Human Resource department also needs to monitor and follow up to ensure employee morale does not take a beating, messages and policies are properly communicated and implemented - IIPM

Q. You believe: “It is abhorrent for companies to embrace a ‘hire-and fire’ approach in their human resource policy”. What do you advice, if not downsizing in order to improve the cash flow, at the time of depression?
A. It is not good to have a hire-and-fire management policy because the staff’s loyalty and trust are quickly eroded. Notwithstanding, there is a place for downsizing when the company has lost its monopolistic position, major client or during times of merger and acquisition when there is duplication of resources. The key principle to note is that downsizing is like amputation. The company needs to manage the negative side effect which is the erosion of morale. Most restructuring exercises require the support of the staff for it to be successfully executed. The CEO or HR department cannot do it in isolation.

The company has other options of improving the cash flow by resuscitation strategies, i.e., revitalise the business to increase revenue and profit. These may include re-inventing the business model, using the internet to reach out to new markets and customers, and identifying new and profitable market niche.

Q. In your terms, please prescribe some regular “check-ups”, which HR can take care of, to ensure the company’s internal immunity during turnaround.
A. It is quite ironical that many companies spend a lot of money on staff’s annual health checks but are quite negligent when it comes to their own corporate health check-ups. Early diagnosis is necessary, just as major diseases can be cured if diagnosed early. This can be done by engaging the turnaround experts because they are independent people and have less concerns to deliver bad news about the company.

An external turnaround specialist with the right expertise has no qualms in telling about the existing virus as he is commissioned to cure the sick business. Read more...

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“People are the most important assets an organisation has”,

Q. How can HR ensure a smooth relationship with the CEO?
A. Since the HR leader plays a critical role in coaching the leadership and facilitates critical decisions, a strong trust in the relationship is an absolute must. The HR leader needs to deliver consistently on commitments, have an organisational pulse and a balanced approach to decision making. A critical differentiator would be the ability to effectively influence decisions.

Q. How can the CEO understand his employees’ needs? 
A. The key to a successful HR strategy is the ability to drive the human equation while achieving business goals. HR issues cannot be considered in isolation in order to have sustainable solutions.

Q. Where do you want HR to transform its role?
A. Managing Change: move from being a change facilitator to driving change.
• Leadership Development: identify, assess and develop key talent.
• Workforce Planning: proactive efforts can help in managing growth and downturn effectively.
• Statutory Compliance: it can make or break the business, understand labour legislations and build systems to comply.  Click here to read more...

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'A seat at the table'

According to Ulrich and Brockbank, the future HR professionals will have to become more knowledgeable about internal operations and increase their knowledge of critical external factors such as customer requirements, supplier relations and competitive market structures, domestic and international regulatory issues, globalisation and the requirements of capital markets. HR professionals will also have to increase their focus on creating value for the external stakeholder. In creating value for the external stakeholder, HR professionals will have to design internal processes that have a direct impact on the customer. Compensation and performance management will be designed to influence consumer choices. In tune with the investment community, which has started to account for intangibles like human capital assets and leadership development, the CEO will expect HR leaders to design processes and organisational capabilities which will enhance the stakeholder value. This is though, not to suggest that HR can bring along this transformation alone. Business leaders and board members will also need to help HR integrate better with line functions and the organisational decision-making processes. Senior leadership will also need to project and position HR as a strategic function across functional borders to reap the benefits of a new and transformed HR system.

In the recruitment arena for HR professionals, we have already seen a significant demand for HR executives who are able to participate in discussions on business strategy from both an HR and a stakeholder perspective, translating the human capital ramifications of business into quantifiable results. Organisations now want HR leaders to be champions of business performance whose decisions and efforts in the HR arena are designed to positively impact business outcomes. It probably is the time to look beyond and start thinking like a CEO, and only then will HR be able to evolve from being a strategic business partner to a business leader. Read more...

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