For organizations to be successful, there are three factors that must be in alignment: process, technology, and people. Most organizations focus investments on processes and technology because they can easily measure the return on investment. Measuring the return on investment in people can be difficult, so businesses often ignore or neglect this factor.
Outside of recruitment and onboarding, many manufacturers fail to focus on their most valuable resource… people. However, when companies invest in people development and optimizing human resources, all areas of the business improve. The company builds better products, delivers better customer service, and generates more revenue and profit.
Many companies struggle with how to reduce turnover in manufacturing, attract talent to the industry, improve retention rates, etc. But rather than looking at the big picture, they tend to take a short-sighted transactional approach. The transactional approach is like treating the common cold, it’s never cured, you only treat the symptoms. Giving a pay increase to try to keep employees without considering other factors, only addresses a symptom of a larger issue.
In contrast, companies should take a holistic approach and strive for Human Resource Optimization (HRO). HRO is defined as having the right people with the right knowledge, skills, and capabilities, at the right time. The results are achieved by enabling and empowering business leaders and employees to do their jobs better.
There is not a one-size-fits-all approach to optimizing human resources. If we think of an organization as a complex system, like the human body, we begin to understand that there are a multitude of factors that contribute to its overall health. Likewise, the human body is different from person to person and the factors that contribute to a long and productive life for one person may not be the same for another. The same could be said for the success of a workplace.
With many human resources best practices that lead to becoming an employer of choice, improved retention rates, a reduction in absenteeism, etc., leaders must customize their approach based on the wellness and maturity of their HR function to meet the unique needs of the organization and its people. Understanding your HR wellness and maturity is vital to a holistic business-integrated approach to achieving HRO success.
Albert Einstein famously said, “insanity is doing the same thing over and over again and expecting different results.” Now is the time to stop the insanity and start investing in the development of people in conjunction with processes and technology.
Research tells us that business-integrated HR organizations allocate less money on daily HR operations, which leaves a larger budget for investments in talent management, workforce planning, leadership development, and other strategic HR functions. Therefore, manufacturers can begin the HRO journey by looking at current HR spending, coupled with resource allocation and other staffing ratios to invest strategically in people without increasing HR budgets.
Studies show that once businesses see the returns gained from re-allocating HR dollars, additional money spent on HR will pay for itself. So, let’s stop only treating symptoms, begin looking at the wellness and maturity of the HR function within our organizations, and form a pathway to human resource optimization.
Need assistance determining the wellness and maturity of your HR function? Contact your GaMEP Region Manager to connect with our human resources team and set up an assessment or get advice on how to get started.
By: Alfred Gardner, GaMEP Human Resources Project Manager