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Category Archives: HR’s role in the organisation

30 April 2009 8:19am

Australian HR departments are struggling to meet the challenges created by recession-driven cost-cutting with fewer resources and less control over decision-making, a new study confirms.

Two in five HR directors feel they have less autonomy than a year ago – almost 10 times the number reporting an increase in control, the survey by Kelly Services has found.

“More control, more information requests, and more centralised decision-making” summarises the responses of many HR directors to the survey, which asked 56 members of the International HR Directors Forum about cost-containment measures and the GFC’s impact on the HR function itself.

One HR director notes that these demands make HR “much more reactive: you can’t be proactive when you are constrained by centralised control”.

The greater scrutiny has also led to a “speeding up of operating rhythms” – from quarterly to monthly reporting, and monthly to weekly – which inevitably leads to a greater workload.

Parent companies’ expectations of their Australian operations are “overly influenced” by what is happening in their home market, the report says, with the parent – in most cases – having a more severe view than local management about the cost-reduction measures needed.

Cost-cutting measures
Virtually all respondents to the survey have already implemented cost-cutting measures, with the most common being reduced use of contractors (74%), hiring freezes (70%) and headcount reductions (66%).

Australian subsidiaries have been required to take steps even where the GFC hasn’t yet had a noticeable impact on local operations. This is despite the report noting that, “given the state of the key US and European markets, Australian revenues (typically around 2-5% of global revenues) are hardly likely to be a decisive consideration in global cost reduction decisions”.

Reducing accrued annual leave entitlements is another strategy being employed by many of the respondents, with one director pointing out that pressure to reduce this liability on the balance sheet is “inevitable” and another saying, “it’s not just a financial issue, it’s a wellbeing issue. It’s not healthy for people not to be taking adequate leave breaks, so we are pushing this angle in our discussions with affected employees.”

Almost half (43%) of the respondents have reduced their training expenditures, but some companies have made a firm decision to keep investing in this area.

One director acknowledges the need to continue to upskill and invest in employees in order to meet business objectives, adding that in circumstances where bonuses and pay rises are out of the question, “we can at least educate and develop our people”.

Only “an exceptional company indeed” would have considered salary reductions 18 months ago, the report says, but now almost one in five employers (17%) is considering this move in the next six-to-twelve months.

This is arguably one of the most unpopular cost reduction measures and, given the need for employees to agree, the most difficult to achieve, the report says.

Added pressures
Among the added pressures HR directors report being subject to are:
more scrutiny of new hires – there are “more hoops” to go through to get new staff on board. In other cases, HR’s involvement in recruitment has been eliminated in favour of line managers contacting agencies directly, leading to a higher risk of hiring employees with poor cultural fit;

falling morale and engagement – nearly 60 per cent of HR respondents have noticed their company’s responses to the GFC having a moderate or significant effect in this area. HR is now faced with a “changed organisational psyche”, when employees realise for the first time that their company faces the same hard realities as everyone else; and workers who no longer feel in control of their careers, creating a “prison mentality” where employees who aren’t happy don’t feel confident to leave;

diminishing returns on the communications investment – communication (almost to the extent of over-communication) has become a more important task to resource, and HR has identified a need to “communicate the same message in many media: some like email, others prefer face-to-face, and others like to have opportunities for discussion”. The drain on HR’s already limited resources is proving problematic, the report says;

employees in need of support – the HR role is now more about providing reassurance and support for employees, with respondents noticing more cases of personal trauma such as financial problems, stress and relationship breakdowns; and

reduced resources – some 60 per cent of companies are attempting to meet these challenges with less HR resources than they had a year ago. Only one company reported an increase in HR funding.

Build a strong business case for HR investment

09 April 2009 8:52am

Meeting today’s HR challenges requires innovative thinking and spending some cash, says Onetest CEO Steven Dahl, and “how you ask for it will make all the difference”.

According to Dahl, the ability to build a business case for HR investment is critical as economic conditions worsen and businesses become more selective in their spending.

A business case is not just about numbers, he says. “It’s about a strong case and how to build it.”

The first step is to clarify your objective – why are you asking for money? This might be, for example, because you want to reduce the time it takes to hire new staff in your Brisbane call centre, or because you want to improve the retention rate in your sales team in Melbourne.

“Whatever your objectives are, have demonstrable proof of the issue and that it needs to be solved.”

The next step is to “gather your allies”, he says. “Get the people who feel the pain of the problem most to assist you.”

Keep asking them why it is an issue, and what it will mean for the organisation if the problem is solved. “There must be consequences in order for the CEO to act. This is the difference between a strong and a poor business case.”

Answering questions as to who is feeling the pain, and why it is an issue for your business, forces you to think analytically, “the way decision makers will”.

HR people, Dahl says, often use “I feel” and “I believe” statements, such as “I think we’re taking too long to fill roles in Parramatta”.

A stronger business case looks deeper into the issue. For example: “Our time to fill is 35 days … we have 10 shifts vacant … costs us $14,000 … stress levels would decline … stress led to 35 per cent of our staff leaving … reduce our time to hire by 50 per cent … increase our production by $28,000 per month … would cost us $2,500 per month … ROI of 11 times … it could be done within eight weeks … benefits would be seen within the first four weeks.”

When building a business case, Dahl says, HR managers should:
conduct further quantitative investigations to support “initial qualitative rumblings”;

use historical data;

apply a dollar cost to the problem;

identify additional flow-on benefits;

address the issue with a known solution;

use a case study or reference site for peace of mind – what are your peers doing?

compare the cost of the initiative to the return on investment; and

determine a timeframe to see some results.

Choose your battles
There are myriad things HR could spend money on, so you must “choose your battles”, Dahl says.

Consider what will deliver the biggest positive return for the business, he advises. To determine this, talk to a wide range of staff and consider conducting surveys, which add rigour to your case.

Write a list of their challenges and rank them according to how important and/or urgent they are. “Issues that will impact the CEO will get more priority.”

If you’re inexperienced at presenting business cases Dahl advises you to “get some smaller wins on the board first”.

“Choose smaller things, shorter timeframes; pick easier targets to build your confidence.”

Presentation is key
How you present and deliver the business case will have a significant impact on whether it wins approval, Dahl notes.

“Bad business cases have been approved because of an ability to sell, while good business cases may not be approved due to poor communication, poor structure, lack of evidence, or a lack of confidence.”

Before you get too far down the track in formulating the case, Dahl says, think about your target audience. “Who is the decision maker? What are their motivators? What is their style? Who will influence the decision, and what are their drivers and behavioural style? These will influence how you structure your business case and how you deliver it.

“You can’t present the same way to different people – for example a CFO and a head of marketing. ‘Your way’ won’t work for everyone you’re presenting to. You need to get into the hearts and minds of decision makers. Do this early, while you’re constructing your business case.”

You should consider:
whether to use statistics and data or case studies and analogies;

using images, graphs and pictures versus text and numbers;

the length of your presentation. The higher up the ‘food chain’, the more time-poor people are – they’ll prefer a simple analysis ;

the level of detail required – remember all decision makers dislike superficial analysis;

whether to send an agenda beforehand;

whether to send a “thank you” and summary afterwards;

where to hold the meeting – off-site or in the boardroom.
Essential elements
Ultimately, Dahl says, a strong business case must either:
save time, or give someone important some time back to do other things;

save money or make money; or

increase comfort or make life easier/better – for example, reducing stress levels by automating a process (but remember to tie “comfort” back to facts and figures).
“The more you can demonstrate time, money or comfort, the stronger your business case will be.”

Managing for Recession or Recovery? What role for HR?

Malcolm Maiden
March 21, 2009
The Government is moving to rein in what an angry public see as excessive executive payouts. Here, four key players debate the issues, and look for answers, with BusinessDay’s MALCOLM MAIDEN.

MALCOLM MAIDEN The question that people outside the business world are asking is – in this environment, is executive remuneration too high?

MARTIN LAWRENCE There are certain cases where pay is just too high.

CEO pay – Sir Rod Eddington
Sir Rod Eddington, Chairman JP Morgan Australia and NZ and a director of News Corp and Rio Tinto explains what boards must do to regain community confidence.

We don’t see it happen very often in Australia. There was a case with Adelaide Bank two years ago where the termination payout to their managing director was so large that they had to issue a profit warning. Everyone, I think, would quite happily say that that is too high.

The better question is: is executive pay linked to performance? Is it actually a fair reward for what’s been achieved?
We’re finding that out right now because we’re starting to see the first disclosures made after things have really started to turn down.

In some cases it’s looked pretty disproportionate.

SIR ROD EDDINGTON Historically, it’s a debate you only have when markets are turning down. It’s not usually a big issue when markets are ramping up, shareholder values increasing, businesses are doing well.

The key question is: is executive compensation linked to the right things? And does it deliver the right behaviours? Linking compensation to medium and longer-term shareholder return is a good thing. You get some strange outcomes – because there’s a lead and a lag effect, you’ll perhaps have rather bigger incentive payments at a time when the market is going down.

You need to make sure that the incentives for senior executives are aligned to the objectives of the company – that the relative salary packages of senior people in a company are appropriate.

In Japan, senior executives get a much smaller premium over the packages of what I would call front-line staff. In America, that difference is substantial. Australia is sort of in the middle.

MAIDEN Are the Government’s moves to cap golden handshakes, and inquire into executive remuneration, the right ones?

JOHN COLVIN With the benefit of hindsight, it would seem there have been mistakes made by some companies. But we believe that education is better than legislation in fixing whatever problems exist. On the termination payments changes – we’re disappointed that legislative action is being taken without prior consultation and ahead of the expected Government discussion paper.

LAWRENCE The changes will allow shareholders to protect the company against huge payments to departing executives and should help boards in their bargaining with executives. If boards respond by simply increasing salaries – again – it will be clear whose interests they are protecting.

MICHAEL O’SULLIVAN The inquiry’s timetable will mean that the Government will not be taking any further steps to intervene in the remuneration issue for at least 12 months.

MAIDEN Well, should shareholders get the power to determine executive pay packages?

O’SULLIVAN I think it’s a foolish proposition to ask shareholders to make detailed judgements when they don’t have – they simply can never have – the information. You need the degree of disclosure you would have in a takeover situation, where you’re in a locked room, in order to make those kind of judgements in any sensible way.

We think that the Opposition policy of a compulsory shareholder vote is foolish. We do think that shareholders should vote on issues of shares, including shares bought on-market for executives. But other than that, we don’t want a compulsory vote.

We’ve done a longitudinal study looking at the movements in chief executive officer payments. From ’01 to ’07, the consumer price index has increased by 17.7 per cent; average weekly earnings have done quite well, 32 per cent; but CEO fixed remuneration – not bonuses, not rights issues, not options – 97 per cent.

It just seems to me that what used to be the work value of any job hasn’t increased in that kind of proportion.

Now that the tide’s gone out and a lot of “boats” are left a long way from the water, people are in some cases going for short-term cash bonuses (that are) not in any way transparent – described to us privately as “if we don’t retain this fellow, he’ll walk”. We really don’t think that is credible: where’s he going to walk to?

COLVIN In the US, in ’84, Congress brought in a law saying that you can’t get a tax deduction for more than three times pay for a termination payment. Everybody (then) rose to that level because that was a norm which the Government had set, as opposed to leaving people to say “well, is that right?”.

I think it was Bill Clinton who brought in a law, in ’93, that said you can’t have a tax deduction for anything more than $1million. Short and long-term incentives just shot off.

So you’ve got regulation distorting the market, making it much worse. We have some of those distortions in Australia. Squeeze the balloon at one end and it goes somewhere else.

O’SULLIVAN It’s hard to say that those regulations caused the egregious behaviour.

COLVIN It doesn’t drive it, but it does distort it. Boards must take control of executive remuneration, particularly the CEO’s. You’ve got to get that absolutely spot on.

Ironically, you probably should be paying more money because they’re actually working harder (now) that the numbers are going the wrong way. When everyone’s rising with the tide, you probably shouldn’t be paying as much.

MAIDEN When remuneration reports are rejected, the same shareholders at the same meeting overwhelmingly support the re-election of the directors who presented the report – seems illogical, doesn’t it?

COLVIN Does it? It is such an emotive issue. I think it is used as a grab bag for voting dissatisfaction against lots of other things. There’s often other angst about the share price: “This is my retirement saving, I’m angry … I’m not quite sure how to deal with it, but I’ll vote against the remuneration report.”

O’SULLIVAN: Institutions don’t vote against remuneration proposals unless we’ve analysed them and are dissatisfied. The best thing is to engage with the company about the bad things in their remuneration policy, or anything else. Our beneficiaries depend substantially, in their retirement, on the success of these companies. We don’t want to be bagging them in the public. It’s much better to approach them privately, see if we can persuade them to adopt a better course, or at least satisfy us that the course that they’ve taken is actually correct.

MAIDEN And when that doesn’t happen?

O’SULLIVAN That’s why there is the beginning of voting against particular directors. There are failures for which I think you can legitimately say that independent directors didn’t play the role that we would have expected of unconflicted representatives.

MAIDEN Do remuneration committees work? When the board votes on those reports, would there be directors thinking: “I can just tick this – the work’s been done?”

EDDINGTON It’s not uncommon for a non-executive director who’s not on the remuneration committee to ask for clarification because they know it’s going to be very much in the public domain, as it should be, and they’re going to have to defend it collectively.

If you want every member of the board involved in the minutiae of compensation or remuneration, or the risk and governance, directors will need to meet once a week and they’ll need to be full-time.

COLVIN Most boards don’t appoint a CEO more than once. Some don’t do it at all, because they become a board member when it’s been done previously. If the board’s doing it correctly, they will also have the remuneration consultants, the lawyers, the governance people, reporting directly to the subcommittee first, and then secondly to the whole board.

O’SULLIVAN The damage is frequently done with the original contract, and can’t be undone. That’s what gives rise to golden parachutes and all these kinds of “welcome-aboard” payments.

LAWRENCE Part of the problem is that when a board is recruiting a new CEO, it’s like drawing up a pre-nup agreement when you’re trying to convince somebody to marry you.

And we’ve seen it go wrong spectacularly fast.

COLVIN When I was drafting them, the best boards started the contract well in advance of looking for anybody. They had a big discussion about how far they’d go, the hot spots. The board was basically ready to say: “Whoever’s doing the negotiation … has authority to those levels. Come back and chat to us if we get him.”

EDDINGTON I didn’t get a golden goodbye. I would never have accepted one. I wouldn’t expect it to be in the contract. And my view is it’s nonsense, really. You don’t need to put it in there. Good chief executives will front up as long as you offer them a good competitive salary. They don’t want payment for failure either.

But look at (US insurer American International Group) and their bonus payments. Not all boards are smart.

MAIDEN Are the remuneration and search consultants part of the answer or part of the problem?

O’SULLIVAN A bit of both.

COLVIN The lawyers, if they’re doing their job well, will set out the contract and the structure. They won’t advise – because they’re not qualified – on remuneration levels. A lawyer will be asked: is this permissible under law. Their job is to say it is or it isn’t.

Then the next question of the remuneration consultant is: is this fair and reasonable? Yes or no? Remuneration consultants are good up to a point, and then it’s got to come back to commonsense.

LAWRENCE: Unfortunately we see, too many times, boards hiding behind their advice. We’ll say, “Why did you decide to pay your CEO an amount which, if I compare him to the obvious peers, his base for turning up is much higher?” And they say, “Oh, we got an appropriate peergroup from an independent consultant.”

Remuneration is one of the very few insights you get into the relationship between the executives and the board. An executive team that is able to get the remuneration outcomes it wants most of the time is also more likely to be able to come to a board with a merger proposal that perhaps shouldn’t have been done, and get it through. It’s an insight for how that relationship works.

O’SULLIVAN One of the issues in a merger was options that people had. They got a remuneration company to reconstruct what would have happened at an assumed share price.

They paid people for forgone options packages that would have been underwater by 10,000 fathoms if they’d been allowed to run.

When we confronted the chairman, he was sort of laughing with us, saying, “Well, I don’t blame you for not being able to understand it; I could never understand it either.”

That’s just not an independent chairman’s role – to give something a tick when he plainly had no idea how it was calculated.

MAIDEN What is the difference between short and long-term incentives?

O’SULLIVAN One is to encourage making decisions that pay off in the long term. And we’ve always said we don’t mind if people don’t get the rewards for that after they’ve left the company.

Short-term incentives are frequently based not only on financial, but non-financial considerations which (companies say) are sometimes difficult to disclose – but we are very sceptical about the non-disclosure.

LAWRENCE The Corporations Act doesn’t actually acknowledge short and long-term incentives’ existence. It just says any remuneration that is tied to a performance condition, you must disclose a detailed summary of the condition. In 2008, in the top 100 companies, 94 per cent of CEOs got more than 50 per cent of their target bonus, and 45 per cent got more than 100 per cent.

MAIDEN It does seem that it’s base pay in drag.

COLVIN Why not go back to where you get a base pay and a discretionary bonus? Many commentators say we’re not going to have any part of a (system) which allows the board to use their discretion – but that’s probably a trust issue.

Let’s say a chairman went to the shareholders and said: “We’re going to have a base pay. Then the CEO can have a bonus at the discretion of the board up to a set amount.” The chairman may say, “I’m going to do that because I don’t know yet whether the CEO’s going to work out. I also don’t know whether we need to pay a little bit more to keep somebody around in really tough times, or really good times.”

However, this will give the board the flexibility to adjust up and down to meet the existing circumstances without relying on any complicated formulas.

O’SULLIVAN Very largely, the behaviour over the last 10 years has caused a loss of trust. I think you can never have a situation where you don’t disclose the basis for your discretionary judgement.

COLVIN But if the chairman got up and said, “Look, I have awarded 50per cent, because we have been on the edge of going out (of business)”, are you giving really confidential information to your competitors?

Are you spooking the market by being really honest?

LAWRENCE Just say that the board exercises discretion this year to reduce these payments.

EDDINGTON Boards will never do that, nor should they. If a chairman’s going to have a performance discussion with the chief executive he doesn’t want to read about it in the annual report – or the newspapers the next day.

LAWRENCEThe problem is we do (read) about the non-performance payments.

EDDINGTON You don’t read about the conversation where the chairman says to the chief executive, “I think you’ve earned 70 per cent of your bonus this year.”

That’s the sort of conversation a good chairman has with his chief executive, although clearly the size of the bonus should be in the public domain.

MAIDEN Do we have agreement that simplification of remuneration policies is desirable?

EDDINGTON Simple has always got to be better. If you’ve got a formula everyone can understand quite quickly – staff and shareholders – then you’re probably in the right place.

If you need a PhD in mathematics to work it out, self-evidently it’s wrong. People don’t trust what they don’t understand.

MAIDEN Finally, what do you think is going to be the biggest change to remuneration policy that comes out of this?

COLVIN I think one will be something which we haven’t got on to: a focus on what does remuneration do in terms of the culture of the organisation, not only in terms of who we are and what we do, but the ethics and the whole structure that goes behind that.

EDDINGTON I hope that all this focus on remuneration which we’re seeing now will result in clear and hopefully simpler compensation packages for executives that are tied to the things that matter in the business.

O’SULLIVAN What ought to happen is that boards should understand that in relation to some of these bad remuneration policies, responsibility is with them.

If the same people repeat the same errors, then the ultimate recourse is to say to these people, “We really need to get somebody else in there.”

LAWRENCE What I hope will happen is that boards think about whattheir stance on executive pay says about their position with theirshareholders and with the community.

Trust is a precious commodity. It’s hard to get, very easy to lose.


SIR ROD EDDINGTON Chairman-designate of ANZ Bank. He is also a director of News Corporation and Rio Tinto and a former chief executive of British Airways. Chairs Prime Minister Kevin Rudd’s Business Advisory Council.

MICHAEL O’SULLIVAN President of the Australian Council of Superannuation Investors, which advises super funds on corporate governance and other investment risks. Deputy chairman of CARE Super.

MARTIN LAWRENCE Co-head of Asia-Pacific governance research for RiskMetrics, responsible for Australia and NZ proxy research. Former manager corporate governance at BT Financial Group’s Governance Advisory Service.

JOHN COLVIN Chief executive of the Australian Institute of Company Directors. A lawyer by training, he was formerly a partner at legal firm Freehills, specialising in employment law and corporate governance, advising companies on executive appointments.

20 March 2009 8:22am

Employers that enforce hiring freezes during a downturn run the risk of anarchic recruitment systems and their costs spiralling out of control, says HR expert Steven Dahl.

Dahl, the founder and managing director of HR solutions provider Onetest, says it’s a “myth” that recruitment freezes protect an organisation from escalating recruitment costs.

“We have to remember and be realistic that even in a recession, people get sick, they have to leave work, they move interstate… Even during a freeze, organisations will be recruiting. The volume of the recruitment might not be as high as it has been in past years, but the critical roles will still need to be re-hired.

“Turnover will still occur even in a recession. When recruitment processes are put on ice, recruitment becomes ad hoc and inconsistent, [leading to] ‘recruitment anarchy’.”

In a webinar this week, he explained how during a time when HR teams might be downsizing or “busy trying to do more with less”, normal recruitment processes are put on ice. When a line manager needs to fill a business-critical role – quickly – they will bypass HR and send the job to an external agency rather than be “inundated” with applications, resulting in a cost between $10,000 and $15,000 (depending on the salary).

“Before too long other managers are following suit and… even though they were in the midst of a recruitment freeze designed to save money and cut costs, have ended up spending several hundred thousand dollars, just in replacement recruitment.”

Now is not the time to let recruitment systems and processes slip, Dahl says. “We know that ad hoc rec ultimately leads to higher costs and greater variability of people that we bring into the organisation.

“We also know from life experience that processes that are more consistent deliver results… And when processes aren’t clearly defined, and we have people who are busy, stressed or time-poor, they tend to do their own thing, and when they do their own thing they tend not to do it particularly well.”

An employer can “end up with as many different selection processes as they have line mangers recruiting, and this isn’t a good thing. If an organisation has right-sized or downsized or retrenched workers over the last six months, as we come out of this recession it has an enormous opportunity to actually recruit or refill its stocks of employees with more of the right people.”

Applications influx an opportunity, not a challenge
Dahl says that while some employers are now shutting down the recruitment pages of their websites due to overwhelming numbers of job applications, this is not the right strategy.

Instead, they should set up online systems to capture all the applications and create a “talent pool” for future recruitment needs.

“What we should be looking at doing is opening it up and getting as many applicants in as we possibly can, registering their interest for future job opportunities, and building that talent pool of five-, ten-, fifteen-thousand candidates which can be accessed for future recruitment needs.

“I can only stress too much to organisations that they don’t turn their back on collecting applications during what I know is a very tough time for business. Whilst you might not be recruiting as feverishly as you were in the last 12 months, you will need to recruit replacement roles; we will come out of the recession and when we do, and you need to recruit more people, this is a great low-cost way to tap in and get access to your very own ready-made talent pool.

“Building your talent pool is going to give you a huge commercial advantage over your competitors. It’s going to help you to fill roles faster, and significantly bring down your recruitment cost per hire.”

Keep the pool “warm”
Dahl warns that “talent pools do ‘go off'” so employers must ensure they stay in touch with the database on a regular basis.

“Send notifications about what’s happening in the organisation about new roles and opportunities that are coming up. You still need to communicate and engage with your talent pool to keep them interested, live and active. A good opportunity will always tempt or entice a jobseeker to take another look, so keep them warm and keep them engaged.”

By Kate Southam, editor,

March 19, 2009 12:00am

THE targets of workplace bullies are being let down by employers who mount internal investigations that often make the problem worse.

That’s the view of Dr Anne Wyatt and Dr Carlo Caponecchia, from the School of Risk and Safety Sciences at the University of NSW.

“In our experience, bullying issues are poorly understood by managers and so internal investigations are often badly handled, confidentiality is not always maintained and they drag on for too long,” Dr Caponecchia said.

They said allegations of bullying were usually investigated by human resources staff who soon became the “meat in the sandwich” with responsibilities to both the employer and employees. In many cases, the focus is on minimising legal risk to the organisation rather than changing the workplace culture to stamp out bullying.

“Human resources have a clear conflict of interest,” said Dr Caponecchia.

“HR has dual responsibilities to the employer and employee, and at best could be seen as the meat in the sandwich – particularly in cases where the perpetrator of the bullying behaviour is a senior member of staff.

“It is not the fault of HR staff but a consequence of the position that they are in.”

It was vital employers appoint third party specialists to investigate bullying allegations.

Dr Wyatt said employers also needed to view the safety risk posed by bullying as seriously as they do the dangers of faulty equipment. Health issues associated with bullying include anxiety, depression and post traumatic stress disorder.

“We ask workers to report a sharp edge on a door or a missing grate or a broken step, but we haven’t endorsed reporting on things that might impact on mental health,” Dr Wyatt said.

“It is okay to say there is a rung missing from a ladder but it is not okay to say ‘I can’t handle my boss’.”

The academics are impatient with populist views that bullying incidents are nothing more than personality clashes or the work of a rogue “office psycho” and say organisations, not individuals, are responsible.

“People say, ‘if you can’t handle the heat, get out of the kitchen’. No one is yet saying that the kitchen shouldn’t be so hot,” Dr Wyatt said.

Dr Wyatt and Dr Caponecchia are also co-founders of the founders the website that provides resources to stop bullying.

The academics say part of the problem is that bullying is poorly defined and inadequately covered by existing legislation. At the moment bullying is covered by anti discrimination legislation and some occupational health and safety laws.

But Dr Caponecchia said bullying and discrimination were not the same thing, and under OH&S only South Australia specifically used the word “bullying” and explained what it was.

The Council of Australian Governments is currently working on “harmonising” occupational health and safety laws by 2011 to create national standards. Dr Wyatt and Dr Caponecchia want bullying to be given more comprehensive coverage under the revised national laws.

The President of the Australian Human Resources Institute, Peter Wilson, agreed bullying needed to be covered in the new national laws and that employers should use external investigators.

“I don’t think there is a conflict of interest (for HR staff) but you do need very well trained (HR) people in the job and they may need help from an external group,” Mr Wilson said. “Certainly (HR) are in a stronger position if you have a report in your hands.”

According to Beyond Bullying, workplace bullying is defined as repeated unreasonable behaviour where some power imbalance exists. This can include colleagues on the same level but where one has longer tenure or some other perceived power.

Bullying includes name calling, public humiliation, isolating or excluding a co-worker, a manager assigning meaningless or menial tasks, ideas and credit stealing and spreading rumours.,27753,25205355-462,00.html

12 March 2009 8:21am

The economy may well be on a slide and headcount freezes in force, but it’s vital to get the talent you are hiring productive as fast as possible.

A new report from Aberdeen Group outlines what “best-in-class” organisations are doing to assimilate their new talent.

“Layoffs, mergers, cut-throat competition, downsizing, rightsizing: these are buzzwords that make up the daily news,” say the authors in Fully On-Board, a report based on a survey of more than 600 HR and line managers from North America, Europe, Asia and Australia. “They are also a reflection of an increasingly competitive business landscape.

“As a result… organisations are forced to achieve greater operational efficiencies – in other words, to do more with the same or less. This, in turn, places greater emphasis on increased productivity, to which key-employee retention is essential.”

Some 84 per cent of leading employers, the authors say, are currently actively developing or utilising “culturalisation” strategies in order to retain their talent, and are, consequently, up to three times more likely than “industry average” or “laggard” organisations to “build a community of employer brand evangelists”.

“Assimilating employees into the organisation’s cultural fabric and reaffirming their employment decisions… is a growing best-in-class process differentiator,” they say.

Assimilation strategies include:
involving senior leadership, by having them meet with new employees early in the onboarding process to answer questions or address concerns about the company;

enabling communication between new employees and colleagues prior to starting dates, whether through communities of interest or social networks; and

assigning a mentor or coach to new employees for the duration of onboarding.
Employers can also engage new workers through their onboarding system, the authors say, by:
being prepared – have all IT (including computer systems and email addresses) that new employees will need up and running prior to starting dates. Provide them with the tools and information on networks needed to connect them with other employees.

Arrange frequent informal reviews with line managers and regular briefings with senior leaders. Have managers define and communicate expectations and goals within the recruit’s first week;

beginning early – commence the onboarding process for new full-time employees upon acceptance of the employment offer. Some 67 per cent of “best-in-class” organisations do so;

including forms and tasks management – ensure employees are “entered into systems” (such as the payroll and superannuation) and receive all appropriate equipment as soon as possible.

“The ability for new employees to accurately and quickly complete all required forms is key to help them concentrate on the job at hand, get up to speed quickly, and be productive”; and

measuring engagement – analyse and act on employee satisfaction surveys and performance reviews. Keep responses in mind when dealing with recruits.
Employers should also consider extending the application of onboarding beyond new hires, the authors say.

Work groups that come to a company as the result of a merger or acquisition, or individuals who accept internal transfers “can benefit from assimilation into or knowledge of the organisation’s culture, vision and goals”.

Going from “laggard” to success story
According to the authors of the study, an onboarding “laggard” is an employer that is currently experiencing a decrease in employee retention and engagement rates.

They outline a number of simple and inexpensive steps to turn languishing employers around.

“Laggards” should:
identify the business issues they want to improve, then assign specific metrics to determine “pain points” that can be addressed by onboarding;

start small, assimilate new hires through simple, cost-effective “buddy” or mentor systems;

frequently measure engagement and retention within the first year of each worker’s employment to “pinpoint” where onboarding processes need to be strengthened;

encourage organisational buy-in by inviting senior leaders to take part in meetings and orientation; and
automate, where possible, forms and tasks management to ensure data accuracy and time savings.

16 March 2009 8:11am

Employers that gather and accurately interpret workforce data before resorting to massive job cuts can avert unnecessary workplace upheaval and save big bucks in future recruitment costs, according to Qantas workforce analytics manager, Nathan Carbone.

“For instance, an analysis of average employee resignation rates can tell employers how many people are likely to resign within the course of a year,” Carbone says.

“If this matches the number of people the organisation intends to exit, it puts forward a solid case for employers to consider letting natural attrition rates take their course without the upheaval of mass redundancies.”

Employers that act rashly and let too many workers go, he says, could find themselves recruiting within the “pay-back period” (before the cost-benefits of layoffs are realised) and battling for the very talent they’ve retrenched.

Conversely, companies that resort to “cost-cutting” alternatives to lay-offs, without first conducting a detailed analysis, could be inadvertently adding to their outlay.

For example, full-time employees offered a part-time role – as an alternative to redundancy – often end up working full-time hours anyway and, due to penalty rates, cost the company more in remuneration spend than before, he says.

Analytics versus “gut feel”
At Qantas, data is gathered and compiled into four key workforce areas, says Carbone, who will be discussing the topic at the upcoming Australasian Talent Conference.

These are:
attraction – including the number of applicants per advertised role; the number that meet the Qantas criteria; that are interviewed; that are offered positions; and that accept positions;

development and motivation – average training and development hours and spend per worker; and individual performance gains post-training;

productivity – profit relative to remuneration; expenses and profitability per individual employee and labour group; and cost of all internal elements, including in-flight meals and fuel; and

retention – exit survey results; and demographics including age, gender, labour group, work pattern and tenure.
An employee’s “entire lifecycle” – from entry to exit – is covered, assisting Qantas to make prudent decisions and accurate projections regarding its workforce, Carbone says.

“Being able to accurately interpret workforce data is crucial in the current environment,” he says.

“Workforce analytics is… helping businesses to make decisions with the backing of data rather than intuition and gut feel.”

Qantas senior managers have “seen the effect of analytics”, he says, and have learnt to “rely on the stories the data is telling them”.

The company can predict future shortages of certain skill-sets and can plan to recruit or train in-house accordingly. It can also strike a more practical balance between a part- and full-time team, and accurately determine the best times to either enforce lay-offs or hold on to staff.

Analytics drive re-focus
The power of HR analytics over “gut feel”, Carbone says, can be illustrated by an experience he had with a previous employer.

HR had hypothesised, he says, that new managers would counter their lack of experience in resource management by allowing a high rate of overtime among the staff in their departments until they established the right mix of employees per shift.

Therefore, fast-tracking the staff-resourcing learning curve of new managers would dramatically reduce the company’s overtime spend, it was argued.

“What the data analytics showed us, however, was that more experienced managers were allocating overtime as a reward for employees and scheduling overtime based on employee needs, rather than the organisation’s requirement,” Carbone says.

“Their overtime spend was actually higher than new managers’.”

This led to a change in focus, he says, away from strategies to fast-track training for new managers and instead to direct experienced managers to be more responsible in their use of overtime.

February 11, 2009

By Matt Barcus
President, Precision Executive Search
Managing Partner, A/E/P Central, LLC, home of

When people ask me what I do, I like to tell them that I am an “Executive Search Consultant,” but I always then clarify that with, “you know, a headhunter.” I am not a Human Resources professional, but I interact with them on a regular basis, and based upon those interactions I thought I could offer up some different suggestions that Human Resources professionals could be doing during these slow times. Now, I do have a couple of good ideas, but I have decided to hold off on those ideas for now as a friend of a friend set me straight about what many Human Resources professionals within the civil engineering industry are going through right now, and it is a topic that is worth mentioning.

The economy has slowed down, but you have not…many of you are still working 50-60 hours week, but now you are experiencing the dark side of human resources where the best skill sets you have are guts and compassion. Downsizing, layoffs, RIF, whatever you want to call it, it is not a pleasurable experience, no matter which side of the desk you may be on. I speak here not through experience, but through the account of this process from a Human Resources professional in our industry.

Preparing for layoffs is grueling:

Compiling staff review documentation from managers;
Working with managers in identifying who will be laid off ;
Coaching those managers as to how to best approach the looming conversation while knowing that no coaching can really ever fully prepare someone for what it’s like to let a colleague go;
Organizing and implementing severance programs;
Administering COBRA;
Conducting outplacement assistance;
Fending off lawsuits;
Taking on the tasks of those in your department who were recently let go;
Much more that I am surely missing.
Maybe the most difficult duty you have right now though, is having to sit down across the desk from a mom or a dad, from a single parent, from an employee whose spouse just lost their job a week ago, from a parent with a sick child or a child who is just getting ready to go off to college, from a young woman who just put a down payment on her first home, or from a friend, and telling them that they are being laid off. ..and then dealing with roller coaster of emotions that are felt from that employee, their family, from yourself, from their supervisor and from their friends who still work there.

This is not what you signed up for, but there is no better trained or more qualified person in your organization to deal with the current situation than you:

You have the guts to stick to the orders that you were given as opposed to packing up your desk and bailing;
You have the compassion to empathize with these folks;
You have the ability to absorb the verbal abuse that is unleashed on you;
And you have the know-how and the desire to do EVERYTHING in your power to make sure that these folks are granted their severance, that they are provided everything they need to know about applying for COBRA, that they know who to call to roll over their 401K into what you hope to be a new 401K in the very near future, and to coach and to help these individuals find new employment.

Especially during these tumultuous times, the Human Resources professionals are clearly the unsung heroes whose compassion, resiliency, hard work and dedication are the rock…wait…the mountain…that everyone leans upon.

The great thing about being in America is that we are resilient. We have the ability to dig down DEEP and to be strong, to stand tall, to fight tooth and nail, and to land on two feet. It is not an easy thing to be a part of, on either side of that desk, but the smoke will eventually clear and most people will be a better person for it.

Ben Schneiders
March 6, 2009

HOLDEN and unions are considering a deal that could mean thousands of manufacturing staff work even less — possibly only a few days a week — in a bid to save jobs and skills in the industry.

The negotiations have been praised by Industry Minister Kim Carr who told The Age that the co-operative approach should be used as an example across the economy.

“The model that General Motors (Holden) has followed in working with the AMWU (Australian Manufacturing Workers’ Union) is one that I think others can emulate,” he said.

“The number one priority for workers now in terms of their negotiations is job security. Both companies and unions should approach this in a flexible manner.”

It is believed the discussions, which are yet to be completed, could result in staff working “rotating shorter weeks”, possibly of only a few days.

The reduced work would be on top of the high number of “non-production” days in the industry already, with 10 days chopped out of Holden’s manufacturing schedule in April. On those days, workers are typically on half-pay.

While a more co-operative environment exists at Holden, in other parts of manufacturing and the economy mistrust reigns as firms move to cut staff and hours.

At Foster’s, industrial unrest threatens to spill over after the company outsourced maintenance work at the cost of 115 jobs, while at Robert Bosch the firm accused unions of adding to job losses with their inflexibility.

Unions have also blamed companies including Pacific Brands for taking the “easier” option of laying off hundreds of staff while executives did not share the pain.

At Holden, the company is reportedly considering cutting the pay of its executives.

Ford has already frozen the pay of white-collar middle and senior managers, spokeswoman Sinead McAlary said yesterday.

AMWU’s federal vehicle secretary, Ian Jones, said “everything was on the table” in the Holden talks and he expected the discussions to be completed within a few weeks.

Mr Jones said the goal was to have as many people as possible employed at Holden, and across the sector, by the end of the year.

Manufacturing remains the biggest full-time employer in Victoria.

Mr Jones echoed Senator Carr’s comments that he was optimistic conditions would improve in manufacturing and said he expected a much healthier car industry by the end of 2009.

“Everything we do is aimed at ensuring that people have employment,” Mr Jones said.

Asked whether workers could be asked to go on half-pay for the extra days they did not work, Mr Jones would not rule that out and said working fewer days was one of a number of proposals on the table.

Mr Jones said there was a spirit of co-operation between unions and car-makers.

Holden, which employs about 6500 people in Australia including 3500 in manufacturing in Melbourne and Adelaide, would not comment directly on the talks. “We’re doing everything we can to minimise the impact on our people,” said spokesman Scott Whiffen.

Prominent businessman Lindsay Fox said the typical 40-hour week should be modified and the Federal Government should spend more on infrastructure and use the knowledge of top executives.