The world’s biggest firms are bigger than they’ve ever been, and run by more decentralized decision-making. Their employees work in more countries than before, often do jobs that are more specialized, must collaborate with each other more than they did five years ago to complete the same task (launch an updated version of a product, say), and – given they work in more dispersed, less centralized and hierarchical structures – must compete harder for promotion opportunities too.
This makes life hard for heads of HR, HR business partners, and their teams who must attract, engage, and retain employees asked to take-on more decision-making responsibility in a more dispersed org structure, develop a wider range of skills, and work with a large array of people that they often don’t know or share a common culture with, and with whom they have no formal reporting or management relationship.
It must feel a bit like asking a sheep dog to start herding monkeys; once, each group of employees was fairly homogeneous and would respond in predictable ways, now senior managers want employees to be more independent, more interdependent, and still all adhere to a common plan.
And, while HR teams have a harder job, they are also under pressure to do it more quickly. Working with and talking to thousands of functional executives this year, CEB staff have heard some version of the same refrain again and again: “It seems more difficult to get stuff done; we just feel really slow.” The size and complexity of firms, and the need for managers to collaborate with so many people, has slowed the making of important decisions just when it needs to speed up.
A Fast Decision Doesn’t Mean a Worse Decision
Often, managers think that if they want to speed up decision-making, they must also be prepared to make worse decisions. For example, a recruiting decision could be made more quickly but without getting as much internal input or spending as much time ensuring the candidate “fits” with the organization. They think they must trade off making a fast decision to ensure they make the right decision.
But, as much as CEB’s work this year has shown that execs worry about how long it takes to make an important decision at their firm, the work has also shown that “fast” for “right” is a false trade-off.
HR teams feel this fast/right conundrum in many parts of their work, but there are eight in particular where they can speed-up decisions without getting them wrong. Four will be covered in this post and four in the next post in the series.
Four Ways Human Resources Can Speed Up Decisions
Compete for talent more intelligently: Firms increasingly need highly specialized roles and skills regardless of the industry(ies) they operate in. But many HR teams lack the right data, or the right ability to use it, to find such people and hire them.
They must first take the time to understand and anticipate what types of skills they will need in the future; this will pay dividends later. They must also understand how to use talent analytics cost-effectively to find the people best placed to fill these roles. And, finally, they should concentrate on non-traditional labor markets they may have overlooked (in an adjacent industry, say).
Streamline the recruiting process: The average time it takes for a recruiting team to fill a position has risen substantially in the past five years. Most HR functions have a big opportunity to speed up hiring without compromising quality.
More complex hiring requirements have complicated recruiter workloads, recruiting processes, and hiring decisions. As a result, the average time to fill an open position is at 63 business days – 21 more days than it was five years ago. This can mean less savvy firms lose talent to competitors and waste an average of $8.5 million per 1,000 vacancies in lost productivity and additional recruiting work.
Many firms try to combat this by giving recruiters more: more resources, more policies, more tools, and more information. But it rarely works. Instead they should look to streamline the recruiting process itself. Recruiting teams should take three steps:
Realign resources for recruitment to focus on speeding-up hiring for current and future posts.
Identify and remove hidden process inefficiencies that slow down hiring.
Slim down the amount of information and stakeholders that influence hiring decisions, and learn how to manage it better.
Don’t ask employees to “own” their careers, partner with them instead: Two-thirds of companies will face an internal skills shortage in the next three to five years, and only 30% of employees are satisfied with the future career opportunities at their organizations. This makes it imperative that HR teams engage and retain the right people to staff the roles the company needs in the future.
To do this, 90% of heads of HR say they want to move away from a promotion-based career culture to a “growth-based” one where employees move laterally to acquire new skills that then puts them in a position to take on a better paid, more responsible role. Most firms try to do this by encouraging employees to “own” their careers, and providing sample career paths, access to job boards, and career conversations. But this can often mean that employees don’t develop the skills the firm needs, which produces an internal skills shortage and/or the firm losing employees it wanted to keep.
Instead firms should encourage “career partnerships” that are of value to both the company and employees. Employees should be shown how the skills the firm wants them to develop will make them more employable. The HR team should market the right position (full-time or project-based) to the right employees rather than using passive channels like internal job-boards, and then make it easy for employees to shift between teams. This keeps employees engaged and provides managers with the right skills at the right time.
Don’t base your rewards on competitors’ offers; do focus on meeting employee needs: As firms compete to hire the same people to take on these increasingly specialist and independent roles, senior managers are understandably looking at ways to control the cost of hiring and retaining good staff. Almost 80% of firms base how they reward employees from competitors, but that approach is costly and inefficient. For the average 10,000-employee organization to move from the 45th to the 50th percentile of market for total compensation, it would cost $58 million and would yield negligible improvements in voluntary staff retention.
Rewards that instead focus on meeting employee needs can improve intent to stay and performance by double digits because they are far more relevant to employees’ work and lives. This includes things like, financial needs (obviously) but also the need for acknowledgement for a job well done, emotional needs, and family needs (flexible working etc).