HCM 4.0 #
DRIVEN BY MANAGMEMENT BY MEASUREMENT
WHY HAS MANAGEMENT-BY- MEASUREMENT APPROACH
POSITIONED AS A PILLAR OF THE HCM 4.0
MODEL?
The celebrated CEO of Hewlett Packard Carly
Fiorina said: “Information is the currency of the digital age. The goal of
digital technology is to turn data into information and information into
insight”.. Every company has its own collection of raw data converting this
into insightful information is the
business need. Information needs organization and analysis for deeper understanding. Information which is focused on
understanding the past; what happened and why it happened has limited value.
Information is really
valuable when it facilities
comparisons and trends and provides
clues to the future .To plan ahead HCM 4.0 needs reliable, high-quality data
for predicting future trends; addressing
recurrent business problems and making
long term decision making
WHAT IS
THE URGENCY FOR HCM4.0 TO RADICALLY SHIFT TO THE MANAGEMENT-BY- MEASUREMENT APPROACH?
Business
functions like marketing, supply chain
and manufacturing report their results in sharp monetary terms. These business functions not long ago used to rely on intuition and
hazy reports to define their outcomes; they have made this shift toward the use
of metrics/KPI in everything they do.
As a result of all
these changes, CEO’s, CFO's and
stakeholders are now looking to
HCM to adopt HCM Metrics/KPI/KPIs as a means of reporting and measuring and to
provide insight for board level decision
making.
Today top
management treats measurement as a key C-Suite issue. The HCM function has to
go beyond anecdotal evidence to justify it cost/benefit calculations.
It is only keeping with the norms of
business that HCM too must work like other business functions
HOW
SHOULD CHROs THINK STRATEGICALLY ABOUT
MANAGEMENT- BY-MEASUREMENT IN INDUSTRY 4.0?
Thinking strategically about measurement means understanding whether
the measurement system
you are considering will provide
you with the kinds of information that will help you manage the HCM function strategically. This is a quantum leap
HCM wants to be a business partner, it must show business impact. It’s
time to realize the traditional metrics add little value to strategic business
decision-making . HCM 4.0 today must integrate traditional metrics to
KPI; and this must be aligned to corporate objectives. This will be the pathway when even the
critics of HCM will say ‘’they are
solving real problems’ . Hence they want to make sure they
are making the right decisions based on data; to be particularly aware of the way they prioritize and
measure this data, especially when it comes to the measurement of the strategic
plan.
HOW DOES
MANAGEMENT-BY- MEASUREMENT APPROACH REALLY PROVIDE THE CUTTING EDGE TO
THE HCM 4.0 MODEL?
The first step is to discard the accounting
mentality that says that HCM is primarily a cost center in which cost
minimization is the principal objective and measure of success. The main cause
of this misconception is the lack of
hard evidence demonstrating their contribution to firm performance.
We have too often generic statements like “
HCM must add value to the business..” hence HCM Management- By-Results approach must answer
these questions
1.
how can the value HCM brings to the business
be ascertained in monetary/business terms?.
2.
How does
HCM justify with facts and figures
its impact on business functions??
Especially when its time speak up to defend HCM budgets against cutbacks or
outsourcing.
3.
How does HCM
justify its positive impact on employee productivity and satisfaction ??
The CHRO also needs comprehensive case management data / summary accounting statement
to track year-to
year-trends and improvements in HR critical business processes. The best way to leapfrog is to focus on the few items that have the biggest
cost and the most impact. The biggest stumbling block to become a true strategic partner is presenting
hard facts supported by data.
HOW CAN THE CHRO PRESENT THE BENEFITS CASE TO HIS OWN TEAM THAT MANAGEMENT-BY- MEASUREMENT APPROACH IS AN IMPERATIVE?
The language of business is results which in
turn are measured in rupees !!! The
‘Management By Measurement’
approach should aim to establish a clear “line of sight “
between HCM interventions and business results
the Management-by- Measurement approach ADDRESSES
the challenge before business centric HCM leaders to covert good intent into visible and recognizable results. It urges
HCM leaders to REGOGNIZE the benefits of
the Management-by- Measurement approach:
Which makes sure that HCM activities inside the firm deliver value;
Makes them visible and recognized by
line managers first and then the top management
Management-by- Measurement approach has a strong is emphasis on how to
FACILITATE REPORTING AND MIS The language of business is results which in turn
are measured in rupees !!! CEO’s and the top deck of management are typically short on time so they focus on key business issues; hence the need
for concise reports which provide the insight for decision making It explains
why HCM has to lift the horizon levels
from the lag factor of measurement to
proactive people analytics
Finally Management-by- Measurement approach shows how to BUILD A CASE FOR HCM
TRANSFORMATION This approach would strengthen HCM operational efficiency as well as build a
strong case at the year-end budget meet for fund allocation.
Metrics/KPIs facilitates management reporting/MIS HCM 4.0 processes need a barometer to help guard against inflated claims both for and against HCM 4.0 operations and
results. Management-By-Results approach are useful in day-to-day top management
processes like reporting and improving performance; managing accountabilities and
aligning organizations activities to streamline work.
WILL MANAGEMENT-BY- MEASUREMENT APPROACH
GIVE HCM4.0 RECOGNITION AND RESPECT IN THE C-SUITE?
HCM 4.0 for over
two decades is struggling hard to gain
recognition for its contributions in driving organizational
success. The Quality
movement of the 1980s gave rise to the
dictum that what gets measured get done! HCM 4.0 does likewise
The
finishing line of HCM 4.0 Model is Management-by-Measurement. HCM 4.0 puts it faith in Metrics/KPIs & Analytics. HCM 4.0 can
explode the myths that everything
in HCM cannot be measured. We can banish for ever doubts about HCM contribution and company improved performance. HCM 4.0 we need to forever ban
the all too common phrases “I think”, “I believe” and “I feel” and replace
these phrases each time with… “the data shows”.
