capital measures as including employee engagement, turnover, diversity, leadership, and productivity among others.
FOCUS ON LOWERING COSTS AND BOOSTING PRODUCTIVITY
“The major reason that management lends increasing support to people metrics projects is that they help lower costs and improve the return on people investments while helping align these investments with business strategy,” says Dr. Stephen Gates, author of the report and principal researcher at The Conference Board. “Human resources leaders need to determine how to link people measures to business processes. They should involve line managers at all stages of the
human capital metrics process, seek advice and input from finance and strategy colleagues, and eventually embed people metrics in managers’ bonus plans.”
“This study illustrates the importance of human capital management to every business’ bottom line,” said Mark Frost, General Manager of the Human Capital Management division of PeopleSoft. “As the service-based economy
continues to grow, companies must be more rigorous in how they measure and engage with their employees. PeopleSoft continues to lead the market in providing solutions that leverage these kinds of employee metrics to increase employee productivity and overall performance.”
LINKING PEOPLE METRICS TO STRATEGY
To gain their support from top executives, HR specialists must demonstrate that people metrics can be successfully aligned with business strategy. According to the results of a recent exercise by The Conference Board’s Human Capital Measurement Working Group, this process is still in its earliest stages at many companies. Although many people measures are cited as currently being used by working group companies, few firms feel confident about how metrics relate directly to business strategy.
Human resource directors are still the primary sponsors of people metrics in most organizations, although 36% of surveyed companies report that business unit leaders are also involved.
Other study findings:
* Survey data suggest that managers become less involved in the selection and execution of people measures as the size of a company grows.
* Utilizing metrics in bonus plans is growing, but is still a minority practice. Only 39% of surveyed companies reward managers based on people measures.
* The financial measures of cost reduction and revenue growth are more commonly linked to people metrics than intermediate performance drivers such as process and product innovation and globalization. However, the
survey results suggest that people measures are more successfully linked with intermediate performance drivers than financial measures.
TOP LESSONS FOR MANAGERS
The study cites the following top lessons for managers:
* Involve HR professionals in the development of overall business strategy.
* Enlist leaders from outside the HR department to help develop and back human capital metrics.
* Collaborate with business managers to ensure that people measures link to the strategic goals of business units.
* Focus more attention on the links between people measures and major performance drivers (customer satisfaction, innovation, etc.) and place less emphasis on their connection to cost reduction, revenue growth, and other financial outcomes.
* Include human capital metrics in bonus plans.
* Audit metrics (internally and externally).
* Develop ad hoc analytical reports that detail how people investments can deliver business results.
I think the better way to go forward is to utilise the HR Scorecard that Ulrich et al have tried to evolve.
I think it encompasses the best way to go forward.
Measures need to be chosen very carefully, and that has to be done by senior management, not functional HR…!
What you measure is what you get… and we measure that which is easier to measure. So, we are sort of stuck/ fixated with measuring GDP as an indicator of human happiness – surprisingly, against much evidence of an increasingly negative correlation between GDP and Happiness of a society. Just think of this irony: the cost of cleaning up the environment from a man-made or natural disaster gets added up in GDP, and not deducted from it!!! – e.g., yesterday, Morocco had an earthquake killing around 500 people. In the economics of the day, this will lead to more business for the insurance, heavy excavating equipments, coffin-makers, hospitals, etc., each adding to GDP… it is a topsy-turvy world.
Perhaps one of the fallacy of present-day economic measures is their narrow focus on consumption. So here is a framework to look at an economy, beyond the consumer economics paradigm. It is actually common sense, which we have sort of abondoned: a happy contented life, of course, is based on buying/possessing items of convenience. But happiness and well-being of a society/nation also depends on a clean environment, and a healthy, social life of its people…. sometime, it seems surrealistic that people have forgotten this simple fact of a happy life – that conservation and maintenance of things we have is as much important to our well-being, as consuming them!!!… Do explore this site.”
On the Workforce Management Community Center: My post on Training Needs Assessments
” There is no one correct way to do a training needs assessment .
Using the language of systems-thinking one would say that delay or time lag during TNA gives rise to a vicious cycle of spiralling
learning gaps and loss of credibility for the training function.
Most training professionals are ignorant of adult learning theories and even basic educational theories like Bloom’s taxonomy. So if the business unit was a training on operational level of a certain skill and if the training manager organizes an awareness level programme only then the training function again loses credibility.
Most professionals feel that being ‘business outsiders’ they do not have the expertise of the subject matter. I believe that subject matter expertise is not needed for a training professional but a ‘process expertise’ in the domain of learning theories.
The other problem is of training and business professionals who believe that training is the solution of all their ills, the panacea to their problems. Typically, these are similar to the workman who has a hammer, and to whom all problems look like nails.
Most form of classroom training has limited impact unless followed up with other changes on the workspace, especially for soft skills and behavioural issues. The more intense the issue the more useless is training as a standalone intervention. It has to be sustained by structural and process changes in the work place.
Training should not be carried out at an activity level but be immersed in business to deliver business results.
I think the approach for training professionals is taking the Human Performance Technology approach! “