Major Challenges to Dynamic HR
• First and foremost, increasing workforce turnover on key positions, decreases
advantage for HR, the longer an employee affiliates with the organization, the
greater the organization's return on investment. So rationalization in salaries
of critical positions is essential.
• Internal transfer / relocations from one property to another without
significant increase in remuneration causes dissatisfaction and allow
opportunity to the competitors to attract quality workforce.
• Information Technology is HR's Route to Reengineering. Keeping up with the
updates and employee training requirements for the systems presents additional
technological challenges. IT continues to automate administrative tasks, often
shifting HR staffing needs and job descriptions i.e. HRIS, OPERA etc
• Employee development / career & succession planning is the most important part
of HR functions. Development of Human Resource in a way to convert them an asset
for the company resulting in Human Capital is the key to gain competitive
advantage over competitors. Among different development tools, CEAP (Capability
Enhancement Action Plan) is designed to set goals / targets and track the
achievements. The main objective is to evaluate the current skills of the
employees, based on that analysis, develop & Implement a Capability Enhancement
Action Plan to improve the Skills of employees for preparing them to take higher
responsibility with a greater focus on job enrichment & job rotation. Initially,
we may implement this on the Divisional/Departmental Heads and / or employees
who have recently been Hired, Promotion and special cases, however this should
be implemented on all employees as a part of their career planning and growth.
Advantages of Dynamic HR
• The traditional HR professional was expected to be a technical expert, with a
deep knowledge of compensation and benefits practices. HR traditionally
considered as custodian of policies and procedures, record keeping section and
dictates the "rules" and told managers what was and was not permitted, based on
policy and procedure. New expectations for HR are for the department to be more
participative, providing recommendations based on technical and legal expertise
and proactively guiding the company's strategic goals. Whereas the traditional
role of HR was to ensure stability and consistency, the new HR role is required
to position the organization for constant growth and change.
• The traditional HR professional acted as an employee advocate, responding in a
passive sense to employee concerns about technical issues such as rules and
regulations. In contrast, the modern HR professional is required to act as a
strategic management partner, rather than being pitted between management and
employees.
• While the traditional HR professional reacted to change, the modern HR must
drive change from the outset
• The traditional HR professional generally was not required to demonstrate the
impact of the department on the organization's bottom line and typically viewed
employees as expenses rather than assets. In recent years, HR has needed to
demonstrate return on investment and the ways in which specific HR practices add
value to the organization.
Key HR Metrics
Link HR to Corporate Strategy
Corporate Strategy
Create HR efficiency measures
• Cost per hire
• HR staff per employee
• Days to hire
• Training cost per employee
• Accidents rates
• Quality of hire
• Employee satisfaction
• Number of hours consulting
• % of employees with certain knowledge
Identify gaps between:
HR Efficiency Measure
HR Effectiveness Measures
• Turnover by age, tenure, race
• Training level 1 evaluations
• Staffing ratios
• Turnover by performance
• Did behaviour change on the job?
• New hire performance at 180 days
Identify HR Value Measures
• HR Expense factor = HR expense/total operating expenses
• Total HR Expenses/Total revenues
• Human Capital ROI = rev-operating exp-com/benefits comp+benefits cost
• Revenue per employee
• Profit per employee
• Compensation budget variance
• Time to efficiency for new managers and employees