Transcript customers LEAVE
Why good HR makes good business sense?
Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction, Delight and Loyalty Business Performance
Slide 1 of 9
Source: Heskett et al. (2008). Service-profit chain. (Harvard) Parasuraman & Owen
The facts …Why it’s Important…
68%
…of
customers LEAVE
because of poor employee attitude
41%
…of
customers are LOYAL
because of a good employee attitude
70%
…of customer brand perception is determined by
experiences with PEOPLE
Slide 2 of 9 Source: Parkington and Buxton, Study of the US Banking Sector, Journal of Applied Psychology Source: MCA Brand Ambassador Benchmark Source: Ken Irons, Market Leader
The linkage analysis with engagement
Slide 3 of 9 Employee Attitudes Senior management interest Challenging work Decision-making Authority Customer focus Employee engagement Career advancement Company reputation As employer Teamwork/ collaboration Resources Decision-making input Senior-management vision Turnover retention Customer Impact
0.65
Customer focus Positive relationship Negative relationship Conceptual relationship Significance of statistical correlations: 0,25 – 0,3 – Significant 0,31 – 0,45 – Strongly significant 0,46 – 0,65 – High significance
0.70
Financial Results Revenue growth Cost of Goods sold Sales, general & Admin expense Operating margin SOURCE: TOWERS PERRIN
The moment of truth…so where to focus?
Moment of Truth Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction, Delight and Loyalty Business Performance
Slide 4 of 9 The HR Management Process / Value Chain Source: Heskett et al. (2008). Service-profit chain. (Harvard) Parasuraman & Owen
What the evidence say…
Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction & Loyalty Human Resources Management Customer Relations Management Business Performance Financial / Profit
Quality of HR Value Chain …………………………………………… …………………………………………… …………………………………………… ……………………………..
ccccccccccccccccccccccccc Service concept: employee behaviour linked to brand promises Retention, Repeat Business, Referral Impacted by level of employee engagement Service designed & delivered to provide consistent customer experiences
Source: Heskett et al. (2008). Putting the service-profit chain to work. Harvard Business Review
Slide 5 of 9
Generic Human Resources Value Chain
People Philosophy, Strategy & Policy
Strategic Research Organisational & Work / Job design HR Planning Recruit, Select, Place & Induct People Development Managing Performance Recognition & Reward Redeploy & Exit
Purpose, Intent, Values Human Resources Administration Employment Relations / Employee Relations Human Resources Management System and MIS Change Management & Facilitation (Project Management)
Slide 6 of 9
Approach: HR ‘State of Health’ Assessment
Example of assessment of Induction, On-Boarding & Engagement 9 10 11 12 13 14 15 1 2 3 4 5 6 7 8 A formal induction and on-boarding policy exist in the company.
Each new employee is taken through an orientation programme.
Each promoted employee is inducted into the requirements of the new role.
The company has clearly defined values.
The behaviour(s) required to live-up to a value is also clearly defined.
Values and their related behaviour(s) are regularly discussed with employees.
Employees are proud to be associated with the organisation.
Employees derive satisfaction from performing their jobs.
Employees feel appreciated by the organisation.
Employees enjoy working with their colleagues.
Employees feel their opinions count.
Employees know what is expected of them at work.
Employees have the necessary materials and equipment to do their jobs well.
Employees often receive recognition for good performance.
Employees feel that their supervisors care about them as individuals.
Answer Range Totally disagree Partly disagree Neutral Partly agree Totally agree Please mark only 1 box, per question, with a X
1 0 0 0 0 0 0 0 0 0 1 1 1 1 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 1 1 0 1 1 1 0 0 0 0 0 0 0 1 0 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5 2 5 3 0
Totally disagree 0-20
33,33%
Partly disagree 21-40
13,33%
Answer Range Neutral Partly agree 41-60 61-80 Totally agree 81-100 Predominant View
33,33% 20,00% 0,00% Slide 7 of 9
HR ‘State of Health’ Assessment (Continue)
Example of collated scoring results 10 11 12 13 1 2 3 4 8 9 5 6 7
Summary
HR Administration Organisational & Job Design Recruitment, Selection & Placement Induction, On-Boarding & Engagement Payroll HR Systems & Analytics Recognition & Reward Employee Benefits Training & Development Performance Management Employee & Industrial Relations Occupational Health & Safety Change Management
Overall state of health of HR Totally disagree
57,14%
Partly disagree
0,00%
Neutral
42,86%
Partly agree
0,00%
Totally agree
0,00% 62,50% 70,00% 33,33% 11,11% 100,00% 25,00% 20,00% 13,33% 0,00% 0,00% 12,50% 10,00% 33,33% 0,00% 0,00% 0,00% 0,00% 20,00% 22,22% 0,00% 0,00% 0,00% 0,00% 66,67% 0,00% 88,89% 100,00% 55,56% 100,00% 55,56% 83,33% 57,14%
67,27%
0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00%
4,49%
11,11% 0,00% 22,22% 0,00% 22,22% 0,00% 0,00%
11,87%
0,00% 0,00% 0,00% 0,00% 22,22% 16,67% 42,86%
9,54%
0,00% 0,00% 22,22% 0,00% 0,00% 0,00% 0,00%
6,84%
Slide 8 of 9
HR ‘State of Health’ Assessment (Continue)
Example of high-level recommendations
HR Discipline
1 HR Administration 1.1
1.2
1.3
1.4
2 Organisational & Job Design 1.5
1.6
2.1
3 Recruitment, Selection & Placement 2.2
3.1
4 Induction, On-Boarding & Engagement 4.1
4.2
Preliminary Recommendations Task
Determine the overall business strategy and define those elements that makes the business unique Document the strategy and test same with selected employees.
Compile a HR Policy & Procedures Manual Ensure that the company strategy and the HR policy is in support of each other Conduct a communication session(s) and explain the manual contents to employees.
Create/update each personnel file with all required contracts and documentation Create an organisational job structure: which jobs are there and who reports to who.
Design a Job Description for every job: inclide key KPA's and behavioural competencies Compile a written Contract of Employment for each employee and ensure that such meets the BCEA and RSD9 standards.
Determin the company values and translate into behavioural descriptors.
Conduct a communication session(s) with all employees and explain the company values and behavioural expectations.
Priority Quantum
1 1 2 3 1 4 8 5 6 7 1 2 1 1 1 4 to 6 ±35 1 ±35 ±35 1 4 to 6 Slide 9 of 9