Importance of HR in 2009

Following the world economy crisis earlier this year, it is utmost important that every organization re-look and re-evaluate every single operation and strategy to ensure survival and profitability. The truth to the matter is, almost all the organization that I know have been affected. And the organization that is able to adapt to the slowdown, re-invent itself and make itself and its product valuable will be able to capture a bigger piece of market share as the world economy begins to recover.

Organization that is not able to change and re-invent itself will lose out to its direct competitor whom is able to do so. Instead of competing for market share, the beginning of 2009 appears to be a year of re-invention and a race to be the most effective and efficient company that is able to satisfy customer needs. Customer needs remain pretty much the same throughout this period of time, where the main concern is price. So, customer does not mind that the supplier does not provide them best services, but they would like the price to be as good as possible. The war on price forces almost all organization to make a product in the lowest price possible. The squeeze therefore has forced organization to cost down, retrench, reduce, outsource or even sell their none profitable unit.

Earlier this year seems to be the best time for company to make use of tools, such as Six Sigma, Total Quality Management, Knowledge Management, Balanced Scorecard and 'Lean' methodology to drive down operational cost. Retrenchment would basically cause two problem, that is loss of moral among staff and loss of valuable staff as well as knowledge. This is followed by outsourcing of an entire none major or focused tasks to a third party organization. In all this
movement, the most overlooked aspect is always, the knowledge that the staff take away with them and the loss of knowledge as a result of outsourcing. Knowledge is among one of the many 'asset' of organization and if lost or shared out to the public may cause their 'secret' of success leaked out, in both cases, giving away their competitive advantage that they may hold against their direct competitor.

HR strategy if properly implemented can help reduce this impact and facilitate organization to re-invent itself so that the organization can sustain and emerge from this economy downturn with an advantage from its competitor. Here are a few areas that HR should look at:

1. HR Strategy must follow the organization vision, mission and strategy. Whatever lay out in the organization strategy, the HR strategy must follow suit to ensure that it is inclined and supports the objective. For example, if Company A decides to outsource its operation to Vietnam, Company A HR must be prepared with employment rules and regulation of Vietnam, access the capability of expertise there, cost of hiring and expenses there and attrition rate. All
this will prepare the organization with knowledge and ability to access whether the feasibility of this happening and also for them to ensure work done at the end of the day.

2. Succession planning must be implemented. Even with limited time and resources, this will ensure continuity and mitigate possible risks moving forward. Retrenchment is also a time where competitor company will try to woe your best staff away with only the minimal promise of monetary reward. They can be attracted to other things such as stability of competitor organization and other none monetary reward. So this time, any employees may move, even the most unlikely. Therefore Succession Planning is a necessity, not a luxury.

3. Knowledge Management is a must. Method of how KM is practiced and implemented across will have to be looked at. We know that it is not possible to extract all knowledge from each employee, BUT, the main knowledge has to be sustained and controlled. Person designated to this must be diligent to follow through in an organization to ensure outflow or retrenchment will not affect work and loss of knowledge. In addition, non-disclosure agreement must be something that has been done throughout. If there is a need for revision and getting everyone to sign on it, so it has to be.

4.Intellectual Property (IP), copyright is also another area that HR has to get involved in order to ensure that all this organization property is protected. This are valuable organization asset that if not properly protected will result in net loss of organization value.

5. Sourcing for talent and talent management is also a major challenge for HR teams. The HR must have the foresight in area of retaining, nurturing and attractive renumeration method to retain talent. All too often, HR poses to be the 'paperwork' or administrative role, but it is time to step up and propose to management the best way to retain talent. All too often, the idea of monetary value is the only criteria that everyone thinks the employee looks at. How about, in the area of flexibility and work from home? For example, Naraya (Thailand), the company that produce ladies accessories have production lines in the remote home of poor village housing area. However, the outreach of the market capability goes as far as Japan, Hong Kong, Taiwan and Singapore.

If there is ever a time for HR to step up and catch up, it is now. It is always said, in the midst of problems and difficulties, comes great opportunity. In the early years of Sony and Toyota, both company, took the step to divert and set up plants across America and then Europe. Before they even have a stronghold in their own country, that is, Japan, they took the calculated risk to expand before others. Today both are superpower, by the sheer diversification and expansion of plant in many countries. They are able to retain their expanding talent in Japan and send them all over the world and further expand and grow talent from there. It is a good organization growth strategy coupled with HR masterstroke. I leave you with one last example, that is Samsung. Today the company grow daily by just filing nearly 100 patents daily. Almost all of their employees are trained in the area of innovation. In one year, it could easily have 20000 patents. In a few years time, all this patents will play a big role in providing monetary return for Samsung. Samsung HR provides the right mix of motivation and compensation to make this happen.

~~~ Life is an adventure where we search for the meaning of the outcome.