Organizations like organisms evolve continuously; the success of an organization depends on this evolution and the effectiveness with which it can manage the change that comes with it. Change may be looming on the horizon due to business transitions impacted by strategic mergers, joint ventures, divestitures, expansions, new business solutions, infusion of technology, market changes, financial downturns, compelling competitive scenarios, new opportunities or even a new dimension of growth. “It is not the strongest of the species that survives, or the most intelligent, but the most responsive to change” observed Charles Robert Darwin way back in 1859 in his seminal book “Origin of the Species”.

Our body, composed of trillions of cells, is a classic metaphor of change constantly engaged in a dynamic never ceasing process where cells die, repair, renew, and rebuild. Change is indeed the way of life and being able to transcend disruptions must become a way of life for organizations too. “It is not success that makes good genes. It is good genes that make success” remarked Richard Dawkins. Humans, unlike other organisms, are blessed with the ability to reason, and in turn can endeavor to predict or envision possibilities and prepare for it. When we can anticipate what may happen tomorrow, we enable the ability to commit ourselves to action today. Organizations normally endeavor to react and respond when compelled with a crisis at hand. A real and ongoing transformational ability, on the other hand, may serve as a powerful and differentiating core competence.

Applying the Occam’s razor, when a business is at cross roads, the imperative is implicit; change the environment or the business itself must attempt to change. Metamorphosis is imminent when disruptions happen. As Shakespeare’s Hamlet contemplated, “Whether it is nobler in the mind to suffer the slings and arrows of outrageous fortune, or to take arms against a sea of troubles, and by opposing end them?” How a business responds by accelerating change, minimizing possible resistance, and achieving organization’s desired outcomes will define its success and determine its future.

On the road to transformation, Kurt Lewin encapsulated the three critical steps required as unfreezing (where you unwind the current state), changing (where you enable and implement) and refreezing (where the new model of business is institutionalized). The levers of enabling sustainable and effective change include appreciating the very need for change, creating a shared vision, continuous and effective communication, addressing the critical culture gaps, carrying stakeholders along, building coalitions, forming a supporting infrastructure, sustaining the urgency for change and facilitating quick wins. The prerequisite, no doubt, is the need for a committed leadership that ensures organizational congruence and execution focus to the task on hand.

Change that endures at a fundamental level, even when desired to be affected across the entire organization, has to be invigorated at the individual level as it necessitates a behavioral transformation. As CK Prahlad observed, the power of n=1, where the real change is brought about through transforming one employee at a time, with the focus on the centrality of the individual. Transpersonal psychology highlights the fact that we, as individuals, are suffused with energy owing to our desire to grow and develop ourselves. When employees see a resonance between the compelling need to change and how it can impact their lives for the better, it creates a reservoir of energy that fuels the transformation sought. As custodian of the intellectual capital in the organization, the Human Resources function must take primacy and play the vital role of a transforming catalyst towards enabling sustainable change.

Building HR Strategy, Managing Culture Design & Change N S Rajan

The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.

– Martin Luther King

We are indeed in the midst of an unsettling environment, fuelled by the rising cost of capital, falling consumer confidence, inflationary concerns, pressure on profit margins, decreased equity valuations, challenges which demand an unprecedented prudence from business leaders. Lessons learnt from past experiences of managing the road ahead in such difficult times reveal that the agenda to sustain and enhance performance requires an ideal balance between managing the “now” with a proactive well managed plan for the future.

As WH Auden aptly observed long ago about cancer, we are seemingly in the midst of a condition where “Nobody knows what the cause is, /Though some pretend they do; / It’s like some hidden assassin/ Waiting to strike at you.” Even as organizations revisit the strategy, the human resources function would be expected to align with the new realities. Announcing short term measures such as employee reduction apparently are transmitting the right signals to stakeholders at large that there is definitive focus on cost control. Is this conserving or destroying value is a question that confronts us.

The role of the HR professional is to be an alchemist. Intellect is the new form of property, and the HR function needs to play its part in ensuring that the human capital advantage of the organization is sustained, irrespective of good or difficult times.

Intellectual capital is not added overnight and the efforts must be recognized as an investment, not just as expenditure. The human resources function must be ‘like a circle whose centre is everywhere and whose circumference is nowhere’. The need of the hour for HR is to weave a strategy to convert this situation into an opportunity that can help the organization emerge stronger once the troubled times are over. How must the Human Resources function respond?

The first critical step is to examine the implications of current changes and ensure that the people strategies are relooked at from a ‘new’ point of view. This would provide the basis for a set of guiding principles that will help take necessary actions across the value chain.

Ø HR strategy refresh must reflect the new business strategy and broad directions being set to steer the company through choppy waters

Ø Implement high impact HR Interventions, to deliver business imperatives, and prioritize expenditure on various HR programs to conserve outflows

Ø Account for HR costs on people programs and tie them to financial returns to estimate the ROI and follow up with close monitoring of effectiveness

Ø Evaluate automation / outsourcing options actively of certain HR functions esp where resources can be conserved

Two decades of incessant growth is likely to have resulted into certain inefficiencies creeping in the way organizations are designed, particularly where there has been an insufficient attention on this critical aspect When it is time to make every move count, organizations need to review the structure to bring in more agility and flexibility in the system. Organization structures are indeed the bridge between strategy and execution, and the second key step is to enable it be even more effective.

Ø Restructure the organization in order to adapt to the new business environment

Ø Realign reporting relationships and delegation of authority for swift decision making

Ø Review of workforce planning as per changed business projections

Ø Examine alternatives such as redeployment/planned sabbaticals/ job sharing/ and rightsizing only as a last resort

The third vital step is to focus on Performance with a new lens. When the chips are down, each employee must be able to extract the maximum mileage of his abilities, and the environment created should nurture a high performance orientation. People can make all the difference if they feel committed. Strengthening the linkage of performance and reward has become the need of the hour.

Ø Identify critical skill sets and develop a focused talent retention and development program

Ø Identify high potential employees and focus on strengthening their capabilities

Ø Create a fungible workforce to enable quick re-deployment

Ø Drive a performance oriented culture

Ø Enhance linkage between individual performance and variable pay

The next step is to conserve the value inside the organization by recognizing people asset to be at the heart of creating a sustainable competitive advantage. It is important to preserve the fabric of the organization through sustained employee engagement and regular employee communication. The message that we are all in it together; that we can survive the times, and more importantly that the leadership has a clear plan creates ownership and cascades the ability to survive and thrive.

Ø Evolve a two way communication strategy to keep all employees and stakeholders updated about the business objectives, and new expectations

Ø Encourage an organizational culture that embraces learning and holds managers and employees accountable for the results

Ø Asses employee engagement levels and drive innovative employee engagement practices

Ø Engage in a Corporate Employer Branding exercise to reach a broad array of audiences

The HR function has a vital role to play in preserving and nourishing the human capital assets of the organization, and must measure up to meet the situation at hand. The primacy of HR must be wrought from the flaming forge of turbulence that besets us. In the words of Tennyson from Ulysses, the role of HR in such times calls for “One equal temper of heroic hearts /Made weak by time and fate, but strong in will / To strive, to seek, to find, and not to yield.”

Building HR Strategy N S Rajan