In 2016 KPMG International conducted a study on HR and found that the old adage, “no one takes HR seriously,” still holds true to a certain extent. They found that only 17% of respondents felt HR was able to demonstrate its value to the business in a measurable way. These numbers are decidedly not good, what’s going on?
Only 17% feel HR is able to demonstrate
its value to the business
As one of our interns wrote, HR is still widely disliked, even twelve years after Keith H. Hammond’s groundbreaking article, Why We Hate HR created a map for how to change things. There are a lot of factors for HR’s failure to become relevant, but at its core one of the main issues is that HR still doesn’t know how to think in terms of business results. This is a shame because effective talent management can truly set an organization apart from its competitors.
Josh Bersin and his team conducted research to quantify how much of a difference good HR can make, and the numbers are impressive. Companies with strategic talent management:
- Generate 26% more revenue per employee
- Have 40% lower turnover
- Are 28% less likely to downsize during a financial crisis
The phrase strategic talent management is a core part of this. If HR is focused on administration, or “perks and fun” it won’t invest in strategic talent management, it won’t measure results, and it won’t add value to the business. Which means no one will take HR seriously.
If you’re in an organization where HR isn’t perceived to add value here are a few ways to change it:
Embrace a General Mind-Shift
You’ll need the right mentality before you can truly dive into changing processes. Master this, and the rest will be that much easier.
1/ Break the Rules
As we’ve previously written, if you want to get things done in HR you’re going to have to learn how to break rules. This isn’t the same as breaking the law, it just means that you stop waiting for permission and instead jump in, do things, and share the results.
2/ Be Results Oriented
Each and every action HR takes should be connected to the business. For example, in assessing the quality of your training programs you shouldn’t be looking at how many hours of training people followed, you should be looking at the impact this had on productivity, retention, customer satisfaction, etc.
This doesn’t mean that you can’t focus on more “fluffy” things like well-being or corporate-social-responsibility. On the contrary, you should! You just need to make sure you can make a case for why such actions will help your organization grow and succeed.
3/ Be Data-Driven
This is directly connected to being results oriented. Numbers will help you refine your processes, justify decisions, and empower you to clearly demonstrate HR’s value to the business. If you aren’t regularly asking, “what data do we have about this?” now is the time to start. Gather as much data as you can and use it to connect HR actions to business results – then make sure executives are aware of the results you are delivering.
4/ Reduce Bureaucracy
HR is famous for creating more bureaucracy, not less. However, if HR is truly there to empower employees to succeed it will strip away useless rules and instead entrust and empower employees to act. For example, rather than create complicated budget rules for expenses on business trips why not simply give employees a fixed budget to spend as they please? This simple change reduces rules while increasing employee independence.
5/ Document Your Strategy
Don’t just talk about your strategy – write it down and make it VISIBLE. A documented strategy helps keep everyone on the same page and holds leaders accountable for connecting their own goals to that strategy. It’s also a great way to demonstrate exactly how HR plans to add value to the business.
Once you’ve got the mind-shift down you can focus on core HR areas. To build a talent-centered mindset we recommend focusing on recruiting, employee development, and the overall employee experience first.
1/ Be proactive instead of reactive
Companies today can’t afford to sit back and wait for talent to come to them. This means you need to engage in sourcing as well as recruitment marketing. By creating processes that have you finding and attracting candidates you’ll be able to draw in the top talent you need.
2/ Connect placements with performance
Being talent-centered means that you don’t just measure recruiting success based on time-to-fill, you look at how each placed candidate actually performs. After all, you don’t recruit just to fill jobs, you recruit to find great candidates who add value to the business.
3/ Forecast vacancies based on business objectives
If you’re well in-tune with the company strategy and goals you’ll be able to forecast future vacancies based on what the company wants to accomplish. This will enable you to lay the groundwork for recruitment processes that can deliver the talent you need, right when you need it.
4/ Facilitate culture change via recruiting
When you want to change company culture one of the best things you can do is bring in new blood. A targeted recruiting process can help you identify exactly what work styles and personality types you’ll need to incorporate into the company to facilitate change.
Talent-Centered Employee Development
1/ Shift from a function-based to a project-based view
Normally when we think about jobs we think of all the responsibilities associated with that role. If employees want to branch outside of it they need to take a different job. Unfortunately, this hurts their development and growth. But, when we change to a project-based view, employees can keep their jobs while moving from project to project, trying and learning a wider variety of things, and getting more immediate feedback on their performance at the same time.
2/ Only give managing roles to leaders
If employee development truly is a priority in your organization you won’t allow individuals to take on management positions if they aren’t willing to be leaders and engage in regular feedback, training, mentoring, etc. with their team. This isn’t to say that non-leaders can’t run projects and use their skills, it is to simply make it clear that you want all your managers to be leaders as well.
3/ Align employee training with long-term business goals
If you are aware of the company’s long-term strategy you can work to run training programs that will nurture your employees to be not only ready for today’s challenges, but tomorrows as well.
4/ Track how developmental actions impact performance
Mentoring, training, e-learning, and other parts of employee development can have a significant impact on company performance. If you are results oriented and data-driven then you will be working to figure out what kind of impact it has and will share it with the business to demonstrate the return on their investment.
Talent-Centered Employee Experience
1/ Radical Transparency
One of the worst things HR professionals and business leaders can do is to cover up problems and pretend they don’t exist. When this occurs employees discover problems anyways, and then draw their own (often negative) conclusions. Radical transparency allows you to quickly share what is going well as well as what isn’t, and what the company plans to do about it. The result is that employees trust you more, and customers will as well.
The social media tool Buffer did this when it had layoffs in 2016. They wrote and shared an entire blog post detailing what happened, what went wrong, and how they would avoid that in the future. This level of transparency was key in building trust and helping the company through a difficult time.
2/ Easy access to effective HR software
Just as traditional consumers expect a positive experience when buying a product online or using a service, employees do as well. Be sure to provide them with intuitive, effective software that gives them the information they need and helps them to grow and advance their careers.
3/ Gather and publish feedback regularly
Use pulse surveys and other measurements to gauge how employees are feeling, then share the results! This will empower your organization to build on successes and openly address potential obstacles.
4/ Employee relationship management
Airbnb generated a big buzz when it got rid of its HR department and replaced it with an employee experience department. The principle was that just as Airbnb wanted to manage customer relationships and ensure they had positive experiences, they wanted to do the same with employees. The creation of a new department changed their focus away from more administrative work and towards strategic talent management that was geared towards nurturing talent to enjoy working for the company while delivering strong results.
If you want to improve your employee experience read this free ebook!
While only 17% of executives may currently believe HR adds value, it doesn’t have to stay that way. If you can help your HR team focus on strategic talent management and continually focus on using data to create and demonstrate business results you’ll make yourself a true partner to the business.