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Blog: The Business of Management July 2009 Archive
 

July 30th, 2009

GM’s Big Changes: A Slap at Traditional HR, Out-of-the-Box Thinking … or Both?

What can you say about a large, tradition-bound, old-school manufacturing company that decides to shake up its management team by promoting someone with no human resources experience to lead its HR function?

That’s the question people are asking about the decision by General Motors to replace its longtime human resources chief, Katy Barclay, with Mary Barra, “a top executive with an engineering background who worked closely with former GM chief executive Rick Wagoner,” according to a story by Workforce Management staff writer Jeremy Smerd

“The retirement of Barclay, 53, who has been vice president of global human resources since 1998, was seen as long overdue,” the story says. “ ‘She is one of the same senior leaders who is responsible for the destruction of the company,’ said Rob Kleinbaum, managing director of auto industry consulting firm Rak & Co. ‘She is responsible for it and should be accountable for it.’ ”

That’s a pretty heavy load to lay at the door of the HR chief. If it’s true, it probably says that Barclay did indeed have one of those coveted “seats at the table.” (Note to all who still long for such a perch: Be careful what you wish for.)

By contrast, here’s a bit about Barra’s HR-free career.

“Barra, 47, is vice president for global manufacturing engineering and has been with GM since 1980,” according to the Workforce Management story.  “She has served in a number of engineering, manufacturing, management and communications positions and was plant manager for the Detroit Hamtramck assembly center. Barra was appointed executive director of vehicle manufacturing engineering in 2004 and was named to her current position in 2008, the company said in a release.”

There’s no doubt that GM is a troubled company that is in need of some huge changes, but does putting an HR novice in charge of the company’s people function makes sense at this critical time?

According to auto industry consultant Kleinbaum, appointing an engineer with no HR experience as the department’s head suggests that General Motors is looking to infuse the company and its workforce with a greater sense of the manufacturing principles of continual improvement and operational efficiency.

“It’s a positive sign they want to make deep changes in HR and don’t want to draw from the HR community,” Kleinbaum said in the story.

It depends on how you look at it, of course. Large companies have tried this in the past. We wrote about Wal-Mart’s attempt to do it, without any notable success, back in 2005, but I know of no research that indicates that there is any higher degree of management success for someone with a non-HR background than a more traditional human resources leader.

Plus, GM’s new vice president of global human resources has some baggage of her own. As noted, she worked closely with former CEO Rick Wagoner—the guy who was famously “fired” (terminated with extreme prejudice, as I put it) by President Barack Obama.

The question I keep coming back to about this move is this: Does GM’s decision to promote someone from outside HR into the top people management job reflect out-of-the-box thinking, a big slap at traditional HR, or a little of both?

I’m thinking it is more the former than the latter, but only time will tell if this move makes much sense—and if it’s possible to make meaningful change without a grasp of what makes HR tick.

Get my latest blog updates, HR news and human resources trends by following me on Twitter.


July 29th, 2009

Are Women Really Better Managers?

Although I’ve worked for many more men than women over the course of my career, it’s hard for me to make a flat statement that one sex is clearly better at managing and leading than the other.

The men I have worked for have run the gamut from bullying and boorish to smart and sensitive, with every shade in between. In fact, I find it much easier to rank my many male bosses on a good-to-bad scale because they seem to fall into such a ranking fairly easily.

That’s not the case with the women I’ve reported to. Although I had a great personal and professional connection with every one of them, their strengths and weaknesses always seemed to be very polarized. Or to put it another way, the things my female bosses were good at they were REALLY good at, while they things they weren’t so good at could drive you to despair.

For example, although I have had at least one bullying male boss who was always glowering and ready to get violent, I’ve never had a guy I was working for ever actually resort to a physical attack. It was a female boss—one who I still today admire as one of the best managers I ever worked for—who actually balled up a newspaper while screaming at me and fired it at my head. This happened on more than one occasion when she was unhappy with my staff’s work.

My point is this: You can’t make a case that men as a group or women as a group are better managers. Each man or woman I have worked for has been good and bad at lots of different things, and it is silly (and sexist) to make a case for the managerial prowess of one gender over the other.

That’s why I nearly fell out of my chair when reading the latest Corner Office column in The New York Times, titled “No Doubt: Women Are Better Managers.” The Q&A was with Carol Smith, senior vice president and chief brand officer for the Elle Group, a media company. The provocative headline was inspired by the interviewer’s observation, “It sounds as if you’ve thought a lot about men versus women as managers.”

“I have, I have,” Smith told the Times. “Hands down women are better. There’s no contest. In my experience, female bosses tend to be better managers, better advisers, mentors, rational thinkers. Men love to hear themselves talk. I’m so generalizing. I know I am. But in a couple of places I’ve worked, I would often say, ‘Call me 15 minutes after the meeting starts and then I’ll come,’ because I will have missed all the football. I will have missed all the ‘What I did on the golf course.’ I will miss the four jokes, and I can get into the meeting when it’s starting.”

Smith continued: “Men also, they’re definitely better on the ‘whatever’ side. Things tend to roll off their back. We women take things very personally. We’re constantly playing things over in our head—‘What did that mean when they said that?’—when they mean nothing. And I’m certainly not immune to this. So there’s a downside to women.”

Smith’s full interview with The New York Times is well worth reading, if for no other reason than to see how such a smart and savvy female executive can come to such a dumb and sexist conclusion. Nowhere in the Q&A does she really make much of a case for why women are better managers than men. Yes, she gives some anecdotal examples, but nothing that makes you sit up and say, “Wow, she’s right about that.”

And let me add this: If any man was quoted in The New York Times saying that men were hands-down better managers than women, he would be roundly criticized, taken to task and—depending how poorly or indelicately he put it—perhaps even tarred and feathered on his way out of town.

In my long career, I’ve discovered only one clear truth about men and women as managers. It’s this: You simply can’t make a blanket judgment about the quality of managers by their gender. Anyone who tries to do so is foolish and shortsighted, and perhaps hasn’t worked for enough different kinds of managers—male or female—to figure that out.

Get my latest blog updates and workforce management news by following me on Twitter.


July 27th, 2009

Balancing a Budget on the Backs of the Workforce

The Golden State of California (home to the Workforce Management world headquarters) is well-known, for better or for worse, as the place where a lot of innovative trends get started. Some of these are progressive and groundbreaking, but you can also make a great case that many of them, especially the workplace-related trends, are just downright regressive, dumb and kooky.

Here’s a great example of what I’m talking about, courtesy of the San Jose Mercury-News: “One of the accounting tricks used to close [California’s] $26 billion budget deficit is increasing income tax withholding schedules by 10 percent. That is, whatever is withheld for state income tax from your paycheck today will increase by 10 percent come January; you’ll get back any excess payments when you file your tax return in early 2011.”

A spokesman for California’s state Finance Department notes that this “in no way changes any working Californian’s tax liability or taxes owed” and that workers can “increase their allowances to compensate—so long as they do not underpay overall.” But as the newspaper notes, by doing this the state is trying “to shoehorn an extra $1.7 billion of personal income tax receipts into the current 2009-10 fiscal year. Essentially, the state is looking for an interest-free loan from working Californians.”

The move to withhold more from the paychecks of California workers happened in the dead of night as the state Legislature pushed through some 30 bills that, taken together, cobbled together a budget fix for a state that was $26 billion in the hole and issuing IOUs to vendors and taxpayers.

No workers or taxpayers got a chance to question or challenge this action, although as the Los Angeles Times points out, “the 24-hour session leading up to final passage of the budget Friday afternoon turned into a slow-moving train wreck … lobbyists for major interest groups were present throughout the night, seeking to influence the process. With hundreds of pages of legislative language passed with little time available for review, few knew what the fine print might contain.”

That’s how California workers got saddled with 10 percent more tax withholdings come January 1, and it shows just how dysfunctional the legislative process is out here in the Golden State. It also shows how now, days after the latest budget “fix” was approved, the impact of the middle-of-the-night budget-making finally becomes clear.

What can workers do about this? Nothing really, except fiddle their W-4 exemptions and tax withholdings to compensate for the extra 10 percent hit they’ll take next year. Of course, most people don’t do this, and the cynical part of this middle-of-the-night sausage-making is that no matter how riled up workers might get, few will actually follow through and take the time to do anything about it.

And, here’s the scary part of all of this: If the state of California can stick workers with a higher tax withholding in order to float the state a tax-free loan, what’s to stop other budget-challenged states from doing the same?

Nothing, of course, and I would be shocked if other states don’t look at this latest “trend” from out here on the Left Coast and decide, no matter how kooky it seems, that it makes a lot of sense for them to help balance their budgets on the backs of workers too.

Get my latest blog updates and workforce management news by following me on Twitter.


July 23rd, 2009

Dear Hiring Manager: Would You Hire Michael Vick?

Here’s a question I’d love to have some hiring managers answer: Would you hire (or even consider hiring) an individual with superior talent but a troubled past who might be a game-changer for your organization? Yes, he’s a convicted felon, but he has served his time, expressed remorse on numerous occasions, and seems generally contrite for his past actions.

Would you give this person a chance? Does talent outweigh the negative baggage, especially if the person in question has the ability to really, really help your business?
In other words, would you take a chance and hire former star pro quarterback Michael Vick?

“For Michael Vick to have any prayer of resuming his NFL career, he has to show true remorse for dogfighting, something he now admits doing as young as 8 years old,” writes Sam Farmer in the Los Angeles Times. “He made that confession recently to Wayne Pacelle, chief executive and president of the Humane Society of the United States, when Pacelle visited him at his home in Hampton, Va.”

The details of Michael Vick’s involvement in dogfighting are well-documented and abhorrent to just about anyone. And, Vick has paid a heavy price for his actions: “Although he remains on probation, Vick on Monday completed his federal dogfighting sentence, which included 18 months in prison and two more under home confinement,” the Times story points out.

 “He [also] forfeited an estimated $70 million when the Atlanta Falcons released him from his 10-year, $130-million contract, [and] Vick filed for bankruptcy protection a year ago, listing $16 million in assets and $20 million in debt.”

Yes, Vick has paid the price, but his crimes clearly warranted the penalty. Ed Sayres, president and chief executive of the American Society for the Prevention of Cruelty to Animals, said it was Vick’s “barbarism that sets the crime apart,” and that Vick admitted he electrocuted and beat dogs to death after they lost fights. “This was not a one-time transgression or crime of passion—this was a multi-year pattern of behavior that demonstrates a startling lack of moral character and judgment,” Sayres said.

But whether you decide to hire Vick also comes down to something else—do you believe in redemption? Can people atone and make up for their actions? Do the Michael Vicks of the world deserve a second chance?

I believe Vick deserves another chance, and I think that NFL Commissioner Roger Goodell—the guy who ultimately will make the decision—will eventually come to that conclusion too.

However, I also believe the discussion over whether Vick should get another chance is one we wouldn’t be having if he wasn’t a big-time, highly talented athlete. Is there any profession in America other than the performance-driven world of professional athletics that would consider hiring someone who served time for torturing animals?

Although I believe in the power of redemption, of serving your debt to society, and of getting another chance, I also don’t believe there is a hiring manager outside the NFL who would take a chance on a convicted felon like Vick no matter how talented or game-changing he might be.

Pro football writers are split on this.

John DeShazier in the New Orleans Times-Picayune feels that “Vick has paid enough to regain admission to the league if a team will have him,” while Mike Lopresti in USA Today says that “the thinking here is [that Vick] probably merits one more year of sanctions, for wanton cruelty, but I could be talked into ending his suspension now. He’s been gone two seasons. That’s forever to a professional athlete.”

For hiring managers and recruiters who like to crow that it’s all about hiring superior talent, that’s only true up to a point, because I don’t believe there is a talent manager outside of the Oakland Raiders willing to go to the boss and make a pitch for hiring a game-changing individual with off-the-board talent who also happens to have a rap sheet that includes torturing animals.

So I ask again: Would you give Michael Vick a second chance? 

Get my latest blog updates and workforce management news by following me on Twitter.


July 21st, 2009

Pay Raises in 2010: Would You Believe 3 Percent?

One great thing about the large management and HR consulting firms is that they do a lot of interesting surveys, and this recent one by Watson Wyatt is no exception.

Here’s what I’m talking about: “Raises for U.S. workers are expected to rebound in 2010, following a year in which many companies slashed raises in the wake of the recession,” according to the Watson Wyatt 2009/2010 U.S. Strategic Rewards survey report that was just released.

Like most surveys done by the big consultants, this one is broad, deep and timely. It covers 235 U.S.-based employers that span all industries and have a minimum of 1,000 employees each. And, the survey was done pretty recently—from April 6 to May 15.

The key survey finding is that “companies are projecting median merit increases of 3.0 percent for 2010”; that compares with the 3.5 percent merit increase that companies originally projected last year for 2009, before the onset of the recession. Of course, that original 3.5 percent increase went down the toilet with the economy, and as the Watson Wyatt report notes, “Now, companies say median merit pay increases will [only] be 2 percent in 2009.”

I’ll leave it to my favorite comspensation expert—Ann Bares of the Compensation Force and Compensation Cafe blogs—to make sense of this with her special insight and analysis, but what jumped out at me was something from a separate companion survey of nearly 900 companies conducted by Watson Wyatt Data Services. It found that “only 10 percent of companies are planning no pay raises for workers in 2010 compared to 25 percent this year.”

That really surprises me, because I thought that a lot more than just 25 percent of companies deep-sixed raises during the Big, Bad Recession of 2009. In fact, that 25 percent figure sounds absolutely incredible when you consider all you heard about furloughs, salary cuts, buyouts, layoffs and all manner of workforce cuts this year.

I’m also surprised by the notion of 3 percent raises for 2010, because as much as I wish it were so, I  question whether businesses will actually feel confident enough in the economy to go that far when they start their 2010 budget planning here soon. My feeling is companies will be a lot more conservative than that, especially since no one really knows if we have hit bottom on the downturn yet.

“This has been a very difficult year for both employers and their workers,” said Laura Sejen, global director of strategic rewards consulting at Watson Wyatt, in a gigantic understatement. “But there is some good news on the horizon. Employers plan to give larger raises next year, and many plan to reinstate previously cut pay raises as planning for an eventual economic recovery continues.”

Well, I really hope there is good news on the horizon, as Laura Sejen believes, but I’m not ready to jump on that bandwagon just yet. Color me skeptical that the economic recovery is as close at hand as she says it is.

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