Modernizing HR
A recent survey of senior business and human resources executives, conducted by Deloitte Touche Tohmatsu and Economist Intelligence, revealed that the HR function is overloaded
by the enormous demands placed on it as employee-relations considerations move to the forefront of leadership agendas. The following statistics support this revelation:
- 85% of survey participants believe people are vital to all aspects of their organization's performance;
- that number increases to 90% when they were asked to look three to fives years ahead;
- Only 3% of respondents describe their current organization as "world-class" in people management and HR functions;
- Only 23% believe HR currently plays a crucial role in strategy formulation and operational results; and,
- 52% of respondents still don't have a chief human resources officer, or a comparable C-level executive dedicated to people issues.
These findings reiterate the increasing importance of employee engagement and its contribution to organizational success. Though focused primarily on the HR function and its
absence in C-suite activities, the survey does open the door for communications executives, who also play (or should play) strong roles in employee relations, internal
communications, leadership and development, and employee training.
Employee Engagement VS. Customer Loyalty
According to a recent report conducted by Best Practices, there is a recognizable link between employee engagement and customer loyalty - specifically, companies that engage
employees show gains in customer loyalty and satisfaction. Among the findings:
- Development Dimensions International data from a Fortune 100 manufacturing client shows a dramatic 1000% increase in errors among disengaged vs. engaged employee
populations;
- 75% of high-performing companies hold managers accountable for engaging their employees; and,
- Only 35% of the full benchmark class hold managers accountable.
As for the report's communications implications, the PR function's ability to encourage cross-functional teams throughout their organizations helps employees understand the
function of all business units as they relate to corporate performance. This knowledge can in turn increase the effectiveness of employees' interaction with the customers they
serve, thus impacting both employee engagement and customer loyalty.
Reputation Building Blocks
The Reputation Institute recently released its annual ranking of corporate reputations, with the following companies rounding out the top 10:
1. Lego
2. IKEA
3. Barilla
4. Mercadona, S.A.
5. A.P. Moller-Maersk
6. Toyota Motor Corporation
7. Terrero
8. Petrobras
9. Sberbank of Russia
10. Rockwool
According to Charles Fombrun, the executive director of the Reputation Institute, Lego's jump to first place is likely a result of "pruning their lines of business." Other
practices employed by the most reputable companies, most of which were not U.S.-based, were "ongoing dialogue with customers," "a global media strategy" and "changes in
leadership."
"For any company, success is about trust and relationships," Mike Lawrence, EVP of Cone, commented to Forbes. "The biggest reason is technology, which has empowered every
consumer to be extremely powerful. Someone who isn't happy with a company can go online and inundate a CEO's e-mail inbox and have people 20,000 miles away ready to boycott."
The Institute surveyed more than 60,000 people in 29 countries on seven factors that contribute to a company's reputation: products and services, innovation, workplace,
governance, citizenship, leadership and performance. According to the report, this is the first year that voters counted citizenship as having the strongest affect on reputation.