Count your costs
The banking crisis has caused a dramatic shift in organisational culture, pushing HR to the forefront of business. So says Peter Cheese, CEO of the CIPD, addressing 12 public sector HR directors who had gathered for Changeboard’s October roundtable.
Cheese added that, if you’re an HR professional, it’s time to develop a more efficient way of working, using data and analytics to measure and define elements such as engagement, output and productivity. Knowing how much the HR function costs your organisation (typically only 1-2% of total budget) – and realising what a critical role it can play – is also vital to its future success, he said.
It will be increasingly important to work out what makes people tick, what turns them off (such as performance management) and how to make employees feel truly appreciated. Working with other functions such as finance, marketing and IT will also be beneficial, delegates were told.
Cheese discussed how he wants to make the CIPD qualification more relevant, from entry level to senior level, and how the Institute wishes to ‘professionalise’ the HR function as a whole. It proposes a move towards establishing a standard level of qualifications and codes of conduct and ensuring HR is better embedded into the culture of the organisation.
There is also a growing recognition that line managers are HR’s key audience and customers within the business. Meanwhile the CIPD is working with several investment banks to help raise the Institute’s profile and make it more credible within the financial sector.
Encouragingly, a number of delegates said they had been working more closely with their colleagues in the finance team. They had deciphered new ways of measuring and assessing different elements of the business, such as the overall headcount and how they treat contractors working for their organisation.
Some delegates also said that HR was shedding ‘unpopular’ image and being recognised for the key role it plays in an organisation.
Realising that other corporate functions and business partners were on the same ‘journey’ as HR was also important in improving HR’s confidence, Cheese said. The historical debate about whether HR needs to sit on the board, however, is no longer relevant, Cheese told delegates. HR has spent too long “navel-gazing” and now needs to set a new agenda recognising its role as a facilitator and instigator of organisational culture.
The question of reward
The different needs of changing generations, from the Baby Boomers to the so-called millennials or Generation Y’ers, were also discussed. One delegate pointed out that a typical Generation Y’er usually expected the positive customer experience they have in all other areas of their life to be repeated in the workplace. The issue of how to reward them, when they don’t typically care about pensions or healthcare insurance, was debated.
Following this came the idea that HR professionals will need to engage and reward members of an ageing workforce who may not retire at 65. DIY giant B&Q – which scrapped the default retirement age more than 15 years ago and specifically targets older workers – was cited as a prime example of an employer that has managed to engage staff and deliver excellent customer service as a result.
The changing nature of the labour force and the way people work was also discussed. Although it was easier to manage people who worked in the office from nine to five, rather than flexibly or from home, HR has to accept that future talent will want to work differently. HR must equip line managers with the right skills to cope with this change.
Embracing Facebook and the future
The growing influence of social media and the difference it has made to the workforce was also debated. The general consensus was that blocking access to sites such as Facebook and Twitter at work is not a good strategy and that employees would probably just access it through their smartphones. Some delegates, however, expressed concerns about employees sharing minority views on Twitter and misrepresenting their organisation. But employers were not sure how to moderate this while helping employees to ‘stay connected’ and ensuring their organisation has a presence and voice on social media.
Although it was acknowledged that HR faces significant challenges over the coming years, the general mood was positive. As Cheese said, there is a need to realise the future is already here.