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Archive for the ‘Economy’ Category

Ready for the new year?

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We all need to take a longer view on things...

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Hmm.

Used to be that we were really touchy about nationalism, especially here in the Midwest.  I think it was mostly driven by the auto industry, but it was pretty pervasive.  I recall sign demanding that any foreign car not be parked in a particular plant parking lot.  My favorite was at the Connersville  Ford plant, specifying that all “Non-Ford” cars be parked across the street.  I happily parked my Volvo fight by the front door, only to be directed to the punishment corner…they did not care that Ford owned Volvo, at that moment.  (Now the Chinese own the Swedes…)

Kokomo, Indiana was a hot spot of this thinking, at least until Chrysler went through two European owners…

What percentage of American made is permitted?

So, it was a twinge of nostalgia that I felt when I drove past this sign at a company that recently went out of business.

 
How about cars from Canadian or Mexican assembly plants – all are in the Americas…
 
Face it.  We’ve all become global – and while there are good and bad effects, it’s the way the economy is.  Capitalism rewards and punishes all…

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I was suspicious of Al Gore as a keynote for an HR conference.  Ex-politicians generally do what Steve Forbes did yesterday – give a standard “stump speech” with 5 gratuitous references to HR scattered throughout. 

Al didn’t do that.  He gave a thoughtful presentation on several HR topics, and only had a standard stump speech in the last third, combined with a proven rousing ending.  In the middle he even told a joke.  Worked for me.

Al on the big screen

His overall theme was “sustainability”, which he defined as not robbing the future to live now.

HR topics were:

Diversity – using all of the differing viewpoints to strengthen the organization.

Education – raising the bar for all employees

Dealing with the internet revolution – there are now 1 Billion transistors for each person on the planet. 

Organizational development – When he worked on re-inventing government, he would start by talking with the janitors and service workers in a department, then work up the pyramid.  They always knew what to fix.  Developing core competencies requires input from all levels.

Compensation & benefits – People work well because they identify with the values of the organization.  Don’t focus on the financial side of compensation completely.  Non-monetary benefits are better at building engagement.

Overall, he said that capitalism is the best method for resolving our recession, and HR is the key to developing society and markets.  The sustainability issue is not just environmental, it means not robbing the future but building value over the long term.  To do this, an organization must communicate from the entire supply chain.

Then, Al went into “Global warming” mode – talking about pollution, the BP response, and melting ice caps.  I could sense that the crowd didn’t necessarily appreciate him bringing his personal crusade into the conference.  However, he won them back by noting that this is the biggest opportunity business has confronted,

He also said that in the future the best young talent will judge where they should work based on how green the organization is.  He said that the challenge is to become more efficient, consume fewer resources, and be more productive.  Organizations that integrate sustainability find that profitability is up.

The very act of taking on a great challenge can transition an organization.  President Kennedy challenged the nation to go to the moon, and 8 years later we were there.  We are feeling another challenge now. 

A saying – If you want to go quickly, go alone.  If you want to go far, go together.  We have to go far, quickly.

Be bold.  This is like no other time in human history. 

He closed by asking the question of how we will be judged in the future.  He said that HR needs to have the moral courage to rise up and solve a crisis.  “We have everything we need to succeed except the will to act…but the will to act is a renewable resource.”

The crowd was back with him at that point – standing ovation.

Al on stage

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The first surprise – the Keynote walks out in one of those neck braces that you wear after a whiplash accident.  Says he has just had back surgery.  He looks and acts and talks like Steve Forbes, just with less head mobility.

He didn't move around much...

 

What we got was a standard stump speech with the term HR inserted as appropriate.  That said, it was a good stump speech.  Key points:

HR has a vital role in the economic recovery.

He is confident that the economy will recover.  2-4 Years.

Watch U.S. Monetary Policy as an indicator.  You cannot have a sustained recovery with a weak dollar.

A big part of the blame for the meltdown comes from the Fed holding interest rates low for too long, overheating the housing market.

This is not the end of the world.  “The end of the world will only happen once, and this is not it.”

Health care made his list – that there will be significant ongoing changes in the law.  “This thing is just getting started, and isn’t over by a long shot.”

The real problem with health care in the United States is that the consumer has lost control of health care services.  Everything is by third party.  By providing customers more controls, you will see costs decrease and access improve.

He believes that we will eventually get it right, but HR will have to push harder to get and stay involved to guide it.

Overall, the core of his presentation was on the theory of monetary policy, with good illustrations, and a short HR part tacked on the end.  If nothing else, he made us all recognize the importance of good fiscal restraint and oversight as a part of a long term recovery.  He also joked that if anyone is ever on a bad date that they want to end early, start quoting him and his fiscal theories.  “They won’t be asking you out again…”

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The migration begins.  Get ready to pick up some talent.

High performing employees have been hunkered down since last October (October 8th, 2008 to be exact.  4:00 pm EST to be even more exact.  That is when Lehman Brothers declared bankrupcy)

I offer as proof the current “leading edge” job listings at Amazon HQ for top talent in recruiting.  If you work in Lean, you watch Toyota.  If you work in staffing, you watch Amazon and Google.

To quote Amazon themselves – “We currently have the following positions open in our Seattle Corporate offices:

• Manager, Talent Acquisition (Digital/Kindle team)
• Recruiting Manager, University Programs
• Sr. Recruiter – University Recruiting
• Sr. Recruiter – Human Resources
• MBA Recruiter
• Technical Sourcing Recruiter, Seller Services
• Sales Sourcing Recruiter, Seller Services
• Sourcing Recruiter – Digital
• Recruiting Coordinator – Digital
• Compliance Leader, OFCCP

You can review any of the positions at: www.amazon.com/careers”

This is big. I interpret that this significant recruiting hire is the first sign of spring – that Amazon wants their team in place to harvest the best of the flood of high performers that will be coming out of the woodwork in the Spring.

As I’m writing my book about the coming talent shortage (and what to do about it) I am pleased to see the first signs of the thaw.

I have my opinions – what other signs do you see?

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Wow.   Pay for performance policy?  Restricting the pay of big shots?  Is there an Easter Bunny?

In the 2 years I worked inside a nation compensation and benefits consulting firm, I never thought that compensation policy was interesting.  Right up there with watching paint dry.  I thought that accountants with big brains set some secret algorithm and the magic box would just whir and paychecks would emerge.  At least that was my impression.

Now, compensation is big.  Really big.

It all comes down to $$$

It all comes down to $$$

Proof came in several forms.  Over the weekend, did you see the protests at the Chicago American Bankers Association conference?  If not, check out the link here.  Democracy can be messy, but it works, mostly.

On the Washington front, pundits are saying that one of the biggest things that Obama has done so far is step in and cap the compensation of the larger TARP-related banks.  But it isn’t simple.  One critic of the plan said the news of the decision may undermine a program that Obama traveled to Landover, Md., to announce on the same day. Obama went to the headquarters of a small company to tout his proposal to let small banks into the TARP program, as a part of the effort to get small business lending going again.

Camden Fine, president of the Independent Community Bankers of America who attended the event with Obama, says the pay master’s decision could doom the idea, as community bankers will be loath to take TARP funds if they think Feinberg will set their pay.

Want a good article on the subject?  Here tiz.

So, what does this mean?  It means that awareness about what people are paid for the work that they do is back on the front burner, and that is probably a good thing.  It also means that compensation theory experts are going to have their moment in the sun.  Whee.

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Sip your coffee and look out the window, if you have one.  The sun that just came up is shining on a “New Normal” world.  The Dow Jones is up, the economists are squawking that the recession is starting to pass, and I’m still cranky.

I took this on Main Street in Carmel...

I took this on Main Street in Carmel...

What if the recession passes but everyone who is out of work stays that way?  I am being asked to help write a lot of resumes these days for “a friend of a friend” and I’m getting a window into a tough job market.  My gut tells me that the rehiring that is starting to happen is not going to re-hire many of the folks that are out, and the expansion that is underway is going to find lots of “Lean” ways to stay at “lean levels”.  Productivity is up and will stay up, and new growth may come from an outsourced workforce.

I just read a good bog post on the subject – here is the link

A lot of the stimulus $$$ went to pay the bills for the unsustainable world we were living in.  Now that we’re re-set at 80% of our former economy, we have to get used to a lower standard of living…and along with that comes a lower employment level.

What to do?  Simply put, now is the time for HR to play a big role in the design and operation of the new organization.  Now is the decade of HR – the folks in finance need low risk and high return, operation needs flexibility and creativity, and the workplace needs leadership.

Now is the time for HR to step up with new tools to be a competitive advantage.  Start using new methods, and leave the ones that got us here in the closet.

Because the sun just came up in a “New Normal” world.  Happy Tuesday.

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