Andrew Mclachlan, performance capability manager for Meridian Energy, reckons managing people is bit like fuelling car. “You can have Ferrari and it can be flash and shiny red. If you think of people as being the petrol fuelling that vehicle, you wouldn’t pour sand into the fuel tank and have the car go nowhere. People are the ‘petrol’ in the fuel tank of business; they make it go places,” says Mclachlan.
Increasingly, businesses are getting that point, although the tight labour market and the fact there are not enough Gen X (age 24 to 45) and Gen Y (under 24) people to go around is not making people management any easier, agree experts.
“It is absolutely becoming more difficult to manage people. Quality employees know they have choice and know if they are good performers. There’s constructive tension for businesses to get it right,” says Mclachlan.
Christien Winter, managing partner for HR consultancy Sheffield, notes that people managers increasingly know that leading staff today is more complex than it used to be – the employer/employee relationship has shifted, and talent shortages are creating pressure.
“New Zealand and Australian turnover statistics at all levels of management are higher than for other regions. Internal hiring is on the rise, as is the quest for improved hiring practices, better training and development,” says Winter.
Phillipa Youngman, director for people management software firm Pivot, says employee attitudes have changed and employers that understand that will win.
“If employees are given what they need they will be productive, organised and vocal; if it goes wrong they will be vocal in the opposite way,” says Youngman.
Tania Giles, senior consultant for remuneration specialists Higbee Schäffler, says people management has always been difficult and managers often find it the most draining part of their role. Recently, certain groups have increased the challenge, says Giles.
Scared of Gen X and Y?
Giles is talking about Gen X and Gen Y employees. Some employers are clearly intimidated by the confidence, assertion and lack of loyalty displayed by these generations, say the experts, and many employers face higher turnover in the 20 to 30 age group as Gen X and Y flit between employers, do their own thing, or take an OE. Unfortunately, these are also the people employers need more of – hiring older employees is increasingly necessary and also valuable, but young people bring fresh perspectives, the latest training, innate IT skills and fewer health needs to an organisation. Plus, they’re not likely to be over-qualified for position. So how can employers find and keep them?
Youngman says Gen X and Y are not lazy or disloyal, they’re just good negotiators. Employers need to be upfront and ask the right questions to ensure there is mutually clear understanding.
“Employers have to find ways to deal with their attitudes or they will lose good people. For the employee, it’s case of ‘I’ll be loyal to you if you are loyal to me’,” says Youngman.
Winter says Gen X and Gen Y expect to receive good mentoring, coaching and leadership and know they have choices. They manage their careers and analyse everything potential employer does, from the recruitment process to the way the offer of employment is presented.
Mclachlan says he led team of Generation X-ers and found they wanted performance plan, career path and opportunities for advancement. When he suggested they put the work in and be patient, they didn’t like the message.
“Someone had to change and it was me,” says Mclachlan.
Allan Freeth, chief executive for TelstraClear, reports that most of his employees are Gen X or Y, “funky” and know what they want. However, he says negotiations need to be business viable.
“I can tell people ‘okay, resign then’ or I can tell them ‘maybe we can do something’. It’s about finding balance of value on both sides and for the long term,” says Freeth.
All-important retention
Generational differences aside, what do today’s employees want, and how can employers attract and retain those they need? Giles says one thing New Zealand organisations are not doing is throwing money at new employees. “The remuneration market hasn’t reacted to the tightness of the labour market. Movement for ’04/05 is consistent with that for ’03/04, so people are realising retention is wider than remuneration,” says Giles.
Youngman has observed the same trend. While speaking at conference, she outlined four different employment packages and asked people to vote on the package they liked most. The number of votes was split evenly four ways. Organisations that offer just cash package will miss the boat,” says Youngman.
Giles says remuneration simply has to be fair, competitive and aligned with the market, and because people increasingly know their financial worth non-monetary recognition is key to attraction and retention.
Modern people management is about creating total employment experience or taking employees on “journey”, say the experts, and that covers how person is recruited, inducted, performance managed, career developed, and the training and rewards they get. Flexibility and not allowing other business issues to hijack your people management practices is also critical to retaining good people.
Robert Half International managing director David Jones says in order to avoid slowdown in business productivity through unfilled positions employers also need to implement people-friendly strategies that offer flexibility in the form of job sharing and adaptable working hours, room for personal development, sabbatical opportunities, unpaid leave options and the ability to work from home.
A Robert Half Finance and Accounting white paper also forecasts gloomy future for organisations that ignore older workers, mid-career mothers, students, graduates and migrants, and Jones says employers need to maximise all talent, regardless of gender, race or other discriminating factors.
“The current situation facing businesses can be partly attributed to poor application of resources rather than [just] generational shift, brain drain and an increase in regulation and corporate governance,” says Jones.
He says foreign students and local universities possess untapped talent and many accountancy graduates are foreign students who would like to settle in New Zealand but are not getting the job offers.
“Employers could partner with universities to identify the best of these students before they have completed their degrees and employ them on summer internships to ensure some retention,” says Jones.
Finally, employers will attract and retain more people if they do more than pay lip service to work/life balance practices and accommodate cultural, life stage and religious diversity, say the experts.
“There’s still demand for employees who can do long hours and don’t have children. That sends the wrong message to women,” says Giles. Mclachlan agrees: “[New parents] know our systems, procedures and culture so of course we want them back. The big thing is to be communicating,” he says.
The role of technology
A few years ago, information technology was considered ‘the next big thing’ for people managers. IT tools would allow them to streamline leave and pay administration and that would free up time for people managers to ‘connect’ with people. Has this happened – and what is the role of IT in people management today?
Youngman says the usefulness of technology is still overlooked, and while people management professionals are good at developing systems and processes they don’t necessarily analyse how IT tools will support these.
“You first need good process to get data into system. If I was to be critical of the HR profession, it is we haven’t been that willing to understand the business drivers of what we are trying to do and set up systems properly. HR and finance need to get closer, and if human resources information system is little deficient in one are
