What are the right things for HR to be doing right now? This is the question posed in a recent article by leadership consultancy Egon Zehnder, who asked some of the world’s most admired companies what was top of their HR agenda.
The piece provides some fascinating insights into how organisations such as Nestle, Goldman Sachs and Ralph Lauren are creating people policies that support the business strategy.
Several key areas of commonality emerge – and although the application (and the budget) may be different, they are issues that are just as relevant to SMEs as they are to the big players.
So, what can HR learn from these big corporations’ top priority list right now?
1. Make talent a business priority
A business lives and dies by the quality of its people, so it is vital that HR takes a strategic approach to finding and nurturing the right talent. But as the Egon Zehnder piece points out, talent management cannot solely be the preserve of HR. It has to be on the radar of the leadership team and the responsibility of managers throughout the business.
In the best-in-class companies featured in the article, people and succession are the on the agenda at every board meeting. Managers are encouraged to identify and grow the talented people in their teams and to develop an in-depth understanding of people’s individual career aspirations. Probably most importantly, managers are encouraged not to ‘hang on’ to the talent in their team, but to provide opportunities to share and circulate their best people around other areas of the business.
If your board isn’t already regularly reviewing current and future talent needs, now is the time to encourage them to start. Perhaps start by focusing the conversation on a few key people and positions – with supporting information to facilitate the conversation. With feedback from the latest performance review, training they’ve had, and how their salary stacks up against competitors, will make it easier to assess if you are doing all that can be done to help them achieve their potential and keep them in the company.
2. Seek genuine employee involvement
Organisations often say they want to listen to their employees, but in reality only pay lip service to the concept. A genuine desire to hear what employees have to say is, however, paying dividends for several of companies interviewed for the article. Leading-edge practices such as reverse mentoring and engagement on internal social media is helping organisations ‘crowd source’ employee ideas and feed these into the future direction of the business. The double whammy is the boost in employee engagement this brings. If people feel they are being listened to and that their ideas are valued, their commitment to the company and willingness to go the extra mile will be greatly increased.
Having a finger on the pulse in smaller companies should be easier, but in reality with so much to do, it’s often an activity that gets overlooked. If regular face-to-face conversations aren’t possible, try putting in place an HR system that lets you share information and gather feedback.
3. Support innovation
HR has a role to play in removing some of the barriers that typically stand in the way of the innovation all companies need to engage in if they are to stay ahead of the game. It’s about creating a culture where mistakes are tolerated and seen as learning opportunities to build on, rather than failure. Forward-thinking companies are also involving employees at all levels in innovation projects, actively encouraging them to challenge the status quo and come up with disruptive ideas for new products, services and business models.
Whatever the size of company, HR can help to remove overly-bureaucratic processes that cause innovation to stall. They can review the approaches to rewards, acknowledgement or performance systems so they reinforce the message that innovation is everyone’s responsibility. A simple “thank you” from the MD, or free pizza, can do more to lift employee morale and engagement than a financial reward.
4. Use data to provide insight
Thanks to advances in technology, HR now has a wealth of people-related data at its fingertips, especially with a people management software. This is valuable intelligence that can be used to support key business decisions around everything from workforce planning and talent management to employee retention and engagement. Data analysis can, for example, help the business ensure it has the right skills in place to support diversification or a planned expansion into a new market. It can also save the business money.
The Egon Zehnder article cites the example of one organisation who were able to put strategies in place to improve attendance when data showed the extent of working time lost to unplanned absence. For SMEs, the key issue is to look at what data is going to be most useful to your business, and ensure you are gathering the information in a system that helps you make the most of it. IT’s also important not to get hung up on “big data.” Influential management thinker and author, Martin Lindstrom, argues convincingly that it’s small data that explains the why behind big data, and what ultimately leads to the most innovations. So, focusing on one-to-one conversations with employees or customers could benefit your business more.
5. Take a fresh look at employee development
Leading companies are shaking up the way they approach training and are pushing employee development higher up the agenda. There is a move away from traditional training programmes and instead towards just-in-time learning that can be delivered to employees via online platforms and accessed from mobile devices. This plays into the expectations of Generation Y employees who are hungry for development and expect to be able to access learning as and when they need it.
Stretch projects and assignments that allow employees to move around and experience other departments and countries are also becoming an increasingly popular way to build more rounded and multi-skilled employees. Coaching – although certainly not new – also continues to be valued as a way of helping people ‘own’ their own development and make a step-change in their performance.
All of these approaches can be made to work well in smaller organisations, and can often serve a dual purpose: providing opportunities for both the “learner” and the “teacher” to develop new skills.
6. Shake-up performance management
There has been much publicity in recent months about leading companies who have abandoned the traditional appraisal process and moved to more dynamic approaches to performance management. This may be a little too revolutionary for many businesses, who still see the value of a formal performance management system. But there is no doubt that shifting the emphasis from a mechanical, paper-based process to more regular meaningful dialogue with employees can significantly raise performance.
Whatever the size of company, HR can help build cultures where ongoing feedback is the norm and managers are encouraged to focus on what their people are doing well (and how they can do more of it) rather than focusing on the negatives. HR can also help to equip managers with the skills to have productive performance conversations and can look at making better use of the sophisticated software that is now available to make the performance management process easier for managers.