5. "the future of hr", dr. peter saul powerpoint presentation

Strategic Consulting Group

THE FUTURE OF HR?

Dr. Peter SaulDirector, Strategic Consulting Group

Paper presented to: Macquarie Graduate School of Management’s

“People Management and Leadership Conference” September 16-19, 2001


SHIFTS THAT ARE RE-SHAPING HR ROLES

FROMLocal markets, operations Manufacturing, clerical workHierarchyIntermediaries; face-to-face Obedience to formal authorityStability, efficiency, controlFull time jobCustomer serviceWork done by employeesFixed work locationManagement prerogativeLoyal serviceWhite, male workforceFinancial performance“Get a job”

TOGlobal markets, operationsService, knowledge workNetworksDirect access,virtual relationshipQuestioning of formal authorityChange, creativity, flexibility, orderPart-time and project workShareholder, stakeholder valueWork done by many contributorsDiverse work locationsSocial licenceMarketable knowledge, skillsDiverse workforceTriple bottom line“Get a life”


CHANGING WORKER ASPIRATIONS

RICHARD BRANSON MICHAEL JORDAN RICHARD BORES (Wizard Home Loans) MERY STREEP AND JODIE FOSTER ANITA RODDICK NELSON MANDELA AND JERRY MAGUIRE

“…had a dream and went through with it...loved what he did…lives life the way he wants... created this lifestyle for herself out of what could have been a downward spiral…really inspiring”

AFR BOSS magazine, June 2001. Survey of work role models for white collar Australians, in 20-30 years age range.


HR AT A CROSSROADS

“Significant change is inevitable for HR” but “what HR will be and do is not yet clear”

SRHM is doing research to develop a vision for the future of HR and a profile of the future HR practitioner

An HR practitioner might be "a hybrid line manager" who is "first and foremost a business executive" but has expertise in at least one HR function. SHRM President and CEO, Helen Drinan

“We have to get management to understand that they're responsible for people” AND “If we do our job—and work ourselves out of a job—so be it."

Results of a forum on the "The State of the HR Profession" held in conjunction with the 2001 Annual Conference of the Society for Human Resource Management

Also see FT.com online forum on “Human Resources: A career in crisis?”


EMERGING LEGAL ISSUES AT WORK

NEW TECHNOLOGY ISSUES

AGE CONSCIOUSNESS IN THE WORKPLACE

GLOBALISATION OF EMPLOYMENT LAW

TRAINING FOR LEGAL COMPLIANCE

WORKPLACE SAFETY

Source: Garry Mathiason (Littler, Mendelson, Fastiff, Tichy & Mathiason) SHRM Annual Conference June 2001. Results of survey of 400 employment attorneys


HR EXECUTIVES’ VIEW OF THE FUTURE

TOP 5 BUSINESS CHALLENGES

Developing new markets

Improving profitability

Market share growth

Becoming the recognised global market leader

Building shareholder value

TOP 3 HR CHALLENGES

Attracting and retaining talented people

Improving organisational capabilities

Developing leadership skills

Source: Arthur Andersen survey of HR Executives in almost 70 Australian-based firmsReported in HR Monthly, August 2001, p.17


“The bad and the ugly in HR”

“Many HR people still lack business acumen”

“We have not adequately managed high expectations of HR”

“There’s too much modeling of mediocrity… and way too little real research going on”

“We have overhyped e-learning and some other fads”

“We do much order-taking… and mistaking talk for action”

Jim Moore, former Director of Workforce Development at Sun Microsystems in his address to the 2001 SHRM Annual Conference


Q. So, how do we organise all the shifts, trends, speculation and forecasts into a framework that can guide fruitful conversations between, and strategic decision making by, senior line managers and HR professionals?

A. Scenarios is one way


FOUR AUSTRALIAN SCENARIOS

“FIRST GLOBAL NATION”Australia capitalises on globalisation; promotes its internal diversity and ethnic tolerance; and boosts home-grown innovation and industry capability

“SOUND THE RETREAT!”Globalisation stalls as political and social structures are not ready; trade barriers and nationalism re-emerge; we depend on bilateral national and commercial relationships

“BRAVE OLD WORLD”Complacent, dependent on agriculture, tourism, “new” manufacturing and some biotech; clever people and companies move overseas

“GREEN IS GOLD”We emerge from the growing imperative to protect the natural environment as a leading innovator of global environmental management

Source: Australian Business Foundation “Alternative Futures: Scenarios for Business in Australia to the Year 2015” Sept 1999


DEFENCE: ‘In the Box’ Scenario Matrix

Open globalised world economy

Closed protectionist

world economy

Social polarisation and exclusion

Global middle

class

Source: Hardin Tibbs report to Australian Defence HQ 1999


DEFENCE: ‘Way Out of the Box’ Scenario Matrix

Revolution in basic science

Science reaches a

plateau

Psycho-social evolutionarypunctuationDiscontinuity in human consciousness

Singleworld

governmentSocial progress with

no discontinuity

Source: Hardin Tibbs report to Australian Defence HQ 1999


TWO SCENARIOS OF THE 21ST CENTURY ORGANISATION

MIT Initiative on Inventing the Organizations of the 21st Century (January 1997) facilitated by Peter Schwartz of the Global Business Network:- http://ccs.mit.edu/21c/21CWP001.html

The scenarios were developed during 1994-1997 by MIT academic and research staff in discussions with hundreds of executives at various MIT Symposia, executive education programs, etc.


FUTURE OF ORGANISATIONS: Scenario 1

SMALL COMPANIES,LARGE NETWORKS Autonomous teams of 1-10 people Temporary - task or project based Linked by high bandwidth, electronic network Venture capital infrastructure identifies promising teams and

provides financing

Independent organisations for social networking, recreation, learning,reputation building and income smoothing evolved from professional associations, unions, clubs,

university alumnis, neighbourhoods, families, churches they are home for our identity as projects come and go

Examples: Film industry; Prato Mills (Italy); Nike; Nokia PC Display Division


Small Company, Large Network HR

Very specific HR scope focused on project organisation (e.g. talent scouting/selection, pay, health & safety)

Outsourced agents, brokers, specialist providers contract staff organisations handle the HR for their talent

as part of their brand and competitive strategy

Mutual employment obligations spelled out in project contracts or implicit in industry standards or assumed from past working experience

Project Manager’s reputation depends on his/her people skills and hence there is a reluctance to delegate to HR specialists


Small Company, Large Network HR (cont.)

Selection is via networks, personal references, reputation

Performance management is via peer pressure and industry/ professional standards

Rewards are contractual or entrepreneurial (equity based)

Development is via doing leading edge projects

Innovation is via brokers, deal makers, agents, sponsors

Individuals rely on professional associations, “guilds”, managers/agents


FUTURE OF ORGANISATIONS: Scenario 2

VIRTUAL COUNTRIES Keiretsu-like alliances with operating companies in every country Minimal national allegiance - primary loyalty is to the corporation Traditional hierarchy or decentralised divisional structure Company is the focus for individual identity Company meets employees’ needs from cradle to grave Employees own the firm AND have right to elect the Board and

management Open book accounting informs management elections Specialist “organisational designers” travel through firm brokering

partnerships and fostering cross boundary communication

Role of governments, industry unions is significantly reduced

Examples: Asea Brown Boveri; GE; Johnson & Johnson


Virtual Country HR

HR almost replaces social welfare, education systems and provides financial management and estate planning services, etc

Corporate (strategic) HR sets standards and monitors the corporate culture helps Marketing build the corporate brand

Divisional (operational) HR total care of employees so they are free to focus on

performance

Actively involved in local communities to reinforce the company culture and image


Virtual Country HR (cont.)

Selection emphasises fit with corporate values

Performance management focuses on results achieved the “XYZ way” and on being a company ambassador in all areas of life

Reward is via promotion, enhanced status, rights, benefits - and pay

Development is via corporate colleges and universities in partnership with the world’s best educational institutions

Innovation is through internal R&D and improvement programs with heavy emphasis on protecting corporate intellectual property


CHANGING “HR” ROLES: Some Generalisations

PAST

HR ROLE WAS CLEARLYDIFFERENTIATED

mechanistic (Personnel Admin)

ritualistic, legalistic (IR) CEO’s eyes and ears

with the troops distinct professional

career paths

HR is HR’s responsibility

FUTURE

PEOPLE/LEADERSHIP ROLE IS DISTRIBUTED AND DIFFUSE

knowledge management relationship management;

teamwork legal compliance change management no distinct HR profession -

new hybrid roles emerge

People/Leadership is everyone’s responsibility


NEW CRITERIA FOR RATING “HR”?

Profit generated per employee (compared to industry benchmark) Salary/wages costs compared to industry median (reflecting

value of corporate reputation/intangibles in labour market) Number of talented candidates applying for advertised (and

unadvertised) vacancies Time taken to satisfy customer orders, inquiries, complaints

(compared to agreed service standards) Incidence of customer complaints caused by employee behaviour Cost of re-work Cost/risk due to time lost through injuries, absences, disputes Rate/cost of unplanned turnover among good performers Percentage of customers citing “service quality” or “competent, caring

staff” as a competitive edge for the company Net cost of generating organisational improvements Percentage of revenue/profits coming from initiatives taken in

last 3 years Share price premium compared to industry peers


AN INTEGRATING STORY?

OUTCOMES(Stakeholders)

Shareholder/Investor

Customer

Contributor- employee- other

Community

FUNCTIONS(Management)

FinanceInvestor Relations

Sales & MarketingOperationsR&D

“Contributor Relations”Contracts (Legal)Supply

PRCommunity Relations

ARCHITECTURE(Leadership)

VISION & MISSION

CORPORATE STRATEGY

Competitive strategyDevelopment strategy

Leadership styleCulture/Values/Ethics

ORGANISATIONAL DESIGN

StructureTechnology

Place


MAPPING YOUR ORGANISATION’S CURRENT TRAJECTORY

Get Talent

Motivate Talent

Reward/ Recognise

Talent

Develop/Skill

Talent

Tap/ Utilise Talent

Retain/ Transition

Talent 2000s

1990s

1980s

1970s

1960s

Derived from an HR framework proposed by Brian Young “PeopleFirst Solutions”Previously Asia Pacific HR Director for Deutsche Bank


MORE WINDOWS INTO POSSIBLE FUTURES

SOME WEB SITES ENGAGED IN THE SEARCH:

http://ccs.mit.edu/21c/index.html

http://www.foresight.gov.uk/default800.htm

http://www.defence.gov.au/nspb/htibbs-futuresV.4.ppt

http://www.dol.gov/dol/asp/public/futurework/welcome.html

http://www.fastcompany.com/

http://www.bsr.org/ and http://www.csp.uts.edu.au/

http://www-csc.mty.itesm.mx/~laava/KMetaSite/menu/sitemap.htm

http://www.managewithoutthem.com/

http://www.futurists.net.au