How Would You Handle HR Dilemmas: Stagnant Salaries vs. Investing in Staff Growth?

Hello Everyone, This is my very first post in CiteHR. The question posted here has been buzzing through my head for a long time, and I have been asking around in discussions locally, with some of my colleagues and other HR professionals outside my organization. I wanted to expose foreign HR professionals to this question to see any possible variation in response to this issue, thus increasing my own knowledge a bit further on this topic. So any response is welcome. Counter query, critique, positive, negative, any kind of feedback will be helpful. It will be highly appreciated.

Scenario 1

As an HR Manager, consider existing staff remaining on the same salary year after year if that staff has no other place to go or no other employment options. To ensure this, you don’t give enough opportunity to the staff to grow and advance in their career through more relevant work exposure or training. This will ensure the staff's incapacity to increase his/her skills' demand in the market, and your organization will have a constant, low-cost workforce that is secured from heavy turnover.

Scenario 2

As an HR Manager, consider existing staff as the organization’s most valuable resource based on their experience and expertise in their respective fields. You increase their capability through training and more on-the-job exposure to new learning so that they can perform better. But you know that this will increase their skills' demand in the market, thus increasing their options for switching your organization. Therefore, to hold them, you give them competitive wages, for which you incur heavy operating costs.

Which scenario would you prefer to apply in your organization and why?

Please consider your answers for the following cases:

1. Staff who are at entry level performing regular, clerical, repetitive tasks

2. Staff who are at mid-level who may or may not be supervising some entry-level staff and performing tasks more into reporting, analytical thinking, and finding scopes for development

3. Staff who are at top-level posts supervising a considerable number of workforce in a specific organizational Department or Division, making decisions that impact organizational goals and achievements

Thank you for reading.

Though it is your very first post in the forum, it is really nice and certainly interesting to read and ponder over. Since you have expressed your openness to the flavor of the response, let me first take the liberty to describe the two scenarios in a comparative note as Cost-orientation versus People-orientation. Of all the three factors of production, viz., Land, Labour, and Capital, which can also be called Materials, Men, and Money, the most flexible yet the most unpredictable is Labour or Men. That's why the fourth factor, viz., Management or Method, emerges as a natural corollary if I am correct. In any organization, whether business or otherwise, management is a very important function whose effectiveness can bring forth the harmony of the other three to achieve the organizational goals in the long run. Land and capital are effectively utilized because they are exhaustible, whereas labour or people are to be "managed" because they are inexhaustible in the sense that they are susceptible to motivation. With this backdrop, let me answer your questions:

Staffing and Motivation

(1) Staffing is essentially a function dependent upon the job or work requirements. A work or a task or a specific function is divided into convenient parts, and the fulfillment of the individual parts in the predetermined sequential order brings the work or task or function to accomplishment. It is like a concerted action of the army in a battlefield. Everyone, i.e., the non-combatant personnel, combat soldiers, Second-Lieutenant, and the Commander, is equally important. But all cannot be elevated as a commander other than the second lieutenant. Therefore, the services of others should be recognized in some other ways. To me, it appears that motivation for people engaged in basic but stagnant jobs should be in periodical monetary hikes.

Middle-Level Management

(2) I think middle-level managers or middle-level management stand phased out nowadays. Anyway, as you said, still some people are required in the middle in matters of communication in both ways, upward and downward, for giving a correct appraisal of the goings-on. Certainly, they need career development commensurate with their personality development.

Top-Level Management and Succession Planning

(3) I need not dwell much on this category of people. They are like advertisements—advertisement pays for itself. If you fail to motivate them and keep them in good humor, your competitors know well what to do. However, one should remember that nobody is indispensable in the long run. Therefore, an effective succession plan should be in place.

Regards.

Dear Mr. Umakanthan,

My sincere apologies if I couldn't address you properly at the beginning of this reply regarding the spelling and choice of parts of your name. I just wanted to sincerely and wholeheartedly thank you for your kind response. Your words are absolutely in line and very realistically cited. I have gained much insight into the subject matter and also found new areas to think about.

Thank you very much. I hope to discuss more HR-related topics in the future.

Regards,
Khaled S. Nawaz