A recent report showed 82% of HR staff do not measure the return on investment of their own practices. Denis Barnard reveals seven questions you should be asking to ensure your HR department is recession-proof.
It’s an unpalatable truth that some HR directors are failing to make business cases that resonate with their boards. Traditionally, HR has tried to measure its performances with factors that do not necessarily show causality with its own activities (absence and retention) rather than hunt out the areas and metrics that prove whether or not they are doing a good job.
Against a background like this, it’s no surprise that boards more accustomed to the world of hard facts and figures feel HR does not possess an experienced enough voice. HR professional qualification studies do not prepare practitioners for the real world, which underlines why HR directors have, in general, a muted voice at board level.
When it comes to HRIS implementations, whether migrating to new applications, or adding new modules to existing ones, I am continually advising clients to take on board their own project manager. It is not good enough to rely on a vendor’s project manager to run the project plan; their first allegiance, understandably, is to the vendor, and it is inevitable that there will be times that the vendor’s interests and those of the client are not necessarily identical.
I’d also urge against appointing an existing member of the HR team as project manager. I can guarantee the project’s priorities will subsume those of the ‘day job’ with adverse effects. Responsibility should be passed on to either an external project manager or to a member of staff with the relevant background.
With tough times ahead, more and more companies are making sure the HR department is pulling its weight, so here are seven ways to recession-proof HR in your organisation:
- Are you cutting your training and development budget and activities? If so, don’t. As I move around organisations in an advisory capacity, I am often amazed by how little the full power of software that they have purchased is actually deployed. This can be for a number of reasons, but first of them is knowledge drift. People leave and their knowledge is passed on piecemeal. The best way to combat this – and one I know organisations are reluctant to do – is to book a refresher training course for all staff using the application.
- How much external legal advice on employment matters are you paying for? Good HR practitioners should be able to cope with most employment matters. Make sure that your appraisal systems are good enough to set realistic targets and measure performance. If downturn is prowling at your door, then you are entirely justified in calling for an interim look at the organisation’s objectives and how they may now impact on individual targets. Don’t wait until the laid-down end of the appraisal cycle in six month’s time – it could be too late. Revised circumstances could call for revised targets.
- How many unnecessary payoffs or compromise agreements do you have to make for unsatisfactory performance? If your HR department is following well-structured policies, this should not be necessary. Is HR still dealing with car fleets or facilities or other unrelated activities? If this is the case, they can’t be focusing on the core HR business. Don’t wait for recession to start looking at efficiency and value in your department. Make it a matter of standard practice which will serve you in good stead when things pick up.
- Are your policies and procedures and employment contracts completely up-to-date (avoiding any compliance issues)? It’s an unfortunate fact of life that there are always less productive people in organisations, usually as a result of weak or indecisive management who have shirked confrontation and unpleasantness. In the longer term, these people are being done no real favours.
- Is HR still attending all or most employment interviews? This should be a skill that is transferred. Make sure that management know how to appraise and deal with poor performers, either by steps to assist improvement or by moving out of the business. Yes, it’s hard, but organisations both public and private have a duty to their stakeholders to perform to their best abilities.
- Is your HR and payroll software up to date and producing quality reporting? You paid a lot of money for it a while ago – is it paying its way? Losing staff through redundancy to see an organisation through hard times is all very well, but if you do it wrong you could get caught with an unexpected penalty imposed by a tribunal that could wipe out your projected savings in the medium term.
- Is your HR department spending time and resources on benefits packages and ‘nice to haves’ – things that, in a recession, are irrelevant because people just want to keep working? When it comes to staffing add ons, if, for any reason, you conclude that you have too many then whatever options you exercise, make sure that you do it the right way in terms of statutory obligation and any organisational terms and conditions.
Denis Barnard is the CEO of the UK’s first HRIS comparison website, HRcomparison.com, due to launch this month. He is an expert on the implementation of HR and payroll systems and has worked in the HR industry for more than 20 years
