The HR employment and salary outlook – part two

The latest HR outlook has thrown up some interesting insights into the profession from what is having a big impact on the role to the biggest challenge facing the vocation.

The HR employment and salary outlook – part two
Technology is having an impact on the HR profession but quality of hire is topping the important challenge list according to Hudson’s Human Resources Salary & Employment Insights 2014 guide.
Hudson NZ Executive General Manager, Roman Rogers, told HRM Online, the report showed that technology is impacting the ways in which HR professionals work and the skills they need.
“Specifically, our Wellington team is seeing HRIS software creating efficiencies within the HR function. Applicant tracking systems such as PageUp and Taelo are also becoming increasingly popular and e-learning is on the rise. More obviously, HR professionals are using LinkedIn and other social media for recruitment and to share information with key stakeholders,” he explained.
Rogers added that technology advancements are also removing the more transactional tasks such as employment contract generation. This may make HR functions leaner, according to Rogers, and leave HR functions more time to work on commercial objectives.
While HR grapples with new technology, the biggest challenge they are facing is improving quality of hire. According to 97% of companies surveyed by Hudson measuring quality of hire was important, but only a third were currently measuring it.
“Quality of hire remains the most elusive talent metric for many organisations. Yet it is also the most important metric for driving sustained business success,” Rogers said. “Today’s leaders must not leave quality to chance if they want to create competitive advantage for themselves well into the future.”
According to Hudson research undertaken globally last year, a majority (85%) of organisations that measure quality of hire, and take action as a result, report it has had a positive impact (10% or more improvement) on hiring quality. Close to half (45%) believe there is a significant impact on improvement. Of the top three quality of hire metrics used: retention of new hires, hiring manager feedback, and employee performance appraisal ratings, it appears that retention of new hires is most significantly affected by the introduction of quality of hire measures with 62% reporting there is a dramatic impact of more than 25% improvement.
Rogers said this raises the question of why so many resourcing functions are still focussed on efficiency, service and cost metrics in favour of quality-oriented metrics.
“Most key performance indicators for resourcing functions focus on metrics for time to fill, time to shortlist, conversion rates (from shortlist to offer), hiring manager and candidate service satisfaction and cost per hire. In addition, the cost per hire metrics rarely take into account the true costs of getting recruitment wrong, such as the costs of turnover or the costs of hiring poor performers. Cost metrics are therefore more transactional than strategic in nature,” he explained.
“HR professionals can tackle the issue of quality of hire by ensuring they have a robust talent management processes in the areas of attraction, selection, retention and exit. They can improve assessment and selection by introducing more rigour to the processes including psychometric assessments, simulations and other objective measures. Also providing structured training and one-to-one coaching on interview skills for hiring managers as well as developing a more compelling employer value proposition to present to candidates during the recruitment process can help improve their organisational assessment and selection practices.”
Despite the challenges ahead and need for HR to adapt to the impact of technology, Rogers said 2014 is “looking like a good year for HR professionals and teams”.
The past couple of years have seen HR teams focussed on more negative areas of HR including redundancies and restructuring. Hudson findings showed that last year was characterised by large-scale internal change for 61.9% of New Zealand organisations and HR was central to driving the change and managing its impact on employees.
“A lot of cuts have been made now, but teams are lean and under pressure resulting in a more stressed workforce, with nearly half (43.3%) working longer hours than a year ago*. So this year we think HR work will be more about consolidation as well as motivating and engaging with the remaining workforce,” Rogers explained.
“We also see there could be potential growth of HR headcounts in some organisations in 2014.”
*The outlook guide showed HR professionals are taking on more work. 30.9% of Kiwi HR employees and 46% in Australia said they were working longer hours than a year ago. Of these, 94.1% in NZ and 73.1% in Australia are working an extra five to 10 hours each week.

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