Analysis

Survey Says: Show Me the Money

by
tmedia/Shutterstock

What is the best way to determine pay increases for employees?

For most organizations, calculating pay increases are included as part of an annualized budget planning process. On the face of it, budget planning appears to be pretty simple – money in vs. money out. How much money do we have to spend? Where are we going to spend it? What are the revenues? What are the expenses? What is the time frame for the upcoming budget plan? Is there a need for a contingency plan? Suddenly, the appearance of budgeting simplicity starts to become more complicated as we have to go through the assessment of multiple and competing expense priorities.

Paying employees must be at the top of that priority list.

While pay decisions do take affordability into consideration, they must also be aligned with workplace pay increase expectations. This is where the importance of data collection, through salary and compensation surveys, comes into play.

Most employees do have an expectation that their pay will be adjusted in a positive way from year to year. This is highlighted in a recent salary survey which showed that Canadian workers expect to receive a pay increase in this current year (2019) based on a number of variables. Specifically, the survey indicates a 2.8% salary increase is expected in Canadian workplaces.

Click here to read the results of the survey.

As we know from our compensation studies, data collection and survey results do provide fact-based evidence that employers can use to make pay decisions. Whether or not the employer can meet the demands arising from survey data sets up another complication in the budget planning process. While employees may expect to see the money, the employer may decide that it can not afford to show it.

Discussion Questions:

  1. How can these types of survey results influence organizational pay strategy?
  2. As an employee, how would you justify requesting an annual pay increase in excess of 2.8%?
  3. From a compensation management perspective, how would you justify giving your employees less than an annual 2.8% wage increase?

Why Measurement Matters

by
Jamila Aliyeva/Shutterstock

Dr. David Weiss is a leader in the field of Canadian Human Resources research. In 1999, his book, High-Impact HR Transforming Human Resources for Competitive Advantage, was published. In it, he describes the employee life cycle as one of ‘Hatch-Match-Dispatch’ which must be supported by the Human Resources function in order to be aligned with organizational strategy. His writing, at the time, was revolutionary.

Twenty years later, the concept of the employee life cycle is more important than ever. It provides the framework to measure the effectiveness of the Human Resources function, through the lens of employee engagement.

A recent article published in Fast Company, provides us with a synopsis of how metrics and measures can, and should, be used to track employee engagement from the beginning to the end of the employee life cycle.

Click here to read the article.

As noted in the article, employee engagement is not just about ensuring that the workforce is ‘happy’ by providing a ‘fun’ environment. Happiness is an elusive thing to measure. It does not assess whether or not the workforce actually is productive or involved with the achievement of organizational goals and objectives. What the Human Resources function can assess is the level to which employees feel connected and involved with the organization at any point during their personal journey within the organization. From the entry point into the organization, Human Resources can measure recruitment and on-boarding strategies. At mid-point, through communication, feedback, and usage tracking, Human Resources can assess the effectiveness of rewards strategies, training, and career development. At the exit point, Human Resources can evaluate the gaps between the expected level of loyalty and commitment to the organization and the reality that causes employees to leave, voluntarily or involuntarily.

Throughout all of this, what Human Resources is measuring is the level of commitment to organizational culture which is the metric for evaluating employee engagement.

The field of Human Resources research continues to develop through the analysis of applicable measurement and metrics. Twenty years from now, perhaps this will lead us to capturing the elusive goal of evaluating employee happiness.

Discussion Questions:

  1. The article refers to eNPS. What is it and how does it link to the measurement of employee engagement?
  2. Identify three specific Human Resources initiatives you think can be measured to evaluate employee engagement at the mid-point of the employee life cycle.
  3. Besides exit interviews, identify two additional Human Resources initiatives that can be measured at the end of the employee life cycle.
  4. Identify the types of tools or systems that are needed to track employee engagement from the beginning to the end of the employee life cycle.

 

Putting Analytics First

by
designer491 /Shutterstock

There are two components in the structure of the world of human resources. The first component is defined by the word ‘human’. The second component is defined by the word ‘resources’. The work we do as human resources practitioners is to manage the combination of both the human and the resource elements in any organization. Our job is to analyze and problem solve when that combination of both human and resource capacities become tangled in problematic inefficiencies or blockages that prohibit organizational decision making and growth.

There is an ever-increasing expectation that the HR practitioner will be the decision making problem solver. In order to do this, the HR practitioner must have the capacity to use facts and data to begin an analysis before even starting to solve a particular problem. Unfortunately, for many HR practitioners, the skills and techniques needed to enter into an analytical problem solving methodology are still in development.

As outlined in a recent article published by Queen’s IRC, the human resources practitioner must take concrete data-driven steps to analyze a problem before jumping to a resolution which may provide misleading results.

Click here to read the article

The author identifies three critical elements that lead to poor problem solving analysis on the part of the HR practitioner. To counter balance each of these, it is clear that in the study of human resource management, we develop expertise in the areas of problem definition, capacity for understanding numbers, and defining the depth and breadth of data to be used in order to facilitate organizational decisions.

It is interesting to note that not one of these three elements refers to the human side of the human resources equation. All three elements are focused on the resource side. What we must keep in mind is that the provision of expertise and support through the resources side allows for the human part of the equation to make data based decisions based on sound resource practices.

Discussion Questions:

  1. Based on the article, what steps will you implement, as the HR practitioner, in order to ensure the integrity of a data based project?
  2. What are the perceived ‘weaknesses’ that face the HR practitioner when dealing with data based decision making?
  3. How can the HR practitioner control the amount and type of data that organizations use for decision making?

Let the Data Tell the Story

by
man drawing happy face
bilderpool/Shutterstock

Trying to figure out where to begin for effective compensation planning is challenging. The end result of a good compensation plan is the alignment of the plan with the expectations of those who are going to use it. Before we can get to the end, however, we must understand, from the beginning, whom the plan intends to serve in order to design the plan to meet these expectations.

Who is in the target market?

Of course, part of analyzing the market will focus on the existing workforce within the organization. This provides us with a short-term view based on immediate workforce needs and expectations. However, the investment of time and resources used to build an effective organizational compensation strategy must look to the long-term goal for sustainable results.

Who in the target market will benefit from a long-term vision? We can find answers to this question through market surveys that shape and guide the path to the future.

A recent example of this type of market survey focuses on the value-based expectations of the millennial workforce.

Click here to read the article.

Click here to read the full report.

The data provided in this report is just that: data. The charts and graphs on their own provide the basis for analysis. Analysis comes from translating the data into meaningful information. In this case, the data is used as a base to build a compelling story that tells the tale of what the millennial worker expects from their future as a valued participant in the Canadian workforce. The results of this report should lead to a natural conclusion that the long-term vision for sound compensation planning must be based on the growing needs of the millennial workforce.

Data analysis and market surveys help anchor the development of compensation strategy at the beginning. It is up to the thoughtful compensation practitioner to use this information effectively in order to implement a sound compensation structure at the end.

Discussion Questions:

  1. Based on the survey data in the report, identify three effective elements of a compensation plan that will meet the needs of millennial workers.
  2. How can market surveys be used to provide short-term planning for compensation design?
  3. How would you use this report on the millennial workforce to shape the compensation plan in your current place of work?

Boom or Bust?

by

It may seem that the concepts of HR Supply and HR Demand come from an almost clinical approach.  This is most evident when we look at these concepts through a human capital lens and try to apply formulas to predict the ebb and flow of human resources supply and demand.

Words Boom and Bust on opposite ends of a balance
Source: Mark Carrel/Shutterstock

Predicting the patterns of potential employee movements are not isolated exercises – They are all connected and part of bigger picture circumstances.

For example, the overall economic situation in Alberta provides us with an excellent opportunity to consider how individual employees will be impacted by the changing economy.

Click Here to Read the Article

As we read in this article, Alberta was once the province offering an abundance of HR demand. There were lots of jobs and lots of opportunity.  Now, Alberta is the province facing the very real impact of too much HR supply – Increasingly fewer jobs and much less opportunity.  HR’s role will be critical in determining how this oversupply will be managed and, most importantly, how the individual employee will be impacted as a result.

We cannot forget that any HR supply and demand analysis is about people.  Analysis and formulaic approaches help us with planning predictions; however, we must remember that the implementation of these plans will have an impact on our fellow humans as we all move into a challenging and unpredictable future.

Discussion Questions:

  1. What types of compensation strategies would lessen the need for layoffs in Alberta?
  2. If you had to accept a wage reduction in order to have your work colleagues keep their jobs, what would you do?
  3. Identify three critical steps that the HR professional should be taking when considering staffing reductions due to economic indicators.
  4. What would be the biggest challenge for you when preparing an HR plan that includes staffing reductions?