HR isolation puts UK businesses at risk

UK businesses are creating employment and performance risks by distancing HR from people and policies, according to a survey released today by Adecco and Tarlo Lyons. The survey amongst some of the UK’s largest companies shows HR detached from the real responsibility of keeping employees motivated and cocooned from many of the risks experienced by UK businesses.

The Work IN Progress: PeopleKeepers survey, published today, surveyed 100 human resources managers in 100 large UK organisations to explore the front-line role of the HR manager in todayís workplace. The key findings were:

Semi-detached decision makers ñ Under half of HR Managers (46%) see themselves as close enough to the core business to help the organisation achieve its strategic goals

Legal risks ñ Diversity is the main area of HR manager ownership with most concerns around the Disability Discrimination Act (81%) followed by the Working Time Directive (62%). Only 13% are concerned about satisfying imminent Age Discrimination legislation which comes into force on October 1st

Called to account ñ Burdened by legislation and compliance pressures, HR managers struggle to provide basic metrics relating to performance. Even with a week’s notice, less than half could report on staff turnover (49%), HR budgets (44%) and employee satisfaction (11%)

Whose job is it to motivate? ñ Only 3% of HR managers consider they have ultimate responsibility for motivating staff. With only 26% considering employee motivation as a risk factor for business, the importance for working ëwell beingí must be brought into question?

ìIncreasing amounts of regulatory compliance, such as CRB checks and anti-discrimination legislation, by their very nature require an element of form-filling and administration,î said Steven Kirkpatrick, Managing Director of Adecco UK and Ireland. But this shouldnít be at the expense of the real reason we need HR professionals and thatís to keep workforces motivated, challenged and continually performing in their jobs.î

There is a risk that, as HR is centralised in large organisations, the function becomes isolated from the workforce. With 54% of managers feeling isolated, it may be that HR is being inadvertently cast adrift from corporate strategy.

ìThe issue is compounded by the fact that many HR professionals, weighed down by admin and legislation, have no time to flex their strategic muscles,î added Kirkpatrick.

It seems a more focussed ërisk radarí throughout the HR function is necessary. Some respondents appeared somewhat removed from commercial risk, mainly because their departments are not accountable for the more ëriskyí elements of business. HR professionals felt that their key responsibilities were for diversity (88%), health and safety (64%) and performance and absence management (64%). Whereas the report shows that only 3% have responsibility for ëworkplaceí churn, motivation and the ëemployer brandí of the organisation.

60 per cent of respondents believe that one of the biggest risks for their companies is legislative and regulatory compliance. Despite the Age Discrimination Regulations coming into force later in 2006, only 13% of respondents saw this as a risk to their business. Also, 36% of companies believed existing standards surrounding diversity were below par. In fact, diversity achieved the lowest performance score across a wide range of HR measures.

ìItís interesting that HR managers donít seem to view diversity and specifically the imminent Age Discrimination Regulations as a direct business risk,î commented Bridget Wood, Employment and Resourcing Partner at Tarlo Lyons. ìHR clearly sees responding to legislation as a big part of their role but there seems to be confusion over the ultimate risk to their organisations of non-compliance.

Despite the fact that less than half (46%) of respondents see themselves as close enough to their organisations to achieve strategic goals, there are ways in which HR can increasingly engage employees and create value. Training and development is the most used method of employee engagement (69%), followed by internal promotion (59%) and above-average pay rates (53%). Flexible benefits (40%) are also considered important.

Steven Kirkpatrick concluded, ìIt would be more productive to see the ëPeopleKeepersí spending more time on actually keeping people within the business motivated and developing in their jobs with new ideas instead of battling with regulations and administration - thatís the value and insight that human resources can bring to an organisationî.