Neil McCormick Founding Member HRExaminer Editorial Advisory Board

Neil McCormick Founding Member HRExaminer Editorial Advisory Board

Neil McCormick returns this week to the HRExaminer Editorial Advisory Board from Australia. Neil has worked in human resources and consulting services for the past 16 years building a repertoire covering human resource management, recruitment consulting, management consulting, talent management, general management and learning and development. He currently serves as General Manager for Talent2, Asia-Pac’s largest HR consultancy. Full Bio


This is Part Two of my series of articles on Workforce Strategy.  Part one was Workforce Strategy 101

As a CEO and senior business leader, I always found it frustrating that measurement and reporting of the people aspects of business never practically tied to the real goal of the organisations I managed. I always felt that the Human Resources functions needed a consistent way to be measured that were both defensible and repeatable, as well as a set of standards to be measured against. I’m pleased to say that over the past 3 years, and in conjunction with Bond University and Queensland University of Technology (QUT) here in Australia, we’ve created just that.

Our Human Resource Performance Audit gives us repeatability and rigour of measurement. And the work we’ve done on Human Resource Advisory Standards gives us a benchmark to measure against.

You can find further detail on the Audit process and the Advisory Standards project (Higher Education example) at the following links:

http://www.talent2.com/Products–Services/Workforce-Planning/HR-Performance-Audit.html

http://www.auasb.gov.au/admin/file/content102/c3/ASAE_3500_31-07-08.pdf

http://www.hrd.qut.edu.au/hrbenchmarking/wpp.jsp

I mention these points now to highlight that my writing on Workforce Strategy includes ongoing reference about the need for rigour and evidence based decision making; the assessment of criticality, and the importance of clearly linking all Human Resources activities to the organisational objective. The terminology I use is intentionally different from everyday HR “speak”.

Workforce Strategy, HR Audit and our Advisory Standards borrow terminology and structure from Audit. We use the terms Inputs, Processes, Outputs and Outcome.  Outcome equates to the delivery of the targeted objective[1]. We use the “three E’s” of economy, efficiency and effectiveness as our points of measurement.

Performance Terminology and Measures

Performance Terminology and Measures

Our core purpose for creating Workforce Strategy is to ensure clients understand how to continuously interpret the human capital needed to deliver organisational goals. It is essential that the Human Capital is in the right place at the right time with the right capability and engagement levels– all in the most economic, efficient and effective way.

Through the implementation of Workforce Strategy organisations will be far more agile, adaptable and flexible.

Workforce Strategy

In day-to-day business, the majority of what we see described as workforce planning or strategic workforce activity is, in reality, crisis management.

Human Resource services are typically under constant pressure to resolve the immediate need. So they are focused on the current crisis, or perhaps the next milestone, but rarely have the resources, methodologies and strategies to get above the “noise”.

I’m not suggesting that tactics to solve current needs be replaced or stopped. I am saying that there’s a far better way to inform and support these tactical decisions and to develop strategies and capabilities to both reach long term goals and to adjust as things change.

Initially, we need to run a parallel strategy until the loop from workforce strategy to tactical delivery is closed; and we create a continuous and seamless flow of informed direction.

The focus of Workforce Strategy is not just on the short or medium term. It looks at today through the lens of future objectives and informs decision making today with that view.

We want to be ahead of the game to the point that we are no longer in crisis mode, but following a flow of business requirements well in advance of the next potential crisis. In other words, managing the avoidance of crisis!

Where to begin?

Easy. Head for the Business Plan! Just don’t believe everything you read there.

We need to have a detailed understanding of what the organisation wants to achieve by a nominated point in time. We also need an outline of what leadership considers the organisation should look like. If this information is not readily available, there are many facilitated consulting exercises that will assist organisations to document and detail appropriate business plans.

It’s important when we undertake this exercise to ensure we are thinking in terms of the “future state” organisational objective and what is required to deliver that objective as the priority. We must assume we were building a new organisation at a point in time in the future; a “Zero base future state”.

Of course, the current and forecast business will impact decisions about future positions. However in this initial step, we should concentrate on the most efficient, effective and economic delivery of those future organisational goals.  Then we determine the most appropriate mechanism to deliver those goals.

So, the starting point is sometime in the future.  The majority of organisations do have a 3 year to 5 year plan. Some organisations work on much longer cycles 10 – 20 years while others consider 18 months a long time.  We take that nominated point in time and analyse the plan and facilitate the discussion:

  • What is the core goal of the organisation at that future point?
  • What are the key objectives?
  • What will the organisation look like (structure, service lines etc.) at that point?                                                                                                                                                                      o   Zero base future state
  • Where is the evidence that this goal and these core objectives can be achieved?

It’s important to understand if these goals and objectives have been assessed and evidenced for the probability of successful delivery. Too often aspirational goals sound so good they quickly morph into targeted objectives. I’m not suggesting that aspirational goals shouldn’t be used as the foundation for objectives. I am saying that aspirational goals should be recognised and treated as such. We need to be vigilant in managing expectation of delivery and recognise the impact non-achievement can have on our people even when, in some instances, the actual level of achievement is exceptional.

At the end of this step we should have a detailed understanding of the organisational objectives and the shape of the organisation at the nominated point in time. This exercise may be easily done with a quality business plan and a closed door but the program will be far more effective if the leadership are taken on the journey. Very shortly we will be challenging some of the precept and concepts, from a human capital requirements viewpoint, of this future state.

We begin this exercise in the full knowledge that this initial position will surely need to change several times through the time period. Business requirements change. However, it is much easier to make a step change than it is to re-invent a new position each time.

Criticality

Not every function is critical, not every capability is critical.

Experience indicates that there is a significant lack of understanding of what the term criticality means, or, in some instances if there is a need to assess criticality in the first place. I do not agree with the position that all capability/people requirements are equal. There is no one size fits all in Talent management.

To some managers any vacancy is critical. To others criticality is determined by the organisation chart where only management positions were considered critical etc.

Functional Criticality is different to Capability Criticality. Criticality is a moving feast with the potential for constant change with the ebb and flow of business demand and resource supply.

In the next article we’ll deal with Criticality and how to focus on those things that deliver organisational outcome.


[1] A lack of linkage to Organisational Objective is one of the major reasons for the failure of many HR Initiatives.



 
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