Developing an entrepreneurial culture
Developing an entrepreneurial culture is a huge labour market challenge. With high unemployment and large organisations shedding jobs, creating sustainable employment is vital. So many organisations have downsized, reducing their staff to an extent that will never be upped to earlier levels. Who will be creating sustainable employment in the long term? We have to develop an entrepreneurial class in SA. Mature organisations looking to compete in global markets are not creating new and higher levels of employment locally other than non-core and informal work.
We have to improve the level of diversity at senior executive level. This is allied to black economic empowerment, an imperative which needs to expand in scope and inclusiveness. In both areas, HR and executives have a key role to play to shift our organisational paradigm from compliance to commitment. Employment equity plans focus on meeting targets and timetables. An enduring challenge is to change the institutional culture of our organisations. We can achieve targets but if we are not changing the culture we won’t achieve external competitiveness. We cannot readily compete in the market place if we do not have cooperation and development in the workplace.
Aligning market driven human resource initiatives
Traditionally one thinks of employment relations largely as a two way relationship between management and employees. A more strategic view is to start with the external market. We must align whatever we do on the inside and how we do it to ensure that a customer will buy and keep buying our products or services. Employment growth and decent work are in part a function of customer demand for what firms do. Human resources management tends to forget this. There’s an overemphasis on our management employee relationship. We must therefore have an external focus. Here are some key points:
1. Customer alignment: what are we doing to attract, motivate and retain employees to achieve good customer service? Leading retail firms like Pick n Pay have focused on this and their employee development is key.
2. Leadership and talent management alignment: the extent to which HR practices are playing a role in identifying potential leaders and developing them in an innovative and strategic way.
3. Performance alignment: the extent to which performance management and reward systems explicitly align to the values of business objectives and priorities. Traditionally these have been developed in isolation.
4. Culture alignment: change management and leadership practices are inclusive and engaging participatively with the organisation’s priorities.
HR as a profession needs to address these challenges more insightfully and through bodies like the SA Board for Personnel Practice, and IPM, universities and universities of technology’s HR education, HR has established a code of professional ethics, a knowledge base and a set of competencies. Its one thing to have all the right academic qualifications, this does not guarantee HR leadership. There are a lot of HR practitioners (even an oversupply at entry level) but not enough HR leaders who’ve established credibility at board level. There is a challenge ahead to improve the credibility of HR. The profession needs to have people in it who are passionate and not just visionaries but missionaries! It is the missionaries who make things happen.
HR practitioners have to understand the following key challenges:
• They have to have a fundamental knowledge of business , they must have financial, strategic and technological capability
• They must have knowledge of state of the art HR practices
• They must move beyond change management and to change leadership , creating a new culture
• They must have a problem solving capability
• They must be willing to embrace the challenge of transformation
Innovative HR are constantly investigating and adapting leading practices that might help achieve competitive advantage, and work on how to reinvent and apply these in their own context. Like Cisco systems, they will look for new and creative ways to attract, motivate and retain people. HR are good at benchmarking, it helps them to catch up with what the leaders are doing.
HR must develop a unique value proposition, just as companies have a product brand and the real strategic challenge is to create an employer brand where the labour market will perceive the organisation as an employer of choice. It is seen to be offering something different that can’t easily be replicated by competitors. Rewards, employment equity, black economic empowerment are all a means to developing a unique value proposition.