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Quick HR fixes are not solutions

Philip Argy, Information Age

15/12/2006 15:18:52

When Just In Time manufacturing techniques were first introduced, they were hailed as an innovative way to streamline inventory management and reduce warehousing costs. Companies like Dell based their entire operation on JIT practices and they now form the classic paradigm for inventory management.

Along the way, this approach has generated a thought process amongst company boards and senior management that it can be applied to everything from planning and forecasting to HR and staff development.

The result is a business culture that focuses on short-term planning, with inadequate attention to long-range planning. And while many companies prepare a three- to five-year corporate plan encompassing their strategic direction and vision, their projected revenues and all the things that flow from that, I'm yet to see one that has a single sentence, yet alone a page, devoted to the skill sets that the organisation will need to achieve its corporate plan.

Oddly enough, some of the boldest five-year plans which reflect considerable vision and contemplate the realisation of significant corporate change, still don't address the skill sets the organisation will need to achieve it.

I'm planning to arrange a meeting with the Australian Human Resources Institute, at which I will ask them to encourage their members to seek greater input into their companies' planning processes.

I believe that every HR department in every company in Australia should be demanding a page in the corporate five year plan to articulate the skill sets they will need, how they will obtain them, and explore the various options of training and investing in staff.

This might involve working with universities and even high schools to develop courses to deliver the skill sets they will need in the future, and providing very public forecasts about their projected demand for those skills.

This would ensure that when people are deciding what to study at university, they have a feel for the likely demand for those skills when they graduate, and they can have a level of comfort about whether they will be able to find a job.

The HR Departments within our organisations are not being properly utilised at the moment because they are not being given the opportunity to contribute in the area of skills foresighting.

The ACS wants all HR specialists in every Australian company to be given a formal skills foresighting role and to be required to contribute to the corporate three- to five-year plan on what skill sets are needed and how they will be obtained.

I would like to think that, with more opportunity for forethought and planning, our companies would only contemplate using the immigration system to import skills that they need as a last resort, and would instead explore other opportunities to develop and grow Australians into the positions they need filled.

Over the past few years, we've seen far too many instances where companies have applied a Just In Time mentality to their recruitment. They wake up in the morning, recognise that they need certain skill sets, take a fleeting glance across the organisation and don't see the skills they need, so they decide to do a 457 visa application.

While this is an oversimplification, far too many organisations are making short-term decisions without counting the long-term cost to the business and the economy. Existing staff have critical knowledge of your organisation so it makes good sense to investigate retraining people who are willing to develop new skills and increase their value to the company.

Consider the lead times in terms of what it takes to train someone domestically compared to what is involved in importing someone.

Our corporations and medium to large businesses need to start talking to the universities far enough in advance that they can take the necessary steps to produce graduates with the knowledge and skills that industry wants.

I cannot stress enough the importance of the HR industry working with the tertiary sector to develop the curriculum to meet their needs.

If you accept that innovation is strategically critical to Australia, then it's short-sighted to let the marketplace decide what courses receive government funding as determined by the level of enrolments.

Sometimes you have to deliberately invest in course development around strategically important skill sets to ensure that we have the skills to be competitive into the future.

If we can persuade all companies with an HR function to start communicating their skills needs three to five years out and if they will allow our government departments to compile and coordinate that data, then we will have a clear picture of what we will need down the track.

We can then use that picture to define which core skill sets are likely to be in short supply and use that knowledge to invest and encourage universities to develop appropriate courses. The benefits - for our companies, universities, professionals and the broader Australian economy - will be considerable.