Time to Refresh and Focus on Core Business Needs
Discussions about priorities and resolutions before the end of the year are an exciting ritual despite of the fact that neither the questions nor the responses change. Going through many such resolutions of the past will validate that people talk about digitalisation, automation, analytics, change management, leadership development etc. as themes to focus in the new year. I find such crystal gazing quite an academic exercise and would love to see themes for next year based on rational thinking rather than prophesying to be a futurist.
It is best to go back to Kaizen, Six Sigma, RCA, and many such tools and establish the next year’s problem statement. I believe the problem statement must arrive from the most significant issue we faced in the last ten months of pandemic driven lockdown. The biggest threat had been to do with the business’s survival, and hence for future, the problem statement must be defined as “Issues around the revival of business”. Across the Industry and organisations, while the severity can be varying, businesses were impacted adversely. Some sectors like telecom, online retail or food tech might have done well during the pandemic but market and economy had been under stress to a large extent.
Hence, we can emphatically say that the call of action for the next year would be “Revival or Recovery of businesses”. If that is agreed, I believe HR priorities have to sharply focus on doing everything possible to enable recovery and restoring the trust of all the stakeholders inside and outside the organisation.
My priorities or resolutions would be around the above theme and would not get into the themes that would sound HR’ish, if I may use this term.
Now, let us look at what should be done to help business recovery either in terms of revenue growth, top line, bottom line, market share, or business cost. For the organisation’s business metrics, Goal Setting & Performance management is the singular most important and useful tool that HR can use to drive the recovery in a focussed way. It will be great to see HR folks redefining the entire goal-setting process and performance evaluation for next year.
It will be advisable to look at the changing rhythm of goal setting and performance evaluation and have quarterly or even monthly process of goal setting and business dashboard-based evaluation process. The year 2021 should also be a year where the focus or weightage for the business goals shall be disproportionate compared to other buckets of KRAs. It will be ideal to have few well-defined businesses goals and link them with the performance-linked bonuses, for example instead of having all the business metrics like gross revenue, net revenue, cost, market share, EBITDA as the parameter, might be useful to sharpen these and have only two or three.
As a traditional approach, performance-based incentives are paid out on individual performance, Org Performance, and business unit performance. However, this year, we need to look at people’s cohorts at senior level where the Org performance becomes superordinate to earn performance bonuses. It will be critical to ensure higher collaboration levels and alignment with the org goals, ideally anchored around business recovery. There is a need to redefine the PMS for the next couple of years to channel energy in the right direction.
The next area where HR can contribute immensely this year is in Manpower Cost Optimisation, which impacts the organisation’s bottom line. I firmly believe that organisations on the growth path throw people on the problems and create flab in different corners of the organisation over a period. We saw the consequences of it in May-June 2020 when many companies resorted to downsizing exercise. I believe that not every organisation would be able to follow job evaluation processes and job worth index to identify the exact value of the job in the organisational context, in growing economy witnessing hyper-growth in some sectors, it’s challenging to maintain discipline on the hiring front.
My advice and caution are maintaining the principle of “minus level” and “cost neutral” hiring. It is a lot relevant for the new age and fast-growing organisations. The strategy of hiring replacements at a level lower than that of the outgoing incumbent and at the similar comp would provide much-needed optimisation. I do feel that while many organisations resorted to workforce rationalisation, still there would be scope of further optimisation, the next phase of optimisation shall not be by downsizing or rightsizing. It shall be based on efforts on optimisation and prudence. Filling vacant positions with internal resources would require strong Internal movements process, it would be imperative, at least for coming next 6 to 8 quarters.
Suppose we reflect on the period from March 2020 till now, it will make us look novice and mock on our long-established working ways, that earned accolades for chasing and creating processes to monitor and review, either in the garb of checks & balances or in the form of process adherence or under the veil of institutionalisation. I feel amused that every people process got either compromised, changed, or challenged during the last year. Simultaneously, I can’t take away credit from the high performing HR teams and leadership, which quickly adapted and demonstrated extreme dexterity in handling contingencies. My simple question why can’t we be like this even during peacetime? Flexible, accommodative, agile, and yet effective? With this premise, I believe HR Business partners and COE role holders would provide excellent service to the organisations by removing and relooking at the ‘non-value adding’ processes.
Learnings of the year 2020 should pave the way for un-building some of the methods which have outlived the utility and can be garnished or revamped to be more futuristic. People policies, Engagement interventions, L&D strategy all would offer an immense scope of change. For example, at MakeMyTrip, we started focussing a lot on leadership academies built around developing functional competence rather than soft skills or behavioural skills. Some launched and some in pipeline learning academies like “Sales Leadership Academy”, “Young Product Leaders Academy”, “Budding Revenue Leaders Academy” are all with an intent to Un-Build historical approaches and create new normal in everything HR does. HR teams will have to pick up tracks within HR domains of learning, talent management and others and focus on some to create, though, short term but the visible impact in the organisation’s talent landscape to regain the trust of existing employees or prospective employees.
One of the areas that can further impact the business-critical mission for the next year would be to strengthen the employees’ loyalty and engagement levels, many organisations have seen it eroding or at least dented in last 10 months. My formula, to bring back the trust and engagement would be to focus on strong communication channels and disseminating business developments in a structured way. I believe people are better engaged if they have complete clarity on where the organisation is heading and good as well as bad news, impacting the organisation. I would have priority around strengthening “Business Communication” processes with the rank and file of the organisation, instead of spending time on feel-good activities and fun activities, clear focus on having regular panel conversations and fireside talks with the leaders with the larger workforce as the audience can be potent for engagement. I also feel that while large organisations with strong history do focus on employee’s family, new age organisations have some distance to cover in terms of unravelling the value of family connections, the year gone by would have given some insights on the aspects of engaging with the family of the team members for creating stronger bond based on trust and personal connections. HR teams can help build trust and create a strong employee value proposition pivoted on engagement involving families.
While I pen these thoughts, vaccination programs against COVID are on the anvil. Organisations have got their workplace operating model in place, and business recovery is slowly but surely bringing back the positivity and optimism in the environment. What is needed for every leader, especially HR teams, is to focus on a few high impact areas, build a credible alliance with the groups, and create effective plans to execute. Some of the high impact areas to prioritise would be Managing Performance, Manpower Costs, Efficient & Flexible Processes, and Communication based engagement mechanism.