Posts Tagged: free agency


It’s Budget Time — Is Your People Plan Ready?

December 7th, 2011

Wait, maybe it is not that easy! Whether you are in a big company or a small entrepreneurial business, the fourth quarter is a time of planning and forecasting for the year ahead. 2012 is coming, and I am not sure we are all ready. But guess what? 2012 will come whether you plan or not. Why not be as ready as you can? Budget time, yahoo! The largest line item in all of our budgets? People!
 
You would think that with all of our advancements in IT and software that people planning would be easier. Workforce analytics and executive dashboards have come along way, however there is still a lot of managing to be done for most of us. Let’s look to history for our explanation. Traditions in budgets come into play. Long-range planning used to be much longer, 5 years or more. Business did not change as fast. We did not have as much information. The world moved a little slower. Today, one year can be a long time. Business moves up and down much, much quicker too. When it comes to the workforce, everything was more stable. Most of us stayed with one company a little longer. Companies could afford to be “parental” and careers began in the mail room and ended years later with the gold watch.
 
Wow, that sure is not true today. Budgeting for headcount did not change much year to year. Just add a few percentage points to last year for cost increases and move on. NOT ANY MORE. I have a good friend and customer who is in manufacturing. Every year they run an extensive process to plan for people within the business. And every year it is completely wrong. Planning how a business will do is one thing, but planning a business and its people needs? We are talking a completely different level of complexity.
 
The workforce/worker issue today is so complex. Each of us will have 7-10 different careers and many will change paths completely. There are multiple generations in the workforce. Some that remember and miss parental companies and many that know they will never exist again. Why? They grew up in households where their mom/dad/uncle/aunt were caught in down sizing and the realities of today’s world of work. Now there are options for free agency, contingent workers, contractors, temporaries. There is so much for managers to absorb and for the workforce to deal with. And yes, it makes planning for people and budgets harder.
 
Our managers psyche is forever changed. The economy is still so uncertain in its recovery and slowwww to rebound. We see high employment numbers and assume that people planning can and should be an afterthought. “There is so much available talent, just keep them coming.” My company hears this everyday. So many business plans are finished and then HR is asked to fill the openings. The War for Talent still exists. The War is just taking longer. The War is just different than we thought. Many critical skill sets remain difficult to staff with “A” players. Ask any head of engineering or VP of sales. The right talent is still rare.
 
Work is different today too. Most work we need done can be project oriented. Jobs and people are rarely perfectly matched. Change happens. People and jobs outgrow one another. This phenomenon has always happened, it is just speeding up! Technology has made most jobs portable — jobs can be done anywhere one has good Internet and telecom. Staff can be and is global.
 
So what does all this mean for you?

  • The world of work and workers has never been more complex for your business. And our mindsets and tools to manage have not kept pace. We all need to change and evolve.
  • Learn to embrace that the way work is viewed is forever changed. We must become workforce experts as managers of our businesses.
  • Get a rolling forecast going. Yes, build a budget that allows for changes and inevitable surprises. Roll with it.

Isn’t Every Job Temporary?

September 7th, 2011

Sometimes seeing and acknowledging workforce and workplace change happens very slowly. For the past fifteen years there have been predictions that almost 50% of our total workforce will be contingent workers. To be specific, contingent means temporary, contractual labor, even seasonal and part-time workers.
 
We are not close to 50% yet, however, it seems with each economic business cycle the numbers edge upward. And you know what? I am beginning to wonder what ‘temporary’ means when it comes to jobs. But I will get back to that premise in a minute. First, let’s talk about the business side of the workforce.
 
Smart businesses have learned to manage their labor costs. Much attention and press has been given to our slow moving economy and the minimal job growth. Companies survived through the recession by trimming their “core” jobs and by reducing their contingent workers. In fact, from 2007 through mid-2009, the temporary workforce dove by 33.7% while the total private workforce dropped by just 5.8%, according to an analysis of Bureau of Labor Statistics data in The Atlantic.
 
For years the staffing industry has been espousing the benefits of a “contingent workforce strategy.” The numbers from 2007-2009 are evidence that businesses could reduce their costs and were able to do so quickly. In other words, the plan worked. Typically cost comes into play, simply put, there are less employee benefit costs. And for most, cost is a driver for using “temps.” However, the real benefit has been flexibility. The flexibility to lower labor costs quickly. The flexibility to change your workforce overnight. The ability to NOT have to build a permanent Human Resources department to screen, qualify, hire and fire. And finally, the ability and flexibility to add skills and competencies for project work.
 
And the numbers support that. In 2010, employment in temporary help services rose by about 300,000 to 2.21 million, according to the BLS. “By 2012, contingent employment will have returned to 2008 levels,” says Dana Shaw, senior vice president for strategy and solutions at Staffing Industry Analysts in Mountain View, Calif.
 
Growth and decline and temporary jobs will happen as a part of smart business. But isn’t every job temporary anyway? Have you ever looked at the average tenure of leaders of public companies? Some studies support that they average a little over year. I know some contract work that is longer than that! Besides, think about your job. Yes, the one you are in right now. Think about how much project work there is with a beginning and an end. Think about how frequently you are challenged to do things that aren’t written in your job description. Businesses demand both productivity and a growth in skills from its workers.
 
Burkhard theory suggests that most people are congruent or right for their jobs just a few times a year. Companies change fast. Jobs evolve. We grow in interest and in skill, and our job might not. Or the job changes around us and we might not be capable or even interested in how it evolves. If you’re in a fast-growing company, skills and work experience will change faster than people can settle in. If your business is shrinking? Many employees become too experienced for their role.
 
It seems like just yesterday that we all wanted was to work for parental companies and retire with the gold watch after thirty years. Many of us lived through the “age of free agency” in the workforce and perhaps scoffed at it for our own careers. Change comes slowly. However, change does come. And perhaps we are beginning to realize that every job is in fact “temporary.”
 

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