rogers - impacts of the global recession on hr strategies
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Impacts of the Global RecessionImpacts of the Global Recession on HR Strategies
Presented by
Donald P. Rogers, PhD, SPHR, GPHRDirector Master of Human ResourcesDirector, Master of Human Resources
Rollins College
Purpose & MethodsPurpose & Methods
• Get You ThinkingGet You Thinking
• Identify Post‐Recession Trends
i li i• Discuss Implications
The Big InsightThe Big Insight
• More Companies must be More GlobalMore Companies must be More Global to be Competitive
• HR must find ways to help make that• HR must find ways to help make that happen
CEO d ’ k h HR h l• CEOs don’t know how HR can help
HR StrategiesHR Strategies
• “ a strategic approach to people…a strategic approach to people management that focuses on the issues that are critical to the organization’sthat are critical to the organization s success”
• Accounting for People Taskforce (UK)
Organizational SuccessOrganizational Success
• RebuildingRebuilding
• Growth
l• Renewal
Critical IssuesCritical Issues
• RecessionRecession– The Slow Return
• Unfulfilled Expectations• Unfulfilled Expectations– Anger
– Mistrust
• Cautious Optimism
People Management StrategiesPeople Management Strategies
• HiringHiring
• Compensation
l l i• Employee Relations
Danger PointsDanger Points
• Performance ManagementPerformance Management
• Training & Development
i i &• Attrition & Turnover
Five Big TrendsFive Big Trends
• Growth in Emerging MarketsGrowth in Emerging Markets
• Labor Productivity & Talent Management
Gl b l l f G d f i &• Global Flows of Goods, Information, & Capital
• Natural Resource Management
• Increasing Role of Governmentsg
Growth in Emerging MarketsWhat Companies are doing to capture Growth
Building Local Presence
Developing Local Partnerships
Recruiting Local Talent
0 10 20 30 40 50 60
Developing Local Talent
0 10 20 30 40 50 60
Labor ProductivityLabor Productivity
• Increasing emphasis on high value goods & g p g gservices changing labor mix– Competencies
• General Management• General Management• R&D• Strategy
d– Productivity– Labor Costs
• Age demographics favor emerging economiesAge demographics favor emerging economies• Education demographics favor developed economies
Global FlowsGlobal Flows
• Flows of goods information & capital willFlows of goods, information, & capital will remain open, but will not grow much
• Capital Markets will become more• Capital Markets will become more integrated
I f i fl ill b fi• Information flows will benefit customers more than producers/providers and much
h i di imore that intermediaries
Resource ManagementResource Management
• Major Strategic Issue but not a major HRMajor Strategic Issue, but not a major HR Issue (no role for HR)
• Very different levels of post recession• Very different levels of post‐recession, strategic importance by industry
Role of GovernmentsRole of Governments
• Levels of public debt may have negativeLevels of public debt may have negative impact on GDP growth in Europe & North AmericaAmerica– Less Leveraged Growth
• Governments pursuing national interests• Governments pursuing national interests rather than shareholder interests may reduce freedom of action in Asia Russiareduce freedom of action in Asia, Russia, Brazil, & Middle East
SpendingSpending
• Consumer spending in emerging marketsConsumer spending in emerging markets is more optimistic
• Consumer spending in developed• Consumer spending in developed markets is more reserved
B i di i b h ki d f• Business spending in both kinds of markets is more optimistic
• Government spending is more optimistic & much more pragmatic
HiringHiring
• Increased demand for skilled laborIncreased demand for skilled labor
• Shortages of skilled labor in emerging marketsmarkets
• Skills Gaps
CompensationCompensation
• Employees still focused on improvingEmployees still focused on improving their standard of living
• Demands for improved quality of life• Demands for improved quality of life becoming more common in China, India, & Brazil& Brazil
• Government support shifting away from ‘ i k’ i i Chi I di‘at risk’ compensation in China, India, Russia, and EU
Employee RelationsEmployee Relations
• “What are they going to do? Quit?” YES!What are they going to do? Quit? YES!
• Increasing demands for protection from market volatilitymarket volatility
• Increasing support for unionization
• Increasing expectations of voice & respect
Performance ManagementPerformance Management
• No more “and other duties as needed”No more and other duties as needed– More prescribed performance expectations
More stable expectations– More stable expectations
• Longer performance timelines
• More group performance expectations
• Less use of ‘pay for performance’
• More use of long term contracts (5 in 3)
Training & DevelopmentTraining & Development
• Global Skills ShortageGlobal Skills Shortage
• Global shortages in general management, R&D strategy technical skillsR&D, strategy, technical skills
• Can’t hire, must train
• Most countries teach technical skills on‐the‐job (entry level is pre‐apprentice)
Attrition & TurnoverAttrition & Turnover
• Emerging markets requiring much moreEmerging markets requiring much more sophisticated (and expensive talent)
• Costs of attrition & turnover escalating in• Costs of attrition & turnover escalating in emerging markets
L j b hif i i Chi I di &• Less job‐shift gaming in China, India, & Brazil
• More spending on ‘quality of work life’
The Big InsightThe Big Insight
• More Companies must be More GlobalMore Companies must be More Global to be Competitive
• HR must find ways to help make that• HR must find ways to help make that happen
CEO d ’ k h HR h l• CEOs don’t know how HR can help
Our Job is to Tell Them!Our Job is to Tell Them!