3 HR Predictions Defining the Future of Employee Retention for SMBs
Did you know that companies with really high employee engagement scores saw their share prices increase by 16 percent when the industry average was just six?
Another study found that companies with low employee engagement were behind their sector’s growth by 2 percent. And Sears found that a boost in employee engagement increased customer satisfaction, which in turn resulted in more revenue.
These examples, mentioned in Gartner’s “Measuring Employee Engagement: Past, Present, Future” report (content available to Gartner clients), show that companies with high employee engagement perform better, grow faster and earn more money. Which is why employee engagement has to be made top priority.
Improving employee engagement needs to be a goal for both HR and IT, according to Gartner’s “Working With HR on Digital Workplace Initiatives” report (available to Gartner clients). HR’s role seems obvious in this context.
But because workplaces are becoming distributed and using more collaborative tools—such as smartphones, mobile apps, Slack etc.—IT plays an important role in implementing technologies that make work easier and more engaging.
At the same time, HR should take up initiatives that retain employees, such as flexible work options, family-friendly policies, celebrating diversity and being inclusive. The shared responsibility of retaining employees ensures that engagement is being taken seriously and the burden doesn’t fall on just one department.
As you plan your long-term employee business strategy, you need to consider these upcoming technologies. Software Advice predicts that these will be the leading disruptors for small and midsize business (SMBs) by 2020.
Here’s what we’ll cover:
Predictive Analytics Assess Employee Pain Points
Predictive analytics give an indication of the future, which can help small businesses prepare for various scenarios. It uses statistical techniques such as forecasting, multivariate statistics, pattern matching and regression analysis on your historical data. It can help you gain market advantage on tackling strategies, expenses, growth etc.
What are the benefits for SMBs?
Reviewing historical data helps you identify what went wrong in the past to avoid those situations again. You can even learn from other companies’ experience.
Predictive analytics helps SMBs glean insights that can be turned into quick action steps.
For example, HR can lower its budget by finding more suitable candidates, solving employee grievances and discovering the employees who are most likely to quit.
By 2021, predictive analytics will disrupt SMB decision-making across all industries and business functions, according to Software Advice’s “Top 10 Technology Disruptors for SMBs” report.
The gap between business objectives and workforce planning can create recurring losses for a company, states a Gartner report (content available to Gartner clients). Businesses commonly form growth plans of five to 10 years but rarely forecast their workforce needs more than a year out. The underlying assumption is that people will quit.
But why are you letting them go? Even though growth is stagnant or declining, more resources are consumed in workforce management—as severance pay, candidate search, hiring or unproductive hours. So, not only do you lose employees, you also lose tons of money.
Adding predictive analytics in your workforce management strategies will help plug this gap. Here’s an example of how one company achieved this:
Predictive analytics helps analyze what-if scenarios for HR
French telecom company Orange Business Services (OBS) used predictive analytics to run analysis to identify talent gaps, existing skill sets and learning opportunities.
Pre-implementation: A top priority of HR at OBS was to improve workers’ skills, which was vital in meeting OBS’s goal of digital transformation. To achieve a digital future, OBS launched a skills transformation program called Eureka in 2016.
Post-implementation: HR used big data, data science and predictive analytics to identify gaps in skills and competencies based on country, region, function and technology. Eureka sourced data from many databases such as the HR information system, payroll, performance management, learning management system and the internal social network.
OBS used the insights to draft a “make or buy” strategy—source new talent or develop existing ones. They wanted skilled employees in upcoming areas such as cybersecurity, SDN/network function virtualization (NFV), cloud, data science and agile project management.
They addressed the talent gaps by acquiring a cybersecurity business, hiring from universities and setting up internal training academies for the rest of the skills (such as Cloud Academy and Software Development and Coding Academy).
So far, Eureka has made a ~20 percent gain in HR and managers’ time, which resulted from easy access to data and an improved process to anticipate the required skills.
Survey your employees: Start with regular surveys on your employees’ engagement levels. What do they think of company policies, workload, wages, co-workers, bosses and even the breakroom snacks? What steps could increase their satisfaction level? Then use these responses to refocus your business strategies on engagement.
Analyze the trends: Review data over a few quarters or years to understand employee needs and their grievances. This will help you revise policies that aren’t well liked into something employees really want.
Keep your data organized: You need a system that integrates different databases into one and secures, organizes, cleans and processes the data regularly. This is essential to getting accurate insights from the predictive analytics solution that’s offered in your preferred HR solution.
User Experience Personification Creates Better Workplaces
User experience personification brings strategies for improving customer satisfaction to employee engagement initiatives. You can treat your employees like loyal customers using machine learning tools, which can help you improve their work experience.
What are the benefits for SMBs?
User experience personification can ensure that employee needs are fulfilled through technology that greatly improves the work environment.
Businesses can analyze their employees’ personal data and preferences to build a digital workplace that enhances task fulfillment. The digital workplace would combine needs such as project management, learning, payroll and taxes as well as onboarding into a single, easy-to-use platform.
Digital workplaces should have artificial intelligence (AI) to vastly improve efficiency. Gartner predicts that “by 2020, AI technologies will be virtually pervasive in almost every new software product and service used by businesses.”
AI will change the way humans work. They won’t have to slave away at work and will enjoy working, which will increase employee engagement scores. Gartner states that companies that make continued investments in employee experience by 2020, will improve employee engagement scores by 10 percent (content available to Gartner clients). In fact, Forbes calls 2018 “the year of employee experience.”
AI that predicts emotions eases call center agents’ job
This example shows how AI kept call center agents sane by figuring out when customers are about to get angry.
Pre-implementation: Kentucky-based health insurance provider Humana Inc., is used to receiving many angry calls. In an effort to be more empathetic to its customers and better prepare its employees, it implemented an AI tool, Cogito Dialog, in its call center.
Post-implementation: The AI pinpoints poor customer experiences in real-time by identifying cues such as a sudden rise in the tone of voice. It then signals the customer service agent to change their strategy (or script) before responding to the customer by suggesting what message and tone would work better in the scenario.
This tool is especially important in Humana’s case as it handles medical queries that require agents to be highly sensitive. It has resulted in better care from agents and greater satisfaction to customers. It also prevents feelings of frustration or being overwhelmed by guiding them at the right time with the right instruction.
Learn from retail: Look at customer relationship management strategies in retail that you can adopt in your business. This includes BYOD (bring your own device) to work. For example, use an app for the basic HR needs (clock-ins, timesheets, payroll etc.) that employees can use from anywhere, at any time.
Create a flexible work culture: Allow mobility by moving to cloud-based applications. A flexible work culture would allow for greater employee satisfaction as it would reduce travel times, enable employees to work from anywhere in the building, from home or even another country while on the go.
Wearables Provide That Extra Swag
BYOD is one of the peak performing trends in the Gartner report “Hype Cycle for the Digital Workplace, 2017” (content available to Gartner clients). It notes that by 2020, “the greatest source of competitive advantage for 30 percent of organizations will come from the workforce’s ability to creatively exploit digital technologies.”
Digital technologies include smartphones, health tracking bands, smartwatches, virtual personal assistants (such as Alexa and Google Home), Bluetooth earphones etc. Employers can store the data these devices generate to set medical insurance premiums, work schedules, project management strategies, schedule meetings and more.
BYOD has vast potential in almost all industries. Software Advice predicts that wearables will disrupt SMBs in areas such as human resources, healthcare, marketing and retail by 2022.
What are the benefits for SMBs?
Wearables can help create better, or individualized employee wellness programs. They also promote a healthy lifestyle, which can improve employee productivity over time.
For example, a report by Rackspace and the University of London found that using wearables at work increases productivity by 8.5 percent and job satisfaction by 3.5 percent.
As more people buy fitness trackers, HR will expect them to be used in employee wellness programs. This will be one way to increase engagement. Leaderboards will track the data and employees will be rewarded for activities such as healthy eating, step counting and avoiding junk food.
Employers could also figure out employee productivity and the factors that influence it—location, time, health status etc. They’ll be able to identify the high and low performers. Managers can then determine the number of staffing hours required while forecasting the demand for labor.
Google Glass halves training time for agriculture company
While wearables are disrupting the health industry, another area that has great potential is training. Let’s see how an agriculture company trained its employees using Google Glass.
Pre-implementation: AGCO, a Minnesota-based agricultural equipment manufacturer, wanted to train its new hires faster and better. It sought to equip employees with wearable technology to increase productivity, quality and accountability in a highly competitive market.
Post-implementation: AGCO distributed Google Glass to train new and existing employees.
It cut new employee training time by 50 percent and task processing time by 30 percent. Google Glass proved to be ideal for the hands-on employees.
AGCO employees use the device in manufacturing for step-by-step instruction on assembling parts, new hire training, advanced product inspections and collaborating with other teams in real-time (via documenting and sharing notes or pictures).
Glass tailors the instructions provided based on each employee’s level and function. AGCO even uses it to give interactive factory tours to its guests, to manage inventory and process deliveries.
Understand wearable usage: Analyze how many of your employees own wearables and the reason for usage to develop various engagement strategies. Adoption will also require training for the less tech-savvy employees who need to be brought into the fold.
Secure the data: Ask employees about their opinions and concerns about this sort of data collection. Adopt strict policies on data usage that doesn’t infringe on employees’ privacy. You’d also require greater investment in security and encryption programs for your databases.
Check out the available options: Find a software vendor who can customize a program for your wearable, or already offers one. For example, to improve employee wellness, you can use Fitbit or Apple Watch and Hubbub Health to motivate and track their fitness routines in fun, gamified way. Some wearables you can use to train include virtual reality headsets and clip-on cameras that mimic instructions narrated by a trainer for hands-on, practical learning.
Conclusion and Next Steps
The disruptors mentioned here will change the workplace in the coming years. Enterprises have a headstart in adoption and have seen success. SMBs should also hop on the bandwagon to work on improving employee engagement and retention. Here are some action steps on familiarizing yourself with, or adopting, each technology:
Talk to a software advisor: Before rushing to get the most popular (read: costliest) solution on the market, talk to an advisor about your exact needs. Our HR advisors are available for a free FastStart consultation at (844) 675-2849. They’ve helped thousands of SMBs find the right solution. You’ll find it beneficial to identify which of these technologies you’ll need first and how you could incorporate it into your business.
Ask your vendor(s) about their upcoming versions/upgrades/solutions: Some HR software vendors offer predictive analysis or CRM solutions (for user experience personification). Ask your vendor whether they provide any of the above technologies. If not, do they plan to develop these features, or offer integrations with third-party solutions, additional costs etc.?
Work out your budgets: Talk to your leadership, HR, IT and managers to understand the functions that currently face the most roadblocks and which of these technologies can help alleviate those challenges. Once you set your business goals, figure out the additional investments required to achieve them.