Sunday, August 23, 2009

The Tsunami is coming

Years ago, Paul Revere came galloping across the countryside of Lexington and Concord warning the colonists that “The British are coming!” In Medieval England the town criers were the chief means of communication. Now I am in no way comparing myself to Revere or the town crier in any way but we as HR folks are headed into the storm.

As an avid reader of white papers and research related to Retention, Employee engagement and leadership to name a few, I came across 4 surveys that had me thinking about my above prediction.

According to a recent study by, there is a measurable relationship between retention and restructuring. On average, involuntary turnover of as little as 1% of a workforce resulted in a 31% increase in voluntary turnover.

Another research report by the Leadership IQ group of 4000 laid off survivors found that since watching their colleagues get laid off, 75% said their own productivity had declined, 70% said the quality of their company’s product or services had dropped and 81% said the service that their customers received had declined. This study also revealed that 70% of managers who remained in downsized firms reported that layoffs were followed by lower employee morale and trust in management.

According to a recent Gallup poll, on employee engagement, Gallup revealed some staggering results:

1. 29% of the employees in the workforce are engaged
2. 56% of the employees in the workforce are non-engaged (checked-out, putting in little energy or passion into their work).
3. 15% of the employees in the workforce are actively disengaged (these workers undermine what their engaged co-workers accomplish)

According to research by Harris Interactive on behalf of the Adecco Group, the most serious threat to organizations in this recession may be the recession's end. A company’s most important asset is its employees, and Adecco's latest Workplace Insights Survey indicates that most employers will see a high level of employee turnover when the job market rebounds.

The engagement poll, I thought was mind bending. Having a workforce of approximately 70% being in some stage on disengagement is frightening. Imagine watching a football team with only four players playing their heart out or a basketball team with 1 1/2 players playing with passion while the others just hang out.

HR departments across the country have been the facilitators of layoffs and restructuring just to name a couple within their companies. When this economy begins to turn itself around, we had better buckle up. If we did it right during these "strategic moves" we may get a break. But if we handled it like some of the companies that I have read about, basically be prepared to kiss retention, engagement and innovation good bye.

So where does that leave us?? One thing is for sure; this is the best opportunity for HR to make its mark giving tremendous opportunities.

The economic downturn has caused many companies to rethink their business strategies and practices. As a result, business leaders are embracing new approaches to workplace issues. "If you don't invest in the future and don't plan for the future, there won't be one.-George Buckley, Chairman, President and CEO of 3M.

The first step is that there needs to be a total assessment of your HR department. A SWOT analysis (Strength, Weakness, Opportunity and Threats) would be the perfect place to start. This will allow you to look at the four phases and should give you a clear picture of the state of your department. In doing this type of analysis, you must face up to reality and, do not give yourselves great marks when you know in your heart that it is not true.

Take apart every facet or your department and initiatives to get a base line as to where you are at this point. With that done, pay particular attention to employee engagement, leadership development, training opportunities and succession planning. From these findings, work with your senior leadership team to put together a strategic plan both short term as well as long term (5 year) goals and objectives with measurable milestones. This plan should be reviewed and updated as needed according to your reviews, which should be at least monthly in the beginning stages.

With that done you must eat, breath, and sleep that plan and do not let it become what I call "credenza ware". If you don't know what that is, just take a look around your office and see the conference book, articles, white papers that you had every intention on working on but you just did not get around to doing it. Now is the time to get it done.

My comment is that this is an important time in our chosen profession and we are now or soon will be in the drivers’ seat. We are no longer the passenger in the corporation; we have the keys and are now the official driver. Do you have your road-map with your destination in sight?


  1. I was particularly interested in the poll on employee engagement. I have heard many other companies state the same thing. A big 'mass exodus' may be on the horizon. Thanks for sharing your views.

  2. Ron,

    May I suggest that you offer links to the studies you refer to in your blog post? I tried to click thru to the Gallup poll study on employee engagement to read about it further....

    Interesting post in connecting the dots from different sources. I agree with your hypothesis that there's a huge pent up demand to explore other employment options once the economy improves. And I believe that most HR departments will simply react versus taking proactive measures in advance.