HUMAN resources professionals are facing considerable challenges during this recession, not least is the tussle to keep and train staff for the upturn and to trim cost and save money to help the company get through the tough times.
The Association of Chartered Certified Accountants (ACCA) believes businesses should only cut training budgets as a last resort in a time of recession.
But it feels that it is vital for HR personnel to ensure the training programmes that survive in whole or in part are focused around the business model, which itself needs to be strengthened to cope with the the business slump.
Attention should be given to two key drivers of business - saving and generating cash, and spending wisely to invest in long-term projects that will deliver sustainable returns.
Therefore, HR must ensure that sales staff should receive training to develop business in areas which generate good, stable returns. Staff in purchasing should be trained in supply chain management and procurement to minimise the drain on working capital.
For production workers, it will make sense to ensure they learn to eliminate excessive cost and waste - and become innovative in process and product development.
The current economic situation will have different impacts on different business models. Those particularly reliant on financial services are hit more badly - and they must be fixed to become less dependent on them.
Employers should think very carefully before shedding staff. The psychological contract that binds employee and employer that takes years to build can be broken overnight.
Thus some companies have held on to their professional staff by reducing their working hours and offering them sabbatical, external secondment or further study.
It is critical that businesses recognise laying off people is not always the only option. You could keep them and bear the cost, redeploy them, put them on part-time contracts, or keep them on retainer.
These could be expensive. But sacking workers and going back to the market to recruit in 12 to 24 months' time may just be as expensive an option, In the meantime, you have spoiled your employer brand, killed staff motivation and poisoned the company's culture.
If you do need to let people go, at least prepare them adequately to serve for a new job; offer them a financial cushion and time to look for work elsewhere; provide them training and guidance; use your network to help them find another job and give them strong but accurate and honest references.
The longer the downturn, the weaker your company is likely to become and the longer it will take it to bounce back. The lessons from the past is to go into strong, maintain your core competences and build up capability to take advantage of the upswing.
Companies must think about how they may redeploy and train people into those core areas.
Here are some tips for an effective HR strategy:
Identify the capabilities required to make your organisation effective. Ask yourself the question, what drives value and what reduces the cost to the organisation of the function?
Once you have identified the relevant roles, ascertain whether the current holders of those roles have the desired levels of technical skills, business skills and commercial awareness.
Develop plans for those in core high-value roles and with high performance levels and those in roles with average or low levels of performance. For the former, place them on the leadership path, with enhanced rewards and development opportunities. For the other group, develop a plan aimed at lifting their current level of performance within a designated time frame.
For those who fall outside core roles, identify those with potential to fill core roles. Look for opportunities to divest or to outsource.
Recruit: look for opportunities to recruit from competitors and key talent. There will be many more people in the job market and many looking to move if they don't feel secure or recognised by their current employer.
