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Why good HR makes good business sense?

Why good HR makes good business sense?. Business Strategy. Leadership. Employee Engagement. Internal / External Customer Satisfaction , Delight and Loyalty. Business Performance. Source: Heskett et al. (2008). S ervice -profit chain. (Harvard) Parasuraman & Owen.

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Why good HR makes good business sense?

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  1. Why good HR makes good business sense? Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction, Delightand Loyalty Business Performance Source: Heskettet al. (2008). Service-profit chain. (Harvard) Parasuraman & Owen

  2. The facts…Why it’s Important… 68% 41% 70% …of customers LEAVE because of poor employee attitude Source: Parkington and Buxton, Study of the US Banking Sector, Journal of Applied Psychology …of customers are LOYAL because of a good employee attitudeSource: MCA Brand Ambassador Benchmark …of customer brand perception is determined by experiences with PEOPLE Source: Ken Irons, Market Leader

  3. The linkage analysis with engagement Employee Attitudes Customer Impact Financial Results Senior management interest Employee engagement 0.65 Customer focus 0.70 Revenue growth Challenging work Decision-making Authority Customer focus Cost of Goods sold Operating margin Career advancement Turnover retention Company reputation As employer Teamwork/ collaboration Sales, general & Admin expense Resources SOURCE: TOWERS PERRIN Decision-making input Positive relationship Negative relationship Conceptual relationship Senior-management vision Significance of statistical correlations: 0,25 – 0,3 – Significant 0,31 – 0,45 – Strongly significant 0,46 – 0,65 – High significance

  4. The moment of truth…so where to focus? Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction, Delightand Loyalty Business Performance Moment of Truth The HR Management Process / Value Chain Source: Heskettet al. (2008). Service-profit chain. (Harvard) Parasuraman & Owen

  5. What the evidence say… Business Strategy Leadership Employee Engagement Internal / External Customer Satisfaction& Loyalty Business Performance Human Resources Management Customer Relations Management Financial / Profit Service concept: employee behaviour linked to brand promises Retention, Repeat Business, Referral Quality of HR Value Chain …………………………………………………………………………………………………………………………………………………………………….. ccccccccccccccccccccccccc Impacted by level of employee engagement Service designed & delivered to provide consistent customer experiences Source: Heskettet al. (2008). Putting the service-profit chain to work. Harvard Business Review

  6. People Philosophy, Strategy & Policy Purpose, Intent, Values Generic Human Resources Value Chain Strategic Research Organisational & Work / Job design HR Planning Recruit, Select, Place & Induct People Development Managing Performance Recognition & Reward Redeploy & Exit Human Resources Administration Employment Relations / Employee Relations Human Resources Management System and MIS Change Management & Facilitation (Project Management)

  7. Approach: HR ‘State of Health’ AssessmentExample of assessment of Induction, On-Boarding & Engagement

  8. HR ‘State of Health’ Assessment (Continue)Example of collated scoring results

  9. HR ‘State of Health’ Assessment (Continue)Example of high-level recommendations

  10. Question:Based on the science and links into business value, would you participate in such an assessment approach?

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