Managing HR in a Recession

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Like a Disc jockey struggling to play his music at the right pitch crescendo with bad speakers, managing people issues during economic downturns could be nightmarish. However loud the music may sound, people will be left standing still on their feet or glued to their chairs. It will require some bit of ingenuity from the DJ to getting people return to the dance floor. This form of ingenuity is what is required of HR professionals during challenging economic times.

The main role of HR to achieving competitive advantage for organisations through effective people management strategies is threatened during recession. Productivity being a major macroeconomic indicator is at an all time low resulting into many businesses folding up and job losses as immediate consequences. For companies that are able to stay afloat, they struggle to keep their employees engaged. The brunt of waning purchasing power due to inflation and the attendant depletion of savings of the working class is transferred to the workplace.

Some of the HR challenges associated with recession include performance issues, agitations for pay raise, pressures from organised labour, tax and other compliance matters. When the well-being of people is threatened as it is often the case during recession, it negatively affects all activities of human existence including their work. This often puts pressure on HR as agitations for pay raise will be on the increase in the face of dwindling sales and revenue. Governments policies in reaction to unpleasant economic climate could involve raising taxes and clamping down on companies defaulting on tax and other statutory remittances.

Rather than adopting knee-jerk approaches to deal with the situation, companies should build a resilient workplace. While I admit I do not have the answers but companies that espouse shared vision and purpose are able to weather the storm during difficult times. No any other department does this better than the HR. While most leaders have ideas of the type of future they envision for the business, only few are able to communicate this in clear terms to the workforce. These few are also bad at listening to the aspirations of the people they lead. The result is a future of a company being built on a foundation which is not in sync with what really matters to employees.

How well companies weather turbulent times will also depend on their adaptability. Building institutions on tenets and values that are long lasting. Enshrining strong corporate governance and ethical values can help during unfavourable climes. As aptly put by the CIPDorganisations will need to redefine success, to question values which underpin their actions and to accept new frameworks” in order to be enduring. This is the hallmark of organisation design and development which is HR’s call.This will surely test our competence and values.

We need to stand up and be counted amongst those who could institutionalize sustainable culture change by leading our companies through recession. Remember the popular saying “tough times don’t last only tougher men do”.

Bashir Mudi Baba can be engaged on Twitter @El_De_Bash. Photo courtesy: http://www.debtdeflation.com

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Diversity and Social Businesses

Businesses are mostly set up to satisfy customers’ needs, make returns on investment, create employment and generate wealth for all stakeholders and the society. Globalization has opened up the migration space and given rise to internationalization of business. In order to further cement their business objectives, organisations are embracing diversity as a means of reaching out to the growing purchasing power of the middle class across the Asian and African continents. This has led to the evolution of diversity management as an outshoot of equal opportunity and diversity studies.

Diversity management is aimed at achieving a double target of profit making as well as reducing inequality in the workplace. The latter which is often neglected at the expense of the profit  making motive. Organisations that however are socially oriented might experience what I call ‘clash of interests’ as the main objective could be overshadowed in the struggle for survival in a murky business environment.

Social businesses for examples those created to give succour to immigrants or those to help return aged people back to work are also required to publish their books and post impressive results for their investors. Some of these organisations do rely on charities and donations; and even enjoy tax cuts. However, it is also plausible to argue that the donations and cuts might not just be enough to keep the business going which may necessitate jettisoning the social objective for a more business-like approach.

This lays credence to the seeming ‘capitulation’ of the social justice theory to the business case theoretical underpinning of diversity management in the academic circles. The real life business scenario tend to give direction of what is taught in our Business schools. If things remain as they are, social business might just be a mere nomenclature of a somewhat for-profit entity based on its mode of operations and management.

It is exemplified by the way we are fast at displaying our equal opportunity and diversity policies but slow at implementing the content from the HR perspective. Another testament to the disturbing trend is the diminishing presence of the Third Sector organisations. They are socially driven entities and different from the conventional business outfits with a focus on filling the space created by the failure of governments and alleviate the pains caused by profit-oriented organisations.

With the ever widening inequality in wealth distribution and the strain in meeting everyday needs, where do people with special needs and those that are ‘disadvantaged’ turn to for respite?

 

 

 

The Money Question at Interviews

It has become a rule of thumb for employers to ask prospective employees salary expectations at interviews amongst other questions. The information is sought to probably clarify a number of issues. First is affordability; whether a company can afford to pay for the value a potential candidate might bring on board. I must say that professionals with track record of high performance are highly sought which tend to tilt pay negotiation in their favour. This is why it is imperative for employers to have an idea of salary expectation from the word go to enable them decide whether to even proceed to the next level of a recruitment exercise. It saves everybody’s time!

A second reason for wanting to know salary expectation of a potential hire is to gauge the industry pay for a vacant position. It allows organisations to know how they are faring in terms of employees’ compensation. If it needs to be jerked up to attract exceptional talent or demand better performance from employees for a company that is way up the ladder in terms of pay.

A recruitment exercise is a bargaining process and it is quite possible for an employer to make a very good deal for a highly sought after professional. Yes it can happen! A lot of reasons might necessitate a professional to change job. Qualified people could take a pay cut for jobs located in the big cities which would launch them onto the big stage. It could also be for a company’s brand and so many other reasons. If I can save money for my organisation and still be able to land a top hire, why not?

On the other side of the divide however, most candidates don’t do well in the bargaining process. Some tend to shy away from the question by opting to go for industry pay of the vacant position. While some would ‘innocently’ succumb to whatever is on the table. Remember an interview is an avenue to prove your worth, why prize yourself low? If you think you are good enough for the job, demonstrate it by asking for a good fat pay!

 

HR Issues for 2015

It is that time of the year when Santa’s red hat is worn by many of us and a beckoning sign of another year. As we prepare for the yuletide and clear our desks, it is not out of place to remind ourselves of issues that will be in the front burner for 2015.

Tim Sackett has set the ball rolling when he noted that retention will be a major issue for HR in 2015. He went further to describe it as the ‘biggest issue no one is talking about”. I’ll add that there are other issues that will form part of our baggage in the coming year.

As unemployment figures across many countries are readily available, shortage of employability skills does not receive much attention. This is one thing HR professionals and recruiters alike will contend with in 2015. It is one thing to have a pool of applicants and outrightly another to have a pool of employable applicants. Filling up vacancies with candidates who have requisite qualifications and skill-sets wont be a walk through the park in the new year.

If skill-sets are important assets for job applicants, it should also extend to HR people. HR Analytics is sometimes seen as another buzzword and mistaken to be a fad; while financial proficiency is seen as not important to HR. My message to proponents of this school of thought is that Analytics has come to stay. For HR to achieve its strategic importance in the boardroom, our understanding of cash-flow and financial statements need improvement.

I do admit that the issues raised in this blog are by no means exhaustive and might stimulate contrary opinions. I must say that it is for the good of HR profession when we have diverse perspectives to issues. As we countdown to 2015, I am wishing everyone a happy holiday season.

Follow me on Twitter @El_De_Bash