Is Drucker = Rock??

Peter Drucker’s 4 Pronged Approach to Creating an Engaged Worker:

-Careful Placement and Promotion
-Demanding High Standards of Performance
-Providing Workers With Information
-Encouraging Workers to Acquire Managerial Vision

Rock’s (as stated earlier) 5 Social factors that trigger an Employee’s Commitment:

-Status
-Certainty
-Autonomy
-Relatedness
-Fairness

An attempt to Map the Two Approaches:

Status --- Careful Placement & Promotion
Certainty --- Providing Workers with Information
Autonomy --- Encouraging Workers to Acquire Managerial Vision
Relatedness --- Providing Workers with Information + Encouraging Workers to Acquire Managerial Vision
Fairness --- Demanding High Standards of Performance + Careful Placement & Promotion

Irrelevance of Geographies

With the advent of ‘Twitterville’, ‘Facebook Era’, the ‘Viral Loop’ and the likes, there is a growing realization that the geographical boundaries and distances are becoming increasingly irrelevant and redundant.

Online Social networking is experiencing a shift in it’s value proposition from being just a personal keep in touch platform to a professional space where you can create cost effective solutions for non virtual i.e. real time business struggles or glitches.

Organizations are progressively utilizing the benefits of Online Social Media for escalating business efficiency.

These virtual spaces are helping businesses’ (to name a few)-

1)To study Consumer/ Employee Preferences or Behaviour Patterns for initiatives like new product development etc
2)To convince the Customers and Influence Consumers (reaching out to both customers & consumers) as well as prospective employees
3)Creating relationships with all target audience segments (Existing and prospective audience fragments)
4)Mitigating advertising & marketing budgets
5)Reducing recruitment costs
6)Create Quicker Processes and hence shorter turn around time

Businesses are able to consider solutions to the above without having to be in the same physical space.

But of course, there are always two sides to a coin. With all its disastrous disadvantages, businesses have to be treading these paths, of networking, wisely.

Tying the SCARF around HR's Neck

Breaking away from the Maslow’s hierarchy of needs, author David Rock introduced a new model called ‘SCARF’. His belief is that social incentives are as strong as physical incentives and that an individual responds to either with equal intensity.

Rock lists 5 social factors that trigger an individual’s response: Status, Certainty, Autonomy, Related-ness & Fairness.

Assuming that his contentions are valid, we need to Map our HR processes to understand how we can satisfy the above employee desires.

Status --- Coaching & Mentoring Opportunities/ Promotions/ Recognition
Certainty --- Career Planning/ Performance Reviews/ Development Planning/ Employee Communication
Autonomy --- Ensuring sufficient decision making say (regular frank informal chats with the manager can ensure satisfaction of the same)
Relatedness --- Engagement Initiatives/ Involvement in Organizational Initiatives/ Regular Informal Discussions to know your employees & their needs better/ Internal Branding
Fairness --- Fair Performance Appraisal / Honest Practices

The Mystery of Incentives

Levitt & Dubner, in their book Freakonomics, have explained how the power of incentives can be used to mould or radically change the behaviour of any individual. They talk about the 3 types of incentives being Financial, Moral & Social.

Taking it from there, it is safe to say that it always takes something else to attract/motivate someone else..and that truth has a lot of relevance in the world of HR.
Contrary to popular belief it is not all about the money.

It starts at the first point of contact. Organizations, today, use various media to sell themselves to the prospective employees. Some use advertising while some use social networking. Whichever may be the media what counts is the power of the message. It is what the organization gets across in that one moment that can act as an incentive to accept/ refuse the proposal. Hence, reinforcing that first impressions count. The organization, here, needs to understand their target audience and walk the podium accordingly. The right EVP/ incentive (culture, salary, career prospects etc) need to be flaunted.

Act 2 i.e. the interview, the organization needs to set the right expectations in terms of what will matter most/ what will strike the cord with the prospective employee. So, if the cause of concern is job profile then one needs to market the profile accordingly and hence convert the employee to their religion and set of beliefs.

That was the incentive story to make him walk in to the jungle but the bigger question is what will it take to make him stay?

This is when we talk of engaging the employee to the heightened levels of excellence and commitment. By employee engagement I don’t mean the number of parties thrown in a year. The engagement process is everything that it takes to engage him and get him addicted to the organization. So you start the process when the employee walks in, ensuring an enriching induction & on-boarding experience, help him form the right relationships (friends at work), provide the required hand holding (mentoring), and most importantly acquaint him with the laws of the jungle (culture) thereby increasing familiarity. Once involved in his rich role (promised job profile), he would need time to time ego boosts to make him feel wanted. Hence, recognition plays an important role. If this is not enough then the performance reviews set the stage for career development. Even when it comes to learning & development, being learning centric is not enough. One has to know the pulse of the employees. You may conduct n*100 programs but do they work with them? You might want to equip them with the most boring of all and it can be done, it just needs to be done in the right way. Use books if they like to read, Use mobiles if they are pseudo techies, use videos if they like time pass, or use role plays if they feel they are born actors.

One could easily say that everyone has a different weakness and the organization needs to use these to their advantage. However, I feel differently.. I think that ’the organization needs to use it’s advantage to ensure that the organization in itself becomes every employee’s weakness’..

Levitt & Dubner said “people respond to incentives”.. Can we assume a scenario where the organization becomes the incentive?

An Online Date with HR

With the advent of social networking websites, HR has been blessed with an opportunity to come up with cost effective means of attracting, engaging & retaining talent. The phenomenon can prove to be a solution across sub functions of HR.

Some possible examples:

Recruitment: These websites prove to be an effective talent search tool. These not only provide with an applicant base but also allow for background verification. Fortunately or unfortunately, they also provide a window into the personal preferences and interests of the potential candidates. Hence, this helps not only in reaching hidden talent but also finding a better match as there is a better understanding of the tendencies of potential candidates. These result in a better Source Value Index Score (%New Hires/ % of recruitment budget allocated to the source).

Employer Branding: These websites can be used as a tool for effective branding. Depending on the target audience/ potential talent pool, an organization can publicize its differentiated EVP with the help of online campaigns. Word of mouth publicity on such forums also helps as these comments are generally viewed by people other than those directly targeted. Hence influencing the behavior of more than intended. As a disadvantage, one small mistake can also lead to negative publicity amongst the target audience.

On boarding & Induction: These websites provide as a platform for creating communities which could be aimed at encouraging discussions regarding the organization, culture, management, opportunities, career ladders, formal & informal norms etc. Establishing & maintaining online mentor mentee relationships not only breaks the ice but also makes it easier for the mentor to be available for all queries as per his convenience.

Learning & Development: Social Networking Websites can be used as a stage to create learning groups, discussion groups etc. This can effectively facilitate formal as well as informal discussions on the subject. Such forums can facilitate sharing of personal experiences. Also, it becomes easier of leadership team to participate regularly as they can respond to queries at their own pace. These forums can also be used to generate a positive buzz about new and upcoming learning initiatives of the company and hence encourage greater participation.

Employee Engagement: could be encouraged by creating social employee groups and activity discussion forums where all employees can participate and give their respective views on initiatives, suggestions, ideas etc. Hence ensuring all opinions are valued. Also, it allows employees across cities and countries to share to keep in touch over burning and non burning issues.

Sigining off with: "The value of a social network is defined not only by who's on it, but by who's excluded,” by Paul Saffo, a Silicon Valley forecaster

The Tipping Point for an Employer Brand

As Gladwell defines it, the “tipping point,” signals a key moment of crystallization that unifies isolated events into a significant trend. Having termed the occurrence of a trend of this nature as an Epidemic, he explains the occurrence due to the three rules of epidemic: The law of few, the stickiness factor and the power of context.

We can make an attempt to apply his logic and rules to identify a methodology for successful employer branding.

Rule #1: Law of the few-Connectors, Mavens and Salesmen

Gladwell says that a lot of these trends are spurted by the influence of Connectors, who have vast networks and are highly responsible for creating people links, Mavens, who owing to their knowledge and expertise take the onus of helping people make sound decisions and Salesmen who use their charisma to convert their sale.

Hence an organization should identify such Connectors, Mavens and Salesmen within and outside the organization and make effective use of them to achieve a strong Employer Brand. Connectors could be existing engaged employees, satisfied alumni base, etc. Mavens could be recruitment consultants and Salesmen could be the Branding team who sells the case to existing employees and is able to build a strong case with the prospective employees.

Rule #2: The Stickiness Factor

The Stickiness factor, as defined by Gladwell, refers to a Unique factor which propels the phenomenon to stick and hence influence future behaviour.

Hence, an organization should work towards creating a Unique EVP which would stick and hence convince the employee himself/ Connectors, Mavens and Salesmen who would then work towards influencing the attitude of others.

Rule #3: The Power of Context

Gladwells says that every trend should be introduced in the right environment to be able to achieve its Tipping Point.

So, the organization should make sure that the EVP they are creating is friendly to the current state of employees in the market as well as the state of the business and industry. Hence, creating an EVP which is in demand at that point of time and not just something which is feasible.

Signing off with: "Any damn fool can put on a deal, but it takes genius, faith and perseverance to create a brand." - David Ogilvy

Curse of expectations: Leading to a dive in the Blue Ocean

The dire need for talent differentiation has led to the curse of high employee expectations. The demand for excellence has allowed talent the audacity to demand an ‘out of the box’ EVP. This has led to the increasing importance of the value of innovation & creativity in HR.

A Red Ocean represents an existing market that is well defined as well as heavily populated by the competition. So, a red ocean is more like the situation of perfect competition wherein the same product/EVP is offered to the buyer/employee at the same price. So, he has little incentive to buy you and you alone. There is zero security in your investment as an employer. Hence, in this ‘War for Talent’, a red ocean strategy would only be a futile attempt.

A strategically inclined HR would hence move towards application & creation of a Blue Ocean Strategies. As defined, the aim of a Blue Ocean Strategy is not to out-perform the competition in the existing industry, but to create new market space or a blue ocean, thereby making the competition irrelevant. Blue Ocean Strategy is the simultaneous pursuit of differentiation and low cost.

HR needs to achieve such heightened levels of innovation excellence and hence be able to produce Quality Classics for an EVP that cannot be replicated.

Some Diving Blue observations in HR:

1) Use of mobile devices for a LMS
2) Virtual Learning environments
3) Informal Learning
4) Stay Interviews as a means of facilitating an effective retention action plan
5) Social Networking Arenas as a means of effective recruitment
6) Development of Unique Organizational Capabilities
7) Unique Branding
8) Unified Recruitment+ Performance Management
9) Application of Appreciative Inquiry
10) Tempting Job profiles
11) Fancy Job titles

Michael Porter: “Innovation is the central issue in economic prosperity”.

HR's Unexpected Encounter: The Black Swan

Taleb defines Black Swan Events as the High Impact, Hard to Predict & Rare Events that are beyond the realm of normal expectations. He substantiates by stating that almost all consequential events in history came from the unexpected.

In our land of business, the irony of the organizational lives lies in the fact that despite having a high degree of impossibility, these bombs (events) do explode and the sound of the detonation is far & wide. The coverage is huge enough to injure even those that were securely packed in the cosiness of their houses.

Owing to the uncertainty & unexpectedness of such shocks, most population may adopt the ‘If we can’t predict, we can’t resolve’ attitude. However, the need of the hour is to shun traditional statistical probability predictions & be prepared nonetheless. You can’t expect the enemy to announce its arrival & wait for you to graciously accept the invitation of the disaster planned out for you.
Proponents have suggested that the business strategy should be agile enough to take on new unpredictable challenges anytime. The business strategy should undergo enough tests & hence be certified shock proof.

HR having claimed a strategic role, the position of a business partner, and the responsibility of change management processes across organizations owes a major role to the situation analysis and hence assistance in providing a solution for the same. The Human Capital Management Processes need to be redefined and structured in such fashion that they make the system bullet proof.

The organizational capabilities should be defined to promote a culture that supports the cause of change management, risk management & encourages a forward outlook to problem solving, a culture that would be analogous to innovation management. The anchor competencies that support the existence of the organizational capabilities should also be particular such cause.

Manpower Planning should be in tandem with the business plans & expected/unexpected uncertainties.
During the recruitment & selection process, an organization could look at effectively using tools like the Competency Based Interviewing to ensure that the pool of talent that they bring into the organization already possesses this mindset & skills that they are intending to advertise and adopt.
In their attempt to ensure diversity is well managed they should look at picking diverse mindsets to encourage an atmosphere which would bring in diverse ideas and approaches to tackle an impossible occurrence.

The Performance Management System needs to agile enough to enjoy the possibility of alteration due to the uncertain nature of business. So in case of a hiccup, the objectives can be tailored as required instead of having people run after targets which may have become meaningless at that point in time. Metrics require to be accordingly aligned as well.
As BF Skinner has propagated, behaviours/ actions which help our cause should be rewarded such that the occurrence is oft repeated.

The Learning & Development team could look at aiding the existing talent base to acquire the necessary skill sets by providing them with the requisite platforms. This could include behavioural workshops, cross functional workshops, structured mentoring, and ongoing pupation of technical skills.
The knowledge management system should be so rock solid that it acts as a protection shield against the uncertain enemy.

Signing off with: “Uncertainty is the only certainty there is, and knowing how to live with insecurity is the only security.”-John Allen Paulos

Recruit+Onomics

Recruitment is process of identifying the target market-pool of candidates for the organization’s product-Employee Value Proposition undertaken by the marketer/recruiter.

Selection is the filtering of the target market into sub groups such that we have the primary and secondary target audience is well defined thereby giving us the suitable/unsuitable candidate pool.

Demand Theory of recruitment would define the relationship between the recruiter’s desire to pay the price of EVP and the availability of goods-the talent. So if the talent is available in abundance then the price that he willing to pay, being the EVP, would automatically fall hence displaying the inverse relationship. Similarly, for the candidate if there are jobs available in abundance then the demand for a certain job would be low and hence the price demanded i.e. EVP would be high.

The Supply theory would come into play as the importance of filling the position/price of talent=EVP/opportunity cost of talent=Competitive Advantage increases, the recruiter increases the talent as that fetches him a higher overall return. Hence, the logic of giving priority to those goods which make more money over those which do not make as much, applies here.

Elasticity of recruitment = %change in demand for talent/% change in business environment
So the elaticity of recruitment is the responsiveness of the demand for talent to the chnages in the business environment.

Applying the funda of innovation economics here, the central goal of the economic policy (in this case recruitment strategy) should be to spur higher productivity and greater innovation. This when applied to recruitment would mean meeting the recruitment metrics effectively and have better and more innovative ways of achieving the same. Secondly, this form of economics also says that markets (organizations/recruiters) relying on price signals, in this case salary, alone will not be as effective. Hence, the EVP has to be packaged as a bundle of offerings and not just salary alone. The recruitment/marketing strategy (Employee Value Proposition) would then be created based on the need identification of the end customer which would be needs of the prospective employee. The Marketing Strategy would attempt to ensure that there are no gaps in the customer’s demand and the product’s (job) promise (EVP=Employee Demands). Hence, making the product i.e. the EVP attractive enough to convert the sale leading to the acceptance of the offer. Being the first point of contact between the customer (candidate) and the product (EVP), it is the recruiter’s responsibility to effectively utilize pull & push strategies to create the magic and convert the sale.

The Opportunity Cost of foregoing talent acquisition would be the competitive advantage that he would gain from that acquisition. Talent being the constant source of differentiation amongst competitors would have too high a return on investment to forego.

Cost Benefit Analysis of recruitment can be done on the following basis:

1) Recruiting Cost Ratio = (Total Recruitment Costs/ Total Compensation recruited)*100
2) Recruiting Efficiency = 1-RCR
3) New Hire Performance (based on the grading systems)
4) Manager Satisfaction Feedback Score
5) Time Taken to fill the position
6) New Employee Loss Ratio
7) Turnover Index
8) Source Value Index = (%New Hires fro Source/% Recruitment Budget Allocation) {Booz Allen's Recruiting Survey}
9) Competency Opportunity Cost: On the loss of an experienced and more efficient employee and replacement with a less experienced and efficient employee that comes with new hire costs (fixed costs+ variable costs)
(For calculations refer: http://www.staffing.org/)

Recipe for Employee Engagement: What are the Ingredients??

Yesterday, I attended a workshop on Employee Engagement. Often faced with the challenge of accurately defining the engagement process, post the workshop I thought of making an attempt at it. I walked out with the following thoughts on the same.

Engagement is a religion where you convert the employees to the organization’s cult. I would personally define it as a heightened level of devotion wherein the employee is unable to identify any gaps in the religion’s offering i.e. The Value Proposition.

It is the ability to foresee and meet the stated and the unstated needs in such fashion that you create a state of mind where the employee is so addicted (the state of being enslaved to a habit or practice) that he chooses to go beyond the contract. So in short employee engagement is analogous to addiction. It is the organization’s ability to make the employees dance to its own form of music i.e. move them towards value creation and achieving heightened levels of excellence. The employee exists to own the success & failure of the organization and intervenes to improve business results.

As Marcus Buckingham & Curt Coffman have put it in their book, First Break All the Rules, these needs have to be met in a set hierarchy. They say that the act is analogous to climbing a mountain where you get acclimatized to a certain type of atmosphere and then move further up and if at all you try to skip a level it will lead to mountain sickness.

So, I guess we could say that we need to meet the vanilla requirements before we add the chocolate sauce.

The inability of the above or inefficiency at it would lead to haunting of the ghosts of disengagement. Disenchantment at work may result in the draconian threat of attrition. And if at all, the disengaged stay back then they will turn into parasites working towards converting the religion of the engaged employees (to that of disengagement).

A colleague rightly put it; Engagement can be compared to a marriage wherein you are marrying the employee to the organization. Like in every relationship, the employee will fall for the charisma of the brand, then there will be the initial commitment phobia from the employee’s end, he may get cold feet and hence there would be domestic issues but it is the organization’s job to create that chemistry i.e. an Occupational Intimacy which will make the employee Say, Stay and Strive (the 3 behaviors of an engaged employee as defined by Hewitt Research) i.e. become a talent magnet. If, however, the brand is mishandled then the dynamics of the r0elationship will get eroded and the reactive approach of wheedling with fresh promises, exit interview approach in this case, doesn’t help too often. Oprah Winfrey spoke similarly about marriage, it’s about Am I in it today? It’s not about will I be in it tomorrow, or should I have been in it yesterday, it’s about being committed to it today.

However, having said that the Engagement process is not a story of mush and romance alone. It has a strong business case. Research has shown a positive correlation between engagement and business performance.

Hewitt Research on the subject suggests that successful employee engagement leads to:
· Increased Shareholder return
· More Market Value/Employee
· More Sales/Employee
· More Profit
· More Revenue
· Greater Customer Retention
· Higher Profitability
· Reduction in turnover cost

Gallup research Statistics say that successfully engaged organizations are:
· 18% more productive
· 12% more profitable
· 12% better at engaging customers
· 51% less likely to leave
· 27% less likely to indulge in absenteeism

Now of course there is always a debate on who owns the onus of creating that magic. It is obvious that it is the line manager who is the driver of the experience of the brand, for any employee. He is the first face of the employer for any employee. HR being a default engagement champion will act as a catalyst to provide a successful & supportive macro environment (providing the processes, methodologies, platforms etc) but it will be the line manager who has to act as an anchor and give direction to the employee.

Would like to sign off with a recently heard quote by Henry Ford: “Why is it every time I ask for a pair of hands, they come with a brain attached?”

HR in the Battleground..!!

There is a growing realization that people are the most important asset that an organization possesses. Human talent has become the differentiating factor among competitors across all industries. The competitive advantage that arises from the talent has a greater impact than from the other resources which are getting largely commoditized, as in they are easily replicable.

Change has allowed HR’s value proposition to move from being an administrative function to being a business partner. The function is now moving focus from just do-ables to deliverables.

With due respect to the challenges faced by other functions, I would like to draw a comparison with a few of them, in order to negate the impression of HR as a cost function.

Like in marketing they sell products to the external customers of the brand, in HR today we sell the company to both the external (the talent/employee pool) and internal customers i.e the employees through employer branding phenomenon.

In the world of finance, we have equity leading to asset productivity which in turn leads to profit, similarly in HR, we have investments in Talent management leading to talent development which in turn leads to an organization’s strategic success.

As in Supply Chain Management, in HR too you make and buy to manage risk, adapt to uncertainty in demand, aim at an improved ROI in developing employees, preserve the investment by balancing
employee-employer relationships as talent development is a perishable commodity.

Selection today is the most important purchase decision that a company makes. Investment in talent development is the most strategic investment of any organization.

Hence, this strategic function, namely HR, now provides us with the opportunity to face one of the toughest challenges in the economy, increasingly being recognized as The Talentship Challenge. This is not about developing people and creating succession plans. It is about meeting the objectives of the company which in business terms amounts to making money for the company, a common goal we all strive towards.