Supply Chain Review: Resource to Endorse
December, 2009: Supply Chain Review: Resource to Endorse
As the Australian economy dusts itself off from the global financial crisis, many companies are starting to invest further in staff education and training to prevent valued employees from seeking what they might deem greener pastures, underpinned by a more confident business outlook.
Simon Kelleher, managing director of World Courier Australia, a specialist in clinical trial logistics, cold-chain solutions and premium courier services, believes staff training has been undervalued by too many companies for far too long.
Kelleher says that, like many small-to-medium sized businesses, World Courier Australia (WCA) has limited resources in payroll, but that cash is not the only – or even best – way to retain staff.
“The way we reward, recognise, train and develop staff – it all costs money but it’s a better use of money than simply throwing cash at employees,” he explains. “We need smarter strategies to show our commitment and respect to our staff.”
Commitment to HR and training
WCA’s “commitment and respect”, according to Kelleher, is reflected in the investment the business has made in the past 12 months to overhaul its approach to human resources and training, which needed to accommodate staff growth of more than 20 percent since 2004.
The overhaul, which began late last year, included axing the internal HR role and outsourcing all the company’s HR functions to The Human Resources Centre.
This means areas such as recruitment, training and staff education, payroll, workers’ compensation, redundancy, conflict resolution and compliance with workplace legislation are now handled externally or supported by HR specialists who also, Kelleher adds, act as management advisors, helping WCA align HR processes with the company’s expansion goals.
“We've undergone a period of expansion in the past five years and as the company has grown in geography and size, as well as headcount, we came to the realisation that our internal HR processes, while they may have supported us when we were small, were becoming insufficient,” Kelleher says. “The demands of HR in a modern organisation exceeded our internal capacity to deal with issues, such as training and compliance with workplace legislation, in a holistic way – and in professional and efficient way in terms of our staff engagement.
“When we started out, like many smaller businesses, we handled HR internally and muddled through, but we had exposure to more complicated workplace issues, so we trialled having an HR-in-training person to look after our HR functions. After 12-18 months, though, we were still not adequately dealing with human resources in a professional and competent manner, which is when we decided to outsource our HR and training needs to specialists who had the skills-set to deal with HR in a holistic manner.”
Cross-skilling for a zero recruitment policy
Ensuring staff have a range of skills to work across various areas within the company, as well as a defined career path, has also been an important aspect of WCA’s evolving approach to human resources.
During the financial downturn, the company’s objective was to maintain a “zero recruitment” policy, which meant the cross-skilling of existing staff became just as important as upskilling.
“We run a lean workforce around the country, so we need to have people cross-skilled rather than compartmentalised, which would be detrimental to our business,” Kelleher says. “We need them to have flexibility, and by overhauling our HR and training, we are now able to give staff the opportunities to join us and add value to themselves and their role – to have the opportunities to upskill and cross-skill and move across different departments.”
Katherine Graham, the founder and managing director of The Human Resources Centre, which effectively acts as WCA’s outsourced human resources department, says identifying and analysing roles within the company that needed to change or be made redundant was crucial in maintaining the zero recruitment policy.
“We wanted World Courier to think more analytically about what their staff and trainees were doing in terms of their job roles and how to align or boost their skills and training,” Graham says. “When we first came on board, one of the first things we did was audit the employees’ skills and skills gap. Now we’re forging a training plan for each individual so everyone knows where they’re at in their staff development phase.”
Adds Keller: “The Human Resources Centre enabled us to identify job descriptions and skills and things we needed to do, and they gave us the tools and pathways to do this. It’s also about letting our staff know that we are investing in them and for them to know they have a pathway to cross-skill and work across other areas of the business.
“It’s about matching these courses and pathways with every staff member. We’re also, with The Human Resources Centre, working with line managers to ensure everyone has access to these pathways, whether it’s through external or in-house education. By next year, every staff member would be able to ask their line manager where they are on their developmental path, and the line manager would know.”
Outsourcing HR: bottom-line benefits
Kelleher says outsourcing to The Human Resources Centre has also been an “economically attractive option”, with the business seeing “marked commercial benefits”.
“On one hand, it avoids the costs associated with having an internal HR manager on the payroll, while on the other, it still enables us to rely on The Human Resources Centre like we would an internal HR department,” he explains. “They came on board at the end of 2008 and ‘embedded’ themselves into our company – that’s a good word to describe our relationship with them. And our staff trust and have confidence in them as well.”
He adds that the most important shift, in terms of the company’s approach to HR and training, was in establishing an HR environment that would support WCA’s business objectives.
“In the past, we hadn’t placed enough significance on HR practices and how that could support our company's objective. The biggest realisation for me now, one year down the track with The Human Resources Centre, is seeing the direct benefit of outsourcing HR in terms of the culture and face we present to our employees as well as the commercial benefits that are significant,” he says. “I don’t want to get into specific numbers but we’ve seen direct benefits to our bottom line by outsourcing competent and efficient HR services as a support mechanism within our organisation.
“Prior to our relationship with The Human Resources Centre, our HR was more reactive. We were trying to put out fires rather than getting on the front foot and demonstrating to staff that we place a high priority on a culture of valuing their contributions and developing their skills and potential for growth through education and training.”
After the downturn: 2010 outlook
While 2009 has mainly been about getting the groundwork right and overhauling its approach to the role of HR as an integral support for the business’s goals and bottom line, 2010 will involve a more “aspirational” approach to HR as the economy crawls out of the downturn, Kelleher says.
“We’re looking to The Human Resources Centre to help us come out of the global financial crises and retain good staff,” he adds. “This year has been about setting up the basic framework and we now feel we’re robust and competent enough regarding our HR processes and workplace compliance obligations, so the next step of the journey is more aspirational, with a stronger focus on training and development, especially for our line managers.”
Graham, from The Human Resources Centre, says their work with WCA in 2010 will move away from labour-intensive operational issues towards more senior-level management training in order to build a highly-skilled workforce.
“Next year is about high-level leadership and mentoring, as well as more sophisticated staff-retention strategies, which will involve upping the ante on training and development so we’ll be looking at implementing such things as recording and validating training, job rotation and conflict training for staff,” Graham adds.
She also says The Human Resources Centre will be working with WCA on training and education programs for line managers, who have technical experience but under-developed people management skills.
“We want them to feel empowered in their managerial role, so the training is about instilling knowledge and confidence so they can discipline and assess staff performance in an industrially sound way that will derive better performance from their staff.”
Adds Kelleher: “Our line managers come from the shop floor, so they are competent box movers who posses strong operational knowledge, but it doesn’t mean they come with HR skills, so the continuing development of our managers under the tutelage of The Human Resources Centre has been critical to our journey. Having more skilled managers is one very tangible benefit and the spin-off is the message we are sending to staff, which is we have a duty and desire to tackle HR in the best way we can.
“I’m very pleased with the decision we took 12 months ago and our position has improved markedly since then. We’re still on a journey but I’m pleased with the changes achieved in our organisation so far, especially in relation to our managers.”
Optional: Breakout box: Summary of WCA’s HR overhaul
The scope of outsourced HR functions carried out by The Human Resources Centre includes:
- Complete human resources audit to ensure WCA complied with industrial relations acts, including Equal Employment Opportunity, Occupational Health and Safety, the Fair Work Act.
- Payroll audit to ensure correct interpretation and payment of staff awards and benefits.
- Staff skills and training audit to help clarify and restructure job roles and position descriptions.
- Development and implementation of staff and management training and education, including conflict resolution, mentoring and leadership skills.
- Development of customised training and career pathways for every staff member.
- Development workplace conduct and performance policies to address staff performance and discipline.
- Development and management of worker’s compensation and redundancy processes.
- Acting as grievance support and mediators for workplace disputes
Media contact and interviews: Managing director of The Human Resources Centre, Katherine Graham, is available for media interviews and background information. Graham has more than 15 years’ experience in human resources and payroll management.
To arrange an interview or for further information, including case studies, please contact Daryl Phillips on dphillips@humanresourcescentre.com.au
About The Human Resources Centre: The Human Resources Centre is an Australian owned and operated human resources consultancy, offering a wide range of services in all areas of HR management, including strategic, operational, legal, training and payroll functions.
With offices in each capital city, The Human Resources Centre assists organisations in areas such as: review of their HR structures and practices, compliance with workplace laws; recruitment and workplace policies and procedures; remuneration and performance management; staff training and development; workplace relations and mediation; occupational health and safety; payroll management and organisational culture.
The Human Resources Centre also operates The Resolution Centre, a specialist division advising on workplace conflict, mediation and employment law, and The Managed Payroll Centre, which offers outsourced payroll services.
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