“HR manages the organization's best competitive advantage - its people. Is capability management really a challenge? Or we just need a more organized & scientific tool for better human capital decisions, manpower potential management, and process improvement.”

We have a tough role to play as HR leaders. Dealing with human resources is all about dealing with a lot of perceptions, personalities, and attitudes. At times, it’s just tough to put things in perspective and design a strategy that focuses on balancing the facts, emotions, and perceptions.

In Quotes, “An interesting combination of facts & perceptions can be presented through various HR Matrices.”

Interesting HR Matrices can be created to evaluate the existing employees & arrive at the best manpower management strategies. A logical HR Matrix which is created based on well-evaluated needs/concerns of the organization can prove to be a highly valuable tool for any organization.

Sharing a brief 5 step guide on designing & using the HR Matrices for the benefit of the current age dynamic organizations:

STEP-1 DESIGNING HR MATRIX

What are the key concerns of the company “X” with its human resources?

• EMPLOYEE POTENTIAL
• EMPLOYEE PERFORMANCE
• ATTRITION RISK
• EMPLOYEE DISENGAGEMENT
• LACK OF EMPOWERMENT

Other interesting matrices could be:

• HR Capability Vs Business Priority
• Management Maturity Vs CHRO Maturity
• Employee Performance Vs Employee Potential

Role of HR - Process Orientation Vs People Orientation

They could range from a simple four-box matrix to an elaborate 9 box matrix or so on based on how comprehensive one wants to be.

STEP-2 MAPPING EXISTING EMPLOYEES TO MANPOWER MATRIX

This is one of the most critical steps. It must ensure: 

• Very conscious manpower mapping to be done while minimizing the perceptual bias.
• Seeking 360-degree feedback on each employee to be mapped in the matrix. This will include an assessment on factual parameters, seeking detailed and focused feedback from colleagues, line managers & other stakeholders.
• E.g. conducting 360-degree appraisal about a Business Development Manager through various stakeholders might include the following:
  • Finance - Sales numbers, Collection Overdues, Gross Margins, overall accountability for account management etc.
  • Clients - Quality of interaction, pro-active updates, availability for feedback/follow-ups etc.
  • HR - Overall hygiene, sales performance, personality, attitude, compliance, growth potential etc.
  • Line Manager- Quality of reports, adherence to timelines, quality of work, sales numbers, quality of account management, prospecting etc.
• Sharing evaluation parameters in detail with the line managers to seek more inputs/ seek detailed inputs on employee’s performance on various KPIs & making required changes. E.g. A Project Manager who is being rated highly positive in 360-degree evaluation, might be a constant defaulter on process compliance, over lenient with the team and hence being ineffective in managing team.
• Making final adjustments based upon more concrete info. from line managers.

STEP -3 DESIGNING HR STRATEGY BASED ON MANPOWER MATRIX

This will largely depend upon a number of other factors apart from an individual employee’s placement in the manpower matrix. HR Strategy might focus on following variable factors too:

• Preparation for contingencies/structural changes - Candidate Pipeline, Manpower Budget (to accommodate high replacement cost)
• Future Plans of the company - Existing employee skill sets might be needed for future projects. In such a situation even a “Low Potential” employee has to be maintained unless a ready replacement is there.
• Impact of an employee on P&L (Salary, Sales Contribution, Margin Contribution). E.g. It might be difficult to maintain a high salaried low potential resource vs a low salaried low potential resource.
• The financial strength of the company (in terms of ability to maintain salaries of staff, withstanding low business performance)
• Critical nature of the role (e.g. a Project Manager role may be seen as much more critical than any administrative role like operations executive). Business-critical roles must be attended on priority.
• Feasibility of replacing low potential/low performing resources with strong personal relationships in the company due to the long service tenure.

STEP-4 PRESENTING HR STRATEGY TO MANAGEMENT

This would largely involve using HR Analytics like:

• No. of business-critical roles held by low potential resources.
• No. of business-critical roles held by employees with high attrition risk.
• % of employees identified as High Potential, Medium Potential & Low Potential. 
• Sales Performance of employees placed as High Potential, Medium Potential & Low Potential.  (Target vs Achievement, Gross Margin Contribution, New client’s addition, etc.)
• % of salary spend on maintaining high/med/low potential resources.
• Work tenure of medium/low potential resources with the company.

Strategy proposals could be:

• Manpower Budget alterations required to hire new resources to replace low potential resources/ high attrition risk resources.
• Future Investment in trainings, certifications, Reward & Recognition programs, Employee Engagement Activities etc. to maintain high potential resources.
• Sources/timelines/talent acquisition investment for identifying replacements for business-critical resources. 
• Budget for increments for promoting high potential resources.

E.g.- an organization with more than 60% of employees identified as low potential might focus on investing in/arranging for replacements.

An organization with majority of employees identified as high potential, the focus might be developing capabilities by increasing investment in T&D/Learning programs, certifications etc.

STEP-5 IMPLEMENTING THE STRATEGY

In Quotes “Designing a good strategy doesn’t necessitate the desired outcomes without a strong implementation plan.”

Important considerations in implementation could be:

• Does the company need to maintain the low potential for any reason for some time or immediate termination can be considered?
• Does the company have ready replacements/potential pipeline of candidates?
• Timelines for onboarding replacements & managing handover.
• How potential opportunities can be created for upgrading high potential resources with the organization?
• Identifying a tailor-made development program for every identified high potential resource & related investment.
• Budget allocation for identified development programs & it impacts on overall HR Budget.
• Identifying the role-specific competencies & implementing competency mapping for developing high potential resources further.
• Overall business strategy is to expand/contract/diversify etc.