Featured Research: How Project Work Is Changing the Face of Human Capital Management

Plus three steps all businesses can take to improve recruiting and retention

 

Even in industries not traditionally focused on project work, there is currently a shift toward project-based hiring and the use of freelance or contingent workers. This trend isn’t fully driven by employers; many workers also prefer a non-traditional style of employer-employee relationship. While this does create a certain amount of pressure on organizations to accommodate non-traditional work arrangements, it also offers a fantastic opportunity to change the way we think about human capital management.
 

If your business is not yet accustomed to trends like project-focused hiring, skills tracking, and post-hire development, you can look to professional services firms to better understand how to incorporate these trends into your company’s human capital management strategy.

Here is a look at how professional services firms are leading the way—and at the areas where we can all work toward a higher level of achievement.

So, first, what can we learn from professional services firms?

Maintain Skills Repositories
Simply put, a skills repository is a comprehensive list of skills and competencies possessed by your workforce. It can include predefined skill levels and categories that can help your organization to plan future workforce needs. Project-centric firms use technology to maintain skills repositories in order to easily match employee skills and competencies with forecasted needs. Although other industries don’t need to be as concerned about matching talent to specific projects, skills repositories could be useful in any industry or any organization.

You might be surprised what skills already exist in your workforce. Many members of your workforce have enjoyed success in different careers and industries and, as a result, possess dormant skills. A skills repository could help your business identify internal candidates for open positions and optimize their current workforce by capitalizing on the full range of available skills and competencies.

Utilize Continuous Feedback

Although we might wish otherwise, the annual performance appraisal process remains alive and kicking. Too many organizations are still mired in this time-consuming and ineffective method to manage performance, while other organizations have abandoned annual appraisals but haven’t built a new model.

Professional services organizations are more likely to use shorter feedback cycles that match project work. When supported by talent management software, these cycles are extremely effective. Conversations can be recorded and referred back to, ultimately helping managers to build relationships with their direct reports, track goals and log milestones. Employees in project-based firms may have measureable targets related to specific projects, but managers and employees can also work to create longer term goals during related discussions.

Try Project-Based Hiring

The gig economy, known for temporary short-term engagements, is growing and as more workers opt for non-traditional work arrangements, it is entirely likely that contract work will become the norm. Research suggests that employers who hire specifically for projects and/or are effective at managing contingent workers struggle less to offer competitive compensation.

Why? It could be that a reliance on alternative employment relationships helps organizations to hit the compensation crunch less often. Although not all businesses should try to focus entirely on project work, being open to alternative working arrangements could have a significant impact on your organization’s ability to offer competitive compensation when you need it most.

Now that we’ve assessed areas where we can learn from professional services firms, what can all of us be doing better?

Acquisition & Onboarding

When treated as a strategic function, talent acquisition can have a profound effect on your ability to influence company culture, establish an employer brand, and ultimately make your firm more attractive to prospective candidates.

Organizations typically just don’t have the bandwidth to achieve this without the support of an applicant tracking system (ATS). An ATS can free your organization from the repetitive, administrative tasks associated with recruiting, which can make it difficult to provide a top-notch applicant experience.

As we all know, an applicant’s experience during the interview process can be the difference between a great candidate accepting your offer or going to the competition. But even after an offer letter is signed, much more needs to happen to reaffirm that choosing your company was a wise decision. 

Onboarding is a critical first step in the employee lifecycle, but few organizations have a thorough strategy in place to integrate new hires into the company in a way that supports retention and engagement. When you create an onboarding strategy that includes your new hires’ needs and integrates collaborative planning for development, you’ll set your employees on a path toward long-term engagement and success within the company.

Post-Hire Professional Development

We all know that talent acquisition is one of the most expensive business processes in any organization. It’s time to start talking about how to reduce acquisition costs by investing in post-hire human capital management initiatives that develop and retain existing employees.

Your employees want opportunities to develop and tend to stay with an organization longer when this investment is made. Unlike throwing additional funds at the acquisition process, spending on learning initiatives for your workforce is mutually beneficial for employers and employees. Increasing employee engagement is shown to have very positive effects on business performance. For example, according to recent Gallup research, the behaviors of highly engaged business units result in 21% greater profitability. It’s worth noting that not every resource problem in your organization is an acquisition problem. Sometimes the problem may be repetitively hiring for the same role or a failure to identify the next great leader. Most of the time, due to manual processes, businesses can struggle to predict future needs and end up scrambling.

According to multiple bodies of research, including Deltek’s own Clarity surveys, many organizations have a partial succession plan in place, but the majority are not prepared for expected or unexpected turnover. Whether the role is a leadership position or an important individual contributor, thorough succession plans are a must to help businesses weather the churn created by employee turnover.
It’s not enough for succession plans to live inside the brain of a single individual. By using the latest succession planning tools available through your talent management software, you can develop, maintain, and test succession plans to ensure that future leaders are ready to advance when you need them most.

Tracking Key Performance Indicators

Even less data-driven companies are beginning to track key performance indicators (KPIs) related to talent management–but the problem is that many are not tracking the right metrics.
Some metrics, like voluntary and involuntary turnover rates, are really just numbers. They fail to provide companies with the information needed to craft, implement and measure a more effective human capital management strategy.

Using a talent management solution to track metrics like Time to Start, Lead Time to Productivity (Lead Time to Billable in professional services firms), and yourTalent Acquisition Sourcing Channel, your company will generate more sophisticated and actionable insights. Here is a closer look:
 

Using technology to help you track, benchmark, and eventually predict metrics will help HR professionals in any industry to position human capital management as a strategic cornerstone for their organization.

Key Takeaways

Out of necessity, project-based firms have learned to integrate human capital management into business strategy. They work to optimize the skills and competencies in their workforce and increase the value of their human capital. Project-based firms have arrived at the conclusion that engaged employees are the key to delighting clients and achieving peak profitability—lessons from which we can all learn.

For most organizations, a lack of integrated technology bogs down HR with administrative work and limits time for value-added activities such as strategic talent acquisition, retention and development. It prevents HR from being seen as a key contributor to strategic planning by limiting the analytics and insights they can provide at the executive level.

HR needs to partner with other functions within the organization, such as IT and Finance, to develop and then implement an HR technology roadmap. Human capital management solutions are the most powerful when they are integrated with the existing enterprise resource planning (ERP) solutions used by your organization. All of the above challenges can be addressed and improved by the effective use of digital human capital management solutions.

Author Bio

Amy Champigny is Sr. Product Marketing Specialist for Herndon-based Deltek, the leading global provider of enterprise software and information solutions for professional services firms and government contractors. Connect Amy Champigny