Are you going to do anything different with HR or just follow the same tired practices of all the other firms you have worked for or compete with?
Many of our readers of The Zweig Letter today don’t know that I started my career in the AEC business working in the human resources management discipline. I worked first in a consulting firm that did recruiting and other things and then worked for two of my clients, both engineering and architecture firms. In both cases, I started out in charge of HR and ended up the marketing director as well. I even wrote a book on human resource management for this industry entitled Human Resources: The Complete Guidebook for Design Firms published by John Wiley & Sons.
The point of my telling you all this is that I have learned over the years that a lot of what is considered commonsense good HR practices I don’t agree with at all. In fact, I think a lot of what most all firms in our industry do related to HR is counterproductive and doesn’t help the firm or the people working in it.
Here are some specific practices I believe should be challenged:
- Annual performance appraisals. It makes no sense to wait up to a year to give positive or negative feedback. You need to give that immediately. And if that feedback has been continuously given, what’s the point? Because the bureaucracy expects it? Everyone hates them – the managers who have to give them and the employees who have to receive them. They are doubly worthless when combined with salary review because that is the only thing the employee actually does care about. If they are happy with it, they pay no attention to any feedback. If they are unhappy about it, they pay no attention to any feedback. And as far as providing documentation for termination, most of the time the majority of the feedback on these things is positive and the fired employee’s attorney can use it as evidence of wrongful termination.
- Annual salary reviews. Once a year is too long to wait. And when people know that and are unhappy with their raise, guess what they do? They start looking for another job! I’m much more inclined to look at salaries quarterly myself. Send a signal that things are going well or things need to change four times a year instead of once. It doesn’t mean you have to give any more money away, either, just because you look at pay four times a year versus once.
- Cost of living increases. If you give out a cost of living increase to everyone, you won’t have any raise dollars left. And if you do (have money on top of that to dole out) you are increasing your costs faster than inflation and faster than you will probably be able to recover them – not a good idea.
- Year-end bonuses. Once again, just because you have always given out bonuses once a year at year-end doesn’t mean it’s the best way to do it. Why not have even more chances to reinforce the individual and the firm are on the right track and do it quarterly or even monthly? Get everyone tied into shorter time frames to perform. Once a year bonuses psychologically give everyone too long to recover from bad months.
- Paying recruitment bonuses. I don’t care for them and never have. Your people should want to get their friends and former co-workers to work there regardless of whether or not they get paid to recruit them. What’s wrong with helping out the company and a friend without getting paid directly to do so? Beyond that, I have personally seen employees get angry when the person they referred didn’t get the job. They felt like the company was trying to avoid paying them a recruitment bonus. These things are not necessary.
- Formal job descriptions. The more of these you have, the more time you will waste on people who think they should be doing something they aren’t doing, or those who think they shouldn’t have to do something they are being asked to do. Why put anyone in a box? Then they really get whacky when you start tying education and experience requirements to these things. That’s when people start getting upset that they haven’t been “promoted” into a job that they ostensibly meet the qualifications for.
- Status titles. Titles like “senior associate” and “vice president” that don’t really connote what someone does or what they are actually responsible for can destroy morale, even though the intent of management that bestows them may be the opposite of that. When one person gets that title and someone else doesn’t who thinks they deserve it – watch out!
- Fixed salary ranges. Why tell someone what their max pay will be in any given role? Seems like a big demotivator to me. And yes – I do realize certain states like New York are requiring that the current high and low salaries of any given job are supposed to be available to employees and applicants, but that doesn’t mean it’s a good practice to follow unless you are forced into it in my opinion.
So the question is – are you going to do anything different with your HR stuff or just follow the same tired practices of all the other firms you have worked for or compete with? You can be different, you know!
Mark Zweig is Zweig Group’s chairman and founder. Contact him at mzweig@zweiggroup.com.
