Executive Briefing

By Rita Zeidner May 1, 2008
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HR Magazine, May 2008Measure for Measure: Frank Talk About Metrics; Telecommuting: The Good, the Bad And the Unknown; When Does Philanthropy Pay?; Taking Bullies To the Woodshed; Quit Rates High Among Women, Minority Pros

Measure for Measure: Frank Talk About Metrics

HR metrics are a bit like the weather—everyone talks about them, no one does anything about them. That’s according to management professors and business analysts Wayne Cascio and John Boudreau, co-authors of Investing in People: Financial Impact of Human Resource Initiatives (FT Press, 2008, published in partnership with the Society for Human Resource Management). We asked the authors how HR leaders can make better use of data.

Your book makes the rather dispiriting observation that “only rarely” do HR metrics drive true strategic change. What gets in the way?

Cascio: Too often, HR professionals think their strategic roles lie in their abilities to generate a “metric of the month”—absentee and quit rates, levels of employee engagement, or costs associated with wellness programs. That’s not enough. It’s the interpretation of these data in light of strategic objectives and human capital needs of the business that drive true strategic change.

Boudreau: HR measurement systems are built to describe what human resources is doing or to justify investments in HR programs. That’s not usually what the broader organization needs. Build measures that address a fundamental question: What information will make the biggest improvement in talent decisions?

That sounds awfully abstract. With the economy souring, many companies contemplate layoffs. Some have sent pink slips. Could a better understanding of HR metrics lead employers to less Draconian steps?

Cascio: We can learn from the experience of Silicon Valley’s high-tech manufacturer Xilinx Inc. It opted to keep its most innovative employees on board when competitors cut their workforces ferociously during the hightech crash. This strategy allowed Xilinx to increase market share from 38 percent before the crash to 50 percent after it. If HR professionals can present data that reflect the fully loaded cost of turnover among key talent, they are likely to influence decisions about the propriety of cutting when times get tough.

Boudreau: Careful tracking of turnover and staffing costs can reveal the potential danger of shortsighted decisions to cut head count to meet shortterm accounting goals. Comparing the costs of keeping engineers or any other high-demand workers on the payroll through a downturn and the costs of laying them off and then hiring them back—when everyone else competes for them—often reveals that one can actually save money by keeping them on.

Read more of this interview on the Business Leadership page online at www.shrm.org/leadership/library/0508metrics.asp.

Telecommuting: The Good, the Bad And the Unknown

No one said designing a telecommuting policy was easy.

Flexible workplace arrangements win favor with employees who tend to like the flexibility and autonomy. Corporate budget crunchers often credit flexible schedules with real estate savings.

Meanwhile, many managers say the notion of employees working at home can undermine collaboration and, ultimately, the bottom line. So who’s right? The debate intensifies as the economy slows down. Now, every bit of productivity counts.

An examination of 20 years of research by Pennsylvania State University investigators suggests that the evidence is tilted, albeit slightly, in favor of telecommuting.

An analysis of 46 studies of telecommuting involving 12,833 employees, conducted by Ravi S. Gajendran and David A. Harrison, professors in Penn State’s Department of Management and Organi zation, shows that flexible schedules offer managers more positives than negatives. Their study was published in the Journal of Applied Psychology in November 2007.

Contrary to popular belief that face time at the office remains essential for good work relations, said Gajendran, the evidence shows telecommuters’ relations with their managers and co-workers did not suffer.

When Does Philanthropy Pay?


These days, companies ranging from Wal-Mart to Starbucks jump on the corporate social responsibility (CSR) bandwagon. After all, who doesn’t love a company with a conscience?

Well, shareholders for one. Especially if doing good’s gonna cost ’em.

These conclusions are included in a working paper now being circulated by a team of Ivy League business professors, including Raymond Fisman, research director of Columbia Business School’s Social Enterprise Program. When the competition is steep, such as in retail, a company’s CSR initiatives may make its products stand out as superior and therefore boost sales and profits, the researchers concluded. However, CSR initiatives may eat into profits in industries that don’t advertise, such as computer chips and business-to-business services.

Big Blue also weighed in recently on how companies can leverage CSR. In a separate report released earlier this year, IBM’s Institute for Business value observed the following traits among outperforming companies with CSR programs. They:

  • Engage their full base of employees, not just top brass.

  • Have a strong understanding of their customers’ CSR expectations.

  • Are effective at aligning their good deeds with their business priorities.

Taking Bullies To the Woodshed

On his personal web site, Bob Sutton, a professor of management science and engineering at Stanford University, posts the following advice: “Sometimes the best management is no management at all—first do no harm!”

He’s not just being snarky.

Late last year, Sutton won a prestigious award for his best-selling book on bullies, The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t (Warner Business Books, 2007). The book is about office jerks, how to recognize and deal with them, and how to avoid turning into one of them.

According to Sutton, a bully’s bad behavior can harm workplace productivity and, in some cases, even eat into the bottom line.

A study adds to the growing backlash against brutish bosses: In March, researchers at the University of Manitoba reported that the emotional toll of workplace bullying is more severe than that of sexual harassment. The findings were presented at the Seventh International Conference on Work, Stress and Health, co-sponsored by the American Psychological Association and the National Institute of Occupational Safety and Health.

Policy-makers are taking note. Legislators in 13 states have introduced anti-bullying workplace laws, according to the Workplace Bullying Institute, an advocacy group. The states are California, Connecticut, Hawaii, Kansas, Oklahoma, Oregon, Massachusetts, Missouri, Montana, New Jersey, New York, Vermont and Washington. So far, none of the proposals have passed.

Quit Rates High Among Women, Minority Pros

Companies invest huge sums to broaden the diversity of their professional and managerial ranks. Such programs, many business leaders maintain, are not just good for workers; they boost profits too. But the effectiveness of these recruitment efforts may be undermined by high attrition, according to a study in January’s Journal of Applied Psychology.

Examining quit rates at 20 corporations, researchers from Arizona State University and Columbia University found that women quit more than men, that blacks, Hispanics and Asian Americans quit more than whites, and that minority women quit more than both whites and men of their own ethnicity. Turnover for black women was highest— 32.8 percent higher than the black male quit rate, 20.6 percent higher than the white female quit rate, and 85.3 percent higher than the white male quit rate.

The study didn’t look at why the workers quit. But the findings raise “serious concerns about these groups’ full participation in corporate America given their premature attrition,” the authors warn. “Greater corporate flight among women and minorities during early employment ... hampers progress toward a more diversified workforce in corporate America.”

Quittin' Time 

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