Hi (Cite Contribution),
Thats an interesting example. I am unable to get specifics from the example.
How small was the co?
How many people were in the team?
What difference in pays are we talking about (5%, 10% or 50%)?
etc...
Commenting on the case, therefore, will be rather premature. All in all, it appears that the pay structures, the work loads and the capability of the individuals were the issue. Many times, the 'headcount' approach that is popular in scientific management, simply bombs!!! I have seen that at a few companies myself. The logic applied is: If he could do it, you could too!!! And this often comes from the owner of the company, who has lesser understanding of the possibilities there.
Some generic remarks though...
1. I don't think attrition has ANYTHING to do with training! One is for the job (internally focused) and the other is for greener pastures (usually economically driven and externally focused).
2. With a 6 month average employment span, naturally, there is inadequate incentive to work longer. Looks like the job was a springboard to a career elsewhere.
3. Other forms of profitability checks might be more interesting... looking at contracts for specific tasks (whereby the person also gets the flexibility to keep his utilization optimized).
It is often a problem that needs changes at the business owner's end. The way forward would, therefore, be that the HR manager must work closely with the head man (since you said its a SME, this should be possible), and get him to understand the critical business drivers. This would be critical. A buy-in from the head is essential and educating him to the business realities from a HR perspective is important. Most times, professionals stop at making management aware. They need to go a step further and EDUCATE the management. This is ONE MAJOR AREA THAT CAUSES A DICHOTOMY AND THE HR FAILS.
I don't know what you do for a living, employed or in business. Anyway, anything you do, thereafter, must have answers to the following three questions from the CEO, the shareholders and the employees:
1. Whats in it for me in this quarter?
2. Whats in it for me in the next 9 months?
3. Whats in it for me in the next 1.5 years?
Most initiatives you have identified, though well meaning, do not actually answer this question to the desired level of detail or 'intensity'. It makes sense to look at these questions in the context of your suggestions. This is another MAJOR REASON why HR fails and is also answering the question as to why HR doesn't feature in the Q2...
Lastly, you cannot make a very capable system with incapable people and faltering infrastructure. Staffing has multiple perspectives. It is essential to explain and educate the other departments on the implications of this factor. At a software company that I worked in, the entire 2000 employees had just 2 HR personnel. There were 6 outsourced individuals. But those two were far more capable... Bottom line, your measures have only partially addressed capability... I might be a trained driver. But if I were to drive 500 km every day on Indian road conditions, I might have issues...
Please don't take this as a criticism otherwise. As management consultants, we focus in a different way at times. We are very appreciative of your responses and your blogs. Thanks for the same.
Reg,
Nikhil Gurjar
President
Consulting Connoisseurs
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