With UK unemployment falling to a seven year low this month, HR functions will be continuing to review their talent strategies and looking for ways to gain ground on their competitors in securing key talent, with the battle for the best people as fierce as it’s ever been.
What is good news for individuals – the jobs market is in good health – is less good news for HR departments. It is harder to recruit the talent needed given that candidates now have more choice and are in a stronger position to call the shots.
There is also the problem of skills shortages – the issue that just won’t go away. The latest Jobs Outlook survey from the Recruitment and Employment Confederation (REC) put this into powerful perspective recently, finding that employers are increasingly being forced to hire temporary agency workers as key skills become harder to source. Over eight in 10 employers say they are hiring agency workers with “key strategic skills” – up from only 55% in April 2013.
With the availability of suitable candidates declining, leading to rising pay rates and the hiring of expensive temporary/contract workers, companies’ costs are also rising and hitting the bottom line.
So the outlook for many organisations to secure the talent they need remains very challenging. This will continue to put more pressure on HR functions, who the Board will be looking to for answers and solutions.
Looking from the inside out
But I believe that HR teams (and the Boards they serve) may often overlook what they already have, not ‘out there’ in the market but actually inside the organisation – trapped all too often in the ranks of what I call the ‘frozen middle’.
The REC hinted as much in one revealing sentence in the Jobs Outlook when they said: “Our data indicates that employers may be shifting focus away from hiring staff, and towards improving the productivity of the workforce they already have.”
Focusing on middle managers
Many organisations, particularly large ones, have significant numbers of middle managers. They really are the oil that makes the cogs of the company turn. Their job, effectively, is to help execute strategy – to put the company’s vision and goals into practice. Without them, no large organisation can operate effectively. And properly harnessed, in my experience they can make a real difference to a company’s performance and productivity.
Frequently, however, this group of highly talented individuals is somewhat taken for granted. They are relied upon to keep the organisation functioning, but not enough is done to really inspire them to lift their game and take the company to new levels of achievement.
If HR can work with the senior leadership team to properly unleash the potential of this frozen middle, the effects can be transformative. Managers who have pushed the boundaries of what is perceived to be achievable have produced results such as employee engagement moving from 60% to 85%, a 20% uplift in sales or a 50% manufacturing production increase.
How can they do this? In my experience, there are four key steps:
- Retrain the middle management on what they believe it is possible to accomplish. By raising their aspirations and inspiring them to be bolder, a new mindset can start to be born.
- Help them blow up conventional wisdom and assumptions. By encouraging open discussion, in which anything can be challenged, the middle layers can start to look with fresh eyes at ways of working.
- Help them see that they can be accountable for delivering on things that are missing and essential. By giving them a sense of empowerment to change things, they will feel a new level of engagement and commitment.
- Open conversations about the future they want to build. Encourage discussion of the place everyone wants to get to and help to create.
This is not something that can happen overnight and it is not straightforward. It takes genuine commitment and an investment of time and energy. It requires much of HR - and also senior leadership, who must be as committed to the process as anyone. Leadership needs to believe that what they are really there for is to unblock potential and creativity - rather than simply to control and manage.
If the right environment is created, a business could be genuinely astonished at the results they can achieve by unlocking the potential of their frozen middle. They can create an environment characterised by genuine innovation, the constant and productive challenging of the status quo, and collaborations across the organisation.
So for HR it is often a case, not of looking out at a crowded and competitive market, but of looking in, to the frozen middle, and finding ways to unfreeze it and give it a whole new lease of life.