Tuesday, April 17, 2007

Change Management and HR

SHRM’s 2007 Change Management Survey Report suggests that more than four out of five HR professionals report that their organizations planned or implemented major organizational changes in the 24 months preceding SHRM’s online survey, which was conducted in November 2006.

The top three major organizational changes that employers were planning or implementing, according to the survey, were:

• New or revised performance management and review processes.

• Major changes to their facilities.

• Changes to the organization’s culture.

However, employee resistance and a communications breakdown are the two primary obstacles employers face when major organizational changes enter the picture. Employees’ understanding of organizational changes improved when HR was involved in the change management processes before it was introduced to all employees, according to nearly three-fourths (73 percent) of 403 HR professionals surveyed.

“The finding that HR departments were most likely to be involved with the planning for major changes indicates that more often than not HR is viewed as a strategic partner for the change process,” the survey report says. Getting employees ready for major organizational changes requires that change management leaders promote understanding of those changes in a well-planned and well-timed manner, Benedict writes.

Perhaps the most important role which HR plays in driving the change initiatives is that to create the element of trust and awareness about the initiative and its impact on people. Some great change management initiatives never fail to have the desired impact as the stakeholders are either unsure about the desired result or do not share common interest and vision in bringing about the change. Change initiative is one of the vital strategic moves which allow the HR function to play leadership role in driving new initiatives.

Some may argue that HR by its very nature is not pro-change and that it believes in maintaining the status quo as it helps in ensuring compliance which brings consistency. However this argument fails miserably as the nature of business is has undergone a dynamic shift and today it’s not about business as usual by how you make the right moves to make the transition to “business unusual” and stay ahead.The same applies to people’s practice in organization. No organization can afford to have de link people strategy from organizational strategy.

I think this is where HR function needs to drive the business decision making in organizations as it’s not just about gearing up for the challenges which lie in the market for getting new business and staying ahead of competition but the real challenge of hiring, training, rewarding and retaining the best talent. Perhaps some of the industries face unique challenge as the business drivers are not the margin of profit or the volume of business but the quality of talent it has to execute its strategy.

Sunday, April 15, 2007

Managerial Decision making

Critical managerial decision making is the key to superior performance at work.One has to refer to critical Data, past records and performance metrics and analysis before making decisions .Mc Kinsey study tries to assess the various factors which influence decision making at work. Executives often end up referring to wrong sources, which lacks scientific rigor and credentials in its finding, for arriving critical decisions. Just because one strategy works for a particular organization may not prove to be equally effective for other enterprises.

Unfortunately, many of the studies are deeply flawed and based on questionable data that can lead to erroneous conclusions. Worse, they give rise to the especially grievous notion that business success follows predictably from implementing a few key steps. In promoting this idea, authors obscure a more basic truth—namely, that in the business world success is the result of decisions made under conditions of uncertainty and shaped in part by factors outside our control. In the real world, given the flux of competitive dynamics, even seemingly good choices do not always lead to favorable outcomes.

The halo effect is especially damaging because it often compromises the quality of data used in research. Indeed, many studies of business performance—as well as some articles that have appeared in journals such as Harvard Business Review and The McKinsey Quarterly and in academic business journals—rely on data contaminated by the halo effect. These studies praise themselves for the vast amount of data they have accrued but overlook the fact that if the data aren’t valid, it really doesn’t matter how much was gathered or how sophisticated the analysis appears to be.

This reliance on questionable data, in turn, gives rise to a number of further errors in logic. Two delusions—of absolute performance and of lasting success—have particularly serious repercussions for business strategists.

It’s actually a real problem which many strategist face and typically too much of analysis may lead to complicated or erroneous conclusions if the context of the reference is not verified. Sometimes a single factor can be picked up as a major perceived thereat and instead of finding a meaningful and objective solution based on organizations own reality decisions may be unduly influenced by halo impressions.

Tuesday, April 03, 2007

Culture as business Strategy

As organizations spread across globe and set operations in different parts of the world, organizational culture is acquiring a whole new meaning. Growing decentralization and growth in no of various units and function means each unit is given the scope to define its scope of operation within the broad organizational framework.Structural changes have been made to allow flexibility of approach and decision making has been decentralized to enable organization scale the challenge of growth and diverse business requirement. All this means organization culture becomes the critical enabler in facilitating a cohesive and well knit unit. Bain & Company’s recently released the Results of Bain & Company’s Management Tools & Trends 2007 study also suggests that Culture continues to be the most important strategy for business success.

The top 5 management trends as described in the report are:

91% agreedCulture is as important as strategy for business success
87% agreed that Information technology can create significant competitive advantages
79 % felt innovation is more important than cost reduction for long-term success.
73 % agreed that consolidating and sharing back office operations improves both cost and quality
66 % agreed that environmentally-friendly products and practices are an important part of our mission

The other two aspects are equally interesting as IT tools and innovative practices are also considered as crucial factors which have considerable impact on the way business will shape in the days to come.

It also suggests that the ten most used management tools included:

§ Strategic Planning
§ Customer Relationship Mgmt.
§ Customer Segmentation
§ Benchmarking