I love it when someone visits my blog and I love it even more when someone leaves a comment. Sadly, though, on a blog, originally taglined beautiful work, I get more traffic about the role or HR and the recession than for topics like poetry.
So you want to know about HR and the recession?
These are my qualifications to talk on the subject:
I pay attention as much attention to the work we do, and the context that we do it in, as I do to the techniques of HR and the psychology of the work.
Here is an important point I have noticed: Writers on HR are not exploring the recession itself.
My observations are this: this is not a recession. It is not a depression either. The financial system is too central to the economy and too large, with one quarter of our livelihoods in UK, for this to be regarded as a cold, or a serious bout of flu. Indeed, I don’t think metaphors of illness or failure will take us far and it is best to think of a caterpillar becoming a butterfly: the one goes and another emerges.
Where will we be in five year’s time? What industries will be surgent? What will jobs look like?
I spoke to someone in Johannesburg today. He had just been into Zimbabwe and I told him of the Forbes’ prediction that Africa will supplant China as the supplier of low cost labour in five years. Look at Africa with that filter and notice the scenarios you now consider. Look at the processes you now perceive to be the ones we should protect, cherish and nurture.
We are not in a position of more-or-less. We are in a position of radical change. We need, I think, to be discussing the nature of work in the UK and how work will change by the time we are out of this crisis.
2. My second qualification is that I have lived through a serous recession before, sadly.
We go through phases in these situations much like the phases of bereavement. We deny, we get angry, we barter, we accept.
At the moment, we are in the early phases, with many people believing that somehow this will all go away while a few others expressing a little anger – about fat cats, particularly.
Few of us are exploring our options in any depth. And, even fewer of us are taking a leadership position in which we help other people understand what is happening and how they can work together towards a better future.
My experience of these situations is that the presence or absence of that leadership, workplace by workplace, will make a difference to the final outcome. The last thing we need is to develop a pattern of each man for himself, women and children look after yourselves.
Leadership matters. And leadership means believing in our followers, and showing it.
3. I am a psychologist.
In any stressful situation, we are faced with the easy choice: be defensive and protect what’s ours. Or, we can step up and be proactive and generative. Which is often very hard.
Let’s take Obama’s inauguration as an example.
Obama’s inauguration will be one of the largest in history – people want to be there. Obama is doing some predictable things. He is looking for ways to include as many people as possible. And he is capping donations at USD50K. Both laudable.
To spend all that effort (and money) on a celebration of past successess is not enough – not now, not after such a campaign. The collective party in Washington and across the country, if not the world. lays the foundation for the next round of effort.
Indeed, a good crisis allows us to think through what is important to us and how we will work together in the future. I desperately want to read stories in the HR blogs on what we are doing together to meet the challenges of the future, together.
Before we launch into micro-actions of making people redundant or whatever else (there’s been lots of traffic on psychometric tests of all things), how do we want people to act?
What collective action are we hoping to inspire and galvanize? What is the good use to which we will put this crisis?
In my last post I described an exercise for testing the depth of our positive attitude: write a novel about myself and make myself feel pain. I tried it. It was hard! I’m glad to know that I am not a masochist.
But I learned a little. I learned that we hate to lose our ‘role’ and that I hate to be around people who are just pretending to have a ‘role’. From there, I found myself listing the HR procedures for increasing belonging and the metrics to show how much value these procedures add to a company.
A manifesto for HR!
My worst nightmare
My worst nightmare is being in zombie-land. I hate being in places where people have become cynical and at best are just “deteriorating as slowly as possible“.
Of course, I don’t really hate it ~ I am terrified by it. We are terrified by anything which assaults our personalities. I’m an INTFJ or a shaper/completer-finisher/resource-investigator. I don’t do incoherent, lazy, out-of-it. I may be misguided. I may be slothful about many things. But I will always have a purpose. If I am going to be rudderless, I do it on purpose!
Our nightmare is not to have a role
This was my insight from the novel-writing exercise. We are all terrified by the prospect of not having a role, or not belonging to our communities and workplaces. We are very sensitive to rejection. Even the nuances of rejection send us into a flat spin.
Many things that can lead us to feel that we don’t belong
A lot of things can lead to a sudden feeling that we are out of place.
Our general confidence
Policies of the firm which signal who is in and who is out
Heaps has been written in the last few years about recrafting jobs to meet our personal needs. A waitress tenderly sweeping the floor of the cafe with good music playing in the background is recrafting her job just as the young guy who also works there recrafts his job by trying to sweep as fast and vigorously as possible. Both put their personal stamp and sense of meaning on the job.
Poet David Whyte gives the same advice. Begin with the ground, the hallowed ground on which you start. Find meaning and belonging in what you already have and build from them.
Positive psychologist, Christopher Petersen calls expanding from what we have “building a bridge while we walk on it”.
And for a good speech showing this is not just for me and you, but for the smartest and the brightest, listen to Dr Rao on Googletalk (YouTube).
Recrafting when we feel rejected
It is tough to recraft when we feel rejected though ~ for this reason. We hate being rejected and we are loathe to admit that we have been excluded.
One, it hurts.
Two, we catastrophize and think that if this person rejects us, then everyone else will too.
Three, we worry that if we dismiss rejection, we may dismiss feedback that will help us manage future relationships.
Four, we catastrophize and think that if this relationship is not worthwhile, none will be worthwhile.
Five, we worry that the information that we have been rejected will be used against us!
Rejection put us in an emotional spin and bullies know it! They’ll use rejection to keep you off balance.
That said, how do you work on finding the good in situation when you are feeling lousy?
Recrafting when we we are afraid
I would say we should do three things.
Make an objective assessment of the situation, as clinically as any staff officer in front of a paper map miles from the front line.
As you are not sitting behind the lines and you are actually in the thick of things, do as you would in battle. Move yourself, everyone else and everything you need out of the firing line.
Consider all the options including the options for negotiation and resumption of pleasantries.
This is really hard to do. Believe me ~ being rejected by people like employers and teachers, on whom you depend, will frighten you almost as much as getting shot at. In many ways it is worse. You can allow yourself to be frightened by bullets as long as you act responsibly. But to admit you are being “dissed” by your own side rips the guts out of you.
So you do the three steps: you take defensive actions, you try to be pleasant, you take time to make an objective assessment. And guess what 90% of your energy is going into defending yourself from your own team!
Time spent on mending relationships in a firm
You are now being defensive and so is the next person and so is the next. Guess what? Anyone who wants to overrun this outfit, or take on this company, is going to win!
The firm is now in peril
This is my biggest nightmare. It is quite clear once the spiral of defensive starts, the only thing allowing this firm to survive, is the incompetence of the opposition. Anyone wanting to ‘take’ them would only have to distract the staff more for the whole ‘shooting match’ to fall apart.
What is the alternative to a firm where we are all watching our backs?
Inevitably, things do wrong in companies. People do bump against each other quite unwittingly. Feelings are hurt. If we want to be successful (survive),we need to establish is a working culture where people are able to deal with shock and surprise without passing it down the line.
How do we stop defensiveness spreading?
Good HR departments, generally in larger firms work hard to keep a positive atmosphere (I did say good.)
Good firms develop strong systems to minimize the management by whim. The reason they do that is to remove the objective threat to one’s employment that accompanies disagreements. When there is no objective threat, then people can attend to mending their fences. Good firms don’t allow people who are party to any “dissing”, in either direction, to take part in decisions about each others employment contract.
Good firms go to great lengths to manage the assimilation process ~ known as on-boarding or induction. They work with people through the forming, storming and norming stages and then take a watching brief during the performing stage coming back in when there are changes in a team or when someone leaves.
Good firms take some trouble to build diverse teams and to educate people why they need the very people who seem very different from themselves. HR also takes some trouble to make sure that a team is not made of people who are too similar too each other and that the important bridging roles of team player and chairperson (the lazy roles!) are also present.
Good firms insist that everyone has an active career plan which is reviewed with you openly by committees chaired by senior members of the firm.
Good firms monitor diversity assiduously and keep a watchful eye on the formation of cliques. HR is quick to intervene to minimize behavior that is rejecting and removes people’s attention from their own job.
Good firms design jobs carefully making sure that is is easy to get down to work (autonomy), that growth is possible in the job visible (competence) and that jobs allow us express ourselves meaningfully (relationships). Work has goals, feedback built into the task itself, adequate resources, dignity, respect, physical safety, contractual safety, mentors and coaches. We don’t want people so confused about how their jobs fit into the wider whole that they cannot think straight.
This is what I do for a living
My job is to make a system so that we are able to work together even when we are rubbing up against people. I will see the effects of my systems in several ways:
People attempt to resolve difficulties without fear of their contracts. People take the initiative; people don’t use the employment contract as a threat; negotiation of the employment contract is kept separate from other decisions; there is no fear in the organization or cynicism.
The output of people does not vary significantly when they move from group to group. Nor does the output vary between people with different demographic characteristics.
The time taken for people to settle into the organization is known and the process is monitored and taken as seriously as quality on a Toyota assembly line.
Everyone has an active career path, we are mindful of who should be seriously thinking about progressing onto other firms, and we treat their onward progression as part of our competitive edge.
Deployment of individuals is not only done for and to individuals. Teams are deployed so that they are balanced. They are given time to bed down and their boundaries are respected. Team work is not disrupted without investments being made in the time it takes to reestablish a team.
We have designed each job so that it has clear goals measurable by the incumbent, they can see how well they are doing and they can step-into the job in an orderly way sharing their successes publicly with others.
HR Metrics
To monitor my system, I have metrics on each process. I also monitor HR Costs/Sales in each business unit and over time. When people have the time to attend to their jobs, I would see small improvements in the ratio.
Take for example, the HR Costs/Sales ratio in manufacturing which is usually around 10%. If people are able to do their job only 10% better, then the ratio will increase from 10/100 to 9/100 or done the other way from 10/100 to 10/110 or a 1% in Gross Profit. That is generally going to be “pure” profit ~ that is, it is money that comes available for new equipment, training and even medical insurance and holidays.
When we are making more money because we aren’t worrying, then that is good profit indeed!
We do what concerns us and we are terrified by its loss
So it seems making a role for everyone comes from greatest concern -that we are going to have to sit around faking it. That led me to think that everyone wants a meaningful role. Not everyone wants to sit around making meaningful roles. Who would make the money if we did? While other people are off making things and selling things, it is my job to create an organization where we can get along without needless friction.
An emotionally healthy company requires good systems. We must be able to work without fear. Problems must be refereed as they arise and early. And we must trawl our systems looking for emotional bruising that is getting buried. If we continue to hide the casual rejection of people “because we can”, it will eventually cost us our livelihood. While we are all protecting ourselves from each other, our opposition will be taking over our business.
Simply, I am doing my job when you are able to do yours and I do this job because I cannot imagine what it is like to live defensively all day long!
PS I still don’t think I did the exercise properly. It is very hard to imagine pain ~ even on a make-believe character that looks, moves and talks just like us!
Succession planning ensures we have someone ready to do a job tomorrow
In business, we use succession planning to ease short term supply problems ~ or in plain terms ~ to make sure that we have people available quickly, to do a job and to do it our way.
We have 3 basic methods of succession planning
#1 Do nothing or leave everything to chance
This is obviously the cheapest to do. It also sets the base line. Whatever else we do should work better than this, or we will stop doing it!
#2 Job cover for every position 5 years ahead
We make a database listing every job in the organization and every person in the organization. This massive ‘spreadsheet’ is repeated 6 times: now, next year, 2 years from now, etc. Every year, the plan is reworked to make sure that there is someone to cover every job 5 years ahead. That way someone’s training and work exposure is started well before they are likely to take on the whole role. And if someone resigns, there is already somebody in-house, trained and ready to take over.
This is the most expensive system and it works best when an organization is very stable.
#3 Evaluate the depth and potential of every team
This method looks at the potential of “critical” teams.
The depth of each team is assessed by rating each member on a 3×3 grid. On the vertical is their current performance (better than adequate, adequate, not adequate). On the horizontal is their potential (unlikely to go higher, will go up another level, will go up 2 or more levels).
This is a relatively cheap method because most of the data is already available from performance appraisals or it can be gathered intuitively from a panel of managers.
Succession planning in the information age
The key to #3 is an assessment of how much higher a person will go in the organization. The Economist today makes a good point. The level that a person will reach is no longer very relevant.
What is relevant is a person’s ability to
gather information
analyze information
make sense of it
present it so other people can make sense of it and know what to do with it
I can imagine some people thinking these skills mean research skills. That’s not quite what we mean. We mean skills linked to the internet.
Make a website in minutes to make data available
Use Google Alerts, Twitter and Search to keep abreast of events and to rapidly deduce what is relevant
Mashup data so that other people can see what is happening
Ask questions that are relevant to people around them
Present data so that people understand the underlying processes and quickly understand what decisions they should make
Track the effects of action
This sounds geeky. It is a little. To do any of this well, though, we need to understand people and their context.
What do they need to know and what will they do once they know?
Succession planning will ask then
Is the person aware of what is going on around them? Do they gather and analyze the right information? Do they ask the right questions? Do they lay out information well? Do people understand them and people find it easier to act quickly and effectively?
Is the person developing his or her information talents?
Are they able to take on larger leadership roles with more complex & dynamic information environments than they currently enjoy?
It would be good to write up the types of information contexts that people work in currently and the demands on their attention.
I am currently writing about 10 Sun Tzu rules for the networked world and I stopped to consider the specific issues faced by startups – defining their fans & customers.
For HR too
HR are another group who face special problems. HR are last to the party and we often feel that there is little we can do about the structure and climate we inherit.
Well there is.
HR in the Recession Stressed World of 2009
First, promote positive psychology.
Full press. Positive psychology is the biggest favor we can do for our organization.
And to develop an infectiously positive outlook, we personally will take more vacations, play more golf, laugh more, and have fun! It begins with us.
Second, read the 10 Sun Tzu rules for the networked world
Originally written by Umair Haque to defend networks under attack, the rules provide a framework for an organizational structure that will work in today’s fast moving world.
Our structures will be a little different to the ones we have now.
The job of corporate HR in a networked world
Why do we need an organization anyway?
In the ‘corporate’ office, our task is to develop the collective properties of an organization that the people out in the field need to compete effectively.
We, for example, work on discounts that make it easier to get good rents in the shopping malls. But we don’t sign exclusive deals that block the initiative of the people in the front line.
We conceptualize the meaning of the collective. But ot in terms of return on our funder’s capital. Interest on capital is incidental to our business. So are we, actually.
We conceptualize why the field units are better off working under one umbrella and we work out which aspects of the organization must be coordinated and which do not have to be.
That’s what we went to university to learn and that’s how we contribute significant, inimicable value that exceeds the cost of our salaries.
Just how lightweight can the organization be?
And then we execute those aspects of coordination in as light weight form as we can.
If capital is needed, so be it. But we don’t become prats and hand-over the business lock-stock-and-barrel. We let the funders have their % return. That is all.
Take the initiative to lead us into the networked world
And we step-up! This is the age of sweat equity. We are in the age of organizing ourselves around our talent and around our relationships with customers.
This is our task as HR managers of the 21st century
1. Conceptualize the organizational structures that add value to the business.
2. Organize the corporate office to add that value.
3. Help talent make the transition from solo operator to team player and from talented employee to customer-oriented professional.
That’s what we do now. We are the entrepreneurs of the 21st century!
And if you are not in corporate HR?
Start learning.
You can activate positive psychology in the workplace without anyone’s permission.
Indeed, if they are inclined to say no, that is all the more reason why you must activate positive psychology, for the sake of your own mental health.
If you don’t understand that argument, contact me, and I will explain.
And activate social media for the functions you do control.
All works parties, sports teams and fund raising can be managed with social media.
Begin, so your skills are up-to-speed when you need them.
To recap: HR in the Networked World
1. Positive psychology
2. Social media
Why?
1. We want to find the organizational structure that brings value to business.
2. We want to organize the corporate office to execute the structure to add that value.
3. We want to help each and every person in the organization go from being solo-performer with talent to a customer-oriented professional who is supported by a team and supports a team in turn.
I have my mission. I hope I have helped you find yours.
Mary, the HR Body put her cheerful face around the door and said “Lunch”. Yep, I was keen. There is just so much that I can take in at one time and the Dashboard at Xoozya is pretty comprehensive.
She dangled a key. “Bring valuables,” she said, “but leave everything else as it is. We’ll lock the door”.
The canteen wasn’t far and I could hear the buzz as we approached. It was just as hyped. Salads, fruit and hot food and the refreshing absence of the cloying smell of old fat and overcooked vegetables. Sweet.
Mary, ever the professional, asked nimbly whether I ate fish. I do, and she said, “I’ll get two fish pies – they’re good. You grab some salads. I’d like plain lettuce and tomato and pear or some fruit. Water OK to drink?” I caught up with her at the cashier where she introduced me as noobe and I put my food on my tab. We grabbed napkins and cutlery and she led the way to a corner table. “We’ll join Peter Wainwright, the HR Director. You remember him, of course?”
As we approached, Peter rose, smiled warmly, and said “Hello, Jo. Welcome to Xoozya! Here’s to a prosperous and happy alliance.”
We fumbled around, as one does, arranging trays and getting comfortable and he asked about my morning. I told him it was clear I have some thinking to do to set up a communication system that leaves me informed but not overwhelmed with information.
He nodded and added: “Well, take your time. Every minute that you spend in exploration now pays off handsomely in comfort and organization later. We also want you to base your judgments on what matters. You’ve joined us with your skills, as has everyone else here,” he said, waiving his hand at the crowded canteen.
Future capability and value
“There are skills that are essential to what you do and there are skills that will change with technological change.”
“We want you to jot down the skills that are absolutely essential to what you do. These we will nurture and respect.”
“Then there are skills that are going to change significantly over the next five to ten years. We want those on a separate list because those require significant investment in time and energy”.
“And there are skills that we don’t use anymore. Those we give a respectful burial.” He smiled. “When we have identified a skill or process that we no longer use, we get an occupational psychologist to document it and we make a display for our skills museum. Then we have a little wake,” he chuckled, “to see it off. It’s quite cathartic.”
Nostalgia for skills & practices of the past
“So which skill in the museum is best-loved?” I asked. “Which grave attracts the most flowers?”
“Ah, we hadn’t thought of doing that. Good idea. We should put the skills up on the intranet with the choice of . . . flowers or . . . a good kick . . . or a big ? mark for ‘who was this!’. And see what we get back!”
My induction so far
Well, I obviously have some thinking to do. It is only lunchtime and I have to think about
And which will change so fundamentally in the next five years that you will need to retrain?
And which skills deserve a respectful burial?
Which are you happy to see go and which will you miss?
And if you are enjoying this series, please do feel free to join in!
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And PS, if you are new to this blog, Xoozya is an utterly fictitious organization. This series began on the spur of the moment as I started to explored the principles of games design and Ned Lawrence of Church of Ned mentioned how much time people put into designing their avatars, or online identities. Xoozya is an attempt to imagine what an organization would look, sound and feel like if it were run along lines recommended by contemporary management theorists.
And PPS Ned is an online writing coach and is available for hire.
Many people are landing on this blog looking for information about HR and the recession. I suspect, though without any evidence, that many people seeking this information may be students, or people deputed to write a position paper on what HR should be doing.
This is intended to help you out. It is a summary, though a long summary, of earlier posts. I’ve also framed it with ideas you will find in classical text books on HR. I am writing mindfully that you may want to use the information for a presentation.
Any one else reading might like to check through to see what I have forgotten. You might also be interested in my inclusion of positive HR that is not yet in most textbooks. It is a long post though, and you may want to bookmark it for later.
Introduction
HR strategy, in business or in other organizations, be they public or private, follows a disciplined logic. Before we decide what to pursue in the HR arena, we ask 4 questions.
What are macro-environmental factors that affect everyone – us , our customers and our competitors?
What business are we in, and what are the institutional factors that affect all firms in our line of work?
What are the micro-environmental factors that set us apart from our competitors?
What are the laws and regulations specific to the jurisdiction where we will be hiring people?
A recession falls mainly under the first question. Recessions may also affect the other three questions as well. For this post, though, we will look only at the way a contraction across the entire economy changes the general pattern of HR, no matter what business we are in.
HR managers struggle, typically, to assert itself within the management team. To clarify our role, initially to ourselves, we typically look at our contribution along two dimensions: hard to soft, and strategic to administrative. ‘Hard’ HR looks at issues like productivity and legal contracts. ‘Soft’ HR looks at emotions, morale, loyalty and engagement. Strategic HR asks the big questions about the type of HR that we need – much as we are asking in this post. Administrative HR is the HR we all see – the forms, the interviews, the communications.
We need to be good in all FOUR areas, and all four areas change in emphasis when the economy slows down. I’ll summarise those changes in a moment.
It being 2009, we also need to add a third dimension: positive HR to ‘gap’ HR. Gap HR is the HR that is commonly described in textbooks, which sadly are always somewhat out-of-date. In gap HR, someone – somewhere – has decided what is good, and the rest of us are required to live up to that ideal. It is akin to a jigsaw puzzle. The picture is known, and we are the scrambled pieces to be put together following a preordained pattern. Positive HR is generative. We may have a picture in mind, but we do not believe it is the only picture. Indeed, we define a good day as the day that we discover a better picture than the one we had previously imagined. This is akin to leggo. We have building blocks which we use to test out possibilities.
With three dimensions, each crudely broken into two, we have 2x2x2 or 8 types of HR, that we can think about and ask systematically, how they change when we move at a national economic level from positive to negative growth.
And then we can ask how we can integrate our observations into a general approach to HR in a recessive economy.
1 Hard, strategic, ‘gap’ HR
A typical task of hard, strategic, ‘gap’ HR is scenario planning. Along with other people who are responsible for the future of the organization, we imagine how the economy might change and we anticipate how we, our competitors and our customers will react to each scenario as it unfolds.
Small business owners do this too. They follow discussions about the economy and they will typically look at a worst case, best case and a likely scenario. Yesterday, a business owner told me that he was working on the economy contracting until around September 2009, and then beginning to grow very slowly.
From this thinking, we are able to make ‘guess estimates’ of sales, and work backwards to the number of people who are needed by the organization and the skills they should have.
2 Hard, administrative, ‘gap’ HR
At the administrative level, it is likely that we will bring some contracts with employees to and end using redundancy provisions – so we pull those regulations off the shelf and dust them off. We are also likely to be pulling out the early retirement rules. We may be recruiting less – so we will try to maintain our relationships with the colleges and schools in the area, while tactfully indicating we will be hiring fewer people. We will also be looking out for government-backed schemes to train people and to subsidize employment in one way or another.
3 Soft, strategic, ‘gap’ HR
At the other end of the hard-soft continuum, we imagine what our organizations will look like, and the way members will interact with each other in five years’ time. We discuss, for example whether Gen Y are different from Gen X and baby boomers.
Planning the way we interact is the most likely area of HR to be sacrificed in difficult times. Letting this area go is the biggest mistake we can make. Managers will react under pressure, in the way we all do, by over-emphasizing their fears, and putting too much faith in their own judgement. We will hear a lot of talk that dismisses the views of other people.
When we hear this talk, it is the sign of an organization in deep trouble. It is in trouble financially. It lacks depth in its leadership. It lacks loyalty to its employees and other stakeholders.
HR leadership needs to be there, to turn around this emotional climate. We should not let this go. This is our main contribution during a recession.
4 Soft, administrative, ‘gap’ HR
On the soft side ,at the administrative level, much training, whether it is directed at productivity, or soft interactional skills, is also sacrificed, while more money is spent on stress-relief (usually for senior people) and counselling for people facing redundancy.
It is important to help people cope with the emotional distress of extremely unpleasant changes to their lifestyles, but regrettably in a ‘gap’ system, HR usually steps in after the distress has occurred. We would be better advised to step in earlier.
5 Hard, strategic, positive HR
Turning now to postive HR, we should note at the outset, that positive management styles are not necessarily cheerful. To be cheerful all the time is like expecting a 12 month summer, and a harvest every week. Positive management styles accept that life is changing, and that we need to change our ways consistently with changes in the real world. Hard, strategic positive HR attempts to take us, from worlds we know, into worlds we don’t know.
It is an obvious fact that we don’t enjoy recessions because we are losing a world we like. As in winter, we see little sun, and as in winter, if we don’t know how to dress warmly and to cook comfort foods, we may have a difficult time.
This recession that we are encountering now, though, is more like an earthquake or tsunami. We aren’t just dealing with a season that we encounter every year. We are dealing with a large mess that arrived abruptly. Structures, we have formerly depended upon, have been destroyed. What else can we do but rebuild, and rebuild better structures, that will last us for the next 50 to 100 years?
Just as in a natural emergency, first we attend to safety. We count heads and we count our supplies and we set about giving everyone the basics : water, food, shelter, medicine. Then without a break in our stride, we depute appropriate people to work on the bigger issues. We set about searching for missing people. We put people in groups to identify priorities. And we put people to work.
BTW, it is standard practice to fly in psychologists to emergency areas to ‘debrief’ or help people cope with the immediate shock. The psychologists are rotated, and are debriefed themselves as they are pulled back ‘behind the lines’. Emotion is contagious, and emotional sanitation, sorry to call it that but to make the point, is as important as clean water and ways to handle human effluent.
In short, we deal with the situation in which we find ourselves in. There is no going back, and the only forward is together, respecting our distress, and making use of all our resources, within which we will find our answers.
The HR leader understands this process and brings it into the practical work we are doing on a day-to-day basis.
6 Hard, administrative, positive HR
As with hard, administrative, gap HR, we will be looking at regulations but with an eye for possibility. We want to be like the on-line out-sourcers who responded to Hurricane Katrina, and put their computer systems at the disposal of authorities. We want to be associated with ‘delivering a bigger bang for our buck’. We don’t want to be associated with cutting costs and bringing misery to people who depend on us and trust us.
An example from UK, is the offer of a four day week to KPMG staff. It is a positive move. At the same time, computer geeks in the south-east have got together to make business services available to people starting their own businesses. It would be good to see large firms, who are essentially very profitable and who made a lot of money when times were good, reach out to help parts of the community who are far more distressed than they are.
We can have immense satisfaction and even in triumph in our use of routine facilities.
7 Soft, strategic, positive HR
Soft, strategic positive HR is the most demanding of our 8 areas, and is needed more during a recession than in good times. When we are faced with loss, it is extremely difficult to sit down with other people to think of ways forward. We become very concerned that we will lose out, and we tend to focus more on what we will gain personally, than on what we can create together.
We need soft strategic, positive HR to proactively help leaders remain generative. Once they’ve moved into a psychological position where they are prepared to be disloyal to their employees, it will be difficult to turn them around. We need to act swiftly to keep their mood positive, so they can imagine possibilities and see constraints as enjoyable hurdles.
To neglect early soft strategic HR will be our biggest failure. From that we can never recover.
8 Soft, administrative, positive HR
Soft, administrative positive HR is slowly coming in to focus in an area dubbed .personal leadership.. Personal leadership is easiest to understand when we observe the 24/7 nature of the internet. Whatever we do, where ever we do it, becomes visible as someone photographs us and tags us on Facebook, or another network.
The internet provides both the challenge, and the opportunity, to live coherently and authentically. No longer do we go to work as one person and change into another at the door. Gen Y are used to being the same person all day long, and though employers have found that confusing, it is now an advantage.
Gen Y are very receptive to setting personal goals that are big enough to include the company, but also not totally dependent on the company. They make energetic partners, who sense wider possibilities, which they bring into the firm. Yet they are willing to move on if necessary.
HR’s role is to ensure that everyone has developed their personal plans and are pursuing them with gusto.
Putting it all together
Eight parts of a portfolio are many parts, and these are only the features of the macro-environment, the first of the four questions we asked at the start. But lets pull together these 8 ideas before the patchwork grows any more complicated. This is the order in which I would think about an HR policy during a recession.
Look after ourselves. In a recession, we feel as if someone has taken away our toys. We aren’t happy, and what’s more, we worry, that someone will come along and take away some more. Our first goal, in this state of stress, is to restore a mood in which we can deal with threats objectively, and return to a generative and imaginative outlook. In short we must be as good at winter as we are at summer. And because winter makes us gloomy, we need to look after ourselves and deliberately allocate time and resources to nurturing an appreciative outlook. Are we enjoying the winter?
Be purposeful, one and all. Recapturing a positive mood is not simply a way to have a party. We have a purpose. After a recession, and particularly this one, we are not going back to where we were. This is the equivalent of a hard winter that will affect the next summer, and harvest as well. So we need to set up goals for the cold season, and the seasons that follow. Each person should have a goal. If mum and dad are retiring to have quiet mumbles, leaving the kids to do whatever they see fit, they will be surprised the day there is no food on the table. Our task is to get everyone to discuss the practical issues openly and calmly, to work out the schedules and goals, and to monitor our progress. Our goal is not to carry on as usual. It is to understand the meaning of a hard winter and to find roles for ourselves where we contribute to the common good.
Weave in dreams. Nonetheless, we don’t really understand what is going on and there is some panic about. We might be trying to hide our panic but, to continue the analogy, kids know more than we think, and can solve appropriate age-related problems quite well. People like being consulted and depended upon, so we should put people onto solving the problems where they have the greatest expertise. The hardest problem to solve is the disappointment of people who need to delay life plans – a person who has to delay going to college, for example. Our task as leaders is to acknowledge the difficulty, and to bring the person’s life story into the frame. What are the things that they could be doing now that they are particularly good at, that help everyone else too, and that get them ready for their life ahead? There is a a lot of work doing this with everyone in even a small firm, and we must remember that we too, need to rest, recover and attend to our own dreams.
Let former experts work on well understood problems. Though there is much we don’t know, there is still plenty that we do. I would ask a mixture of implementers and defensive pessimists to explore and plan our responses to well known issues.
We still need the regulation gurus. New government regulations will almost certainly come into play. People with detail-oriented, administrative minds and experience will take charge of this for us.
Bring all the good ideas together and let people see them. All this while, people are generating good ideas that are grounded in their own work and experience. We want to catch the ideas and weave them in to our plans, in an open wiki, so everyone can follow how our ideas are developing.
Celebrate our past, good and bad, as our foundation of the future. And finally, I would capture the essence of what we are doing and show how we are carrying the strengths of our past with us into the future. I wouldn’t bury the negative. I would look to it for what we learned, and the relationships which emerged from our difficulties.
Come with me!
I hope this helps you. I have started a wiki called MGMT101 to organize ideas about managing in the 21st century. If you would like to add your own ideas, or comment on others, please do drop a comment here, and head over there to add your thoughts.
I am a work psychologist. That means I am as much concerned about work as I am about psychology. I do a lot of background reading about management, organizations, new work like nanotechnology, etc.
McKinsey’s advice on management & organization in a recession
McKinsey have just circulated an old report 2002 report on risk and resilience in recessions.
They argue that firms that come out of a recession in the upper quartile, differ significantly from other firms. The winning group, lets call them “recession-lovers”, either hung on to their upper quartile position, or came up from below.
The McKinsey report has a few sentences I find ambiguous. They are also talking about firms that make the UQ. They aren’t talking about firms who climb from LQ to Median say, so we should be careful not to over-extrapolate.
3 winning characteristics in a recession
I have found THREE characteristics of the ‘recession lovers’.
1. ‘Recession-lovers’ surge ahead because they were always clearly focused on what they are doing. Prior to the recession, recession-lovers are involved in less acquisition activity than their rivals. Recession-lovers maintain their acquisition activity during a recession, while others drop acquisition activity to the steady level of the recession-lovers.
Can we conclude that firms who are less successful during a recession were involved in shakier business prior to the recession?
2. Recession-lovers make 33% more sales per employee than their rivals. During the recession, they maintain this ratio by spending MORE money on sales and general costs. To do this, they absorb lower margins(TESCO’s just announced this I think).
Can we conclude that more successful firms move to protect and maintain their central markets?
Can we conclude that less successful firms are willing to jeopardize their market position by taking quicker profits?
3. Recession-lovers spend more money on R&D and double this expenditure during the recession.
Can we conclude that rivals had thought that their markets and products were stable and by cutting back further believe that markets will be essentially unchanged after the recession?
3 thought-provoking questions for HR Managers to ask
If I have summarized this report correctly, then there are hard questions HR Managers should be asking as they consider redundancies, cutbacks, etc.
1. When we hired staff, we assured them of their importance, and the value and importance of the products and services they would deliver. What has changed?
2. Now the market is tougher, surely we should give staff more, not fewer, resources to do their work and to sell our products and services. If we don’t allocate more resources, than why? Was our previous allocation of resources thoughtless, or, is the market is worth protecting, in which case . . . What are the ethical and legal implications of what we are saying?
3. If we are making less provision for R&D, then are we saying that the demand for our products and services will be stable into the future? Is so, why not write long-term contracts for staff on those lines?
What’s your take?
I would like to phrase these questions as constructively as possible and I don’t want to overreach.
How can we improve our understanding of a business so that in the future we can ask the right questions earlier?
Where do young HR managers in UK develop and test their understanding, BTW? Which are universities and firms known for turning out HR Managers with solid business sense?
McKinsey have just circulated an article on supply chain management. I read it hoping to find information on local modularization, i.e., breaking up the supply chain in the way done by Boeing.
Rules-of-thumb for organizational structure
The article was about linear, but global supply chains. In HRM, we have very few rules-of-thumb to guide us about what is possible. Here are three that I gleaned from the article.
The demand for labor within a firm varies huge
1. Demand for mobile phones is often inaccurate by 400%. Evidently, if we have no idea whether we need to make 1 of something or 5 of something, we will have heaps of productive capacity idle much of the time. We are also going to have people hanging about, or we have to hire people at short notice with consequent loss of skill, team cohesiveness, and performance.
Companies who ‘play well’ with their supplier reduces their order times and save money on ‘capital employed’
2. A company who shared market information increased their suppliers’ confidence in the company’s predictions [industry unstated] and decreased inventory by 45% and order-shipment cycle time by 70%. Do we deduce that this reduction in capital-employed and stock-outs and the improved the cash-flow of the business with a positive knock-on effect into other areas like HRM?
Companies who share sales data with suppliers benefit from fewer stock-outs
3. A retailer who provided a supplier with direct access to their data and ceded the management of their supply chain improved the availability of availability in store by 70%, and overall supply chain inventory by 20%. Improvements of this size are likely to decrease lost sales and the price of the product itself and increase competitiveness.
Lateral communications across organizational boundaries
It is stunning that improvements of this magnitude come about from improving the lateral communication structures across the organizations boundaries.
I wondered earlier today whether there any examples of HRM across a whole supply chain. It would be an interesting project.
What do HR Managers do? Who do IT Managers do? What do any staff managers and trusted subordinates contribute to the leadership of an organization?
What does the boss do and what should subordinates and staff managers do?
While I have been in the UK, I have been struck by the confusion and discomfort that local HR practitioners feel over their role in the management team.
Learn from Henry Kissinger about advising the boss
People who do feel under appreciated, or who are looking for better ways to describe their role, may enjoy this piece by Henry Kissinger, where he describes the relationships between the members of the ‘security team’ at the White House – the President, the Secretary of State, the Secretary for Defense and the National Security Adviser.
The contribution of the National Security Adviser seems to mirror my understanding of the HR function.
“to ensure that no policy fails for reasons that could have been foreseen but were not and that no opportunity is missed for lack of foresight.”
“takes care that the president is given all relevant options and that the execution of policy [by various departments] reflects the spirit of the original decision.”
“insisting — if necessary — on additional or more complete options or on more precision in execution”
