An ever evolving world
Nick Martindale provides an overview of the challenges facing the HR community.
With the economy finally picking up, many aspects traditionally associated with HR which may have been put to one side during the downturn are once again coming back on the wider business agenda. This can create both challenges and opportunities for those working in the function, and understanding the implications will be vital.
According to a CIPD survey released in Autumn 2013, talent management is the area HR sees as most important for 2014. This is something David Parry, UK head of human capital at Deloitte, has also noticed, both with clients and in his firm’s own research. “Organisations are actively thinking about what we would call an employee value proposition,” he says. “They’re asking why somebody would come to their organisation as against their competitors, whether that’s culture, investment in development, pay, interesting work or being able to make a difference on the social front.”
As part of this, HR needs to consider the work environment and broader culture they offer, and whether these are likely to encourage staff to stay, and deliver their best performance, says Vanessa Robinson, head of research at the CIPD. “Companies with good workplaces and cultures should get better results and avoid people getting burned out or having a few people being very highly incentivised at the expense of others,” she says. “Getting a sustainable view of performance is important.”
Retention and engagement is also likely to be a core focus for HR and benefits professionals over the coming months. A study by Globoforce in 2013, for instance, found 42% of people were looking for a new job because they felt they had not received sufficient recognition.
“We are recommending to many of our clients that they implement a “meaningful” reward and recognition programme,” says Natalie Gunson, managing director of incentives firm AYMTM. “This can allow top-performers the chance to earn reward based on specific measures that benefit them personally, from vouchers for shopping to personal holidays, all based on specific performance criteria. Loyalty and performance should be rewarded, and can make the difference between employees staying or leaving an organisation.”
Ensuring any reward scheme is effectively communicated is vital, warns James Malia, managing director of P&MM Employee Benefits. “Even great news such as company-wide pay increases can backfire if the employees are not engaged, or the message is communicated incorrectly,” he warns. “Depending on the size of your team and their preferred methods of communication, emails, social media and even in-office posters are all very effective ways to tell staff about changes or the introduction of new benefits. One route or medium will rarely be enough to totally communicate and engage the audience.”
Bringing more people into the organisation is also likely to be an important area for HR. Identifying and attracting well-rounded leaders is a particular challenge, says Jerry Gray, managing director at executive search and selection consultancy Veredus. “Businesses are becoming savvy to the fact that they need senior representatives with a more generalist skillset, but these individuals are scarce,” he says. “Exacerbating this issue over the coming year are the changing expectations within this talent pool. Salary and bonuses are no longer the top incentives they once were. Instead, work/life balance and corporate culture play a much greater role.”
HR will also need to bring in people from different backgrounds, and make the business case for this to the wider organisation, says Andrew Manning, director of the Centre of Excellence at talent management organisation Pinstripe & Ochre House. “Having a diverse workforce allows an organisation to reflect its customer base and better understand their needs in order to give them the best service possible,” he says. “But for diversity to flourish HR must ensure that the culture is adaptable enough for new ideas to be accepted.”
Other areas will also require the attention of HR, as a result of legislation or changes in society. Jo Thresher, head of money at work at Jelf Employee Benefits, highlights the need for HR to understand – and explain – the implications of recent changes around freeing up pension pots, as well as the ongoing work around auto-enrolment and the abolition of the default retirement age. “Lack of understanding will mean a lack of planning for future staffing needs,” she warns. “Employers and employees will need to review what this means for them.” In the longer-term, coping with multiple generations of employees in the workplace at the same time will also create challenges, adds Robinson, particularly around supporting line managers tasked with managing older workers.
The introduction of shared parental pay and leave will also have implications for HR in 2014, and could prompt organisations to review their policy around maternity pay. “Employees of employers with generous maternity pay policies are more likely to want to take advantage of shared parental leave, so employers will need to give careful consideration to market practice in deciding how to amend such policies or introduce new ones for both parents,” says Nick Thomas, a partner at global law firm Morgan Lewis.
There could, however, be benefits too, he adds, particularly if the policy proves popular. “If both parents take a shared approach to these caring responsibilities, this may mean that employers can get mothers re-integrated into the workplace much sooner than in the past,” he says. “Employers may decide that, overall, this causes less disruption to their business.”
HR’s own skills
HR will also need to look at its own development, after being starved of investment for a number of years, says Parry. This is particularly the case with the use of technology to support new areas such as analytics, reward modelling and performance management, he says. “It has also been starved in its personal development, and the skillset associated with the evolution to a much more business partnering, consulting-style and strategic role,” he adds.
Getting others in the business to understand and buy into the main focuses for HR is another challenge, which also presents an opportunity for the function. “HR can facilitate, support and champion this whole agenda around reward and incentive, and also more generally around how you encourage the right behaviours and culture,” says Robinson. “But they need their senior business colleagues to buy into it too. This can’t be something HR does on its own.”
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