Executives talk about it. HR claims they are a part of it. Everyone agrees it is crucial. But what is strategic HR, really?
Let’s forget about all the onboarding, retention, and sourcing stuff. Contrary to what people might think, those are after-the-fact issues.
Employee care and nurturing is like maintaining a building: you have to start with quality brick. In other words, the employee skills that walk in the door every morning and walk out every evening define (and limit) what you can do with the organization.
Some do it right
Let’s step outside the organizational realm for a moment. Can anyone name a single professional orchestra that hires musicians without hearing them play? How about a professional sports team that hires players without watching them? Know of any Olympic team in the world that doesn’t require athletes to try out first?
It does not stop with onboarding. Don’t they all employ expert coaches to observe and develop player skills? Don’t players attend specialized workshops where they practice to get better? At the end of a performance, don’t players get evaluated on what they did — swimmers for swimming, runners for running, skiers for skiing, and so forth?
Now, let’s look at a typical organization. Managers work from outdated position descriptions that define “what” is required instead of “how” skills to get things done. Interviewers ask candidates questions like, “So, tell me about yourself,” “If you were an animal, what would you be?” and, “How would your friends describe your weaknesses?”
Managers are seldom selected based on their ability to coach, and employees often attend workshops that have little or nothing to do with their job. Finally, at the end of the year, HR distributes a generic one-size-fits-all appraisal form that fits no one.
Half will fail
Is it any wonder why half of new employees fail to meet expectations? Or, why organizations get sued for discrimination? More importantly, isn’t it clear why HR can’t become strategic without mastering strategic tools?
Professional teams fail if they hire unskilled members; but, when organizations have not defined, or fail to evaluate mental, interpersonal, organizational, and motivational skills, new hires may look good for a few months, but long term performance becomes a game of chance.
The same goes for promotions, transfers, and organizational reorganization. When the job significantly changes, half of employees generally flop.
Want to know the cost of 50/50 hiring practices like this? Experts estimate it ranges between 20 percent and 50 percent of base payroll EVERY year.
Not only do organizations need more people to do the same amount of work, they have to mop-up mistakes, correct bad decisions, repair quality defects, replace customers, pay recruiters, fight legal challenges, and so forth. No team owner would tolerate that kind of performance from talent scouts, players or coaches. So, why does business?
We learned as children how to use common denominators to solve math problems. But, I never heard of a class that taught mangers how to find common denominators between hiring, training, management, and appraisal. Why? These functions tend to be housed in isolated knowledge silos, staffed by people who are unaware how to integrate their functions.
It should be clear that organizations cannot become strategic until all systems that touch employees are coordinated.
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Explore the Role of Incentives in Performance Management
In the military, for example, candidates must pass job-specific entry exams, attend job-specific training programs, learn job-specific skills, are coached by job-specific experts, and know clearly what tasks must do to fulfill their mission. Selection, job skills, training, supervision, and feedback all have the same common denominator.
If we peel away enough layers of the four main HR systems, we discover that intelligence, personal organization, interpersonal skill, and motivation are at the core:
- Intelligence refers to the employee’s ability to learn and apply job-related information to solve problems and make decisions.
- Personal organization means being able to establish plans of action, monitor and follow-through tasks to completion.
- Interpersonal skills means getting things done through people by coaching, persuasion, servicing, or maintaining relationships.
- Motivation refers to having the right attitudes, interests, and motivations that make work fun and energizing.
Of course, since these factors change from one job to the next, it’s important to establish the specific job requirements and business necessity for each position.
In the mid 20th Century, co-inventors Ivan Getting and Bradford Parkinson conceived and developed a system of global positioning satellites (GPS) that could help rapidly moving vehicles get to their destination. They did not invent a Star Trek transporter that could move someone directly to their destination; they invented a coordinated system that gives drivers step-by-step instructions how to reach their goal.
Those principles are key to strategic HR; that is, once executives set the destination, HR systems should operate like an organizational GPS by selecting and promoting employees with skills necessary to perform step-by-step activities — providing help, support, and coaching; providing feedback about whether they are on track; and, guiding them get to their destination.
Can you get there from here?
Strategic HR in action takes a forward-looking organization willing to step out of traditional thinking, specifically:
- Forget about rewarding employees primarily on outcomes. That is like paying players only for games they win. It’s short-sighted, ineffective, and can encourage winning at all costs;
- Forget about hiring employees using only interviews. Candidates practice how to pass interviews, data is hard to verify, is easy to fake, and includes too much personal bias;
- Forget one-size-fits-all appraisal forms.? They seldom have anything to do with performing a specific job and are often used to punish employees;
- Forget about promoting individual contributors to management without evaluating their coaching skills and motivations. Ill-conceived promotions lose good employees and gain bad managers; and finally,
- Replace recruiters who “need to know the candidate” with ones who “need to evaluate the candidate’s skills.”
The Big Pay Off
Strategic HR requires converting goals into tactics. Once tactics are clear, they use them to bridge the gap between hiring, training, coaching and appraisal systems. By clustering all jobs into a smaller number of (12-15) families, it’s possible for HR to standardize and simplify job-specific requirements.
Once these are in place, candidates can be hired and promoted based on family-specific standards, training can be tailored to competencies, appraisal can be based on day-by-day activities that lead to results. This not only provides an organizational GPS system every individual can follow, it meets the EEOC guidelines for equal opportunity.
It normally takes about 3 years to implement this kind of program. Most find, however, that a 20 percent to 50 percent of annual base payroll savings provides more than sufficient incentive.