Strategic HR Planning

A Merger “Like No Other”

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In mid-April of 2020, there was a formal announcement regarding the completed merger between two HR technology-based software companies, Kronos Incorporated and Ultimate Software. Given the state of the pandemic-related chaos impacting organizations across the globe, it seemed a bit unusual to find these two companies proceeding in, what appeared to be, a business as usual approach. As noted in the announcement, the CEO of the combined organizations acknowledged the impact of these turbulent times, while pointing out the successful collaborative efforts of both companies to continue providing HR-focused customer support. While the announcement of the completed merger appeared in April, the plans for that merger were identified earlier on, as noted in this analysis, published this past February. There is no doubt that the negotiations over the strategic alliance happened over a lengthy period of time, well in advance of any public communications that may have appeared this year.

On the surface, this merger is indeed “like no other.” HR technology-based tools are usually targeted for specific tactical or operational functions. Kronos Incorporated provides workforce management tools, such as time and attendance tracking. Ultimate Software focuses on the transactional payroll side of HR, along with talent management software, which includes a very strong focus on the Canadian HR market. Each party brings with it a separate puzzle piece. Once they are put together, they form a completely new entity, with a new name, in order to provide a wide range of HR software applications. From our strategic human resource planning studies, we know that this type of merger gives us a real-life example of a consolidation.

With this type of merger, there are multiple impacts on both internal and external stakeholders. While this is an exciting opportunity to increase the strength of HR technology-based systems, a consolidation of this kind comes with risks regarding market competitiveness and customer service. As noted in the analysis provided by the US-based Society for Human Resource Management (SHRM), HR customers may find increased competition, decreased availability of what they are used to, and having to go outside their existing HR technology-based ecosystem.

The reality for success, internally and externally, remains to be seen. One would hope that, as these two merging organizations are HR-based technology companies, they will proceed along the rocky path to successful consolidation with sound HR practices and strategic plans in place.

Discussion Questions:

  1. What are the cultural implications of this type of merger (consolidation) between these two technology-based HR software providers?
  2. Based on the information provided so far, what types of positions or departments might be declared redundant as a result of this consolidation, even with plans to increase the number of employees over the next three years?
  3. In your opinion, what type of restructuring plans should be put into place?
  4. What benefits does this merger offer to the HR profession?

Time to Put the Human in Human Resources!

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In this time of crisis, as we deal with the COVID-19 pandemic, governments are trying to simultaneously cope with the situation and support their citizens. Most governments are being very supportive with generous financial support, but some are using this time to make some controversial decisions, such as the current Canadian Liberal government attempting to give themselves sweeping powers without democratic oversight—in the end, the Canadian federal democratic system determined that oversight will still be provided.

This is a time of great chaos for our modern society, but it can also be a time of great reflection on how we want to better our society for the future. In the media, one is hearing calls for improvements, such as more respect and greater compensation for our frontline workers, including—but not limited to—grocery store clerks, truck drivers, and personal support workers.

It has also been brought to our attention that we need to do more to improve the fundamental working and living conditions of our long-term care homes as well. The Quebec government have proposed an idea to redeploy education workers to work in long-term care facilities. To understand why the government can do this, we need to have a history lesson on the foundations that formed the employer and employee relationship in Canada, as we know it today.

To understand Canadian employment laws, you have to go back over 400 years to England, to the 1563 Statute of Artificers Act, which basically stated that if you refused to do or quit a job, you would go to jail. It was a very draconian concept, but at the time, this was seen as an efficient way to deal with poverty.

Then, in the 18th century, there was a development of what were called the master and servant laws, and these laws now act as the foundations of our current employer-employee relationship. Only a change in the name of these laws, and not in the legal relationship itself, has occurred; we have just replaced the word “master” with “employer” and “servant” with “employee.” The fundamental power structure supporting this contractual relationship, however, remains the same. All the power rests with the “master,” or employer, and the “servant,” or employee, must follow their demands. Even though we have other laws, like the Employment Standards Act and the Human Rights codes, the ultimate balance of power still rests with the employer.

This is what the Quebec government seem to be relying on, believing that they are the “master” (and they do have the legal right to be) over their employees (the teachers), who are their “servants.” The government then believe that they have the power to decree whatever work their employees should do. In a case like this, we are using contractual laws that are hundreds of years old to decide what our employees should be doing.

Even in a time of crisis, perhaps it is time to embrace a more egalitarian view of the employer-employee relationship. Perhaps it is time to put the word “human” back into “human resources,” and treat workers with the respect and dignity they deserve. Perhaps it is time to dismiss the outdated belief that workers are just “servants” to their employers.

Discussion Questions:

Click and read the following two references: here and here. Reflect and prepare to debate one of the following positions with a partner:

  1. It is time to change the concept of “master” and “servant” in relation to the employer-employee relationship.
  2. There is no need to change the concept of the “master” and “servant” relationship in an employer-employee relationship as other employment laws have already done so.

Monitoring HR Practices

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Organizational strategic planning has three distinct components. The first component is the establishment of the plan, which includes the high-level setting of vision, mission, and organizational objectives. The second is making the plan operational, and includes the implementation of the plan throughout all levels of the company, so that departments and business plans align in support of the planned strategy. The final element is that of monitoring all of the organizational activities, which is critical for ensuring the workforce is moving in the direction set by the plan, in order to meet the strategic objectives.

While HR plays an integral role throughout the strategic planning process, workforce monitoring (the third step) is the purview of the HR function. It is the role of HR to track and measure what the workforce is doing. HR provides the monitoring framework to ensure that not only is everyone headed in the same direction, but that the workforce activities are meeting timelines and required projections.

The concept of monitoring the workforce is not new. The means in which workforce monitoring takes place, however, has adjusted significantly with the evolution of HR technology. For example, the use of artificial intelligence platforms allows for computer keystroke monitoring. This is used as a measurement tool to track and report on employee performance levels. While the impetus for this type of monitoring stems from the need to track, measure, and report on productivity as a performance metric, it does come with a negative perspective. As noted in this article, keystroke monitoring has a distasteful aspect of spying or snooping on employees. The use of this intrusive software is made worse in these days of remote workforce management, due to the impact of the COVID-19 crisis. Is the continued practice of workforce monitoring with spyware necessary?

A recent post in the Canadian HR Reporter provides us with a refreshing approach to meeting the current challenges that face the remote work environment. The article highlights the real opportunities that HR can put into place by eliminating unnecessary practices in order to sustain business continuity for the organization. Rather than obsessing about employee productivity levels, through the elimination of unnecessary and intrusive practices, a simplified HR approach can lead to a new way while still maintaining support for the organizational strategic plan.

Discussion Questions:

  1. To what degree do you think the employer should be able to monitor the remote workforce?
  2. Instead of keystroke monitoring software, what other mechanisms can be put into place to track and report on employee performance?
  3. How would you react if you found out your employer was using spyware to monitor your work patterns? Explain your rationale.

The HR Danger of Overconfident Leadership

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Leaders, from supervisors to CEOs, are crucial to any organization’s successes, but the research is showing that overconfidence in leaders can have a detrimental effect on organizational performance. This overconfidence problem in leadership has two main factors to consider:

  1. Overconfidence does not equal ability.
  2. Overconfident leaders are prone to “ideator’s bias.”
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Let’s review overconfident leadership in a little more detail, based on the two ideas above. Overconfidence not equaling ability can be seen in the following examples, which were some of the biggest disastrous business decisions of all time that led to organizational downfalls:

  • Western Union rejecting the patent on the telephone.
  • Kodak creating the digital camera, then killing the idea as not feasible.
  • Blockbuster passing on buying Netflix.

We know these decisions were critical mistakes for these organizations, but here is a quote that may take the cake on poor leadership decision-making, from Michael Lazaridis, founder of Blackberry. The creator of the smartphone said this, as he pointed to a BlackBerry with a keyboard:

“I get this,” he said. “It’s clearly differentiated.” Then he pointed to a touchscreen phone. “I don’t get this.”

Hafez Husin/Shuttestock

Blackberry at its peak had 75% of the mobile phone market. The company no longer even makes Blackberry phones now. Where would Blackberry be today if its leadership had made some different decisions?

Not all disastrous organizational decisions are caused by an overconfident leader, but in the examples above, it must be admitted that the leaders’ decision-making was flawed.

In a Talent and HR Management article by John Hackston, a well-researched phenomenon known as the “Dunning-Kruger effect” (D-K effect) is outlined. This is a theory that posits that the less a leader knows about a topic, the more confident the leader is in making a decision about the topic. This is also known as the “Dunder-Mifflin effect,” which anyone who has ever watched Michael Scott on The Office, as he makes a series of blundering decisions, will understand. Click here to see some of Michael Scott’s worst decisions.

The second problem of overconfident leadership is closely tied to the D-K effect, and it is called “ideator’s bias.” Ideator’s bias occurs when the individual believes that their own ideas are better than the ideas of those around them. Leadership is about bringing out the best in your people, not believing you are the best in your organization. Leaders and organizations should try to remember Jim Collins’s ideas of leadership from his book Good to Great, and his concept of the Level 5 leader:

“At Level 5, you have all of the abilities needed for the other four levels, plus you have the unique blend of humility and will that’s required for true greatness.”

A quality that leaders need to adopt to become a great leader, and avoid the two pitfalls of the D-K effect and ideator’s bias, is to bring humility into their skill set as leaders. If a leader is prone to combining the phenomena of the D-K effect and ideator’s bias, one can only believe that it is just a matter of time before a leader’s decision becomes disastrous.

Discussion Questions:

1. Complete more intensive research on the D-K effect, ideator’s bias, and a concept called “optimism illusion” (not discussed in this post). Create an executive summary comparing these three concepts.

2. Imagine your VP of HR has just read your executive summary and now wants you to create a PowerPoint presentation. Create a five-minute PowerPoint presentation explaining how to prevent the D-K effect, ideator’s bias, and optimism illusion from occurring in your organization.

3. Review Jim Collins’s Level 5 leadership concept, and think about the supervisors you’ve worked with. What level of leadership would you place them at, and how did their leadership level affect your job performance?

Forecasting the Future with MEC

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The marketplace for the current retail industry is competitive and challenging. It also provides us with the opportunity to analyze the realities that businesses face in order to stay alive. MEC, formerly known as Mountain Equipment Co-op, is a case in point.

MEC is a Canadian outdoor equipment and clothing sales retailer with a targeted consumer base. Customers are members who can purchase a lifetime membership card to buy high-end adventuring products. If we were to apply one of the corporate strategies from our HR planning studies, MEC would most likely fit into the ‘differentiation strategy’ category. Established in 1971, MEC continued to persevere successfully until 2019, when it faced multimillion dollar losses as reported by the CBC.

As noted in the CBC article, MEC faced numerous environmental challenges. Again, if we were to apply our HR planning studies to this case, we would see that an environmental scan of the strategic business challenges facing MEC include both internal (organizational and staffing structures) and external (online and big-box store competition) impacts.

In January 2020, MEC announced the implementation of significant staffing and structural changes in response to the aforementioned financial and retail losses. As noted in this article, which summarizes their proactive strategic business initiatives, MEC appears to be implementing a ‘turnaround strategy’ in order to increase its organizational viability.

Part of this new business plan includes the need to convert a number of existing part-time or casual roles to full-time, permanent employment positions. This step provides an example of the need for HR forecasting, which must take into account the current HR supply measured against the future HR demand for human capital. With the implementation of this kind of staffing strategy, both the number of employees, and the corporate knowledge that these employees bring to their roles, should be retained, and will increase profitability and much-needed viability.

In order to survive, any business strategy that is focused on the need for change comes with the expectation of success in implementation, along with an escalated level of risk. It remains yet to be seen how these changes will all play out in this real-time application of human resources and business strategic planning for MEC.

Discussion Questions:

  1. What other types of business strategies could MEC use in order to remain viable in the current marketplace?
  2. What type of staffing strategies is MEC using to bolster employee support and confidence?
  3. What are ongoing environmental risks that MEC must consider in order to remain viable?
  4. If you were to apply a SWOT analysis to MEC’s new strategic directions, what would be the results?