James HolincheckMy Gartner colleague Jeff Woods is preparing to respond to some questions from the Wall Street Journal about the impact of the economy on the software market. He asked me and some other analysts what we are seeing in the different markets we cover. He specifically asked if we are seeing demand for something like layoff modeling capabilities. Here is the answer I provided:
We would consider that functionality as part of a broader workforce planning solution. There are some clients looking at these solutions to model different workforce reduction scenarios to understand the impacts on a variety of different variables (costs, critical skills, knowledge/experience, etc.), but they are still somewhat few and far between (and the technology to do this is relatively new and immature). I did discuss this in the note I wrote on Building the Benefits Case for Talent Management Investment (Gartner subscription required) for the Quest for Talent Special Report last month.
I would say there is more of a move towards the basics. HR, like everyone else, is facing lower budgets and potential headcount reductions so they are looking at opportunities to improve HR efficiencies. Unfortunately, they are missing the bigger opportunity to help the business.
Do you agree? Is Finance running roughshod over everyone including HR? Whenever there are challenges, there are opportunities as well. HR should be leading the charge in advising senior executives as to the most optimal workforce composition. I will be interested to see if we see successful CEOs during the downturn credit their HR organization for aligning their workforce with the business realities in a way that maximizes competitive advantage and minimizes costs. That would be something, wouldn’t it. What do you think? Will we see that story written in the Wall Street Journal in the next two years?
Category: Uncategorized Tags:
4 responses so far ↓
1 Jim Holincheck: Dealing With Talent in the Downturn January 22, 2009 at 7:05 pm
[...] Read more… Share: [...]
2 Martin Sacks January 22, 2009 at 7:56 pm
Jim:
We are having many interesting discussions with our customers, who are using our software to model and action reorganization initiatives as a result of the downturn. Our software allows organizations to visualize their current structures, and collaboratively plan future organizations. Companies can then compare the forward plan with their current reality, and action the delta between the two.
This is clearly not a simple process, and what we have found is that where HR is not proactive in providing the data and tools to management to make these complex go-forward decisions, then they get their fate handed to them on a plate. ie: management is just too focused on achieving their immediate operational/financial objectives to give anything more than a handwave to the process, other than what is imposed on them by the compliance folks.
If there is anything this climate is showing us, its the importance of HR taking the initiative to stage the data and tools in a consumable fashion for line management/finance, so that its ready to go when the rubber hits the road, so to speak. For the most part, its too late to be talking about getting everything together, when the reorg has to happen now.
The take home, we believe, is to OPTIMIZE frequently, good times or bad, and you wont have to REORGANIZE, when the bad times come. HR needs to drive home the business value to being nimble, and take the initiative from finance when it comes to people decisions. That way the nuances of the reorg – taking action that preserves the strategic workforce plan, preserves capabilities and respects performance and skills – wont be lost when finance pulls out the hatchet.
Martin Sacks, CEO
HumanConcepts
3 Brendan January 22, 2009 at 9:14 pm
It is a luxury to have HCM Software but almost essential in an economic downturn. In order to weather the storm and cut cost effectively by doing more with less you must have the hard data to make the right decisions. The HR environment is changing rapidly and a more proactive approach must be taken to stay ahead of the game. Now is the time to embrace new technology that will allow companies to develop their employees and come out of the gate strong when the economy springs back to life.
BG
4 Stacy Chapman January 23, 2009 at 4:52 pm
Hi Jim,
Our clients have certainly had finance try it – but because they have long term workforce plans in place (which usually means solid relationships with the right levels of the business), they are able to quickly show the impacts of potential decisions and help the business to make more informed, targeted calls.
I think you are totally right about missing the opportunity to help the business – even building models of capability or cost impacts of RIF’s doesn’t help you if you arent’ clear on which are the strategically critical parts of the business, which have the most need for internal experience, etc HR needs business acumen and insight in conjunction with tools like ours.
Regards,
Stacy