Human capital risk and reporting / Ernst & Young

My favourite presentation at last week's conference was given by Shaunagh Harvey Kelly and Mike Morley Fletcher from E&Y (the slide comes from a different presentation).

I think risk tends to get forgotten by HR functions (perhaps not within those covered by SOX). But the risk management approach outlined by the E&Y consultants fits perfectly with the requirements for HCM reporting within the UK's business review and similar reports elsewhere.

And it's really important!

As Taleo reported last year, according to Best practice in risk management: A function comes of age, a report from the Economist Intelligence Unit sponsored by ACE, IBM, and KPMG, human capital risks are the most significant threat to a company’s global business operations:

"Human capital risk, in particular, stands out as an area that respondents find particularly challenging. This risk, which is related to loss of key personnel, skills shortages and succession issues, has consistently been rated as among the most threatening risks that companies face in the two years that this series has been running. As this survey demonstrates, it is also among the most difficult to manage, and few respondents claim that they are effective at dealing with it. These findings point to the need for closer integration between the risk function and the human resources function, as well as a clearer understanding of the risks that companies face with their location and human capital strategies."

So I understand Mike Morley Fletcher's disappointment that "typically HR is not there when big risk assessments are done".

EY presented their risk assessment cycle, including the following four steps:

1. Validate objective

2. Identify risks to achievement

3. Evaluate risks (likelihood vs impact)

4. Assess risk gap

5. Identify further actions and monitoring mechanisms

... which can then be reported in the Business Review.

ie, it's not about avoiding risks ("in business, it takes risks to get a return"), but identifying the potential 'risk universe', understanding them (and their upside as well as downside) and putting in place appropriate actions to assess, measure, monitor and mitigate them.

And HR needs to be there when big risk assessments are done, and proactive in pointing out these most threatening of risks to business colleagues who are unlikely to fully understand them.

Symposium events: Measuring and reporting human capital summit

I chaired and presented at this HCM reporting conference last week (on behalf of Learning Light and Human Capital Management magazine).

The event was well attended, and with some excellent speakers. I particularly enjoyed presentations from David Povey, Business Excellence Director at Co-operative Financial Services and Laura Wilson at Standard Chartered. And a joint presentation from Ernst & Young on human capital risk - I'm going to come back to this.

But I think the delegates' favourite session is likely to have been the knowledge share networking session. This was an opportunity to share each other's experience, insights, challenges and solutions. I sometimes worry about the quality of conversation in these sort of sessions, but at this event there was a high level of energy and from what I heard, some great knowledge sharing too. I think all conferences should include it.

Flexible working - more than your job's worth!

In a previous post, I noted a challenge from the Harvard Business Review:

"If a company actually embraced—rather than merely paid lip service to—the idea that its people are its most important asset, it would treat employees in much the way Google does."

British company's reaction to today's announcement that the government will extend the right to request flexible working to more parents and require agency workers to be treated more fairly shows how far we've still got to go...

For example, the Federation of Small Businesses has warned that firms will struggle to absorb the cost of the reforms:

"The announcements on temporary agency workers and flexible working put small businesses in an impossible position."

There are a number of operational pros and cons that Sainsbury’s HRD Imelda Walsh must have considered in recommending an extension in the right to request flexible working from parents of children aged up to 6 to those with children aged up to 16 (an increase of 4.5 millon workers).

And if I was asked to participate in this debate, I would say that the pros outweigh the cons. As the CIPD explain:

"Our research shows that part-time and flexible workers are happier, more engaged with their work, and therefore likely to perform better and be more productive. And in a tight labour market, flexible working is part of the package that can help recruit and retain the talent organisations need to deliver their objectives. It is therefore unsurprising that a great many employers, large and small, go well beyond the legislative minimums and allow employees to work flexibly regardless of their family status."

But to me the choice is more strategic and more straight forward too. If companies see their people as human resources then of course they're going to want to maximise the utility of this resource. If they see people as providers of valuable human capital, who invest this capital for as long as they're looked after and provided with an appropriate return, the course of action is just as clear, but completely different.

So while the extension is a sensible compromise, I'd argue it doesn't go far enough. After all, we're only talking about the right to ask. And giving some people this right and others not, is bound to present problems. Again, quoting the CIPD:

"We remain concerned that businesses who stick to the legislative minimum on the right to request may begin to see the emergence of a divide in the workplace between the flexible working haves and have-nots. The danger with ever larger groups of people entitled to request flexible working, and a smaller number not entitled to do so, is that a sense of unfairness will damage the employment relations climate and business performance."

But many organisations that want to invest in their human capital need to do more than simply apply the right to ask past those who are legally entitled to it. As Personnel Today has noted, many employees fear that their careers will suffer if they take up their right. And they're probably correct. Reporting on research of small business owners / managers, Management Today also explain that:

"The issue, of course, is that if the people running companies don’t really understand the basic concept."

Perhaps if business managers learn a bit more HR-speak it might help.

And it sounds as if some major cultural change is required too.

HR Carnival 33

HR Carnival time already! I've only managed one post since the last one which can't be good news.

Anyway, do check out carnival 33 on Peggy Andrews' Career Encouragement blog.

It's got some good posts although I was disappointed by the first one from 8 hours & a lunch. Not that there's anything wrong or poor about the post - Deb's (sorry, deb's) always an entertaining writer and findings like those in the HCI's / Vurv's (shortly to be Taleo's) HR in the age of Talent certainly need to be discussed. But I strongly disagree with her conclusions. So here are mine.

While I'm at it, I've added some other complaints from HR Guru:

1) too many HR folks spend too much time on things that really don't impact the business / HR people do not understand the business

Yes, agreed, but let's no stop at just implementing the business plan - we need to shape that too.


2) too many HR folks can't speak the CFO's language / HR people expect others to understand “HR Speak”

Well, OK, we need to understand our businesses and be comfortable with Finance, but we need to educate the rest of the business to use the CPO's language too!

We shouldn't expect our business colleagues to understand debates around grandfathering or red circling, but they do need to understand how reward influences motivation, and 'engagement' is no more jargon than 'balance sheet'.


3) too many HR folks are all about the party planning

Sorry, I don't see them. I think this one's a myth. (But note, the early results of my Social Connecting survey suggest that physical connecting activities like parties are likely to be more effective at building social capital that virtual ones using social media tools).


4) too many HR folks are all about the politics

Nor this.


5) HR people care more about the process than the outcome

I don't think they do, in the main. But they do recognise, which a lot of their business colleagues don't, that they can't be responsible for business results. The missing link is human capital and I think if HR can take more responsibility / accountability for this, then the perspective of the business will start to change.


6) HR people prefer talk to action and are non-committal and vague

The issues we deal with are often extremely complex in which cause and effect relationships are subtle and tenuous if they exist at all. There are often no right answers. Organisations are not machines. They won't 'change' overnight but they will move as people's shared understanding shifts. And sorry, but this requires talking to each other.


7) HR is a tool of management

Actually, I agree with this. I don't think enough attention is given to Ulrich's employee champion role. It goes back to the point I made above. Yes, HR needs to help their organisations implement strategy through their people, but they also need to make the business aware of the potential of their people, and the value they can add to business results.


Harvard Business' Conversation Starter has encouraged HR to paint a new picture of itself. Well the above points and my comments to the Conversation Starter post are the outlines of my painting.

I did start off outlining some of my beliefs about HR last year (I've no idea where the time has gone!) and will return to complete these shortly.

HR for innovation / Google

I've got a bit behind on my business reading but I've been catching up on the Harvard Business Review. I think the most relevant to this blog of all the recent articles I've been reading was April's on Reverse engineering Google's innovation machine.

The article reviews some of Google's great human capital management practices which it credits towards the company's success (whilst pointing out that it is impossible to establish whether these practices have led to its success or its success enables these practices).

The practices include:

Building innovation into job descriptions: '20 percent time'

"One clear reason for Google’s success at innovation is that the company does what many others do not: budgets for it in employee time. New ideas at Google are often generated by employees, from the bottom up, in a prescribed system of time allocation. Technical employees are required to spend 80% of their time on the core search and advertising businesses, and 20% on technical projects of their own choosing."

HRZone provides more detail on this approach, as described by Google's HR Director for EMEA, Liane Hornsey:

"Employees' work structure follows a '70/20/10' model, an arrangement which, Hornsey says, is 'hugely important to anyone who works here'. This refers to a breakdown of the working week: 70 percent of the employee's time should be spent on the business, fulfilling the job role (which, incidentally, is very clearly defined - providing absolute clarity about the job description is essential as 'good people only fail if they do not know their role'). Ten percent of the schedule is time to do 'whatever [the employee] wants' – time for innovation and creativity, freedom to think.

Twenty percent of the time – or one day out of every week - she calls 'personal work', a period spent on personal development which will ultimately benefit the company. '[Staff] can work on whatever they want to work on, as long as it's in line with the mission [of Google]. This gives you time to develop'."

Twenty percent time / Google time has clearly ben a driver for the success of Google as well as Genentech and 3M but it still hasn't been copied widely elsewhere.

OK, it's a fairly different way of doing things but I still find its lack of uptake quite surprising given its impact on business results (eg accounting for 50% of new product / feature launches) and talent management: Google's overall HRD Stacy Sullivan explains that the policy is as important to attracting and retaining employees as it is to sparking fresh ideas: "We hear people asking about it in interviews. It’s a bit selling point. It makes people feel the company values the employees."


Eliminating friction at every turn: ensuring change can happen quickly and efficiently

"Google’s approach to innovation is highly improvisational. Any engineer in the company has a chance to create a new product or feature. That individuals can have such influence has allowed Google not only to attract high-quality employees (including some of the world’s best computer scientists, statisticians, and economists) but also to create a large volume of new ideas and products."

This is a great example of coherence and alignment between strategy, HCM practices and employees: the strategy requires innovative practices which attract talent who enable the company to deepen its focus on innovation.


Letting the market choose: “crowdsourcing” its product strategy

"The emphasis in this process is not on identifying the perfect offering, but rather on creating multiple potentially useful offerings and letting the market decide which are best. Even a modest fraction of Google’s more than 132 million users constitutes a massive test bed and focus group for evaluating the potential of new products."

Is this an HCM practice? I think it is because it demonstrates that Google are thinking about accessing the appropriate human capital wherever it exists - and this doesn't have to only be in employees.


Cultivating a taste for failure and chaos

"Google executives appear to be undeterred by failure. In fact, Schmidt encourages it: “Please fail very quickly—so that you can try again” is how he described his outlook to the Economist. Similarly, Page told Fortune that he had praised an executive who made a several-million-dollar blunder: “‘I’m so glad you made this mistake. Because I want to run a company where we are moving too quickly and doing too much, not being too cautious and doing too little. If we don’t have any of these mistakes, we’re just not taking enough risk.’” Needless to say, that level of risk tolerance is rare in corporations, despite the widespread belief that error and innovation go hand in hand."

Supporting inspiration with data - making extensive, aggressive use of data and testing to support ideas

The article explains that Google takes an analytical, fact-based approach not only to its core business of page-rank algorithms but also to making any change in its web pages and deciding what new services to offer.

The article also refers briefly to Google's recruitment processes: "It continually modifies its hiring approach based on an ongoing analysis of which employees perform best and most embody the qualities of 'Googleness'."

ERE.net describes Google's use of algorithms in recruitment in more detail:

“The basic approach is quite simple. First, you survey current employees on a variety of characteristics and traits, including teamwork, biographical information, past experiences and accomplishments (i.e., have they started a company, written a book, won a championship, set a record).

Next, you statistically determine which of these many traits your top performers and most impactful employees' exhibit that differentiates them from bottom performing and average employees.

Finally, you develop an online survey to gather the predictive information from applicants. Then each candidate's biodata survey and resumes are screened electronically and given a score between zero and 100 based on how many of the top performance indicators each candidate possesses. (It's important to note that using biodata to screen candidates is not a new process, but is quite rare in companies that hire large numbers of professionals.)"

But I like Google's use of 'soft data' as well. In addition to a fairly innovative suggestion scheme (in which people can comment on and rate the ideas of other people), Google, seeks to tap the overall knowledge and intuition of its people through prediction markets:

"Another order of analysis involves Google’s use of nearly 300 prediction markets consisting of panels of employees. It uses the panels to assess customer demand for new products (“How many Gmail users will there be on January 1, 2009?”); company and product performance (“When will the first Android phone hit the market?”); competitor performance (“How many iPhones will Apple sell in the first year?”); and some just for fun (“Who will win the World Series?”)."

I think this is a really interesting approach, particularly in an organisation so focused on the use of information (in which according to a Harvard case study people aren't allowed to say 'I think' but instead must say 'The data suggest...'


So some great approaches supported, as the article notes, but a great culture, that even without the pool tables must make Google a truly great place to work - and no wonder they're so successful.

I'll finish my review of the article with one more quote:

"If a company actually embraced—rather than merely paid lip service to—the idea that its people are its most important asset, it would treat employees in much the way Google does."

I'd argue that companies should aim for the same degree of sophistication, but perhaps different practices may be appropriate (it's all about getting the alignment between strategy, practices and people).

But any company can develop these sophisticated approaches. As Google's Sullivan explain, they make sense for all workers, ranging from retail clerks to midlevel managers to top executives: "It could be anyone - just give them an opportunity to make a difference to your organisation".

So why aren't you doing them?


(Note, I've also commented on another of April's articles, 'What you can gain when you lose good people', on my New Social Business blog.)

HR Carnival 32

Check out the carnival at the Maximize Possibility blog.

One post of note is Taleo's sumary of the global update to BCG's HR survey.

I particularly like advice at Coaching Tip on managing the brain drain, for example through this innovative approach:

"Two companies that have taken the practice of hiring back retirees are Procter & Gamble and Eli Lilly. Faced with the prospect of losing large numbers of Baby Boomer researchers, the two companies joined forces in 2003 and launched YourEncore, which created a pool of former emplooyees and other experts whom each could call on for temporary help."

On a personal front, my attention was drawn to Brazen Careerist's suggestion that plastic survey may be the next must-have career tool:

"We are hard-wired to treat good-looking people better and it’s pretty much impossible to overcome this tendency. Patzer shows that this salary discrepancy is true even in law firms, where the partners doing the hiring are acutely aware of how illegal it is to favor good-looking people. Researchers at University of Texas, found that even mothers treat good-looking children better than average-looking ones.

Before you complain about how unfair all this is, Patzer shows that good-looking people are actually better for the company’s bottom line. This is because highly attractive people actually earn more money for a company than average looking people. One study in Holland, for example, showed that companies with better looking management consistently billed more hours at higher rates than companies with average looking management."

My facestat results suggest I may need to take some notice!

Introducing my Enterprise 2.0 blog

I hope you've found my latest series of posts on web and enterprise 2.0 interesting. I'll be returning to some other themes shortly.

One reason I wanted to focus on this area for a while is that I've been starting to think about my next book, which ever since finishing the last one (on human capital), I've wanted to focus on social capital.

There are a lot of areas I feel I need to learn more about (and get more experience in) in order to do this - one of which is social media. But there are a lot of other areas too.

And I'm hoping to get plenty of input to support my learning. So I've set up a separate blog to focus on this area.

I've called this blog 'The New Social Business'.

I don’t want to use the ‘2.0’ tag, because I think being a social business involves much more than just the use of social media (and doesn’t actually need to involve the use of social media at all).

It's still not an ideal term of course because many people take 'social' simply to mean the opposite of work. I use it in its more formal, scientific context to refer to human society and its organisation, including the relationships between people.

And I've had to add 'new' to the term 'social business' because social business or social enterprise is typically taken to refer to organisations focusing on social benefit rather than organised in a social way.

So if you have been interested in my posts on enterprise 2.0, please also check out this new blog, join the community and contribute towards what I am sure will be an important new book on the effective management of people for organisational success.

Oh, and it would be great if you could take my social connecting survey too.

Is web / enterprise 2.0 a bubble?

Anonymous commented on my post 'social connecting in business', suggesting that 2.0 is a bubble and that I should "pontificate new collaboration / interaction models in HR without bringing up web 2.0".

I don't think that 2.0 is a bubble, but I agree that other approaches are as important (possibly more so). I believe that if organisations see 'connecting' as the key issue, then this will guide their choices in technology and other areas, and avoid over-investment due to marketing hype.

I've been asking about this in Linkedin. Most people's answers seem to agree with both anonymous' and my own points, ie that 2.0 is largely hype, and that the key to avoid falling for this is to focus on connecting, on people rather than the technology:

"Jon, I think you are right about that concentrating on technology first is not the best approach. And I agree with Charles Caro that the whole concept of Web2.0 is just hype. The 2.0 should be applied to the people if you really want to apply it to anything. We maybe have better tools, but there is one constant, and that is the most important as I see: you talk, connect, communicate with people. And people are more or less the same as they were 10 or 20 years ago."

They also suggest that this will help businesses think more innovatively about the technology:

"I see a lot that businesses use Web2.0 technologies as a replacement for an existing tool - the blog replaces the newsletter for example. Again people are just using the innovation as a new delivery mechanism for fairly traditional content. The problem from an organisational perspective is that it is quite difficult for people to change both the 'what' and the 'how' of what they are doing. It can be tricky to get people to realise that completely new things are possible."

Some innovations will be successful, and others wont:

"With many more players involved there are more ideas on the table. Many will still be stupid, but some will be successful. Moreover, web effects will tend to be more and more similar to chaotic or ripple effects, with behavioural pattern that will dramatically affect success of business or technological solutions."

The key is to get involved and see what will work for you:

"Learning Web 2.0 (however you define it) is much like learning a new fundamental skill like bicycling or typing or email or spreadsheets. You can't be sure exactly how you will use it, but you can be sure it will be useful in all kinds of ways. It's pointless to try too hard to figure in advance how it will affect your business--that is unknowable. What you want to do is have loads of people learn the skill and the best uses will emerge."

The graph on this post is from the early contributions to my survey: this seems to contrast with the answers to my Linkedin question - so far people responding to the survey are a lot more bullish about the possibilities inherent in web / enterprise 2.0: 50% say that 2.0 is a revolutionary new opportunity for business that must be grasped with a sense of urgency.

What's your take?

You can add your views to my survey at http://www.surveymonkey.com/s.aspx?sm=Pr2WYysTiyb3DM6a8mW7WA_3d_3d.

And / or please add your comments here.

Learning 2.0

Hello to everyone I met at today's Learning & Skills Group conferencette. I hope you'll get time to take my social connecting / web 2.0 survey (top right-hand corner of my blog).

And especially to Jane Hart. Jane, I hope you're not too shattered now after your two sessions on learning tools.

I've already posted a series of updates on social networking and web 2.0, as well as enterprise 2.0, management 2.0 and knowledge management 2.0.

I like Jane Hart’s description of learning 2.0 as well:

“Learning 2.0 (or E-Learning 2.0) is a second phase of (E-)Learning based on Web 2.0 and emerging trends in learning e.g. informal learning, self-managed learning and performance support.

The traditional model of Learning (which might be termed Learning 1.0) focused on content produced by experts (teachers, instructors, etc), and structured into courses, to be consumed by users/learners.

Web 2.0 technologies support a more social, collaborative and sharing approach to learning, so that learners (in both formal and informal learning situations) can co-create content and collaborate with peers to form a learning network - hence it is also referred to as Social Learning.”

You can see how all of these terms knit together…

(This post's picture is a slide from an IBM presentation, Enabling Global Integration through the use of Web 2.0 Technology, presented on an HCI webinar last year.)

Knowledge management 2.0

Knowledge management 2.0 is expressed well by David Gurteen:

“Another label for KM 2.0 might be “Social KM”. It is an emerging social model of KM. To my mind it is a very powerful model as it clearly places responsibility for knowledge sharing and making knowledge productive in the hands of the individual.

And so in the world of KM 2.0 we have two categories of social tool – soft-tools such as after action reviews and knowledge cafes and techno-tools such as wikis and blogs – an incredibly powerful combination.

So if the central question asked by managers in the KM 1.0 world was “How do we make people share?” the question of the KM 2.0 era is “How do we better share, learn and work together?” And is asked by everyone!

KM is becoming social.”

Again, very much linked to my other comments on enterprise 2.0 and management 2.0.

Note, the picture for this post is taken from Gurteen's presentation, 'KM goes Social', available on Slideshare.

Management 2.0

Management 2.0 comes up in Gary Hamel’s book, ‘The Future of Management'. Hamel argues that management will evolve to look a lot like web 2.0, and will therefore be more adaptable, innovative and engaging. He lists the key criteria of both web 2.0 and management 2.0 (which I think apply to all real enterprise 2.0 approaches) as:

• Everyone has a voice


• The tools of creativity are widely distributed


• Its easy and cheap to experiment


• Capability counts for more than credentials and titles


• Commitment is voluntary


• Power is granted from below


• Authority is fluid and contingent on value-added


• The only hierarchies are "natural" hierarchies


• Communities are self-defining


• Individuals are richly empowered with information


• Just about everything is decentralized


• Ideas compete on an equal footing


• It's easy for buyers and sellers to find each other


• Resources are free to follow opportunities


• Decisions are peer-based.
  

Enterprise 2.0

Enterprise 2.0 refers (at least in the way I use the term) to the web 2.0 enabled organisation: one, which like web 2.0 (the social web) is likely to be open, collaborative, democratic etc

(see this 'enterprise meme map' from ITSinsider.)

The term was introduced by Harvard professor, Andy McAfee in a Sloan Management Review article, Enterprise 2.0: The Dawn of Emergent Collaboration.

McAfee uses the term slightly differently to me – to “focus on those platforms that companies can buy or build in order to make visible the practices and outputs of their knowledge workers”.

I am much more concerned with the outputs of these technologies, the changes in the business itself than the blogs, wikis, group messaging software etc that enable these changes. In fact, I would prefer the term ‘social enterprise’ which emphasises the nature of the organisation (which can be developed through real or virtual tools and activities) if this wasn’t more commonly used to refer to organisations with a social purpose rather than a social way of operating.

My concern about a pure focus on web 2.0 technologies is expressed well by Thomas Davenport in his Harvard Business blog:

“What he's [McAfee] trying to do is to bring Web 2.0 technologies into the enterprise, to understand and describe how blogs, wikis, tagging, and other participative tools will change large bureaucracies. He believes they will empower employees, decentralize decisions, free up knowledge, and generally make for better places to work. I share his goal of more democratic organizations and hope he is correct.

However, I fear he is not. Such a utopian vision can hardly be achieved through new technology alone. The absence of participative technologies in the past is not the only reason that organizations and expertise are hierarchical. Enterprise 2.0 software and the Internet won't make organizational hierarchy and politics go away. They won't make the ideas of the front-line worker in corporations as influential as those of the CEO. Most of the barriers that prevent knowledge from flowing freely in organizations – power differentials, lack of trust, missing incentives, unsupportive cultures, and the general busyness of employees today – won't be addressed or substantially changed by technology alone.”

Agreed. But 2.0 web technology does seem to be an important enabler.

The extension of the 2.0 tag from the web to the enterprise has further led to the placement of 2.0 after just about any other business term you might care to think of. Often this is done to refer to a ‘social’ way of operating, but sometimes, rather unfortunately, it’s just used to try to infer a more innovative way of doing things - even more so if something is labeled 3.0 (see ReadWriteWeb's discussion of web 3.0 as a marketing ploy).

I think three of the most sensible extensions are management 2.0, knowledge 2.0 and learning 2.0. And I will look briefly on these in my next three posts.


See also my previous posts:

Social networking will change HR
I'm tweating two
Social networking vs web 2.0
Social connecting in business
HR 2.0 survey.



Take my 'Social connecting in business' survey here.

Social Networking will change HR

The title of this post is taken from Business Week’s article published this February, Social Media will change your Business (an update on what was apparently an iconic article on blogging published in May 2005 – well before I started getting interested in blogging and social media in general).

I think this article provides a useful summary of social networking and web 2.0, and the update from the previous article shows very clearly how much business application of social media has advanced in a very short period of time. (My own learning about social media continues to advance as well - a particular hat tip to the Podcast Sisters for this).

The main point of the Business Week and other articles is that social networking and web 2.0’s ability to generate mass participation has the potential to provide a significant boost to organisational productivity. In an FT article, John Chambers at Cisco explains that “it will have more impact (than web 1.0) because the power of many to many allows you to do things at a dramatically different speed”.

Importantly, although most business people who know about social media tend to think about the applications of this technology in terms of connecting to customers, the greater opportunity may be in connecting with employees.

In fact, some recent research by McKinsey has shown that more businesses are already using some combination of web 2.0 technologies to manage collaboration internally (75%) than to interface with customers (70%) or with suppliers and partners (51%).

(This investment doesn't seem to have worked its way through to HR applications however - the Industry Standard notes that Industry Standard notes that HR is still at the bottom of the heap.)

To me, the key to McKinsey's enhanced ability to collaborate is the quantity and quality of connections employees have, both internally and externally. Social networking is therefore likely to be more important that other web 2.0 applications.

In fact, this is sort of what McKinsey has found. The main web 2.0 technologies and tools they find companies are investing in are web services (80% using or planning to use), collective intelligence (48%), peer-to-peer networking (47%) and social networking (37%) – all more popular than RSS, podcasts, wikis, blogs and mash-ups. But I’m not sure that web services or peer-to-peer networking are really part of web 2.0 – they seem to me to be part of more traditional distributed computing (and I’m still not sure about mash-ups either). And I think collective intelligence is a mix of social networking and web 2.0, so this leaves social networking as the most popular (still not necessarily the most important) form of technology (I accept readers may not agree with my manipulation of this data).

A list of social networking (and web 2.0) applications within people management might include:

• Recruitment: using not just individual but corporate networks, whether these are open or closed, to identify and screen candidates, build relationships and promote the organisation using a human voice. (Other web 2.0 applications include recruiting through virtual worlds and promoting through blogs and podcasts.)
• Learning, including induction and onboarding: the use of webinars, blogs and podcasts etc to provide extended opportunities for passive learning. (Other web 2.0 applications could be seen to include the use of rapid e-learning systems by subject matter experts.)
• Knowledge management: enabling people to contribute, share, build upon and access information is largely about web 2.0 rather than social networking itself. However, social networking has a key role to play in identifying who are the owners of knowledge, ie it supports mainly know-who rather than know-how / know-what. Social networking can also be important in enabling employees and others to contribute ideas, suggestions and knowledge.
• Enhancing communication, involvement and engagement: enabling people to connect and communicate in an informal, human sort of way, in order to build meaningful relationships (potentially easier for some to do virtually rather than face-to-face). (Other web 2.0 applications include blogging and podcasting whether this be from the CEO down (a CEO blog) or by encouraging and facilitating the employee’s voice through internal or external blogs, wikis etc.
• Developing relationships, which I think extends beyond both just knowledge management and communication, as the quantity and quality of social relationships both internally and externally to an organisation provide their own, largely intangible value, for example, in supporting employees in managing their own careers. Another aspect of this is in identifying people who can contribute to an organisation who are not the organisation’s employees (managing across boundaries) and potentially in ‘crowd sourcing’ (outsourcing to individual agents).
• Virtual team working: supporting virtual and dispersedly located teams and home workers, giving a personal flavour to relationships with others in the organisation.
  
  

The other reason I suggest that social networking is likely to be more important than web 2.0 is that I feel (and I’ve got absolutely no evidence for this what so ever) that the extra social capital provided through social networking’s enhanced connections and relationships will have a greater impact than the extra human and organisational capital provided by employee blogs, podcasts and organisational wikis etc - mainly because social capital is generally much less well developed.
So yes, HR 2.0 is going to have an impact on the way that people are managed and developed. I like the illustration provided by Sanjay Dholakia of SumTotal in a Talent Management magazine article (see also my previous post web 2.0 in SuccessFactors' Ultra):

"Joining Web 2.0 tools to traditional performance management practices such as the annual review, 360-degree assessments and training, etc. gives employees a sense of independence. They can evaluate their competencies and take actions to improve productivity in a networked way, with peers, managers and colleagues providing support. In this way, Web 2.0 tools and traditional talent management technology mesh, and workers can seek out organizational experts and communities of practice as needed."

But I still think it’s going to be social networking that is really going to change HR.


See also my previous posts:

I'm tweating two
Social networking vs web 2.0
Social connecting in business
HR 2.0 survey.

Take my 'Social connecting in business' survey here.

I'm Tweating two

Well, only six months ago, I said I could never see myself doing it, but I'm now on Twitter.

For those of you who don't know what this is, France Roche at KnowHR has a good post / video link that explains it well.

What changed my mind?

Well, one recent trigger has been Debbie Weil's recent blog posts on Twitter.

And more broadly, it's the fact that a few other HR bloggers are now joining: see for example, one of Gautam Ghosh's recent posts.

And my interest was also raised in a recent show of the Podcast Sisters.

My previous reservation was mainly to do with my blog posts being rather long and so not being able to see how 'micro blogging' would work. Actually, I think the term is wrong. To me, this isn't a form of blogging (which would fall in the category of web 2.0 using the categorisation I described in my last post) but of social networking itself (people-to-people vs people-to-content. It puts me in direct contact with other people, not really just their content. And seen in this way, it has huge potential value to me.

So here I am.

Mind you, I still don't think many HR professional are on board. Twitter search engine Terraminds picks up just 8 HR twitterers. And About.com:HR's recent poll finds almost complete ignorance of it:

Social networking vs. web 2.0

Although these terms are often used imprecisely and interchangeably (with each other, and with other terms such as social media and social software), I believe 'social networking' and 'web 2.0' do refer to different things.

The way I separate the two is by explaining that:

social networking focuses on connecting people to each other, whereas

other web 2.0 applications focus on connecting people with the content that has been generated by other people.

So I might connect to someone via Linkedin and then subscribe to his or her blog to access the content this person has generated. (Of course, it is not quite as simple as this, as I may often subscribe to a person’s blog because I value them and their thinking, not just because of what they are currently writing about – in many ways I am in fact subscribing to the person, not just their content.)

So the points in my previous post about connecting apply in particular to social networking. In many ways, social networking is only a technology enabled way of doing what good networkers have always done, but this can now be done by many more people, and on a much broader scale.

See also my previous posts:

Social connecting in business
HR 2.0 survey.


Take my 'Social connecting in business' survey here.

Social Connecting in Business

This post refers to my new survey on HR 2.0. I don’t want to influence anyone’s answers to this, either one way or the other. So you may want to take this survey before continuing to read on. The survey is available at: http://www.surveymonkey.com/s.aspx?sm=Pr2WYysTiyb3DM6a8mW7WA_3d_3d.


Referring to the CIPD’s current research, the elearning network define web 2.0 as ‘the second generation of web-based 'social and sociable' technologies that gives people more voice in matters that affect them, encourage conversations, interpersonal networking, personalisation and individualism’.

The term ‘web 2.0’ was introduced by Tim O’Reilly at an internet conference in 2004, in reference to data, voice and video applications that use the ‘internet as a platform’, enabling non-technical people to easily build their own programs with user friendly interfaces.

It is the fact that web 2.0 allows lots of people to easily use the web to communicate and to share information with many other people in real-time that leads to another definition of web 2.0 as the ‘participatory web’.

So, whereas the first boom in internet usage (what has now become known as web 1.0) was about broadcasting information, web 2.0 is about collaborating, participating and exchanging information between people. There may be truth in the point that this is what the web was supposed to be about all along (and some internet sites have encouraged it for a long time, for example users have been able to write book reviews in Amazon.com since1995). However, web 2.0 put interactions rather than transactions at its very heart.

In fact, to me, web 2.0 is about these interactions, not the technology that supports them. Google’s Blogger may be a web 2.0 application, but it is my blog: my posts and your comments, which are at the heart of much of my experience of web 2.0.

And in fact, although web 2.0 may have been defined as ‘internet as a platform’ in 2004, at the second conference a year later, its meaning had already changed to refer to the new ways of working this technology was enabling.

To me, the fundamental focus of web 2.0 is about connecting, which then enables empowerment, collaboration, collective intelligence, organisational democracy and all the other benefits that are often seen to result from the technology.

So to understand the importance of web 2.0, we need to understand the process and benefits that organisations see in connecting, not just how they are using the technology.

And we need to remember that connecting can be done in the real as well as the virtual world.

These are a couple of my beliefs about web 2.0 which underpin my current survey.

HR 2.0 survey 1.1

Here's the full link in case you want to email it out to your contacts to complete (I can dream):

http://www.surveymonkey.com/s.aspx?sm=Pr2WYysTiyb3DM6a8mW7WA_3d_3d

HR 2.0 survey

The elearning network are running a survey on organisations' use of social networking / web 2.0 initiatives, on behalf of the CIPD.

I think this is a great initative and I look forward to hearing about the results of the survey at the CIPD's HR Software Show in June.

However, I do think they've missed a trick by approaching this from the viewpoint of the initiatives and the technology. After all, we all know that the technology behind e-learning doesn't matter; it's how this is used as part of a blended solution to achieve certain learning and business outcomes that counts.

So what are we really trying to do with social networking and web 2.0? I think if we could answer this, we'd be in a much better place to predict the impact of the technology.

Here's my perspective: it's about connecting. Connecting with other people both inside and outside of the organisation to increase human and particularly social capital (capability, engagement and useful relationships).

Another thing we all know is that the point of performance in most organisations is no longer the individual, it's the team. So human capital is no longer the only thing that counts. It's the combined social capital from people working together that's increasingly going to make a difference to organisational success.

And if social networking can influence this, well, then, I think it's got a future...

However, I don't believe many corporates have got this message yet. I think the value of connecting is well understood by independents like me, and by a lot of individual employees too. But I don't think many business leaders, or HR people, are thinking like this yet.

I could be wrong of course.

So I've also written a survey to find out. Please, please, please, take this now!* It will mean a lot to me, and I think your insight together with everyone else's will add a lot of really helpful clarity to this important area.

It is a slightly longer survey than the elearning network's and I apologise for that, but it's only 16 questions, so it should only take you 5 minutes to complete.

I'll publish the results in my blogs in a few months time, but if you include your email address in the survey, I'll send you the results.

And look out for some interesting posts on web 2.0 coming up too.



* The survey is designed for practitioners, but I'd still encourage others to complete it as long as you answer from the context of one particular organisation that you know.


(HR 2.0 logo created at http://h-master.net/web2.0/).

Innovation in performance management

In his KnowHR blog, Frank Roche suggests that organisations may need to develop a dual system for performance management, with one version for high performers and another for everyone else.

"Great performers don’t need performance reviews. Especially the yucky and typical kind. They have a great distaste for ratings that can’t adequately capture what it means to be up at two in the morning working on a project while the rest of the company sleeps. On top of that, they really resent getting a rating that’s anywhere near what Joe Average gets."

The slide presents a 3 level approach for performance management we introduced in my last corporate role - based on standards (performance appraisal), SMART objectives (performance alignment) and what we called stretch goals (performance leadership) and I'm now referring to as MUSICal dreams (although 'd suggest keeping the earlier term for use within an organisation!).

The approach in the slide suggests that all employees can be set all three levels of goal. But I also think that organisations may want to focus on one or more level according to the employee's performance. Low performers need to be focused on the standards for their role. Higher performers need to focus on their dreams.

For me, the key to answering Frank's concerns isn't how high performers are reviewed, it's the type of goals they are set. If' they're freed up from the organisational mechanics to focus on their dreams, their performance is going to be even higher, and the review of this is going to be much more pleasant for all concerned.

The Dream Manager

Although I think Matthew Kelly's book, The Dream Manager, provides a very powerful case for helping employees explore their dreams, his book promotes a rather different role for dreams at work to me.

I think the power of dreams will be felt when individual dreams and someone's role at work are aligned, hence my proposal that they are discussed as part of performance management.

Kelly talks about dreams as a complementary issue to work, and the business benefit being one of increased engagement that will be gained by helping people explore and meet their dreams, generally outside work. The dream manager who helps people do this is in a sense an employee benefit that would form part of a reward package:

"This will win the respect of your employees on a level that most employers would never even dream of. People will see [the company] as a place where dreams can be accomplished, a place where they won't get stuck forever. People who want to achieve their dreams will want to come and work here. So we will keep attracting the right type of people. People who are hungry and willing to work hard to achieve their dreams."

- This would still be a great benefit to offer of course.

Performance challenges in the City of Dreams

My own presentation at the HR Strategies conference focused on moving beyond standards and SMART objectives in performance management to helping people express their dreams.

I think we need to do this if we're going to move beyond gaining compliance to really harnessing our people's commitment towards helping our organisations succeed.

The more we can capture what’s important to our people, and align what they really, really want to do, and what their organisation is giving them the opportunity to do, the more engaged they’re going to be, and the higher the contribution they’re going to make.

I got some of these ideas from an excellent book, Dream Manager by Matthew Kelly (hat tip to the Cranky Middle Manager).

A character in this book describes the power of dreams as:

"I think we've forgotten that people are people. At Wal-Mart they call them 'associates', at McDonald's they call them 'crew members', at Starbucks they are 'partners,' at Disney they call them 'cast members,' here we call them 'team members,' and at most places they just get called 'employees' or 'staff.' But in all of this, we've forgotten that first and foremost they're people.

What sets people apart? People are unique in that they have the ability to imagine a more abundant future, to hope for that future, and to take proactive steps to create that future. This is the process of proactive dreaming. Isn't that the story of all great individuals, families, teams, corporations, and nations?"

In many ways, we are our dreams. But people stop dreaming because they get caught up in the hustle and bustle of surviving. And once we stop dreaming, we start to lead lives of quiet desperation, and little by little the passion and energy begin to disappear from our lives."

Unlike SMART objectives, dreams need to come from the