The Power of Employeeship and its Direct Impact on Company's ResultsAfter The Great Resignation in the wake of COVID-19 pandemic and the huge wave of Baby-boomers retirement, pressure was put on companies. Till now, the war of talent is still ongoing in the time on the edge of various crisis. Company centered strategy is shifting to people centered. What should we do?
The war for Talent is something that many companies around the globe have faced over more than two decades. This phenomenon coined by Steven Hankin of McKinsey & Company in 1997 is still ongoing, more challenging than ever. It simply refers to an increasingly competitive landscape for recruiting and retaining talented employees.
The Great Resignation in addition is an ongoing economic trend in which employees have voluntarily resigned from their jobs in early 2021 in the wake of the COVID-19 pandemic. Among the most cited reasons for resigning include wage stagnation is the long-lasting job dissatisfaction.
Here we could also add depopulation in some Western countries, big gap between demand and supply in critical competencies and huge wave of Baby-boomers retirement, big uncertainty in the world with conflicts and energy crisis, all of that indeed put the pressure on companies to Re-think the People strategy.
So, the million question is which driving factor is the most important enabler for companies to attract and retain people? There is no general recipe and no copy-paste strategy. Instead, look deeper into your people analytics, needs and behaviours. You will find the answer BUT I would dare to emphasize that psychological safety is taking more and more place among employees as the most critical one. By empowering Employeeship with psychological safety in the ground companies can gain both in terms of individual but also team performance. Research and survey are showing that innovation as a competitive advantage is possible if a company has people with high motivation and strong feeling of belonging. How could the way to empowered Employeeship look like:
"Empowered Employeeship leads to usage of full potential a company possess in its people"
1. Create a Culture of Care where people feel comfortable to admit, share and learn from failures. Companies need to have strong leadership commitment and empower its employees to bring even difficult topics to the table and discuss. Care from psychological perspective includes continues learning and development in all aspects. Care is very much about listening and understanding, supporting and coaching in the way that opens up for new ways of thinking and managing things.
2. Develop a Culture where ownership and responsibility in the organization is strong linked to each and one of the employees. If the employee is rather a partner than a subordinate than the individual contribution and feeling of personal value will be higher. This employee will give a company more value back because it will feel respected, acknowledged and empowered. This in turn will even strengthen company´s leaders and most probably lead the company to a higher maturity level. The better people the better business. At the end, all business problems are people problems. Therefore make your people accountable, responsible and put the hat of ownership on top of their heads. Just to mention, Employeeship is a philosophy adopted notably in Sweden where the hierarchy is abandoned. And it gives great companies, brands and results!
3. When having 1 and 2 in place then the most natural part is to work further with Inclusion. You can also say that companies need to develop a Sense of Coherence where three parts are important: a) the employee needs to feel included in an environment that is understandable and purposeful; b) the employee needs to have resources and conditions that makes the work possible and manageable; and c) the work that the person is expected to deliver and perform need to be part of the bigger picture and the employee needs to understand that. Just sitting in front of the computer day in and day out, delivering for example drawings of calculations will not give meaning long term. But if you put these deliveries into the bigger context by showing where this piece of a puzzle is and how it is connected to other pieces will most probably lead to higher satisfaction and retention rates, loyalty, performance and for certain create strong attractiveness as well.
Empowered Employeeship leads to usage of full potential a company possess in its people. We all have individual responsibility to contribute to a culture where other people feel comfortable. Just start with yourself and how you would like to be treated. Clear direction from top management and strong commitment from all employees will make this journey possible.
SOURCE ManageHR
How to Strategically Plan a Budget for HR in 2024The article discusses strategies for planning an HR budget for 2024, emphasizing the need for advanced HR technology and digital tools to enhance employee experience. It highlights the importance of focusing on talent retention due to high attrition rates in Asia and adapting to changes in the workforce market. The article stresses compliance with labor law changes and the need for a data-driven approach to budgeting. It outlines key budget components, including recruitment, training, salaries, HR technology, and employee well-being, to ensure a comprehensive plan for organizational growth and success.
As companies brace themselves for 2024, many HR teams are busy preparing comprehensive budgets for the coming year. Fortunately, with a host of cutting-edge HR technology and digital tools available, companies can plan a budget with more resources at their fingertips to better plan for the year ahead, significantly enhancing the overall employee experience.
In terms of a direction for 2024, companies are encouraged to channel more efforts towards talent retention, given the high attrition rates across Asia. In an effort to further empower their workforce and improve organisational culture, having the right HR tech is also a crucial consideration.
On that note, let’s look at how to create your 2024 HR budget and what to include in it.
What’s Most Important in Your 2024 Budget Plan
Keeping up with recent advancements for your workforce:
Understand how the talent market in 2023 will differ from 2024’s and plan for your manpower accordingly.
Consider if there has been a new shift towards or an increased use of AI tools to enhance both employee experience and candidate experience. According to analytics and advisory company Gallup, higher employee engagement translates to increased profitability – 23% more, according to their research.
Compare the workforce flexibility levels in your company with that of the overall job market – bearing in mind that there is a greater inclination towards a more flexible workforce, in terms of temporary and contract vs. permanent staffing.
Consider any increase in costs due to inflation, as salary (and potentially benefit) increments will have to be made accordingly.
A greater focus on talent retention:
To be able to maintain a robust and healthy workforce means to prioritise talent retention. With high employee attrition rates and talent retention being a top HR challenge in 2023, a key focus for businesses should be on how to retain their workforce better in 2024.
After conducting a thorough review internally, consider looking into programmes, practices and systems that can improve employee satisfaction, provide stronger employee assistance programmes and support, as well as streamline the overall HR experience for your employees.
Remaining compliant with labour law changes:
Given that 2023 has been a year with many labour law developments across various countries in APAC – such as Malaysia’s massive overhaul of its Employment Act and Singapore’s introduction of the COMPASS framework for Employment Pass applications – it is highly crucial for companies to remain compliant with upcoming labour law changes in all locations, particularly those with a presence in multiple countries.
Compliance can come in the form of adhering to minimum wage hikes, new tax brackets, increased number of leave, and so on – all of which can incur additional costs and would need to be accounted for in the HR budget. Additionally, remaining compliant with labour laws ensures there are minimal legal and financial repercussions, leading to a more prudent budget.
How Do You Prepare an HR Budget?
When you plan a budget for HR, some crucial pointers to have in mind when listing down what to include are:
Building a Strategy for Smart Expansion: Consider your company’s expansion plans for 2024 – if any. Coming up with a solid plan if you want to expand in 2024 is crucial, and you can consider a low-cost and minimal-risk option such as an employer of record. According to an article by Yahoo! Finance, in 2023, the worldwide EOR market reached a value of USD 1890.29 million and is projected to grow at a compound annual growth rate (CAGR) of 12.07% over the forecast period, ultimately reaching USD 3745.43 million by 2030.
For companies with multiple locations, when revising the budget, HR will look at which locations are now more mature and stable compared to last year to allocate the budget more evenly.
Investing in The Right Software and HR Tech: Get acquainted with the latest AI trends in hiring and find out how the right tools can enhance your journey of finding the right people to join your workforce.
Integration Options for Different Business Sizes: Speaking of knowing what works for your company size, if you’re a regional company, you’d likely work with a payroll outsourcing provider to streamline your regional payroll. Revisit your current service to see if its integration capabilities are still suited to your business – depending on if your headcount has been expanded or downsized recently.
A Data-Driven 2024 budget: A budget that is tailored heavily based on data allows for better foresight, less errors and allows you to make better informed decisions for your businesses. A report by McKinsey Global Institute shows that data-driven organisations are likely to be 19 times more profitable, and 6 times more likely to retain those customers. You can use data from previous budgets to get insights on what to do differently this time.
What are the must-haves in your HR budget?
If you’re wondering what a complete 2024 budget should entail, the following list can serve as a general checklist of what to cover:
Recruitment and hiring
Hiring Agency / Job advertisements
Employee assistance programmes
Interviews, screening candidates and background checks
HCM software management
Onboarding procedures
Employee relocations
Recruitment marketing
Talent retention
Outplacement Services (if required)
Visas and work permits
Training and development
Employee Certifications
Trainer/expert/consultant fees
Addressing skills gaps
Learning systems
Salaries and other benefits
Employee salaries
Overtime pay
Payroll system management and maintenance
Insurance & healthcare
Other statutory contributions
Retirement plans
Paid time off
Employee bonuses
HR Technology
HR Information Systems
Payroll Outsourcing Systems and Integration costs
HR Vendor
HR Team Upskilling
HR Certifications
Workshop and Training budgets for HR team
Diversity and Inclusion
Increase in diversity hiring
Implementation of inclusive hiring practices
Employee safety and well-being
Employee health
Security at work
Physical and mental employee well-being
Others
Employee/employer appraisals and surveys
Upkeep of recreational areas in the office
Company trips
Fitness facilities
Safety trainings
Some resources to use when you plan a budget for HR:
Having a wealth of handy information can help you plan a budget more efficiently. If you’re looking for resources on the latest HR developments across idea, here are a few you might want to look at.
Resources
Guide to Hiring in Asia – A compilation of in-depth guides for various countries across Asia on how to compliantly hire employees in each country.
APAC Labour Law Insider – Quarterly updates on HR legislations across 17 locations in Asia.
China Labour Law Updates – Monthly updates on China’s labour laws.
Labour Law and Compliance Workshop Webinars – Complimentary webinars on labour law updates across various locations in Asia.
Templates and Checklists
HR Onboarding Checklist Template
Payroll Request For Payroll Template (RFP) Template
Handover List Template
Layoff Planning Checklist
China Personal Information Protection Law HR Compliance Checklist
Out of Office Message Template
In conclusion, having an HR budget is essential for companies as it provides a structured financial plan to effectively manage and optimise their most valuable asset – their workforce. It ensures that resources are allocated for hiring, training, and retaining employees, ultimately contributing to organisational success and growth.
Looking for a HR provider that can offer you HR outsourcing, advisory and HR tech services? At Links, we look forward to providing you with complete HR solutions to drive your organisation. Contact us today for more information!
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