7 More Fascinating Employee Engagement Trends For 2017

It’s no surprise that employee engagement numbers have been abysmal for the last few years (and if that is a surprise, you need to read our blog more often.) According to Gallup, engaged employees comprise only around 30% of the workforce.1 No wonder this post on 2016 engagement trends was so popular. 

Until engagement numbers dramatically increase, we are going to continue presenting these trends. By the looks of things, this will be a long term project. Here is what the experts are saying we can expect for employee engagement in 2017:

1) Employee Engagement Will Grow…Slowly

In their latest State of the American Workplace Report, Gallup shares that over 33% of the workforce is engaged. While this may seem like a negative (and it is), these numbers are still an improvement over recent years. In 2013, engagement for the US workforce was under 30%. A ten percent rise in just three years is very encouraging.

So why the rise in engagement? Is it a shift in performance management strategy, or advances in HR technology? Gallup feels that shifts in engagement depend on “factors related to an organization’s performance management and human capital strategies”. 

Note: If you don’t have the time to unpack Gallup’s full 2016 report, 34Strong has created this series of blog posts to help you digest the key learnings.

2) Performance Management Technology 2.0

In their latest report, Predictions for 2017: Everything Is Becoming Digital, Bersin by Deloitte is focused on how technology continues to change our lives and workplaces. The ubiquity of mobile devices means that we are always on, sending and receiving messages and accessing seemingly infinite media platforms 24 hours a day. 

http://www.humanresourcestoday.com/2017/trends/?open-article-id=6351358&article-title=7-more-fascinating-employee-engagement-trends-for-2017&blog-domain=15five.com&blog-title=15five

This tech revolution is also permeating the world of HR. Performance management has been gradually moving away from a focus on annual reviews, to real time feedback platforms. Over the past few years we have seen giants like Adobe, GE, and Microsoft make these transformations and that trend will likely continue. It is uncertain whether the annual review will disappear altogether, but it will at the very least be augmented by more regular communication between employees and managers.

In the coming year, more software companies will emerge that provide performance reviews, 360 degree feedback, pulse surveys, and OKR tracking (objectives and key results). Companies that know success is created by helping their employees succeed will be adopting these technologies.

3) Data Focused Management and HR  

While we’re on the topic of technology, let’s talk about people analytics. This often takes the form of software platforms where employees are asked metrics-based questions. Productivity (performance relative to stated goals and objectives within a specified time frame) will now be measured and catalogued.

Managers and other company leaders will review this data via dashboards. They can see at-a-glance performance numbers company-wide, and drill down to analyze teams and individual contributors. According to Human Resources Today, people analytics ranks among the top ten human capital trends this year:

In 2017, predictive talent models will help HR departments recruit and promote the right individuals into the right jobs.

This trend is especially helpful for larger teams, where managers and executives need to understand trends and aggregated data for hundreds or thousands of employees. 

4) Organizational De-structure

Based on their latest Human Capital Trends study of over 7,000 companies worldwide, Deloitte found that the vast majority of companies (92%) don’t think that they are organized correctly.

Many are shifting away from a top-down hierarchical structure to more horizontal or lattice type structures. The former exists to create individual teams for scalable efficiency, but today’s markets are not optimized for those factors since rapid innovation has increased the speed and quantity of competition. You can scale a department via a hierarchical structure and then have your entire product offering supplanted by a crafty competitor.

These shifts will impact employee engagement in a positive way by allowing people to be more effective at what they do and by seeing the impacts of their contributions. We know from studies in behavioral economics that people are motivated by seeing their contributions, which in turn increases job satisfaction and morale.

5)Human Performance Strategy Will Change

Bersin and his team predict a massive shift where basically every leader in every business will have to be focused on employee wellness. In the report referenced above, they share extensive data on how productivity and engagement has slowed, while the amount of hours worked has increased and vacation time taken has decreased.

Likewise, author and productivity expert, Tony Schwartz, has written extensively on the topic of employee burnout. In this post, he categorized employee engagement as a negative:

[T]oo often, it refers to employees who get to work early, stay late and remain connected at night and on weekends. That’s a recipe for burnout, not enduring high performance2.

Bersin states the current strategy is to rethink the overwork problem by moving HR into a new role as “consultant in human performance”. Instead of managing performance review processes, employee onboarding, and health & wellness programs, HR must focus holistically on how they can help people and teams perform better.

6) More Recognition Programs

Gordon Tredgold, founder and CEO of Leadership Principles, shares that recognition is the key to employee engagement. That’s a bold claim that he backs up with Gallup research:

Two-thirds of employees, who said they hadn’t received any recognition in the last seven days, were twice as likely to say they would leave the company as the other workers when asked.3

Of course how recognition is delivered impacts how it is received. Is it specifically tied to work performed, or a baseless platitude designed to keep employees happy? How frequently is it given? Is it shared publicly across the team to amplify the impact? Is it accompanied by a tangible reward?

According to The Society for Human Resource Management, recognition ranks in the top 10 factors influencing employee job satisfaction. And according to PWC, how recognition is given does matter. 41% of millennials prefer to be rewarded or recognized for their work at least monthly, if not more frequently. Companies like Blueboard, O.C. Tanner, and our very own High Five feature allow for creative and frequent employee recognition and rewards.

7) Performance, Culture, & Engagement – Together!

Our CEO, David Hassell, has written at length about the importance of building strong company cultures, how to foster employee engagement, and how to manage employee performance. Last year, David shared how organizations have historically thought of those three critical factors as separate and distinct. In the coming year, as performance management becomes more of a holistic practice, managers will consider them together:

The interplay of building culture, fostering high employees engagement, and focusing on performance management (namely vision, strategy, objectives, alignment and execution), is in essence an ecosystem that must be focused on as a whole in order to ultimately achieve high performance.

Why does employee engagement persist as a focal point for performance management experts and HR leaders? Because it is directly linked to other factors that matter to every business owner. According to Gallup, engaged teams show dramatically less employee turnover and absenteeism, 17% higher productivity, and 21% greater profitability.

For the coming year and beyond, technology will continue to permeate every aspect of our collective existence, both personally and professionally. But tech alone cannot make people more engaged (and in many cases it can be more of a distraction than a benefit). No, it will be the managers, human resource professionals and business leaders who have the greatest impact throughout an employee’s lifecycle. They must ultimately make the people-centric decisions to create work environments where people are naturally inspired to bring their best every day.

10 HR Trends for 2017

The last two years we published an overview of the HR trends of which we expected that they would have an impact on HR in the coming year (“9 emerging HR trends for 2015” and “11 HR trends for 2016“). Number one on the 2016 was “HR embrace agile”. Although we have seen this topic appearing on the agenda of many conferences, the reality is that many HR teams have great difficulty to work in an agile way.

Here we present the 10 trends we think (and partly hope) that will be important for HR in 2017. The list could have been longer, but this year we stick to the magical number 10.

1. Consumerisation

In her excellent article “Consumerization of HR: 10 trends companies will follow in 2016” Jeanne Meister captured all the trends she describes under the label “Consumerisation”. People are more and more expecting an experience at work that is comparable to the experience they have at home. Netflix knows their movie taste and makes good recommendations. With the help of Tinder they are able to find new partners, and all their devices at home are connected through the internet. What most people experience at the workplace is still far from ideal. The percentage of people who are not very happy at work is still remarkable high. Where is the algorithm that has suggestions for new opportunities? (“You like these type of assignments, you might also like …..”). The “Employee Experience” is very much related to this trend. The organisations that consciously design a positive employee experience, for the complete life cycle of an employee, are still scarce.

2. Performance Consulting

Redesigning the performance management cycle was high on the agenda of many organisations in 2016. Earlier we made a plea (“HR: don’t kill performance measurement!“) not to stop with performance measurement. It is positive that we get rid of the traditional paternalistic process, where a boss who had limited observations has to give feedback to her employees. It is positive that we are getting rid of labelling people with performance ratings (“You are a 3.5…”). 2017 can be the year with more focus on performance consulting: how can we help good people to become better, by providing very concrete feedback and very concrete suggestions on how to improve performance. Most people want to improve their performance, and frequent relevant feedback from various sources is an important element of performance improvement.

3. From individuals to teams to networks of teams

In their article “Organizational Design: the rise of teams” McDowell et. al. describe how new shapes of organisations are emerging. From static hierarchical organisations to networks of teams that are able to adapt to the continuously changing environment. Traditionally the focus of HR has been on individuals. Many of todays HR practices (as recruitment and performance management) take the individual employee as the starting point. The view of HR is also often limited to the people on the payroll of an organisation, with less or no focus on people and teams who are important for the organisation but not on the payroll. The focus of HR is slowly shifting, from individuals to teams. Looking at networks of teams and how to improve the way teams are working together still gets less attention.

4. Man Machine collaboration

The notion that it is less about man (woman) versus machine than about how men and women can benefit from machines is slowly gaining ground. Dirk Jonker of Crunchr told me about a recent experiment in the area of succession management. The MD officers of a multinational were asked to take a pile of cv’s of employees and rate them to what extend they were considered to be candidates for certain positions (1=highly unlikely, 5=highly likely). The results were fed into the computer. The next step: the computer was asked to look into  the HR information system, and suggest candidates that were not in the initial pile, but were comparable to the profiles of the people with high ratings. MD Officers and machine working together to create a richer succession bench. It is still early days, but the signs are there that artificial intelligence will enable HR to increase their impact in various areas.

5. Algorithm Aversion

Alas. Even when an algorithm beats human judgment, people tend to trust human judgment (especially their own judgment) better. When you sat next to the driver in a Tesla, you have probably experienced the feeling. You prefer the driver to keep his/her hands on the steering wheel, above trusting the Tesla technology. Algorithm aversion is also one of the obstacles in the use of people analytics. If HR provides solid insights, many managers still tend to rely on their own judgement. How to overcome algorithm aversion is an important topic for 2017.

Additional reading: Walter Frick in HBR: “Here’s why people trust human judgment over algorithms”.

6. HR Operations

HR operations has been highly undervalued. Of Ulrich’s HR roles “Administrative Expert” certainly got the lowest ratings. All the HR professionals wanted to be a strategic business partner, the role with the most positive connotation. The last years we have seen an upgrade of HR Operations that will continue in 2017. Most likely HR can add most value in the HR operations area. The requirements for the people in HR operations are different though, and probably we need a new breed of HR professionals who can run HR as a service organisation.

Read: 6 major trends in HR Shared Services

7. Data ownership

In 2014 we wrote (“9 emerging trends for 2015“) that privacy seems to be less of an issue. For 2017 our prediction is that there will be more discussions about privacy and data ownership. As part of their effort to improve people analytics, organisations are capturing more and more data of their employees. There are numerous new instruments available that can capture people data realtime, and use it to give an indication of the mood in various parts of the organisation. In the discussions about people analytics we sense a growing resistance. Employees are starting to wonder what is in it for them. Who is the owner of the people data? This trends is clearly related to trend number 1 (“Consumerisation”). People are willing to share data, if the benefits are clear. You don’t mind Netflix to measure what series you are watching, if they use the data to give you good suggestions.

8. The end of Open Space

In 2015 we mentioned as trend for 2016 “Back to the Office”. If people return to the office, they do not want to work in open space. They prefer an individual approach, where they are able to choose their working location in line with their individual preferences and personal needs. Not one-size-fits all. and this will require more creativity and flexibility of the office designers. Tech can help to make the best match between current needs and available space. Generally individualisation continues to be an important trend, and HR has difficulty to cope. HR likes equality, transparency and neatness, and these values do not always fit well with an individual approach.

9. The battle of the Apps

The amount of clever HR Tech solutions is increasing rapidly. The list of successful HR Tech companies is not so long yet. The big HR systems have not lived up to the promises. Implementation is expensive and takes a long time. If you have the money and a relatively stable organisation, the investment in one of the big core HR systems can certainly be worthwhile. The providers of the neat modern HR solutions are struggling to convince HR to add their solution to the mix. HR does not want to take risks, and the IT department still does not like to have too many providers. But increasingly HR gets the notion that currently a good mix between a solid core HR system, payroll solutions and focused innovative HR solutions might be most effective. This leads to the questions: which solutions to choose, and how to capture the data from the different systems for your people analytics?

10. Choose your own

Many more trends are emerging. Add your own, or choose on of the list below, to make this a list of 10 HR Trends for 2017.

• From vacancies to opportunities
• Selecting on value fit
• The end of classroom training
• No more leadership journeys
• Purpose, purpose, purpose….
• Less multitasking
• Working from 9-5
• …………………………….https://hrtrendinstitute.com/2016/11/23/hr_trends_2017/
  

HR Technology Trends In The Workplace In 2015

Technology and the HR function. Not always comfortable bedfellows. Looking ahead, what will be the major technology trends and challenges facing the HR profession in 2015?

Last year, the HR technology buyer began to really get in touch with their end users and look for technology designed to support people, not just processes, says Steve Parker, head of business transformation at Achievers. “This meant moving away from the outdated but consolidated offerings that employees, managers, and executives used only when they had to such as HR “self-service” to providing tools that people used because they want to – technology designed to engage and help people be more productive.”

Parker argues that there are two major HR technology trends that will emerge in 2015. They are:

Technology will provide transparency. Whether we like it or not, employees will be taking a page from the Yelps and Trip Advisors of the world and will rely on using tools like Glassdoor and social media to describe and evaluate their companies’ true employment brand. With today’s social-enabled consumer technologies, disengaged or disgruntled employees, like customers, can immediately express their dissatisfaction, and prospective employees and customers can immediately see what those disengaged employees have to say. But it works the other way too, which means positive feedback can be shared just as easily. In 2015, HR will start embracing technology that creates this transparency and fosters an open culture where employees can easily recognize and communicate the great things that happen every day in organizations

Technology will finally help us do something about this disengagement problem. Disengaged employees cost the US economy $500 billion per year in lost productivity. And let’s face it, we spend more effort and resources measuring engagement than we do doing something about it. That’s about to change. While the tools for measuring personal attributes or capabilities have been around for a while, solutions that help organizations create—not just measure—an amazing environment will come into their own in 2015. We’ve all seen awesome employees get swallowed up by bad companies or bad bosses, so organizations serious about increasing their performance will begin to focus more on taking action on employee engagement by providing people with tools to connect across functions, catch others in the act of doing things right, and stay aligned to what’s most important.

Technology can aid the workplace and the HR function but it will also provide a potential headache for HR teams and boardrooms in 2015 as organizations grabble with the need to embed new technology at the speed their employees are demanding, according to Tim Payne, a partner in KPMG’s People Powered Performance Team TISI -1.43%. He believes that this will result in workplaces where the generational divide may become increasingly difficult to handle.

“The digital divide that separates generations in the home will gradually creep into the workplace next year, as organisations adopt new technologies to stay ahead of the competition,” claims Payne. “On the face of it new technology sounds like a good idea, but the challenge will be whether organisations can adopt new technologies quickly enough to satisfy employee need whilst ensuring everyone is able to get the most out of it. Failure to do so may create conflict in the workplace with some people feeling empowered and others left behind.”

Source- http://www.forbes.com/sites/karenhigginbottom/2015/01/06/hr-technology-trends-in-the-workplace-in-2015/

Handling Workplace Conflict - Myths and Reality

Workplace conflict is much more common than you probably think. Yet, it is nothing to be ashamed of or swept under a rug. To truly understand workplace conflict, you need to understand some basic facts about the myths and reality of workplace conflict. The myths about workplace conflict are:

1. It is not nice to have conflict. This idea is ingrained in our psyche. From childhood, you are taught that it is not nice to have conflict and you should always put a smiling face on it. Therefore, it is simply wrong to have conflict.


2. Conflicts will resolve themselves over time, so there is no need for me to get involved. This is one of the more common approaches taken by managers. It’s a hands-off approach to dealing with conflict.


3. A true team would never have any conflict. When true team spirit prevails, there would be no conflict or even a chance for it. All is sweetness and light in a good team.

……. And now for the reality:

1. It is not nice to have conflict - If it is not nice to have conflict, is it better to grind your teeth and suffer in silence? You get to be the nice guy, but you are probably heading towards a major meltdown.


2. Conflicts will resolve themselves over time, so there is no need for me to get involved - This is probably one of the most common myths about conflict and one that produces disastrous results. If a manager fails to address workplace conflict head-on will find themselves dealing with a much bigger problem in the future. Most conflicts that involve minor disagreements or matters that are trivial tend to resolve and work themselves out over time. Larger disagreements or conflicts tend not go away without some type of intervention.


3. A true team would never have any conflict - A team without conflict is one where the team members have nothing of value to contribute and no passion for their job. It is a group working according to the direction of the leader and with no scope for any creative ideas to emerge.

You should realize that conflict is inevitable and working out a solution is the major task of the manager. One of the main keys to handling workplace conflict is to stay focused on the problems and not the personalities of the individuals involved in the conflict. A good way to avoid dealing with larger conflicts later is to confront them in the early stages.

By Myron Curry

Maslow's hierarchy of needs is a theory in psychology proposed by Abraham Maslow in his 1943 paper "A Theory of Human Motivation" in Psychological Review.^[2] Maslow subsequently extended the idea to include his observations of humans' innate curiosity. His theories parallel many other theories of human developmental psychology, some of which focus on describing the stages of growth in humans. Maslow used the terms Physiological, Safety, Belongingness and Love, Esteem, Self-Actualization and Self-Transcendence needs to describe the pattern that human motivations generally move through.

Maslow studied what he called exemplary people such as Albert Einstein, Jane Addams, Eleanor Roosevelt, and Frederick Douglass rather than mentally ill or neurotic people, writing that "the study of crippled, stunted, immature, and unhealthy specimens can yield only a cripple psychology and a cripple philosophy."^[3] Maslow studied the healthiest 1% of the college student population.^[4]

Maslow's theory was fully expressed in his 1954 book Motivation and Personality.^[5] While the hierarchy remains a very popular framework in sociology research, management training^[6] andsecondary and higher psychology instruction, it has largely been supplanted by attachment theory in graduate and clinical psychology and psychiatry.^[7][8]

Maslow's hierarchy of needs is often portrayed in the shape of a pyramid with the largest, most fundamental levels of needs at the bottom and the need for self-actualization at the top.^[1][9] While the pyramid has become the de facto way to represent the hierarchy, Maslow himself never used a pyramid to describe these levels in any of his writings on the subject.

The most fundamental and basic four layers of the pyramid contain what Maslow called "deficiency needs" or "d-needs": esteem, friendship and love, security, and physical needs. If these "deficiency needs" are not met – with the exception of the most fundamental (physiological) need – there may not be a physical indication, but the individual will feel anxious and tense. Maslow's theory suggests that the most basic level of needs must be met before the individual will strongly desire (or focus motivation upon) the secondary or higher level needs. Maslow also coined the term Metamotivation to describe the motivation of people who go beyond the scope of the basic needs and strive for constant betterment.^[10]

The human mind and brain are complex and have parallel processes running at the same time, thus many different motivations from various levels of Maslow's hierarchy can occur at the same time. Maslow spoke clearly about these levels and their satisfaction in terms such as "relative," "general," and "primarily." Instead of stating that the individual focuses on a certain need at any given time, Maslow stated that a certain need "dominates" the human organism.^[11] Thus Maslow acknowledged the likelihood that the different levels of motivation could occur at any time in the human mind, but he focused on identifying the basic types of motivation and the order in which they should be met.

Physiological needs

Physiological needs are the physical requirements for human survival. If these requirements are not met, the human body cannot function properly and will ultimately fail. Physiological needs are thought to be the most important; they should be met first.

Air, water, and food are metabolic requirements for survival in all animals, including humans. Clothing and shelter provide necessary protection from the elements. While maintaining an adequate birth rate shapes the intensity of the human sexual instinct, sexual competition may also shape said instinct.^[2]

Safety needs

With their physical needs relatively satisfied, the individual's safety needs take precedence and dominate behavior. In the absence of physical safety – due to war, natural disaster, family violence, childhood abuse, etc. – people may (re-)experience post-traumatic stress disorder or transgenerational trauma. In the absence of economic safety – due to economic crisis and lack of work opportunities – these safety needs manifest themselves in ways such as a preference for job security, grievance procedures for protecting the individual from unilateral authority, savings accounts, insurance policies, reasonable disability accommodations, etc. This level is more likely to be found in children because they generally have a greater need to feel safe.

Safety and Security needs include:

• Personal security
• Financial security
• Health and well-being
• Safety net against accidents/illness and their adverse impacts

Love and belonging

After physiological and safety needs are fulfilled, the third level of human needs is interpersonal and involves feelings of belongingness. This need is especially strong in childhood and can override the need for safety as witnessed in children who cling to abusive parents. Deficiencies within this level of Maslow's hierarchy – due to hospitalism,neglect, shunning, ostracism, etc. – can impact the individual's ability to form and maintain emotionally significant relationships in general, such as:

• Friendship
• Intimacy
• Family

According to Maslow, humans need to feel a sense of belonging and acceptance among their social groups, regardless whether these groups are large or small. For example, some large social groups may include clubs, co-workers, religious groups, professional organizations, sports teams, and gangs. Some examples of small social connections include family members, intimate partners, mentors, colleagues, and confidants. Humans need to love and be loved – both sexually and non-sexually – by others.^[2] Many people become susceptible to loneliness, social anxiety, and clinical depression in the absence of this love or belonging element. This need for belonging may overcome the physiological and security needs, depending on the strength of the peer pressure.

Esteem

All humans have a need to feel respected; this includes the need to have self-esteem and self-respect. Esteem presents the typical human desire to be accepted and valued by others. People often engage in a profession or hobby to gain recognition. These activities give the person a sense of contribution or value. Low self-esteem or an inferiority complex may result from imbalances during this level in the hierarchy. People with low self-esteem often need respect from others; they may feel the need to seek fame or glory. However, fame or glory will not help the person to build their self-esteem until they accept who they are internally. Psychological imbalances such as depression can hinder the person from obtaining a higher level of self-esteem or self-respect.

Most people have a need for stable self-respect and self-esteem. Maslow noted two versions of esteem needs: a "lower" version and a "higher" version. The "lower" version of esteem is the need for respect from others. This may include a need for status, recognition, fame, prestige, and attention. The "higher" version manifests itself as the need for self-respect. For example, the person may have a need for strength, competence, mastery, self-confidence, independence, and freedom. This "higher" version takes precedence over the "lower" version because it relies on an inner competence established through experience. Deprivation of these needs may lead to an inferiority complex, weakness, and helplessness.

Maslow states that while he originally thought the needs of humans had strict guidelines, the "hierarchies are interrelated rather than sharply separated".^[5] This means that esteem and the subsequent levels are not strictly separated; instead, the levels are closely related.

Self-actualization

Main article: Self-actualization

"What a man can be, he must be."^[12] This quotation forms the basis of the perceived need for self-actualization. This level of need refers to what a person's full potential is and the realization of that potential. Maslow describes this level as the desire to accomplish everything that one can, to become the most that one can be.^[13] Individuals may perceive or focus on this need very specifically. For example, one individual may have the strong desire to become an ideal parent. In another, the desire may be expressed athletically. For others, it may be expressed in paintings, pictures, or inventions.^[14] As previously mentioned, Maslow believed that to understand this level of need, the person must not only achieve the previous needs, but master them.

Cybage Softwares analyses data for HR activities to become most efficient firm

That a software firm is datadriven is a bit like stating the obvious. Most of this though tends to be focused on the actual work they do, and not as much on their internal processes. 

It uses analytic's in all key human resource processes as it works towards its stated goal of becoming the most efficient software company.

Cybage Software, the $90 million Puneheadquartered software services company, would beg to differ. It uses analytics in all key human resource processes as it works towards its stated goal of becoming the most efficient software company. And interestingly, the emphasis is on efficient, not profitable or successful, which are the terms commonly bandied around. 

Explaining the philosophy behind this, Arun Nathani, CEO & MD, Cybage Software says, "The primary cost in our industry tends to be salaries, and therefore, the roots of inefficiency lie in how we measure people. 

How accurately you measure your workforce is one of the primary factors that determines how efficient you are." Good performers have a higher probability of leaving while the bad ones stay on, and as this cycle continues, companies end up with the wrong people in positions of responsibility, directly impacting performance. "There is a financial and human resources angle to measuring people using analytics," he says. 

Typically, all companies, irrespective of the industry, grade employees on the results achieved by them. Cybage ensures it keeps all external factors and KRAs out of the mix. "Our appraisal process measures people only on their 'approach', and not on the 'results', as the results tend to corrupt the underlying truth," says Nathani. An easygoing client, selling a well-established product, an easy project, a booming market - all these are factors which could impact performance, irrespective of how skilled the person actually is. 

"We've identified 35-40 roles within the company, and each of these has been broken down into the specific skills and sub-skills required," says Jagat Pal Singh, Chief Technology Officer, Cybage Software. 

So while a junior level employee may be evaluated on his technical and communication skills, a manager's project management ability, organisational alignment and relationship management skills are some aspects which will come under scrutiny. What makes this unique, however, is that the employees aren't marked on an absolute scale, but compared within the team. 

If you say a person scores 7 out of 10 on technical skills, it's hard to question it; but when you say that one employee demonstrates a higher level of technical skill compared to another person on the team, it's open to scrutiny. "This is a fairly detailed process, with the questions designed in a manner to minimize ambiguity and personal biases. 

For instance, if a manager has to rank an employee on her personality, rather than leave it to the manager's perception, it is further broken down into questions like, "which of these two employees would you send on a dinner meeting with a client," explains Singh. After the exercise is completed at the team level, the results are merged for all the employees using another set of algorithms to finally arrive at a dollar or rupee value for each employee. This is their perceived salary, and depending on what their actual salary is, the appraisal process will try and minimize the gap between the two. 

The system is designed to pick up fluctuations in an employee's scores over time, which could indicate that the manager isn't doing a proper job of ranking them. "This way, the right people see the career growth they deserve and eventually, the company ends up in a position where the right people are doing the right job, which tends to translate into financial success as well," says Nathani. The 18-year-old company has been growing at a steady 15-20% over the last five years, and expects the trend to continue. 

While this system was formalized only in 2005, the company has always followed a similar 'commonsensical' approach. In the early days when money was scarce, the company figured that the only way to succeed was to be efficient and delivery focused. "No company can go wrong if your value proposition advantage is providing value for money to the customer," he says. 

Over time, as business grew, they figured there's no reason to fix something that was working fine for them. The determination to do this right is also a function of its size. In an industry peppered with global giants from India, it becomes important to remain relevant. Nathani likes to call his approach the 'Moneyball Effect'. 

The book is based on the true story of how the Oakland Athletics (US baseball team) managed to build a successful team with a measly budget. It touches upon how it's important to not get carried away by what you see at the surface. To build an efficient environment, you have to identify the root of the problem and go back to the basics. 

The use of analytics in HR isn't restricted to performance management systems. During the hiring process, new recruits are evaluated by the interviewers and their comments are fed into the system where they are mapped against the attributes defined for that job. This also helps determine the newcomer's salary and ensures that it is on par with his peers. "Employees tend to be more unhappy if they find that their peers within the company are making more money than them as compared to their peers outside," says Singh. 

Another area where Cybage has successfully used analytics is, in determining the efficacy of its hiring during placement season. Singh explains that while they'd be invited to campus only towards the end of the placement season at the top ranked institutes, at the lower ranked ones, they were hiring over the first few days. After analysing the performance of both sets of employees, they realised that the ones hired from the lower rated institutes were performing much better, and started focusing their attention primarily on these places. 

Analytics has also been used to determine the reasons why people are leaving the company. Instead of going by their perception of the reasons, Cybage uses analytics to determine whether it's actually a bigger trend which needs to be fixed by changing certain policies. Similarly, the HR department runs a number of employee engagement programmes as a motivational and retention tool. Attendance figures showed that a salsa class was far more popular that a musical night that the company organises. 

On the surface, based on larger participation, it would seem like a good idea to have more salsa classes. But analysing the performance of the employees who attended both, you may find that the ones attending the musical evening not only tended to stay on longer, their motivation and performance levels were also higher. "This helps HR tailor other programmes in keeping with the actual impact they've had," says Singh. 

Interestingly, this data-driven approach is yet to find many takers. Nathani has a simple explanation: "The end result of a system-driven approach should be that it makes you redundant, and to accept that, you have to get rid of your ego and accept that the system is more powerful than you." 

Some of the larger companies are now struggling with efficiency issues, and it's a well documented fact that any attempt to change the system has led to disgruntled employees. Nathani likens it to swimming against the tide. What seems to be working for Cybage is that they started swimming before the tide came in.

source: http://economictimes.indiatimes.com/articleshow/19495584.cms

Sachin
FK-2270