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3 Ways to Avoid Promoting The Wrong Person

Written By Ash

Why don’t we make the best sports players the managers? Why don’t the smartest thinkers become the teachers? Why don’t the highest performing salesperson become the sales manager? To avoid falling trap to The Peter Principle. 

As an employee, you may have faced the following situation; after time and effort of working towards a promotion, upon starting your new role you find yourself not fully prepared for it. Either your expectation of what the role entailed was way different, or you felt under-prepared to execute the duties and responsibilities of the role, or you even felt a lacking sense of competency for the position. 

As a manager, on the other hand, the following situation may sound familiar; a position has opened and it’s time for you to promote one of your direct reports. You identify the star player; someone who you have seen outperforms his targets year on year, has strong interpersonal skills and is generally seen as the Most Valuable Player. Without second-guessing, you proceed to promote this person only to find them struggling in their new role and seem to be out of their depth. 

If any of the above resonates with you, you may have fallen victim to The Peter Principle. The Peter Principle is a concept in management made famous by Laurence J Peter and Raymond Hull in their book with the same title in 1969. The Peter Principle observes that people in a hierarchy tend to rise to their “level of incompetence” as an employee is promoted based on their success in previous jobs until they reach a level at which they are no longer competent, as skills in one job do not necessarily translate to another. 

Although the concept was published in 1969, we still see many examples of The Peter Principal in companies today and even more so in highly hierarchical organisations.

An easy example to illustrate The Peter Principle, which is a promotional error many companies still make today, is by looking at sales teams promotions.

If Company A needed a new sales manager; they would typically look at their sales team’s individual performance and conclude that the person with the best sales track record should be promoted to sales manager. Now this person despite an amazing sales track record may find difficulty executing his new role because the skills and competencies needed to be a good sales manager differ greatly from the skills and competencies needed to be a good salesperson.

The bigger the change in the design of the role, the bigger gap of incompetence may exist. For example, if you’re promoted from engineer to senior engineer, your work may be more challenging but you’re using the same skills. When you are promoted from senior engineer to manager, however, you may lack the “soft skills” needed for such a role. These can include your ability to motivate team members, delegate tasks and responsibilities, communicate effectively, resolve conflict, and liaise with other teams and senior management.

The bigger the change in the design of the role, the bigger gap of incompetence may exist.

Obviously, it’s undesirable for someone who lacks the competence to hold a position of responsibility in your team or business. He will start becoming aware that he’s under-performing after thriving in previous roles, and he will likely feel demotivated, frustrated and anxious. Over a long period of time, as more and more senior roles are filled by people who are ill-equipped for them, company-wide mediocrity sets in leading to reduced productivity, reduced morale and reduced innovation. Those factors alone have a huge impact on top and bottom lines. 

Due to this, companies are placing increased importance on the development of employees, in fact, a report from Brandon Hall states that 58% of companies say that their top priority is closing leadership gaps but, only 19% of them say they are “very effective” in developing leaders1. With that, the below points will help ensure your company won’t promote employees into incompetence and therefore avoid The Peter Principal. 

1. Groom The Way Ajax Does

Many companies still reserve the target of their succession planning programmes to a few high-level critical positions and develop their direct reports to possibly fill those roles when vacant.

The problem with this is only upon reaching those levels are employees now starting to be groomed, and should the need arise to take the new role now they are highly underprepared.

Reserving succession planning for a select few roles is short-term thinking.

Consider instead, a build-up of potential successors across levels of the company starting from the very bottom of your structure.

The time spent grooming an employee from entrance to the top ensures your company’s readiness for successors.

Reserving succession planning for a select few roles is short-term thinking.

An example of building capability and competence over time from outside the corporate world is Amsterdam based football club Ajax, historically one of the most successful clubs in the world. One of the reasons the club has been so successful is its long-term perspective. Talent is scouted early. Children as young as 7 join the Ajax Youth Academy. As the children age, the best ones get promoted to higher divisions and the most successful end up living their dream: playing in the Premier League. This is an excellent example of the long-term, strategic perspective taken by Ajax. Talent is groomed for at least 10 years before they join the Premier League team. Whenever a player of that team leaves, Ajax has multiple candidates lined up who can replace him, regardless of the position in the field.

2. Think Mobility Like Apple

Your employees are the backbone of your company, especially the ones who do a good, solid job, day in and day out.

Many HR teams then automatically feel that not promoting these high performers will result in them either being demotivated and dropping in performance or worse, leaving the company.

But some of these employees may not have the potential to move up yet because of a gap in competence for the new role.

Once again, a promotion here may be a short term reward that leads to long term problems.

This is where companies now need to expand their idea of growth to include more than just upward mobility.

Employees can also grow and develop laterally, which also contributes to their long-term development.

In fact, many examples have shown that lateral moves make employees more knowledgeable which contributes to a higher career growth. 

Employees can also grow and develop laterally, which also contributes to their long-term development.

Consider one of the most famous succession planning stories of the corporate world, Apple. Steve Jobs was working hard to prepare Tim Cook for the position of CEO. Cook took on a variety of different operational roles including manufacturing, distribution, sales, and supply chain management before working directly with Jobs to gain experience in the CEO role. It wasn’t a single vertical career track that led to Tim Cook leading today’s tech giant, but rather, the many many lateral moves that increased his readiness for the role. 

3. Performer Like Shearer, Potential Like Mourinho, Both like Cruyff

One of the basic elements of succession planning is how to identify successors effectively.

This means companies need a systematic way to look at their entire organization and apply parameters in measuring talent.

A method that has been widely used is applying the matrix of performance against potential and looking at where employees fall.

However, understanding what this matrix truly means is crucial as misinterpretation leads to overlooking the right successors. 

A method that has been widely used is applying the matrix of performance against potential and looking at where employees fall.

We can illustrate the idea of performance and potential by looking at 3 names that have made a mark on the world of football. 

Alan Shearer; The High Performer: In the Premier League and for Newcastle United, there are few players more legendary than Alan Shearer. The striker still holds the record for all-time Premier League goals scored and is usually rated as the best striker in league history. As correctly predicted by fans, in 2009 when Newcastle United’s manager was taken ill due to heart conditions, Alan Shearer took the club reins. Unfortunately for Newcastle United, not only did Shearer fail to save them from relegation, but they also had one of the worst runs in Newcastle and Premier League history. An example of how high performers can be mistaken for high potentials to bigger roles. 

José Mourinho; The High Potential: As a player, José Mourinho made just fewer than 100 appearances for 4 different Portuguese clubs, in that time he scored a mere 13 goals. Nothing really materialised from his short career on the pitch, but it provided the foundation for one of the most successful managerial careers we’ve ever seen. Through his strong passion for the game and outstanding tactical knowledge, he has gone on to win over 20 honours including the world’s best club coach 4 times. An example of how high potentials may not perform in their current role, but excel when given the opportunity. 

Johan Cruyff; The High Performer High Potential: A testament to Ajax football development discussed earlier, Cruyff trained with the club as a youth and debuted professionally with Ajax. His career is regarded as one of the best great footballers turned great manager stories of our time. As a player, he contributed strongly to the success of his club and the national team even winning the most prestigious award in football, the Ballon D’Or, 3 times. As a manager, aside from success in winning football cups, he also pioneered coaching styles and techniques said to be ahead of his time resulting in clubs like Ajax and Barcelona successfully redesigning youth academies. Cruyff is an example of how high performers with high potential can excel despite role expansion. 

High performers stand out from average employees in any organization.

They consistently exceed expectations and are management’s go-to people for difficult projects because they have a track record of getting the job done. They’re great at their job but may not have the potential, or desire, to succeed in a higher-level role or to tackle more advanced work. 

On the other hand, a high-potential employee is harder to identify and is one who has been identified as having the potential, ability, and aspiration to climb to higher-level roles or tackle new and advanced work.

High potentials can be difficult to identify, for two reasons.

First, high performance is easy to observe that it then drowns out the less obvious attributes, behaviours and traits that characterize high potentials–like change management or learning capabilities.

Second, few organizations define the attributes and competencies needed for each different role–which means that managers don’t know precisely what to look for to assess potential.

To overcome this, companies first need to define the parameters they look for in potential that upon assessing can clearly separate high and low potential candidates; whether it be soft skills, leadership capability, communication prowess or any other attributes. 

“When performance is the only criteria employees are evaluated on,” warns Brian Kight, Director of Performance at Focus 3, “high performers will be the only ones moving up–and your high potentials will be moving out”

Criticism of The Peter Principle

While the theory sees many examples to make it evident and the book which sold millions of copies worldwide stayed as a bestseller for 33 weeks, there are many schools of thought and research that critique The Peter Principal.

Some companies believe that to maintain a high calibre workforce which leads to high performing organizations an “up-and-out” strategy made famous by law firms is more suited.

Another is that performance will eventually “regress to a mean” in large organisations despite The Peter Principle being present. 

Whilst there may be some schools of thought that oppose the idea of The Peter Principle, it can’t be denied that it does occur. The potential business impact of The Peter Principle especially in the long run can be detrimental.

Therefore, companies should use the above as a guideline to avoid promoting employees into the point of incompetence. 

Reference

1. https://www.infoprolearning.com/infographic/13-shocking-leadership-development-statistics-infopro-learning/

Are You A Contender Or Just A Pretender Of The Digital Age?

Are You A Contender Or Just A Pretender Of The Digital Age?

Written by Founder & CEO, Sharma Lachu

“I thought productivity is supposed to drop when you work from home, how come we are working a lot more?”

In a catch up with his team lead, one of my colleagues innocently quipped. While we all found it hilarious, it also piqued my curiosity. Are we just lucky at Accendo, that we were mostly born as an organisation in the Digital Native timeframe, or did we build the mindset needed to behave in this way?

That led me to think of organisations that we not born in the digitally native era and how they are progressing in these times.

If nothing else, this pandemic has shown us that people around the world are adaptable, agile and most glaringly – resilient, together. From New York to Florance, China to Australia, people have come together to redefine what the new normal (yes, I am aware this is over-used) is.

How is it, that the COVID-19 pandemic we face today has served as a stimulus to what we perceive as Digitisation. What happened to “We don’t think we need this now” or “This is just nice to have… not essential”. There are even memes going around allotting the credit of digitisation to COVID over that of the CIO or CTO.

How is it, that the COVID-19 pandemic we face today has served as a stimulus to what we perceive as Digitisation.

Tools such as Microsoft teams, G-Suite, Zoom are surely helping the scenario but we are also aware that these tools are mere enablers. What about people’s readiness to execute continuously and to hold the stamina required to be “digitally effective”?

In my humble opinion, just having the tools in place to work “Anywhere, Anytime” is not the true north for a digital workforce. I opine the real true north, in this case, is the decision quality, speed of execution and levels of productivity.

I opine the real true north, in this case, is the decision quality, speed of execution and levels of productivity.

This is the very framework of a digital workforce. When talking about building a digital strategy, I have seen companies spend millions blindly investing in technology without having a real sense of measurement of the Readiness of the people to adopt these new practices. “Create and they will adopt” may work for Apple, Google, and Tesla but unfortunately, most companies do not have the discipline to rigorously hire and groom talent as they do.

“Create and they will adopt” may work for Apple, Google, and Tesla but unfortunately, most companies do not have the discipline to rigorously hire and groom talent as they do.

I keep talking about “Readiness” – why? Because without knowing where you are now, there is no point trying to figure out “How to get to a new place” or “Where this new place is” and this means leaning into data as a true digital business would.

Why are we afraid of our data at work?

In every aspect of our lives today, data plays an important role in deciding what we eat, what music we listen to or even what news we see.

Algorithms have been quietly ruling our lives for over a decade now. Do you think the news you see on Facebook or Google is neutral? Think again. Algorithms go through what we like, what we read, glance over and what we ignore in order to place in front of us news that is aligned to our belief system. This is not me ringing the Zeitgeist alarm; this is just the way algorithms works – the confirmatory bias*.

In every aspect of our lives today, data plays an important role in deciding what we eat, what music we listen to or even what news we see.

On the other hand, when I see how low the bar is set with regards to the data we are willing to share publicly and the lack of trust deficit we have for Social Media, I wonder why people are so willing to “expose” one’s life to companies who then use this data to form opinions of us?

But this very “us” is not willing to do the same when information is asked of us at our workplace. Suddenly, data becomes private. The very same person who will expose all the most intimate moments of their life on social media will not share the most basic info at work.

Why? Where did the trust deficit go?

Then, it struck me. Social Media has always been a form of expression and appreciation. Fake as it may be to some, we want to display a version of ourselves there because we get to control how and what we display and we, to some extend are already aware of the outcome – Likes, Shares, Views – all these leading to a hit of dopamine in our brain which according to Simon Sinek, a study at Harvard proved that 8hours of social media a week is equivalent to the same amount of dopamine a crack addict gets in a shot. We are consuming digital crack.

Unfortunately, when I share data of me at work, it is always used against me. Lesser bonus, no promotion, criticism of my poor performance and on and on. This is why, even after spending tens of millions of dollars on huge HRMS systems, we still cannot seem to get the most basic information right. Josh Bersin in one of his papers put it nicely, “I’ve talked with multiple CHROs who have spent many millions of dollars on replacement core HCM systems, only to find out that the employee experience fell short and required a new layer of software on top.”**

I’ve talked with multiple CHROs who have spent many millions of dollars on replacement core HCM systems, only to find out that the employee experience fell short and required a new layer of software on top.“- Josh Bersin

Why do professional athletes rely on data to make their work better?

I take a lot of inspiration from sports. I always think of myself as a huge amateur sports enthusiast; one who enjoys studying every little detail about it. In studying football, cycling, badminton and many other sports, it had become evident as daylight that they all seem to understand how data can be used to consistently improve their performance – one small step at a time.

In building the case for incremental improvements, Fernando Torres once said in response to an interviewer’s question about how he has become so prolific, that all he does is listen to Rafa Benitez because after looking at some sheets and screens he (Rafa) tells him where to stand and the balls seem to keep coming there and he keeps scoring.

Chris Froome blew up Stage 19 of the Giro D’Italia doing something no one thought was ever possible (if you are interested, please watch this link. It is mind-blowing how science was used to enable the human performance)

Usain Bolt in the run-up to his Olympics World Record used an immense amount of data to better his “off the block” segment of this sprint.

I can keep going with examples where is it the norm (not the exception) to use data to better ones’ self. So why do we not do the same at work? Why do managers punish the “athletes” when there is data? Why not use it to find ways to better the individual and by bettering the individual, you better the team.

I put it to you, that the reason we still do this today is because we are stuck with the old ways of working. One, where the manager has the power and the staff just does what the manager says. I’m sorry, but those days are long gone. The power balance of employment has moved from Employers to Employees. The organisation that will thrive is the organisation that understands how to build “Talent Experiences”. Those that are still determined to hold on to nostalgia may as well prepare to be nostalgia.


We, collectively, spend more time at work than anything else we do in our lives. Is it not incumbent upon the leaders to make sure that the people that work with us are provided with an environment they can thrive in? There is sufficient data to show that when parents go home frustrated from work it increases the likelihood of their kids becoming bullies in school***. As an irresponsible leader, we are contributorily negligent in committing these crimes – vicariously through the kids of our colleagues that we mistreat.

Is it too much to ask that from now, organisations start thinking more like sports teams in knowing that the best use of the data we collect about our people should be used primarily do develop them, re-skill and up-skill them, predict movements so you can help them and understand their best position so they can contribute immensely back to your organisation? 

Reference

*https://www.frontiersin.org/articles/10.3389/fdata.2019.00011/full

**https://oliver-dev.s3.amazonaws.com/2019/01/27/12/54/25/916/Tech_Disruptions.pdf

***https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3519332/

BLOG

4 Hidden Costs of Poor Succession Planning (Or Not Having One At All)

Deferring or putting succession planning in the back burner is an easy thing to do, especially when there are other pressing priorities. However, one cannot hope that the best employees never leave, and that finding replacements is going to be easy while the impact to business will be quite low. The failure or lack of succession planning is often due to boards and stakeholders allowing it to fall off their priority / agenda, as well as many other challenges such as the lack of a structured process, ambiguity of accountability for succession planning, decision-making based on gut feel over objective data, and so on.

For more details about the challenges faced in succession planning, click here to subscribe

Failing a succession plan or not having one at all comes with several costs and risks for the organisation, particularly for mission-critical positions. Companies that underwent forced transitions/successions (i.e. unseating an incumbent and/or hiring externally) could have generated USD112 billion more in market value in the year before and after the turnover, had the succession been planned.

Companies that underwent forced transitions/successions could have generated USD112 billion more in market value in the year before and after the turnover, had the succession been planned.

In general, organisations with good succession planning practices perform better financially compared to organisations who have poor succession practices*.  Hence, the question then is not “What does succession planning cost?” and instead is “What is the cost of not putting in place a strategic succession plan?”   

Hence, the question then is not “What does succession planning cost?” and instead is “What is the cost of not putting in place a strategic succession plan?”   

Hidden Cost 1: Financial Risks for the Business 

The impact of a sudden departure or crisis for a key leadership role or mission-critical position is significant and could cause disruption to the business. Some impact of business disruption includes issues such as suspended initiatives, disrupted third-party/partner relationships, loss of revenue or shares and so on. There is a lot of uncertainty and turbulence posed from a sudden vacancy/departure of a key position within the organisation. Studies show that companies without a proper succession plan forgo an average of $1.8 billion in shareholder value compared with companies that succession plan, regardless of whether the replacement is an insider or outsider**. For example, shares for Hewlett Packard took an 8.3% plunge after the CEO stepped down in 2010***. However, this could be avoided if organisations have solid and effective succession planning in place. 

Studies show that companies without a proper succession plan forgo an average of $1.8 billion in shareholder value compared with companies that succession plan, regardless of whether the replacement is an insider or outsider.

Strategy Business
Selecting the Wrong Candidate

Hidden Cost 2: Selecting the Wrong Candidate

When there is no structured process or success profile in place to determine what good looks like and selection is based on subjectivity or one-sided factors, whether hiring from internally or externally, there is always the risk of selecting the wrong candidate, someone who is not fully qualified, for a role. This happens even more so when there is an urgency to fill a vacancy quickly. The lack of a role fit, be it behaviourally, culturally or skill-wise, would negatively influence the effectiveness and performance of someone in the role. According to the U.S. Department of Labor, the cost of a wrong hire is at least 30% of the employee’s first-year earnings****, and this is an estimate of hard figures. There is also the element of morale and productivity of other employees that could potentially be affected on top of the quantifiable financial impact****.

The lack of a role fit, be it behaviourally, culturally or skill-wise, would negatively influence the effectiveness and performance of someone in the role.

Lost Knowledge and Expertise

Hidden Cost 3: Lost Knowledge and Expertise

When a top talent leaves the company/role without a successor, the employee leaves taking with them all the knowledge and skillsets they have gained while in the role, in addition to relationships built with stakeholders and how that could be leveraged to yield business results. For example, while hiring someone externally may fill the knowledge gap for the industry, but they require time to understand the dynamics and politics of the organisation. The cost to replace a highly trained employee is expensive and could exceed 200% of their salary*****. Losing skilled employees in highly niche roles also increases the difficulty in finding replacements externally due to the lack of talents in the market. Without someone to receive that knowledge transfer and to succeed in that role under the former incumbents’ guidance, that knowledge and expertise are lost and will not be passed down. As a result, significant effort and cost are required to retrain a new incumbent.

The cost to replace a highly trained employee is expensive and could exceed 200% of their salary

Bonus.ly

Hidden Cost 4: Losing Internal Talents

It is significantly cheaper for internal talents to succeed a role, as the organisation can save on time and recruitment fees. Furthermore, internal talents already come with institutional knowledge, as well as other relevant data that can be factored into the decision-making such as a performance track record, 360 feedback and assessment data. Promoting/Hiring internal talents as part of career development and advancement opportunities can motivate and retain employees. As a result, this would strengthen their engagement and commitment to the organisation, thereby increasing employee performance and talent retention. In contrast, organisations will lose out on these when there is no succession plan in place as it can be easy to overlook internal talents who are highly interested or suitable for a key position for external hires instead.

Ultimately, there is an undeniable cost to the organisation when succession planning is done poorly, or not done at all. Not only would organisations’ businesses be affected financially, the people element (e.g. employee engagement, talent retention, capability) is also impacted. There is no doubt how critical a priority it is to get succession planning right. Therefore, organisations need to invest in resources and tools to build a solid and steady talent pipeline for business continuity and success.

Keen on learning what steps to take for effective succession planning? Sign up for the webinar here.

References

* https://www.strategyand.pwc.com/gx/en/insights/ceo-success.html

** https://www.strategy-business.com/article/00327?gko=a813e

***https://www.wsj.com/articles/SB10001424052748704268004575417682006400508

****https://www.forbes.com/sites/falonfatemi/2016/09/28/the-true-cost-of-a-bad-hire-its-more-than-you-think/#76cd5cf64aa4

***** https://blog.bonus.ly/10-surprising-employee-retention-statistics-you-need-to-know

3 data challenges that hinder effective succession planning

3 Data Challenges That Hinder Effective Succession Planning

This is the first part of a four part series on common challenges of Succession Planning.

Succession Planning is critical for organisations to ensure business continuity and success. Majority (86%) of leaders believe in its urgency and importance, however, only 14% believe that the organisation is doing it well*. One cause for concern is data, as succession planning is for most organisations still a subjective process susceptible to human bias. While there is no one size fits all approach to succession planning across different organisations, it is important to recognise that good data is one of the key success factors because the right decisions can be made.

Majority (86%) of leaders believe in its urgency and importance, however, only 14% believe that the organisation is doing it well

Deloitte

The overarching goal of succession planning is to have a pipeline of leaders across the organisation for mission critical or key positions. With a steady pipeline of leaders, organisations will have a stronger organisational culture, a future-proof workforce as well as better stability and resilience*.

However, selecting the wrong talent comes with a price that could lead to detrimental consequences for the organisation. Hence, it is of importance for organisations to prioritise a more analytical and scientific approach to succession planning. And yet, many organisations still face difficulties when it comes to data in succession planning, the 3 key factors being – Data Collection, Data Analysis and Data Outcomes.

01 Data Collection

In a survey, more than 50% of organisations approach succession planning and data collection in an unplanned and ad-hoc manner**. This may cause organisations to lose out in taking into consideration relevant and crucial data, especially data that is already existing. In actuality, data from existing processes in place, e.g. formal appraisals, 360 feedback, performance ratings, could add value and better inform decisions in the succession planning process but are usually overlooked and not collected.

Furthermore, the data are all sitting in separate spreadsheets and platforms and require significant effort for its collection and compilation for the succession planning process. This as a result also makes it harder for succession planning to be scalable across more employees and positions due to the effort required. 

02 Data Analysis

With existing data sitting in different platforms and sources, it is difficult for organisations to connect the dots between them when evaluating candidates for succession planning. Although organisations are increasingly taking steps to support or drive succession planning, many still lack the appropriate tools to ease the process and make sense of the data objectively. In addition, many organisations miss out on certain data that can be utilised to predict a candidate’s potential. In most cases, only existing data of performance in the current position is taken into account, while other data, e.g. psychometric/behavioural data and agility which can be used to predict potential against the specific new position, is overlooked. Past performance data should not be the only determining factor in succession planning, as future potential is as crucial an element. Otherwise, it would be falling into the pitfall of the Peter Principle, whereby candidates are evaluated based on criteria and expectations of their previous role, instead of the intended/succeeded role which requires different skillsets and capabilities.

03 Data Outcome

Most organisations face difficulties in visualising and drawing insights about talents in a data-driven and objective manner for decision-making. With that challenge, succession plans tend to fall back on subjectivity and gut feeling. Only 55% of board directors / leaders have a clear view and understanding of the strengths and weaknesses of the senior executives in detail.*** There is a lack of clarity and holistic visibility to the capabilities of the talent pool. Instead, leaders tend to default to subjective factors and instincts such as likability, tenure, relationships or informal evaluations to make decisions on their preferred successor. Furthermore, leaders inadvertently select successors who are a lot like themselves or their idea of what a successor should be like. This is exacerbated by their confirmation bias whereby they already have this impression or opinion of a candidate and would only accept information that supports their original belief, thereby rejecting information that does not. 

In conclusion,

While many organisations recognise the importance of succession planning and are making it a key priority, it is still difficult for them to yield results and see the expected value from it. Organisations face a myriad of human bias and inconsistencies in their decision making, on top of the pain points in collecting, managing and evaluating data that should otherwise be used to eliminate subjectivity. In order to take control of their succession planning and ensure its effectiveness, organisations need to address the aforementioned data challenges by putting in place the right processes and solutions based on best practices and a data-driven approach to succession plan effectively.

References

*https://www2.deloitte.com/us/en/insights/topics/leadership/effective-leadership-succession-planning.html 

** https://www.ciphr.com/advice/succession-planning-matters-many-companies-get-wrong/

***https://www.gsb.stanford.edu/faculty-research/publications/2014-how-well-do-corporate-directors-know-senior-management

Virtual Assessment Centres_ Best Practices and ideas from our recent Lunch 'n' Session (1)

Virtual Assessment Centres: Best practices and ideas from our recent Lunch & Learn Session

Assessment Centres (ACs) have been a highly reliable process in many talent programmes however due to the high cost and time investment it has become un-scalable in many organisations. By leveraging on technology to virtualise the entire process, organisations can make talent decisions quicker, cheaper and more reliably.  

In the spirit of overcoming MCO constraints amidst COVID-19, Accendo has recently conducted a virtual lunch and learn session to share about virtual assessment centres (VACs), covering topics including:

  • History of ACs
  • Benefits and Limitations
  • Key Focus Areas for VACs
  • Steps to VAC Deployment
  • Key Learnings

Like the many technological and scientific advancements from during war times, Assessment Centres were first developed and adopted in the context of military officer selections, before AT&T adopted it in a corporate context. ACs has since evolved to the global practice that we do today. 


Interested to learn more in detail? You can listen to the recording of the full webinar here

So, why has Assessment Centres been adopted and utilised since the mid 1930s till now? There is plenty of research out there about its validity and predictability. ACs has several benefits that have made it an important global practice: 

  • It gives a realistic job preview to not only candidates/potential hires, but also to employers. 
  • Furthermore, ACs are designed in such that candidates are cross observed and evaluated by different assessors in various exercises against the same criteria, which gives the results an increased layer of rigor, validity and objectivity
  • With the war on talent today, employers are no longer only facing off against competitors, but also cross-industries and against start-ups. Hence, ACs provide employers with the avenue and opportunity to employ talent attraction strategies and improve employer branding.

However, there are also several limitations for the traditional Assessment Centre. 

  • Traditional ACs are logistically and resource heavy, in addition to the expertise required. Apart from the time and expertise needed to design and build the exercises, the planning and management of AC administration requires significant effort, e.g. training assessors, arranging location and accommodation. 
  • With the high level of complexity, resources, cost and expertise required, employers have to gain buy-in from stakeholders, especially in justifying the budget and ensuring commitment from multiple parties to the process and outcome. 
  • Furthermore, even though ACs can be used to assess almost any job, ACs are commonly used only for graduate trainee programmes and senior level positions due to resource and budget limitations, thereby reducing its scalability

Key Focus in Virtualisation 

To ensure companies get the full benefit of VACs and in turn make accurate talent decisions, there are a few key focus areas to virtualising a VAC:

  1. Reduce, Reuse & Replace
  2. Create the Right Candidate Experience
  3. Leverage on Data

01 Reduce, Reuse & Replace

As with the concept of recycling, this can be similarly applied to the resources used in ACs. 

  • Reduce: This is about re-evaluating what resources are really needed, and if needed, how can we do it more efficiently. E.g., the time and cost to run an AC would typically require 1-3 days, but a virtual administration would significantly cut down on time and material cost. 
  • Reusing: As 76% of organisations already utilise assessment tools*, they can be reused in VACs. Commonly used assessments like 360 feedback and newer ones like video interviews can be integrated for use within a VAC. Furthermore, the online branding that companies are already doing can be re-used and leveraged in the VAC.
  • Replacing: Most traditional AC exercises are less scalable due to its limitations. In VACs, the virtual equivalent can be used to overcome these limitations, e.g. business simulations, virtual team simulations and pivotal experience interviews.

02 Create the Right Candidate Experience

Research from Mercer has indicated that 81% of HR teams are investing in tech specifically for candidate experience. VAC platforms are a catalyst to candidate experience and branding:

  • Branding: VACs are one of the best tools to promote employer brand because the entire virtual experience a candidate goes through can be designed to match the employer brand the company wants to convey in a much more impactful way.
  • Integration and consolidation: Oftentimes, companies face the issue of candidates having to re-do similar assessments or that the data does not speak to them. Through an integrated VAC platform, different assessments can be rolled out together, providing a smooth candidate journey and consolidating all data into a meaningful output.
  • Candidate Functionality: Leveraging on technology, functionality and candidate user experience can be much enhanced and made a lot easier. For example, one-click access, completing assessments at own convenience, solutions to manage varying levels of internet connectivity and so on.
  • Accessibility: Accessibility is important to achieve scalability, as it can influence important numbers such as completion rates. Understanding the demographics of the candidate pool will give a view on how accessible the platform needs to be, e.g. mobile compatibility. The more diverse the demographic, the more accessibility impacts the overall experience.

03 Leverage on Data

Technology is able to process large amounts of items and score it according to algorithms without subjective bias. 

  • Speed: VACs can be accomplished as a speedy process. On top of the logistical and time cost-cutting, VAC scoring and reporting outputs can be generated on the spot upon completion.
  • Accuracy: The stacking of assessment tools increases its validity and accuracy, in addition to output data guiding the feedback and sharper interview processes. 
  • Holistic: One of the vital aspects about leveraging data points is the idea of collecting holistic information. With VACs, talents can be viewed holistically through multiple different facets. 
  • Scalability: With the technology and data, VACs can be conducted not only for limited job roles or levels, but throughout the organisation while tailored to expected competencies of different job roles.

Now with the key areas of VACs covered, we can look into a high-level overview of the steps in VAC deployment:

01 Planning

  • Job Analysis: Evaluating the job accountabilities, job levels and needs of the jobs in future.
  • Define Competencies: What does good look like? Understanding out what behaviours are expected of the job role.
  • Exercise Mapping & Design: Understanding and simulating the environment/context for the job and mapping the appropriate assessment tools to measure the competencies.
  • Candidate Experience: Crafting the communications, language used in the VAC, e.g. email invitations. Ensuring the right length and process of the VAC.

02 Execution

  • Platform setup: Setting up the platform and the candidate journey.
  • Define Competencies: Deciding the appropriate proficiency levels and behavioural indicators for defined competencies. 
  • Exercise Mapping & Design: Revisiting the assessment tools mapping and setting up the assessment tools to measure these competencies on the platform
  • Candidate Experience: Testing and reviewing the candidate experience

03 Analysis

  • Score Outcomes: Choosing the appropriate score output and which reports are needed.
  • Cut-Off Scores: Whether there is an automated score cut-off and evaluating what this means to the assessment passing rate. 
  • Additional Data: Reviewing what extra information has been collected and which metadata to consider.
  • Bias & Inconsistencies: Evaluating whether ratings were justified and ensuring consistency of candidates’ completion of assessments.

Last but not least, the session was concluded with some key takeaways and learnings based on our experiences with VACs:

Design determines output: Always start with design first because the output will be sharper. Consider which competencies are key to the role and avoid over depending on one assessment tool to measure.

Candidate Experience vs Engagement: Think about the candidate experience, what are the high touch areas surrounding VAC, the interactivity of VAC exercises, as well as the timing (length, when to deploy etc) and messaging, e.g. the Why of VACs. 

Think about your audience first: Think about who your candidates are, their job levels as well as the purpose of the AC (e.g. recruitment/development). 

Security: As with any technology deployment, security is of high importance, as information is being collected from people and security/information leakage is best prevented. 

Don’t Overload Because It’s Online: Avoid overloading because it is online or put in too many assessments just because they are 5 minutes each.


To wrap up, Assessment Centres have evolved and improved throughout the many years, leading us to where we are today – VACs. However, this is not where it ends, one day, VACs could potentially enhance further, transforming into new concepts such as a collaborative virtual career fair and AC. While an experimental concept now, it is a next step to the future of assessment centres. 

Interested to learn more in detail? You can listen to the recording of the full webinar here
Subscribe or follow us for future events from Accendo.

References

* https://hbr.org/2015/07/ace-the-assessment

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Is The Business Ready For When The HR You Know Is Gone?

IS HR ACTUALLY SERIOUS ABOUT CHANGE?

While the world keeps talking about moving “digital”, there is a stereotype that gets blanketed – HR hardly adds value to an organisation as they are not prepared to lead the company into a digital work environment and that maybe it is time their seat at the table is revoked.

I see it slightly differently. Within the next 5 years, the role of HR will drastically shift. This is no longer a hunch, this is now fact the likes of Josh Bersin have proven. HR will become part bots, part deep level expertise coaches for the business (internal consultant with deep expertise). So with that, I have a slightly different question.

IS THE BUSINESS READY FOR WHEN THE HR YOU KNOW IS GONE?

The ownership of managing people is not on HR- it never has been, and never should be. It’s on the very bosses that claim the credit for the good work their people do but when the very same people fail to deliver, it is suddenly HR’s issue.

Time and time again sitting with Business-line leaders, I hear them say something along the tune of “We don’t have time for this, we have a business to run”. But what is your business if not a collection of individuals? People are not easy to deal with, I get that, but we can’t solve the people problem like we solve a process issue. We cannot legislate for human nature but we can learn to build brilliant experiences that lead to brilliant results.

Alex Ferguson, former Manchester United football manager, once said, “They (the players) win, We draw, I lose”. That level of accountability and understanding of how to get the best out of people seem to be common-sense but that is not really so common if anything it is becoming more scarce.

THE ROLE HR WILL PLAY IN THE FUTURE AND HOW TO PREPARE FOR IT

I have always opined that HR must learn to stop being a cost centre and become a profit centre. It was nice to know that a recent McKinsey article also started saying the same – but this surely sounds easier said than done.

The role of HR can no longer evolve. IT MUST REVOLUTIONISE. Start by drastically changing the composition of the HR personnel within each department.

I believe the 1/3 rules apply here. 1/3rd of your HR department should be Mathematicians and Statisticians and people exposed deeply in the field of Behavioural Psychology. Another 1/3 should be business/functional (internal) consultants and only 1/3 should know anything about HR. Don’t trust me? Ask Laszlo Bock, former Senior VP of People Operations at Google, who also seems to think so.

The reason for this is really simple. The HR teams of the future are going to be the kind that generate data based on experiments, gather data from sources all around the world and build a story on how the company can leverage these sets of data to craft a story to drive ultimate performance.

The HR of the future is one that can sit with CEOs and Boards and have the same conversation that the Heads of Strategy and CIOs are having- What levers can we pull to make sure we are able to achieve our goals?

I crave for the day a head of HR can sit with the CEO and Board to draw a line of things that needs to happen with its people directly to “Target Share Price”.

This day, I truly believe, is not far away.

In Memory of the Great Jack Welch, allow me to end this with one of my favourite quotes from him to CEOs – one that seems so simple but so nuanced and insightful;

“If your CFO is more important than your CHRO; you’re nuts”

Jack Welch

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Interested in knowing how to drive ultimate performance from your talents? Find out from a single integrated platform that can help you consolidate multiple data-points from talent assessments to make better talent decisions. Send an email today to demo@accendo.com.my

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3 Points from Josh Bersin on Creating Great Talent Experience

Long gone are the days of “prehire to retire” where an employee stays in the same organisation for 20 years with the expectation that they’ll be rewarded for their hard work and loyalty (Lurie, 2018). 

There is a drastic shift from the baby boomers to the millennials. This is seen in the shift of work trends and the way we work which has caused organisations scrambling to find the best solution to find, keep and manage their employees. 

 

‘OK, Boomer’

The recent meme of ‘OK, Boomer’ has further encapsulated the growing gap between the two generations. Millennials have been using this to dismiss the ideals of past generations. 

What this means for the workplace is that millennials’ needs and wants in the workplace have changed and they do not want the baby boomers to tell them the ideals of the workplace. They now want and need different things from organisations like managing their own talent experience at work. 

 

Future of Work: The Switch from Talent Management to Talent Experience

So, with the new generation entering the workplace, companies are no longer satisfied with mere end-to-end talent management systems. The switch to Talent Experience has surfaced with the focus being on employees and enabling them to take charge of their own career paths.  

‘Digitalisation transformation’ has brought further changes to business as CEOs now are focused on upskilling their workforce to be agile with the spotlight being on culture, engagement and employment brand (Bersin, 2020). 

It is no longer an HR problem but a company problem. With people shortages and lack of skills in every industry, businesses are now striving to improve employees’ lives and experiences. 

 

But what is Talent Experience?

“Talent Management” platforms are for HR. “Talent Experience” platforms are for employees.” – Josh Bersin

Talent Experience Management is collecting data and using it to connect and personalize every interaction for every employee to be more productive and improve their career, development and growth at work (Montesa, 2019)

94% of employees stated that they would stay with a company longer if the company invested in their individual careers. 49% want to learn only when they need to learn. LinkedIn

With Talent Experience, employees will have their needs addressed and fulfilled to be more motivated at the workplace by having more control in their individual careers. This will in return help sustain the business when organisations are able to retain and develop key talents.

With Talent Experience, HR will also be able to know what “good” looks like and find the right candidates for the right jobs faster, improve productivity and engage and grow employees. Plus, the organisation gets a good overview of the entire workforce with valuable insights to make better talent decisions. 

This is what “people-driven” businesses should be about. A safe space for employees to be inspired, feel safe and well trained to then translate into creating remarkable products and providing excellent service. 

 

How do you create a great Talent Experience?

  1. Deep Understanding of Your Employees’ Needs and Wants
  2. Focus on Building Culture, Engagement and Employment Brand
  3. Use Talent Experience Systems

#1 Deep Understanding of Your Employees’ Needs and Wants

It is essentially a philosophy of understanding the emotional, physical and career needs of your employees rather than the pragmatic and functional aspects. 

By being people-driven and viewing employees from a human perspective instead of a work resource, this returns the human aspect in Human Resources. 

#2 Focus on Building Culture, Engagement and Employment Brand

As the recruitment between organisations become more competitive, there is an ongoing race to find agile talent, develop strategic mindsets, build a culture of transparency and trust.  

When organisations establish trust with their people, there is a sense of security that employees’ wellbeing is being prioritised and taken care of. When they feel secure that their career needs are taken care of, they are able to focus on being more productive instead of being anxious. 

#3 Use Talent Experience Systems

By utilising technology and AI and empowering employees to plan their own career paths, it helps them visualise their strengths and weaknesses and have a proper benchmark themselves against their aspired roles. With objective data points, they can then craft their unique and personalised career journey to meet their career dreams. 

Imagine with this personalisation, how employees can collaborate with organisations on how both parties can best craft their career journey together in the context of an organisation. It helps both the individual and the organisation understand how they can both align themselves better. 

 

What does this mean for HR?

It will consist of continual effort from HR to ensure that employee needs are being addressed with local solutions and not just corporate programs. 

Talent Experience will continue to evolve as employees’ needs change too. Hence, HR needs to keep adapting and understand their people first and foremost to know where their pain points are and to make their lives better as a whole. 

 

Reference

  1. Bersin, J. (2020). Create A Meaningful Employee Experience: Workday’s Global Impact & Employee Life Team – JOSH BERSIN. [online] JOSH BERSIN. Available at: https://joshbersin.com/2020/01/create-a-meaningful-employee-experience-workdays-global-impact-employee-life-team/ [Accessed 20 Feb. 2020].
  2. Bersin, J. (2020). The Talent Experience Market Is Real: And HR Tech Vendors Are Scrambling – JOSH BERSIN. [online] JOSH BERSIN. Available at: https://joshbersin.com/2019/06/the-talent-experience-market-is-real-and-hr-tech-vendors-are-scrambling/ [Accessed 20 Feb. 2020].
  3. Lurie, M. (2018). Why Is There Such A Disconnect Between Baby Boomers And Millennials When It Comes To Work Ethic?. [online] Forbes.com. Available at: https://www.forbes.com/sites/quora/2018/09/25/why-is-there-such-a-disconnect-between-baby-boomers-and-millennials-when-it-comes-to-work-ethic/#393f21b81de7 [Accessed 20 Feb. 2020].
  4. Montesa, M. (2019). Everything You Need to Know About Talent Experience Management [eBook]. [online] Phenom People. Available at: https://www.phenompeople.com/everything-you-need-to-know-about-talent-experience-management [Accessed 20 Feb. 2020].
Malaysia's Top CHROs

5 key points on Employee Experience by Malaysia’s Top CHROs

A new HR disruption is here and it’s here to stay. What is this new buzzword and how are talent issues evolving?

With digital transformation rapidly changing the nature of work, businesses are focused not only on building the right workforce to meet evolving needs but also ensure that the experience of the employees is one that fosters a stronger relationship with them.

Are we in the midst of shifting from “Talent Management” to “Talent Experience”?

Recently, we had the chance to pick the brains of some of Malaysia’s top CHROs to better understand what HR leaders think about Talent Experience and improving employees’ work, productivity and personal lives.

 

Here are the key points that were highlighted:

  1. Importance of personalisation
  2. Difficulty in implementing personalisation
  3. How to translate the mindset to the organisation
  4. Justifying ROI
  5. Dirty data is worse than no data

 

#1 Importance of Personalisation

How we consume information and services, as well as millennials entering the workforce, are two reasons why personalisation has never been as important.

All the CHROs talked about how one manages their workforce has similarities to raising a child, wherein not every child is the same and may require different parenting styles. Similarly, employees have different needs and wants, which requires personalisation

A key point to note here is that while employees and HR want personalisation, this is a big change from traditional practices. Therefore, expect challenges or resistance from the organisation while going through this transition.

 

#2 Difficulty in Implementing Personalisation

The challenge lies in translating that mindset and behaviour to the ground. Quite often, there is reluctance in managers wanting to accept the responsibility to justify decisions related to personalisation. Most managers rather prefer to have a standardised cheat sheet dictated by HR on key issues that involve personalisation, so that their hands are clean. For instance, take the case of work from home decisions. In many companies, the decision to allow or not allow this is with the manager. However, many managers do not like to take this decision, preferring to have a standard policy driven by HR!

Of course, there are exceptions, where mature managers are able to handle and manage discussions with their teams and discern tough decisions, but this is tough to implement.

In Malaysia specifically, people also seem reluctant to break the status quo because personalising the experience takes more effort. Their discomfort towards change has been translated in how their prioritise personalisation.

 

#3 How to Translate the Mindset to the Organization?

One CHRO shared their experience of having to dirty their hands by going to the ground and taking baby steps to train and change the culture.

Managers are trained to have tough conversations with their teams. This helps improve their competencies in managing teams better.

CHROs have to drive the change and sometimes take unconventional methods in leveraging influential leaders to pioneer the change.

 

#4 Justifying ROI

Another challenge was that sometimes there are no direct answers to ROI.

CHROs in Malaysia want to do so much more but sometimes the lack of direct ROI makes it harder. Despite their challenges, they still take up responsibility through trial and error and are accountable for their decisions.

A CHRO shared that they garner support from the ground and leverage on that to demonstrate the needs of the organization as a whole rather than it just being an HR initiative.

It also depends on the culture of the organisation. Some cultures are more inclined to a certain type of personality and it is easier for them to sell and pitch to their stakeholders.

 

#5 Dirty Data is Worse than No Data

Data is important in helping CHROs decide the level of personalisation or standardisation. CHROs now rely a lot on data to make better objective decisions in managing the workforce.

However, the cleanliness of data is more important as dirty data gives wrong assumptions. Organisations need to manage and maintain their data well in order to make sense out of it.

CHROs painstakingly spend long hours to go through data to make sense out of it. Some also use small data points that give them valuable insights to drive transformational change for the business.

 

In conclusion

The landscape of HR in Malaysia has definitely developed from the dated “Talent Management” to “Talent Experience”. It is just the start of the new era but as the world moves towards an increase in digitalisation, the impact for HR will be huge. To stay ahead of the game, businesses now have shifted to investing in their people to build digital skills and agile transformation with new ways of managing jobs and careers.

 

Reference

  1. Bersin, J. (2020). From Talent Management To Talent Experience. Why The HR Tech Market Is In Disruption – JOSH BERSIN. [online] Available at: https://joshbersin.com/2019/04/is-integrated-talent-management-over-yes-let-talent-experience-reign/ [Accessed 11 Feb. 2020].
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How to Avoid Making The Single Biggest Mistake in Talent Assessment Practices

Talent Assessments offers valuable insights to HR teams about their candidates, right? Although it’s true, HR teams often make 1 big mistake in utilising assessments, causing serious financial and efficiency impact.

Talent Assessments have long been part of most mid to large size companies hiring process. They come in different uses from the “time-pressured” Cognitive Test Suites, to the “discover yourself” Personality Profiles, to the “let’s see what you’ve learnt” Skill Test. With an array of ways to gain insights into candidates even before meeting them, it comes as no surprise that many companies have adopted Talent Assessments as a mandatory part of their recruitment process. In fact, as of 2019, 75% of Fortune 500 companies use psychometric testing in recruitment (Independent, 2019). *

 

Benefits of Talent Assessments

So what benefits have Talent Assessments brought to companies that have made it go from a World War 1 recruiting tool to an estimated USD2-4 billion industry today? Talent assessments have brought significant improvement to 3 critical areas of business:

1. Business Performance

Increase sales, reduce attrition, extend tenure and improve performance. Get the right people in the right roles.

2. Candidate Experience

Win appreciation with branded and gamified assessments in a quick and engaging hiring process.

3. Process Efficiency

Know your metrics and align your talent strategy. Focus on what matters. Easily and seamlessly present results.

Even more impressive to note is companies that have kept a close eye on measuring the impact of Talent Assessments were able to produce objective figures such as**:

  • 36% Increase in Revenue
  • 40% Reduce in Resources
  • 40% Reduce in Time-To-Hire
  • 25% Increase in Tenure

 

The Single Biggest Mistake in Talent Assessment Practices

With all these impressive benefits it would appear that HR teams could do no wrong when they include Talent Assessments as part of their core talent processes. However, even the best-trained HR teams often end up making one of the biggest mistakes in Talent Assessment practices – onboarding too many Talent Assessment tools. Just like we often over-indulge in desserts because they taste good, only to later suffer, so do HR teams often end up having too many tools and thereby diluting the original purpose.

 

Negative Effects of Having Too Many Assessment Tools

If Talent Assessments hold that much benefit, what could possibly be the negative effects of on-boarding multiple tools? Let’s explore the 3 key negative effects of having multiple assessment tools:

1. Significant increase in costs

The 1st problem is obvious, yet many HR teams still spend redundantly on tools and providers, directly contributing to an increase in assessment costs often by 2 to 3 times, and in turn impacting bottom-line. Why would they do that? Often decisions are triggered because of a new buzzword or trend in the Talent Assessment market, which drives a company to rush and onboard another tool in addition to their existing portfolio of assessments, without consideration of long-term use, impact and cost. In addition to the above, certain tools or providers may also include a hidden cost that only becomes clear as testing volume grows. The real impact is felt when the business asks HR to defend these costs and as the redundancy becomes apparent, what do you think happens to next year’s budgets?

2. Significant increase in execution time

The 2nd problem is not hard to imagine. Your company has onboarded its 5th Talent Assessment provider because of which your team will need to be trained on new tools and reports, thereby increasing the time needed for training. Building further on this – as Talent teams hand Managers a new report, which has a different format from the ones they have been using previously, more confusion arises. Finally, significant manual effort and time spent on collating data from multiple reports to convert that into a single source of truth. This of course also carries the risk of manual errors creeping into the data. All this has already stretched your time, making you miss your KPI targets. So remember that every new tool, report or provider necessitates in-depth knowledge and training, or else results will not be optimum.

3. Too much data, no information

A Forrester report stated that between 60% to 73% of all data within an enterprise*** goes unused for analytics. This includes talent assessment data that often gets collected but does not get turned into information. Having multiple assessment tools often causes data to be plentiful, but too varied for HR to turn into meaningful information and insights needed for effective decision making. This is mainly caused by each tool having its own logic behind the data leading to conflict of data points and therefore HR not being able to draw a definite conclusion.

 

3 Best Practices to Follow in Tool Selection

Now that we have understood the detrimental impact of having too many assessment tools, we will identify 3 steps HR teams can take to avoid falling into this trap.

1. Clearly identify what needs to be measured

A recent study by McKinsey & Co rightly stated that “Simple advice—if there isn’t direct science linking the assessment to job performance or to the characteristic you’ve determined matters for the job in question, don’t use it.”****

HR teams must start by clearly identifying what factors will tell them if a candidate will or will not be a right fit for the role in question. These factors can include anything that will predict performance such as leadership traits, technical skills, cultural alignment, cognitive ability, etc. Only once this has been set should HR start to evaluate assessments tools that are able to accurately measure the criterion set, thereby increasing the relevancy of each tool. By practising this, your HR team may find that having 4-5 types of assessments should be able to cover all testing needs.

2. Customise and Contextualise Outputs

Often, the journey leading into onboarding multiple tools doesn’t begin with the search for a better test, but a search for a better output. Many talent assessments today have reached similar levels of validity, making differences in input very minimal. With test validity being standardised and controlled by industry bodies, assessments have now turned their attention to improving outputs. The toughest job HR teams have in the introduction of a new talent assessment tool is to convince business managers that this new assessment will give them better results. The biggest challenge stems from the fact that talent assessment outputs general speak a more psychological language which is unfamiliar to business managers. HR’s strategy to win this is to work with talent assessment tools that are able to customise and contextualise their outputs to language familiar to their organisation. By using terms familiar to the business (e.g. internal frameworks) and avoiding jargon when producing assessment outputs will increase the familiarity effect, and increase adoption rates by the business.

3. Consolidate when multiple tools are unavoidable

With many organisations going through transformation and diversification, the need for evaluating varied and complex types of traits and skills leads to multiple tools becoming unavoidable. When faced with this situation, HR teams should always search for talent assessment tools that can consolidate output as far as possible. This will ensure that problem 2 and 3 either do not occur, or their impact is minimised. Additionally, with data interpretation and consolidation being done by AI-driven platforms today, insights produced can be more in-depth and non-conflicting, which is a big challenge when done manually.

 

In conclusion

By understanding the 3 impacts of multiple assessments tools, we now know the cost of making the biggest talent assessment practice mistake. If your current company’s approach to talent assessments needs to be reviewed, remember the 3 steps of caution to ensure you get the most out of your talent assessments.

 

Interested in knowing how a single integrated platform can help you consolidate multiple data-points from talent assessments to make better talent decisions? Send an email today to demo@accendo.com.my

 

References

*https://www.independent.com.mt/articles/2019-06-05/business-news/75-of-Fortune-500-companiesuse-psychometric-testing-in-recruitment-6736209146

**https://www.cut-e.com/online-assessment/

*** https://www.inc.com/jeff-barrett/misusing-data-could-be-costing-your-business-heres-how.html

**** https://www.mckinsey.com/business-functions/organization/our-insights/the-organizationblog/the-4-biggest-assessment-myths-undermining-your-hiring-proces

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PIVOTING HR IN THE AGE OF THE GIG ECONOMY

It seems like every few months, there exists a new buzzword that signals a change or challenge that HR professionals are told to prepare for. Failing to do so, they are told, will lead to their swift demise. These ‘future of work’ prophecies no doubt bring with them a sense of fatigue.

The newest of such buzzwords is the ‘Gig Economy’. What is it? And what does it mean for HR?

A study from 2015 claimed that 44% of all US workers are involved in non-traditional employment – or ‘gigs’. The ‘gig economy’ (based around accommodation, transport and cars, e.g. Airbnb, Uber) was growing at 140% per year, based on the turnover of a sample of larger operators.

For some, it simply refers to the ever-growing number of people who use one of the (still relatively) new talent platforms or online service brokering like Uber, Airbnb, Grab, FoodPanda. For others, it includes these people, but also anyone who works in a continent, temporary, diversified, or freelance capacity. In other words, anyone who isn’t a full-time or part-time employee.

A study from 2015 claimed that 44% of all US workers are involved in non-traditional employment – or ‘gigs’. The ‘gig economy’ (based around accommodation, transport and cars, e.g. Airbnb, Uber) was growing at 140% per year, based on the turnover of a sample of larger operators.

Combined with factors such as increased workplace flexibility, a global, distributed workforce, advances in robotics and cognitive technologies of the ‘future workplace’ it becomes part of a range of factors HR needs to account for when planning future strategies.

71% of executives believe their companies are either ‘somewhat’ or ‘very’ able to manage contingent workers, with the main challenges being:

• Legal or regulatory uncertainty (20%)
• Culture is unreceptive (18%)
• Lack of understanding among leaders (18%).

Is your HR department ready for the gig economy?

Combined with factors such as increased workplace flexibility, a global, distributed workforce, advances in robotics and cognitive technologies of the ‘future workplace’ it becomes part of a range of factors HR needs to account for when planning future strategies.

Here are 4 changes you can implement to capitalise on this growing trend:

Embrace a flexible workplace

As the gig economy grows, one of the most significant ways it will affect the employment landscape is by bringing work-life balance to the forefront. Workplace flexibility is no longer a “nice-to-have” or a “perk.” Instead, it’s a make-or-break part of the job search for most applicants. Job searchers demand flexibility, and they know they can get it from the gig economy if full-time employers are unable to. As a result, employers are finding they have to offer flex time, work-from-home or telecommuting opportunities, and generous vacation packages if they want to woo top candidates. Parents with young families, in particular, aren’t budging on these requirements anymore. HR departments should take note of this demand and plan accordingly, whether that means adjusting benefits plans or completing network tweaks to make telecommuting more feasible.

As the gig economy grows, one of the most significant ways it will affect the employment landscape is by bringing work-life balance to the forefront.

Figure out which roles are ‘gigable’

Retaining your existing employees—and continuing to draw strong talent to full-time roles—is something that should remain a priority for your organisation as the gig economy grows. However, you should not ignore the statistics. The number of gig economy workers in the United States will hit 9.2 million by 2021—up from just 3.9 million in 2016. These numbers mean no business can ignore the gig economy, and companies that can embrace it will be in the best position to capture top talent and thrive.

These numbers mean no business can ignore the gig economy, and companies that can embrace it will be in the best position to capture top talent and thrive.

You may already have gig economy workers in your organisation, such as contractors, freelancers, or vendors. What you should continue to do is identify roles that could feasibly adapt to the gig economy. Which responsibilities or services could you bring into your business on a contract or freelance basis? You should focus on vacant or soon-to-be-vacant positions, but you can also look at jobs that are currently filled. That way, if someone leaves your organisation, you’ll know whether you can eliminate the position to save money or convert the job to freelance. Having some flexibility here will help you remain agile when ideal gig economy opportunities come along.

Focus on integration

Independent workers such as contractors or freelancers beat traditional employees in job engagement, innovation, satisfaction, and pride. Where they fall short of regular employees is in another area: commitment. Gig economy workers typically aren’t as committed to the companies they work for. Many freelancers work for multiple employers at once and rarely maintain communication with more than one or two people at each company. Figuring out ways to integrate your gig workers into your organisation more fully is a good strategy to prevent your company culture from eroding. Ideally, the extra integration will increase commitment, which in turn will make it easier for you to establish a pool of go-to freelancers that you can rely on again and again.

Establishing an onboarding strategy

You can’t afford to skip the onboarding step with gig workers, but many employers do it, anyway. They don’t run background checks, provide training, or do performance reviews. Instead, many gig workers work unvetted with limited supervision and almost no feedback until they turn in their assignments. This structure is unstable and puts undue risk on your business. Remember: your gig workers are still representatives of your brand. They enjoy access to company information and resources that are likely proprietary or confidential, and you still need to track and maintain their performance standards as they work.

You want to make sure every gig worker is someone you can trust. As for training, you should at the very least have a kickoff call or video conference briefing with the freelancer before getting them started. Even if the project is straightforward, you want to lay out your expectations firmly and clearly. Encourage the freelancer to contact you with any questions and ask for an early sample of their work to make sure they are on the right track before they complete an entire project.

Remember: your gig workers are still representatives of your brand.

These strategies will lay a foundation for a positive employer-freelancer relationship, which will make it easier for your business to embrace the benefits of the gig economy going forward. However, as with any big change, pivoting your HR department for the needs of this next generation of workers is easier said than done. To learn how we can help you streamline and perfect this process using data, and smart technology, visit us at Accendo.

Sources

https://time.com/4169532/sharing-economy-poll/
https://www2.deloitte.com/au/en/pages/human-capital/articles/human-capital-trends.html