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Is That the Scent of Recession in the Air? Several recent discrete events suggest that the macro economic goal (to slow the rapid growth) is occurring. Consider the following:
A Strategic Opportunity - Are these signs of a recession? Perhaps, but more importantly they are opportunities. Assuming that these indicators are correct, what does this mean for HR? It means that demand for human capital will decrease, the talent crisis will end, and HR can move aggressively to strategic work. Now companies can find new ways to improve workforce productivity. While there always will be demand for the best people, the demand will come into better balance with supply. Job openings and available labor will even out. In some instances, HR will face a familiar problem: reductions in force. HR will once again have to decide who goes and who stays. In any discharge of employees, the goal is to hold onto the best and dismiss the lowest producers. With all of the usual problems, well done performance appraisals are the best available means for rank ordering employees. The Appraisal Challenge - What makes performance appraisals so hard? First, most supervisors have a complex relationship with their subordinates. Raters may be aware that a person has a personal problem, and inappropriately “cover” for them. Obviously, this can lead to disastrous results. Second, supervisors often know that a performance rating will translate into a raise or other financial benefit. Reluctant to deprive a co-worker of this reward, they overscore the employee. Third, many people are uncomfortable with confrontation. To many supervisors a low rating means an uncomfortable meeting with an employee. To avoid this, they score employees beyond their performance. 360 Degree Feedback - To overcome some of these problems with performance appraisals, some firms have moved to 360 degree feedback. This allows multiple raters to score the employee. It moves self appraisal and the opinion of the supervisor into comparison with peers, subordinates and others. However, the problem of implementation remains. Someone must coordinate the appraisals; someone must meet with and interpret the results of the 360 process. If this process can be linked to professional development, it is even better. Editor’s note: Fauecast represents the Check Point 360, a process that does connect feedback and development needs. However, in most work groups with which Fauecast has consulted, the group knows who the top performers are and who works more slowly. In well functioning groups, the work load is shifted and balanced, so that the task is completed. Therefore, inquiring among employees would be a reasonable way to assess performance. This can even be done outside of a formal 360 degree feedback program, but it is often underutilized because managers are unsure how to proceed. Here too, Fauecast can help. If there is an acceptable level of performance, some workers will produce 50 to 100 percent above that standard for even the simplest job. On the other hand some workers will never be up to the minimum standard. As the task complexity and work requirements increase, the range of performance similarly expands. At top management levels, the range of performance appears even greater. Given the resources of the firm, some CEOs produce great returns, while others fail to achieve even a reasonable rate of return. Yet some firms continue to carry underachievers at all levels. Gains from Effective Appraisals - Performance appraisal is designed to elicit the opinion of the supervisor with regard to the employee. Employees are entitled to know whether they are measuring up to the expectations of the firm or not. Will some employees feel bad that their performance is below expectations? Yes. Are they entitled to help with and support for their personal problems? Yes. That’s why there’s the Employee Assistance Program, EAP. Are employees entitled to training to learn how to do their job better? Yes; but not unlimited time, or opportunity. Are some performance meetings difficult? Yes, but the gains for the employee and the firm outweigh any downside cost. Will some employees sue if they are unhappy with their appraisals? Probably yes. However, we again have a positive for the firm that offsets the cost. If there’s a whiff of recession in the air, it means some good things for HR. First, labor shortages will balance themselves. Second, firms will again be evaluating employees and letting low performers go. Finally, development needs will arise from the firm, and support the demands of workers for improvement. These are the best of times for HR. Where Marketing and HR Meet Fauecast and Picard & Company have announced a new strategic partnership to aid client companies. The new effort involves driving product development, excitement, support materials and organizational development (analysis, communications and training) to higher, more productive levels. In combining efforts, Faue and Picard integrate divergent functions that often fail to communicate. While marketing (Picard & Co.) brings strategic planning, advertising, sales tools, communications, research and design to bear, too often the projects and programs never make it to the employees who will implement them. Calls to customer service to order the new gizmo may receive an unknowing response, or worse. Conversely, many efforts at organizational consulting (Fauecast), which provides motivation (spirit), performance appraisals, incentives and consequences, team building, supervision and train-the-trainer, may fail to grasp the larger external world which marketing understands. By integrating these complementary disciplines, Faue and Picard will offer tactical solutions that utilize cooperation, respect and a penchant for “making things happen.” Picard said, “The goal of every engagement is to add leverage and high commitment to marketing and business projects.” Fauecast Report will update the readership on these developments. Contact Fauecast if your organization can benefit. Profiles on the Web In June Fauecast presented the seminar, “The New Art of Hiring Smart — on the Internet” to the Buxmont (Pennsylvania) chapter of SHRM (Society of Human Resource Management). Because the Internet gives everyone immediate access to this powerful assessment program, the participants welcomed the topic and 45 minute presentation. In November Fauecast will present a modified program on assessments to the Garden State SHRM Conference. If you need a speaker on this or other topics, please contact Fauecast.
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