Management Challenge - How to retain HR in the wake of melt down
Management Challenge - How to Retain HR in the Wake of Melt Down
"Companies that yield to short-term disturbances in the global labour market place themselves at risk of losing their long-term competitiveness."
The traditional model of human resource management focuses on administrative functions: application processing, benefits, compensation benchmarking, conflict resolution, employee grievances, performance review, and compliance of rules.
HR professionals typically spend the bulk of their time absorbed in these day-today tasks, disengaged from the organization's broader objectives. The human resource curricula of business schools reinforce this tendency, producing competent HR professionals well trained in administrative processes but lacking a firm grasp of the links between human capital and corporate strategy. Thus, the recession which has affected the entire globe has redefined the HR's increasing role in corporate reorganization and challenges.
Talking about the challenges faced by most of the companies RS Shanbhag, CMD of Value Points Systems said, "Recession purifies the system and helps in bifurcating the best from the rest. We are gearing up from today itself to prepare for the best to come and go cracking when markets turn around from this recession. We are back to basics, redefining and fine-tuning every aspect of doing business."
For those who manage organizations, there's no avoiding the realities wrought by an economic climate as difficult as this one. Corporate leaders and Human Resource Professionals must guide managers as they consider making painful decisions, and must help employees as they struggle with the fear of losing their jobs while watching their retirement savings vanish.
Those who emerge on the other side of the recession as stronger organizations will have done so by communicating exceptionally well, retaining and motivating key employees, and containing rather than slashing costs. Investments in human capital are not likely to be an important priority for organizations whose very survival is threatened by the global downturn. But for organizations with strong fundamentals in the form of balance sheets and compelling business models, the economic downturn presents important opportunities to strengthen their HR management capabilities and position themselves for the inevitable rebound:
• Utilizing slack time to engage employees in professional development and technical training programmes, which serves both to sharpen skills and to preserve morale during tough times.
• Opportunistic hiring of talented individuals caught in downsizing at weaker enterprises, which augments the company's human capital base for long term growth.
• Promoting cross-divisional and cross-functional collaboration, which improves utilization of human resources and encourages teamwork between employees who previously had little or no contact.
• Redefining and expanding spheres of authority and responsibility of star employees, which permits assessment of the leadership potential of individuals who may eventually occupy executive positions in the organization.
• Besides taking hard decisions on routine and regular matters, the organization also has an important task of familiarizing its staff with the changed dynamics of the market. The culture of frugality has to be percolated down the line at all levels. In other words, HR needs to engage all employees to drive the culture of frugality across the organization.
• Every organization adopts cost cutting measures and with cost cutting measures operational efficiency has to be ensured amongst all levels. Manpower cost being one such cost trimming it in a pattern as suggested shall not only bring out rich dividends in terms of monetary savings for the organization but shall also weed out inefficiencies and wastages present in the system.
- Must go. The employees who have not been performing well and have not been a contributory factor today must be asked to leave. They cannot continue to sail through on the strength of their experience. If their experience does not culminate into tangible results they need to make way for the new incumbents.
- May go. These are the categories of employees who have been performing well but the performance of late has deteriorated over a period of time. They lack motivation, energy and have been performing well below their desired potential. As they lack initiative and necessary drive required to perform the work they could be dispensed with.
- May be retained. These kinds of employees who are on the rolls need to be retained as they time and again prove valuable in terms of productivity. They are the kinds of employees whose services are sometimes sought after and their resignations shall mean / have an adverse impact on the department. While leaving the organization for better prospects they take away with themselves wealth of experience, expertise and trade secrets and thus the organization needs to take care of these employees monetarily and non-monetarily. However, they are not indispensable.
- Must be retained. These are the kinds of employees who are intensely result oriented and they volunteer for assignments and are always on the look out for more responsibility. As a result, they become utmost valuable and respected people in any organization. They continually prepare themselves for positions of higher responsibility in the future. They have identified their key result areas and work absolutely and positively to give out their best at all the times. They have learned every minute details of the business and nothing can stop them from getting paid more and getting promoted faster in spite of recession / melt down. The organization at all costs has to make valiant efforts to retain these people and their services.
Thus, when we speak about retaining Human Resource we literally emphasize quality people who are at serial no. 3 (may be retained) & 4 (must be retained) as it proves extremely advantageous to the prosperity of organization.
While termination of employees is an avoidably painful process, how companies manage downsizing is an important component of human resource management. Generous treatment of departing workers - including high-quality placement services and severance packages - not only creates goodwill among former employees who will speak favorably about the company and who may indeed return as "boomerangs". It also burnishes the company's image as an attractive workplace ("employee brand") and thereby strengthens its capacity to recruit and retain talented persons when the economy recovers.
The author of this article is Iyer Subramanian. He is working at Bombay Chamber of Commerce and Industry in the capacity of Joint Director-HR. These are some of his experiences which have been narrated. E Mail: iyerpdkgnm@yahoo.com
"Companies that yield to short-term disturbances in the global labour market place themselves at risk of losing their long-term competitiveness."
The traditional model of human resource management focuses on administrative functions: application processing, benefits, compensation benchmarking, conflict resolution, employee grievances, performance review, and compliance of rules.
HR professionals typically spend the bulk of their time absorbed in these day-today tasks, disengaged from the organization's broader objectives. The human resource curricula of business schools reinforce this tendency, producing competent HR professionals well trained in administrative processes but lacking a firm grasp of the links between human capital and corporate strategy. Thus, the recession which has affected the entire globe has redefined the HR's increasing role in corporate reorganization and challenges.
Talking about the challenges faced by most of the companies RS Shanbhag, CMD of Value Points Systems said, "Recession purifies the system and helps in bifurcating the best from the rest. We are gearing up from today itself to prepare for the best to come and go cracking when markets turn around from this recession. We are back to basics, redefining and fine-tuning every aspect of doing business."
For those who manage organizations, there's no avoiding the realities wrought by an economic climate as difficult as this one. Corporate leaders and Human Resource Professionals must guide managers as they consider making painful decisions, and must help employees as they struggle with the fear of losing their jobs while watching their retirement savings vanish.
Those who emerge on the other side of the recession as stronger organizations will have done so by communicating exceptionally well, retaining and motivating key employees, and containing rather than slashing costs. Investments in human capital are not likely to be an important priority for organizations whose very survival is threatened by the global downturn. But for organizations with strong fundamentals in the form of balance sheets and compelling business models, the economic downturn presents important opportunities to strengthen their HR management capabilities and position themselves for the inevitable rebound:
• Utilizing slack time to engage employees in professional development and technical training programmes, which serves both to sharpen skills and to preserve morale during tough times.
• Opportunistic hiring of talented individuals caught in downsizing at weaker enterprises, which augments the company's human capital base for long term growth.
• Promoting cross-divisional and cross-functional collaboration, which improves utilization of human resources and encourages teamwork between employees who previously had little or no contact.
• Redefining and expanding spheres of authority and responsibility of star employees, which permits assessment of the leadership potential of individuals who may eventually occupy executive positions in the organization.
• Besides taking hard decisions on routine and regular matters, the organization also has an important task of familiarizing its staff with the changed dynamics of the market. The culture of frugality has to be percolated down the line at all levels. In other words, HR needs to engage all employees to drive the culture of frugality across the organization.
• Every organization adopts cost cutting measures and with cost cutting measures operational efficiency has to be ensured amongst all levels. Manpower cost being one such cost trimming it in a pattern as suggested shall not only bring out rich dividends in terms of monetary savings for the organization but shall also weed out inefficiencies and wastages present in the system.
- Must go. The employees who have not been performing well and have not been a contributory factor today must be asked to leave. They cannot continue to sail through on the strength of their experience. If their experience does not culminate into tangible results they need to make way for the new incumbents.
- May go. These are the categories of employees who have been performing well but the performance of late has deteriorated over a period of time. They lack motivation, energy and have been performing well below their desired potential. As they lack initiative and necessary drive required to perform the work they could be dispensed with.
- May be retained. These kinds of employees who are on the rolls need to be retained as they time and again prove valuable in terms of productivity. They are the kinds of employees whose services are sometimes sought after and their resignations shall mean / have an adverse impact on the department. While leaving the organization for better prospects they take away with themselves wealth of experience, expertise and trade secrets and thus the organization needs to take care of these employees monetarily and non-monetarily. However, they are not indispensable.
- Must be retained. These are the kinds of employees who are intensely result oriented and they volunteer for assignments and are always on the look out for more responsibility. As a result, they become utmost valuable and respected people in any organization. They continually prepare themselves for positions of higher responsibility in the future. They have identified their key result areas and work absolutely and positively to give out their best at all the times. They have learned every minute details of the business and nothing can stop them from getting paid more and getting promoted faster in spite of recession / melt down. The organization at all costs has to make valiant efforts to retain these people and their services.
Thus, when we speak about retaining Human Resource we literally emphasize quality people who are at serial no. 3 (may be retained) & 4 (must be retained) as it proves extremely advantageous to the prosperity of organization.
While termination of employees is an avoidably painful process, how companies manage downsizing is an important component of human resource management. Generous treatment of departing workers - including high-quality placement services and severance packages - not only creates goodwill among former employees who will speak favorably about the company and who may indeed return as "boomerangs". It also burnishes the company's image as an attractive workplace ("employee brand") and thereby strengthens its capacity to recruit and retain talented persons when the economy recovers.
The author of this article is Iyer Subramanian. He is working at Bombay Chamber of Commerce and Industry in the capacity of Joint Director-HR. These are some of his experiences which have been narrated. E Mail: iyerpdkgnm@yahoo.com