The Great HR Debate

by 08 Jul 2010

What is HR’s secret to getting talent management right?

One of the biggest issues facing HR now more than ever is getting the right people on board and keeping them, while trying to keep them engaged.

Graham Childs from Mastertek said the key drivers for people leaving jobs had changed over recent times. One area he said that HR could influence is inequity in the workplace, which leads to disillusionment, by managing poor performance better. “People say ‘I don’t mind putting in the effort but for God’s sake fix up the dead wood here that is dragging us back’” he said.

Jodi Dickson from FCB Workplace Lawyers was quick to point out that performance management tended to be a symptom of something that isn’t right in the organisation. “I don’t think anyone actually recruits dead wood. If you’ve got [that type of employee] in your organisation it’s something you’re doing or not doing that is creating the problem,” she explained.

“I think a completely new view of what we’re doing as HR practitioners is required post/mid-GFC. We need to stop focussing on managing resources and look at the different kinds of relationships people have with their employer. You’ve got this legal relationship which you must get right; you have an intellectual relationship, trying to stimulate them, allowing decision making and control; you have an emotional relationship, and then you have a physical relationship which is where you sit them, the kind of tools that you give them. I think HR managers have to start understanding those fundamental relationships better.”

Ari Kopoulos from Employee Connect said that with the help of technology, HR professionals can pinpoint potentially problematic employees at an early stage. “It’s about profiling the individual, not just in terms of performance but potential. You need to have the right data on your employees for strategic decision making.”

“But there’s a gap,” said Dickson. “Organisations don’t look at themselves and ask ‘what do I need to give this person to bring the potential out?’”

Kopoulos replied: “Technology can help identify when this goes wrong. If there’s someone who has gone from being a ‘high performing’ and ‘high potential’ employee, to being a poor performer, they’re probably looking for another job. That’s what we call flight risk management.”

Dave Burroughs said that at a more basic level, employers now have less talent to choose from so employees are rising up to managerial positions with technical competence rather than leadership or management skills. “It’s incredibly important for us to be developing that next crop of future leaders so that they can step up with leadership skills that will get the best of the people sitting around them,” he said.

“The really good companies that came through the GFC well had really well-defined values. They didn’t impose them on their organisation, they developed from within. They are really attractive to work for. Certainly a lot more organisations are getting interested in not just ‘how’ they do things but ‘why’,” he said.

Dickson added: “Leadership for me is about harnessing the results and using them to push people towards their purpose. Unless we start to harness this outcomes-based, purpose-based leadership, we’re going to have a lot of disenfranchised CEOs asking ‘why am I pouring money into this space’. You’ll get a profession full of counsels and I think HR in this country has moved away from that. Counselling with a business purpose is what’s required.”

So are employers being more cautious when recruiting now in order to get the right talent on board in the first place?

David Owens from HR Partners said that while organisations have always been cautious in hiring decisions, certain areas are under the spotlight. “There is a lot more attention given to HR recruitment, particularly by CEOs,” he said. “CEOs are looking to be personally involved in interviewing and being involved in the recruitment process. It has become higher profile and is getting due diligence from the C- suite much more now than it used to.”

Childs asked: “Are HR professionals moving back into specialisms? I’ve noticed a lot of recruitment targeting specialist roles such as remuneration and benefits.”

Responding, Owens claimed that the demands on a HR team have become far more sophisticated. “The whole idea of compliance is much more rigorous, we’ve got an industrial relations revolution going on and fantastic innovation in technology. So all of a sudden a senior HR person can’t just be a really good generalist - they have to recruit and engage some top level HR expertise.”

He added: “If you’re a bank and you want to hire and keep the best people, you’ve got to be paying the best benefits and bonuses, and the only way you’re going to keep ahead of your competition is by having the best remuneration and benefits people running that function. Without them you’re blind. What’s really encouraging for the broader HR community is that the budget is actually available for HR leaders to acquire these talented people. It makes that HR capability much greater within the organisation.”

He added that a two-sided conversation about return on investment (ROI) is occurring. “There’s ROI in the sense that ‘this is what we’re going to get in terms of lift in company performance’, but there’s also ROI in the risk management sense that ‘if we don’t have these remuneration and benefits specialists, we’re going to lose a lot of people and lose a lot of money’.”

Childs agreed, saying that risk management had also become extremely important in the design the of reward programs. “Reward needs to be tied to the risk that you’re taking. Organisations are now asking ‘what is the length of the risk? When is the reward being paid? How do we tie it into our business strategy?”

Dave Adler from Smart Salary said that HR needed organisation-wide support to achieve its goals. “A lot of businesses seem to think that HR is a team of people that sits over there, and leave the performance and talent management up to them. But at the end of the day, every single manager, whether it’s in sales, accounting, marketing or the CEO, they are all looking after people every day of the week.

“Some employers thought that with the unemployment rate going up, they could stop worrying about a lot of the HR initiatives, and that it was an employers market. But the reality is that this moment was an opportunity for HR to say hold on, we’re really going to show our employees that when things get tough we’re going to keep working to make this a better place to work. The GFC was a good opportunity to really gel people to the organisation,” he said.

Are Gen Y too demanding and are Baby Boomers change resistant?

The question as to whether companies have to alter their incentive programs to cater for different generations in the workforce was met with the general agreement that the needs and wants of each generation are the same – the only difference is how they ask for it.

“The things Gen Y are asking for are the same as what the Baby Boomers are asking for,” said Childs. “They’re asking for flexibility, they’re asking for somebody to lead them, give them fair and honest feedback and to work for a good company. I don’t see the difference between Gen Y and Baby Boomers and what they want from the workplace – the only difference is Gen Y are more noisy about it,” said Childs.

Kopoulos however questioned whether Baby Boomers truly understand the shift toward real flexibility. Childs said that the Baby Boomers who are asking for flexibility today are the deniers of flexibility in the past. But they are now beginning to see the value in flexibility. Owens agreed, suggesting Baby Boomers are turning to flexibility options now because it’s simply their turn. “If everybody else is working nine day fortnights – it must be my turn now!” he said.

While it was agreed that the needs and desires may be the same across each generation, the acceptance and willingness to adapt may be different. Burroughs believes that baby boomers may be more resistant to change. “The challenge for the Baby Boomersis the change – but for the younger generations change is like breathing. If it doesn’t change then there is something wrong,” he said.

However Childs said that resistance to change is not a characteristic specific to a generation. Instead it is when companies approach change in the wrong way that the problem arises. “People of all ages will accept the outcome, even if they might not like it, as long as there has been a fair process along the way,” said Childs. “If people feel they have been engaged along the way and understand the reasons behind the decisions they will accept the outcome. But if a company just applies the outcome and doesn’t take you on the journey – it doesn’t matter what the outcome is, Baby Boomers won’t accept it,” he said.

Burroughs also said that the same leadership principles apply across all generations; keep people informed, give them some autonomy in decision making, make them feel respected and trusted and feel part of what they’re doing.

Dickson said that because young people have access to so much information at their fingertips, if they want to know something they no longer have to go to authority to get it. Workplaces are therefore going to have to realise this and be engaged with this new kind of intellectual rigour. Employers will need to encourage bringing new information to the organisation and teach employees how to filter what is relevant and what’s not.

“The more switched on organsiations don’t ban Facebook or Google because they realise that information leads to empowerment and that’s what we want – immediate decision makers,” she said. “So if management want to stay relevant they need to be just as committed to finding out that information as well.”

Social media – is it dangerous or an essential HR tool?

The whole generation question naturally led to Gen Y’s forte – social media. According to Kopoulos any savvy recruiter or HR professional will keep a close eye on sites like LinkedIn and how they assist talent management. “If you did some deep research and look at what kind of conversations a candidate is having on LinkedIn, what their network is like – you can make some generalist decisions on suitability for employment,” he said.

Childs, however, questioned the credibility of social networking, and profiles on the professional networking sites such as LinkedIn. “Isn’t it dangerous – isn’t what people put on their social network actually an alter ego? Isn’t it something different to what they really are?” he asked.

Kopoulos responded that if you look purely at qualifications posted, then you might as well take a blind resume and address it the same way. But if you go to the next step and look at the conversations they are having, their network and their recommendations then it tells an entirely different story.

“I think there will be a time when there will be an application to take competencies from across LinkedIn and employers will be able to pick somebody who is competent in a certain area with a level of authority.”

The whole social networking debate raised another issue around discrimination.

“What happens to the individual when you cancel that connection – or ‘defriend’ someone on Facebook?” asked Kopoulos. “They don’t get a notification and I think they should! Also, what happens to the individual in the workplace that you do not accept as a friend on Facebook? Is that discrimination?”

Adler said that many employers still don’t actually check candidates on LinkedIn and Facebook before they hire them – and are still only hiring them from their CV and have no controls in place to check that the information they are receiving is correct. According to Owens, they are the employers who should be using reputable recruitment agencies. “Who’s going to trust competencies that are verified online?” he quipped. Kopoulos acknowledged the point and said that it’s always good to have a recruiter to go back to if things go wrong.

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