Human Resource Professionals can contribute to the socio-economic change in Australia.

The overwhelming availability of media, both social and formal, make it is easy to get distracted by the political “ping pong” and perceived waffle we are constantly bombarded with.  However, now organisations need to deal with the uncertainties of a budget delivery in the next few weeks and a protracted looming federal election.

We live in a time of political optimism with a current PM who sees the issues facing Australia as opportunities.  We clearly have deep-seated issues like an ageing population, high costs of doing business and providing services, relatively few value-adding sectors like manufacturing, a slow economic growth and an imbalance between revenue and expenditure levels.  Governments must rely on their own planning and service delivery departments while considering the impact on the private and not for profit sector.  We all have a role to play in maintaining our standard of living and assisting in closing the gap between the haves and have nots leading to a more sustainable society. 

As HR professionals we need to make that transition from narrow HR focus to a broader and more methodologically driven approach to organisational issues – often referred to as human capital management (HCM).  This approach commences with the development of a dynamic strategic plan that addresses the historical trends, where we are today as well as projecting forward with a dynamic quantifiable rolling strategic plan that defines the corporate accountability.  Other than the corporate statements that we are all familiar with the strategic plan must define how we intend to measure the success of the plan as well what capability will we need to deliver the strategic direction at the level defined in the performance measures.

Capabilities provide a framework for the organisational structures – today, 3 to 5 years and possibly a transitional structure if the organisation is undergoing significant change and development.  The positions within the structure represent the “contributing elements” and in modern organisations these positions are focussed on the outcomes they need to produce and are often quite different to the older more traditional “job”.  Modern HCM approaches enable the contributing elements to be designed in outcome/competency terms and sized and valued against the market.  This quantification of the human assets enables the HR to be placed on the balance sheet as a note.  This helps closes the gap between the book value and market capitalisation of a listed company.  The off-balance sheet items consist of the HR asset value, intellectual property value and socio-economic contribution (+ve or –ve). 

Without a clear direction of the organisations core business or main purpose it is difficult to measure the success of the organisation and determine what will be its capability needs in the short and long term. 

If you would like to do a quick assessment of your organisations strategic “health” then take a few minutes to complete the assessment survey and you will get a report as feedback.

If you would like to discuss any of the issues raised in this article please contact:

Maxumise consulting Pty Ltd

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We are all aware of a number of worrying signs in the social and economic health trend lines including the budget deficit, the cost of providing services especially health and education, investment in research, the maintenance of our assets, the heavy reliance on non-value adding e.g. loss of manufacturing etc.  While these trend lines may not be easily reversed it is fairly obvious that at least the rate of decline needs to be halted –and we need to hear the solutions.  Whether these solutions are Treasurer Morrison with his expenditure solutions or Ken Henry with his fiscal consolidation approach or the opposition’s taxation/negative gearing or some combination, the outcome is much the same i.e. governments are faced with higher costs of providing their “core business” of broad socio-economic management.  Reducing the widening gap between the haves and have-nots and probably addressing the unsustainable lifestyle some of us have become accustomed to, having had things too good for too long are difficult tasks.  Prime Minster Turnbull commenced his reign highly optimistic and apparently with a plan for innovation, growth and opportunity.  While the issues have been identified, more and more uncertainty creeps into the solution.  Perhaps it is time for organisations to become more proactive and develop a plan that will bring about the change at the “coal face” remembering we are both an island nation as well as a player on the world stage, rather than relying on governments to lead the charge.

What is the role of HR in this new direction to the future?  Well in the short term we cannot do much about the inherited ageing population or the high cost of doing business we created over the past 10 to 15 years or the big loss of value adding sectors etc.  But we can have a major input into the organisational wellbeing going forward if, as HR professionals, we adopt a broader more organisational and HR perspective – we call it human capital management (HCM).

HCM professionals provide methodology advice on consolidated organisational and human resource matters, ensuring the organisation comes up with appropriate short and long term solutions.  Professionals can find “boiler plate” solutions, it is so easy with search engines these days, but if taught the methodology they can work through the process to find the right outcomes for our organisations, or at-least know when they need help. 

In organisational and HR design this methodology commences with a robust and quantifiable strategic plan (SP).  The plan tells us what business we are in now, as well as what business we should be in now and into the future and how to measure the success of the implementation of the SP.  It is good to see the trend in some of the large Australian banks who are rationalising their business structures and hopefully focussing back on the primary core business.  We have had the opportunity to look at a number of “strategic plans” from government, not-for-profit and private sector organisations recently, and while we are yet to find the perfect dynamic strategic plan, we have found a number of 5 to 10 year static “road maps” that provide little or no clear definition of the core purpose of the organisation or historical trend information let alone any real forward measurable projections and strategies of achieving these i.e. accountability.  Many strategic plans, especially government, have poor visions, trendy missions and headings like KRA’s consisting of general statements of what has been done and even vaguer statements of what is going to be done and usually without any timeframe or quantifiable accountability within the performance measures.

Without a clear and quantifiable picture of where the organisations has come from, where it is today and where it wants to be in 3 to 5 years how is the organisation going to determine the capability it needs for the future?  This capability includes the human resources as well as plant, equipment and technology.  If an organisation does not have a future and possibly a transitional structure then they are unlikely to be preparing for the next generation of employees and will most likely become a “boiled frog” organisation.

A key role for the organisational/human resources professionals, in assisting governments realise their dream for Australia, is understanding what will our organisations future core business be and what capability is needed to deliver this.  The organisation’s structure represents the elements needed to deliver the core business at the standard set by the projected performance measures.  For Australia to regain its competitive edge these contributing elements must change dramatically.  If we are going to compete on a global platform the academic institutions together with industry bodies should have been redefining their programs yesterday.  We have seen many examples of this in the past where disruptive technology has left businesses and educational institutions behind for example, analogue to digital and print to electronic media.  We have tried to respond with new academic degrees such as mechatronics but this is tinkering around the edges not looking at the real and broader needs of industry.  As businesses recognise the changing shape of the contributing elements the balance sheet assets will include the HR assets, intellectual property as well as socio-economic contribution value (positive or negative). 

When certainty is uncertainty, we need to define our purpose through a 3 to 5 year strategic plan for our organisation.  We may be surprised at what emerges as the “core purpose” as well as what those “contributing elements” are and where are they located.  We may even ask if, on the world stage, is Australia too small?  Should we have a broader business base, say Australasia based businesses?  Then where does this leave the role of government and is the tail wagging the dog?  Whatever the solution is, it is clear that organisations need to plan and implement organisational and human resource programs that put them on the front foot as efficient and effective socio-economic contributors. 

If you would like to do a quick assessment of your organisations strategic “health” then take a few minutes to complete the assessment survey and you will get a report as feedback.

If you would like to discuss any of the issues raised in this article please contact:

Max Underhill

Maxumise Consulting Pty Ltd