Four out of five HR professionals worldwide are concerned about the financial toll of the coronavirus virus epidemic on their organization – but this crisis may also open up new opportunities for practice.
More than half of HRD HR leaders (54%) said they were somewhat concerned about their company’s financial well-being, while one quarter felt ‘very worried’ about the economic decline from the crisis.
When asked about their epidemic cost-cutting strategies, respondents cited the following measures:
Rent Freeze (30.77%)
Salary freeze (28.21%)
Reduce working hours (15.38%)
Temporary layoffs (10.26%)
Asking workers to go on unpaid leave (2.56%)
One of the three HR leaders stated that his company let at least 10% of its employees go through the crisis.
Despite this, many are hopeful about the prospect of re-appointing former employees: About 43% of HR leaders expect to call back their employees within six to 12 months.
Some are expecting recurrence in less than six months (22%). Almost the same percentage said that there are no plans to recruit employees for at least another year (21.43%), the survey found.
HR practice itself is not immune to employees and costs decline over the coming months as the world continues to recover from both the financial and health effects of outbreaks. A global CFO survey by Gartner estimates that HR will see a 7% reduction in average costs throughout 2020.
Lessons from the global financial crisis. Also open up new opportunities for HR practice to redefine its role in the midst of a crisis – from cost-cutting measures to overall restructuring.
Most companies can see a more comprehensive HR team, integrating recruitment, talent development, and performance management into a single comprehensive strategy.
This was the case during the 2009 global financial crisis, as reported in a study by Ipsos and Talent 2.
Faced with the reality of corporate downsizing, over time HR leaders shifted their focus to strategic rather than operational or strategic / HR work.
He cited the following as his top three priorities under such “turbulent economic conditions”:
- Performance Management
- Leadership and Management Development
- Employee Communication and Engagement
“Performance management and leadership development are understandable priorities because strong, visible leadership will be critical as companies feel stressed due to the recession,” the analysts said.
The study found that “since recession forces organizations to examine performance in sharp detail, underperformance will be dealt with in a more direct and proactive manner.”
Not many businesses can make it after the COVID-19 crisis, employment lawyer Steph Diehberg recently spoke to HRD.
But “those who survive will rebuild and improve their contingency plans.” Something will thrive and grow, perhaps in an unplanned manner.
This is a new era.….
Human resource leaders may face ongoing staff and cost reductions throughout the year, yet find their idea to replace a high-performing team – one that remains resilient and thrives in crisis situations . But it is up to these leaders to empower their people.
An example of this lean philosophy is for leaders to give employees more autonomy when they work remotely and businesses navigate this “new normal” way, Dürberg suggests.
“Managers should give employees the confidence to self-manage and be productive at home, provided they are properly supervised and have the necessary resources,” she says.