Aug 11, 2009

Trust enabling vs Employees as Resources

On the XLRI Sapphire blog I read this blog post on how HR people can use levers to manage employees as resources.

Sample this:

It is not important how much one is paying to work in a company; it is the way one is making the payment. As per the understanding on compensation, it could be very well said that most of the companies following the same philosophy compensate employee within a span of (+ / -) 10%. But the most important part is the way they used to compensate differs from each other. Some focuses on fixed cost, some on variable cost etc. One should keep in mind that pay should solve three purposes:
1)      It should pay for what the employee has done in past
2)      It should provide benefits for employee current needs
3)      It should serve as an incentive / motivation to work the same company in future.
Thus the compensation policy should focus on all the aspects of past, present and future. There should be a sound mix of base pay, benefits and incentive plan.

Erm, Ok.

The problem with these approaches - of benchmarking compensation - of sticking to the tried and trusted way of doing things - of viewing employees as resources - is that they always ensure that your firm is an also-ran. An average player in the larger scheme of things!

It takes guts to be different.

Sample this post from OD guru Gurprreit Siingh on his experiments with trust:

 It was time for annual increments. I decided to share the financials with every member of the team. And asked each one of them to decide their own increment for the year. With the exception of 1 person, every one of them chose an increment almost exactly in line with what I would have given.
It was also during this period, that we won every award that the company had to give. That we had record levels of performance and customer satisfaction.
Even today, I look back on that period of my life with awe. While it is easy to describe the successes as end-points, there were challenges on that journey that could have led us either way.
My key learnings from those experiments:
1. Trust is always repayed with trust
2. Almost all people are responsible and want to do a good fair job. People are innately good.
3. There is little or no malintent in people
4. If you give people broad guidelines and allow themselves to self-govern, they will do a better job than if you micro-managed them
5. When you trust people and let go, you unleash energy, creativity and employee entrepreneurship

Yes, the truth of HR management is simple.

It is not about looking at employees as resources. Trust them. Have faith. And give them reason to have faith in you.

Unfortunately, in our yearning to be business partners, and 'strategic' we often forget the "human" in HR... and are seen as manipulative by employees - and are manipulated also by all parties.