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Sep 23 2011
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Business, Human Resources, Leadership, Management

Transformative HR: Book Review

As many of you know, I love to read! While I have an appetite for all kinds of books, news & blogs, I just love great content on HR. And often, that’s the hardest to come by. One of my favourite authors on HR is John Boudreau. I became an instant fan when I read and reviewed his book Retooling HR. I felt that the frameworks, approaches and tools he talked about can not only help HR professionals to up their game, but can also help in talking coherently, logically and meaningfully with the business. The application of usual business analysis tools such as portfolio management, segmentation, conjoint analysis etc. to HR issues was extremely appealing.

So, when I got a copy of the book Transformative HR, I was thrilled. Transformative HR has been written by John Boudreau and Ravin Jesuthasan. Ravin is a senior colleague of mine and is the Global Practice Leader for Talent Management at Towers Watson. I hungrily read the book and I think it is one of the best I have read so far. The key takeaway is that HR professionals and leaders need to make informed human capital decisions to keep their organisations competitive. ‘Informed’ is a key word here and the book outlines an evidence-based approach to human capital decisions. They outline 5 basic principles of evidence-based change:

1) Logic-driven Analytics: How often do we HR professionals have an overload of information and metrics? Do we just have numbers or can we tell a powerful story? In a transformative HR future state, the authors share how we can use frameworks & mental models to go behind the metrics, understand the real picture and produce insights which are in high demand by other organisational stakeholders. After all, getting the numbers right is just the beginning. The real value-add comes from using a multi-dimensional approach by synthesizing business strategies, business metrics and talent metrics to produce real insights that help in achieving those business objectives.

2) Segmentation: Conceptually, most of us agree that one size doesn’t fit all and we need to segment our workforce. But, how? John and Ravin propose 3 fundamental questions:

  • What are our vital talent segments?
  • Which employment elements induce the desired responses at optimum cost (supply-side talent segmentation)?
  • What do we need employees to do (demand-side talent segmentation)?

I think this is a powerful way to think through key talent investment decisions, as it helps to understand how to customize the employment deal to create the highest payoff in terms of business outcomes, at the optimum costs.

3) Risk Leverage: I feel that Human Capital Risks are often under-reported and worst, not well-understood. Now, all organisations face HR-related risks, but instead of just mitigating risks, the focus should be on optimizing risks. The book presents a number of systematic approaches to optimize risks and develop sustainable advantages. Again, the approaches are rooted in management tools that business leaders are used to – tolerance analysis, portfolio theory, stochastic simulations, probability matrices etc. In two words: cutting-edge and powerful!

4) Integration & Synergy: Often, HR processes operate in silos which prevents us from getting the “1+1=3″ effect. This principle talks about how to integrate various HR sub-functions as well as integrating HR with other organisational units. The live example about the Talent Management Game at Shanda (one of China’s largest online gaming company) is just fascinating!

5) Optimization: The principle of optimization follows from segmentation. It is all about identifying where & how the payoff of certain HR investments will lead to exponential returns. It is all about identifying the mix of investments that will have the most desired business outcomes. So, instead of spreading HR investments across the board equally, the focus should be on understanding & positioning ‘fairness’ to mean strategically differentiated treatment.

The book is full of great examples and brilliant case-studies from leading global organisations such as IBM, Coca-Cola, Royal Bank of Scotland, Deutsche Telekom, Ameriprise, Royal Bank of Canada, Khazanah Nasional Berhad etc. Overall, it’s a compelling read. It is for anyone who wants to bring rigorous thinking, informed decision-making and sustainable impactful change in their organisation. Did I say that you just can’t miss this book!

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Sep 03 2011
7 Comments
Employee Engagement, Social Media, Technology

A Mobile Strategy for Employee Engagement

I remember clearly that a couple of years ago, a leading mobile handset manufacturer talked about a term called “micro-boredom”. Micro-boredom happens in very small slices of time in which we do not know how to fill the time. And mobile devices, with their applications, provide the escape route. Clearly, I felt that this is going to be an important trend which will mean that mobile devices with a large apps ecosystem would flourish. That’s what is happening today with iPhone and Android devices. But, importantly, micro-boredom is a trend and people do tend to look at mobile devices as a way to fill in the void. And you can possibly see this trend all around you – think about daily commutes, coffee breaks, waiting for someone – the list is endless. In effect, I think that there are multiple opportunities to have the attention of people.

On the other hand, there is some data (though limited to the USA) from a mobile analytics firm, Flurry, to suggest that mobile app usage is not only increasing over time, but is also actually ahead of the traditional web consumption. This reinforces the strength of the mobile medium.

Combining the two trends above, I feel that the most ubiquitous, available, connected and engaging screen is the screen of a smart-phone. It is always with the individual, it is always on and one can push content on it. While a number of companies are using this screen for engaging their customers, I have not come across companies with a mobile strategy for engaging their employees. The possibilities are endless. It could be an enterprise social networking app to keep up with other colleagues or the latest news about the company or to check out what is the next product being developed by the team on the 18th floor! It could be a video app where people could listen to senior leaders articulating the purpose of the company or the new strategy. It could be an app that provides e-learning. It could be an intelligent recommendation engine app that looks across all your enterprise web activities and recommends books for professional development. Or it could all come together in an integrated app. I could go on, but I am sure that we can conjure up even greater possibilities with this.

I think having a mobile strategy for engaging employees is very important already, though it may not be widely recognized as a need. I think this is a powerful medium to connect and engage with employees. If you have any ideas on how to bring a “mobile employee engagement strategy” to life, do write in!

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Aug 24 2011
3 Comments
Business, Employee Engagement, Human Resources, Leadership, Management

How Can HR Use Engagement Surveys to Drive Business Performance?

Several companies invest thousands of dollars in running Employee Engagement surveys. Typically, they use the survey results to benchmark workplace experiences with other organizations,  determine enterprise-level priorities, drive key HR programs, set engagement-related KPIs, involve managers in the action planning process etc. But one of the key elements missing is how do we use these insights from the survey, fortify them and use them to really drive business performance. I often find that we miss connecting those critical dots. If HR has to ‘get a seat at the table’, then all it’s initiatives should link back to business performance, including employee engagement.

I could think of one potential approach, and it may be suitable to larger size organizations with a decent number of “units of analysis” i.e. bank branches, retail stores, production sites etc. If we have sufficient number of units to study, the first step would be to start linking the employee engagement survey data to business metrics. Think sales, profitability, productivity, employee attrition, customer survey scores, safety incidents, customer waiting time etc. Then you would need some analytical wizardry to examine how these metrics link to employee survey data. Do highly engaged bank branches have higher loan growth and higher net interest margin? Or do low engagement manufacturing plants showlow productivity as well? Or worse, the linkage is not meaningful or not strong enough (in which case you really need to go back to the drawing board to design a good survey). Such linkages help to establish the validity of your employee research frameworks and help create buy-in among the senior leadership team.

The next step is really to take it a notch further up. Based on the above linkage analysis, you would have identified your high / average / low performing units. Now, the way HR can really add value and improve business performance is by replicating the high performing units. How do you do that? Well, you try to examine what differentiates these high performing units from others. You could look at a range of variables for employees in these groups – age, tenure, experience, competencies, managerial practices – anything that can hypothetically differentiate performance. And yes, you could also connect it all back to the employee survey and see what issues are these “high engagement – high performance” units particularly satisfied on as compared to other units. Again, we are just looking for factors which can differentiate or even predict engagement and performance

Only when you have insights of this depth, then you could work out a plan for replicating such high-performance. Such insights can provide inputs into recruitment plans, talent management, rewards, training & development, career progression etc.  And all this will potentially have much more credibility since you have validated these against business outcomes.

What do you think? How are you using employee survey data to improve business performance? Drop in a line if you would like to discuss this in details.

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Aug 13 2011
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Business, Employee Engagement, Enterprise 2.0, Human Resources, Management, Social Media, Technology

Gamification of the Enterprise

One of the blogs I love reading is The Future Of Work blog by Socialcast. It has great content about things I am passionate about – social media, organization development, employee engagement, collaboration tools etc. They also put up great infographics every now and then. I just couldn’t resist posting their infographic titled “Adding Play Into the Enterprise”. It does a crisp summary of employee engagement trends, the explosion of gaming and how they can be married together. My favorite bit is when they compare the ‘Gaming World’ with the ‘Job World’. So, your job title is the “level”, salary is “score”, promotions are “level up” and performance reviews are the “stat summary”. That’s a cool way to think about it!

Enjoy the infographic! And do share your best ideas on gamification.

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Jul 14 2011
8 Comments
Business, Employee Engagement, Human Resources, Management

Employee Value Proposition – Think Delivery, Not Just Design & Communications

I have been thinking about one of the hottest trends in HR circles – Employee Value Proposition. The origin of Value Proposition perhaps is in strategy and marketing. Kaplan & Norton, who introduced the world to Balanced Scorecards, said – “Strategy is based on a differentiated value proposition. Satisfying customers is the source of sustainable value creation.” Which leads us to another commonly used term Customer Value Proposition. Wikipedia defines it as – “a Customer Value Proposition consists of the sum-total of benefits which a vendor promises a customer will receive in return for the customer’s associated payment.” Essentially, we are talking about a the “delivery of a promise” in return for something that’s valuable to the customer (usually money payment, search costs etc.). The “promise” itself isn’t sufficient, the delivery is critical to the value proposition.

Employee Value Proposition (EVP) can also be understood in a similar way. It is the sum-total of benefits and experiences a company promises an employee in return for the employee’s time and efforts. The EVP can include compensation, benefits, learning & development opportunities and the overall workplace experience. Usually, companies would define their EVP through some combination of these. So, that’s the promise. But, the crucial challenge for HR, leaders and managers is to deliver on the EVP.

Many a times, I see HR professionals in a rush to define the EVP and communicate it to the world. We want to create a message, come up with great tag-lines, brand the communications and throw it out. Advertisements, posters, billboards, social media – you can do it all and still achieve nothing. A badly execution EVP strategy can never solve talent attraction and retention problems. To be effective in the EVP initiative, it is equally or more important to think about whether existing systems, policies, culture, management style and processes support the delivery of the EVP. If not, then we need to think about what changes are required. Your Employer Brand could fail miserably if the brand doesn’t deliver on the promises. And in this day and age, sentiments are often vented quite openly on public channels.

So, if your EVP promises “a culture that thrives on teamwork, leveraging collaboration to solve X challenges”, but employees join the organisation only to find silos, then its a failure. Or if you promise “performance based pay and best-in-class benefits”, but pay is driven by tenure and benefits are just about average when compared to other organizations, employees will feel disenchanted. The list of examples can be endless.

So, the first step is to look within, not outside. Look within and ensure that the delivery mechanisms are in place. If you get it right, you will just end up creating engaged employees, who also act as advocates for the Employer Brand. It’s as much about the delivery, as it is about the those feel-good, slick communications.

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