The Herman Trend Alert|
December 22, 2010
HR Responds to the Economy and Labor Market (Part 2)
Occasionally, a study is so important that we devote two weeks and extend the length of The Herman Trend Alert to cover these results. This week, we offer you part two of the highlights from the 2010 Towers Watson Global Workforce Study.
The study recommends specific steps for employers take to improve their reward and talent management programs. First, employers must differentiate rewards between top and average performers. It will be especially important to have organization-wide consistency in reward and talent management programs and to develop business-centered leadership competencies. In summary, wise employers will increase their emphasis on performance management, leadership, and employee learning and development---in our view, long overdue.
Moreover, employers are advised to develop a formal Employee Value Proposition (EVP) and communicate it to employees. (We have a problem with this one, because we believe employers must have multiple EVPs, not just one!)
Companies in diverse regions approached cost cutting and cost management differently. Globally, almost all companies undertook some cost management or cost cutting activities. However, companies in the United States and Europe were much more likely than others to take aggressive measures; over 60 percent of US companies took four or more cost cutting actions. Many eliminated training and recruiting functions and are now scrambling to re-establish them.
Recently, Dr. Ilene Gochman, Managing Director, Talent Management and Organization Alignment at TowersWatson, delivered the closing keynote for Workforce Management at their Engage 2010 Online Conference. Gochman revealed additional insights from this important study.
She believes, "What worked for organizations pre–recession just isn't sustainable in today's environment. The current business environment affects the supply and demand of talent in unprecedented ways, as well as the ability of employers to engage and retain employees."
Employers must respond to the revised "employee-employer contract" (which she characterizes as "the new employment deal") and employees' evolving priorities. They must alter how they operate and how people may connect to their companies and work. Meanwhile, organizations face increasing demands from their employees for security, stability, and opportunity, plus career advancement for top talent and employees with critical skills is particularly critical.
The key elements for a new employment deal---one that addresses the needs of various workforce segments---are:
The new employment deal will challenge some employers, but most will understand the value of supporting their employees in these ways.
Special thanks to "Workforce Management" Magazine and Dr. Gochman for bringing this important study to our attention.
Next week's Herman Trend Alert will feature our 2011Workforce/Workplace Forecast.
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