World_Report_on_HR_Challenges_2010

Of cutback and exibility measures relying heavily on

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Unformatted text preview: ion for a long time beyond the actual crisis. Employees freeze their effort when they expect redundancies and only slowly unfreeze when the situation improves. Trust is killed and the probability of social unrest rises, which makes the crisis even worse. Aer layoffs in the 2000 and 2004 crises, we learned that this is not the right way. It also ruins your image as an employer—something we need to avoid in the extremely tight labor market for pilots and expert technicians.” Exhibit 16. Flexibility Measures Tend to Rank Higher on Perceived Effectiveness and Employee Engagement Examples of cutback measures Above average 10 8 9 7 2 3 Base salaries are reduced 4 Average flexibility measure Early retirement is increased Bonus payments are cut back or postponed 5 6 Employees are laid off 2 1 1 Company events are cut back Average effectiveness Examples of flexibility measures 6 Performance management is tightened 7 Job mobility is reinforced: employees are trained to perform different jobs within the company 8 Processes are streamlined 9 Average cutback measure Hiring criteria are tightened 10 Flexible work time is set up 3 4 Below average Below average Cutback measure 5 Average engagement Flexibility measure Above average Average cutback Average flexibility Sources: Proprietary Web survey with 5,561 responses; 731 responses in this section; BCG/WFPMA analysis. Note: Size represents the percentage of companies using the measure during the crisis. The lower-le quadrant highlights measures that poison a company in the long run. Companies that rely on measures such as reducing base salaries, cutting back bonus payments, and eliminating company events will rapidly experience a drain of high-potential and highly valued employees. The upper-le quadrant includes measures that may be bitter medicine but work relatively effectively, at least in the short term: layoffs, shortening of the workweek, and early retirement all fall here. The lower-right quadrant contains a single flexibility measure—increasing the profitrelated component of compensation. T B C G • W F P M A Developing Capabilities for HR to Partner with the Business Units H R is increasingly positioned as a strategic partner of the business units in adding value to the company. At many companies, however, neither HR professionals nor business managers have developed all the skill sets required for this partnership to flower. While both groups recognize the need for training and other developmental initiatives, the differences in their perceptions of the gaps must be addressed. For example, business managers view HR professionals’ HR expertise as less important than their skills in business planning and conflict resolution. And, while both groups agree that business managers’ handling of poor performers is their most important people-management skill, business managers see a far smaller gap in their own performance than HR professionals do. Companies have adopted a variety of initiativ...
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