What HR can do to meet the requirements of agile organizations
Companies need a change because the two extremes don’t go together.
Nowadays Agile is the modus organizations prefer to operate in. Differences in the way of working between agile teams and traditional teams are getting bigger and that is why the need for agility is increasing even beyond IT departments.
I believe that the more widespread Agile becomes in an organization, the higher the necessity for HR to step in gets. Currently we see gaps between the way HR is operating and the way the rest of the organization should be supported. When acquiring new team members, the focus is shifting from attracting talented employees to attracting motivated individuals with an immense hunger to be challenged, interact with colleagues and have regular intervals to reflect and learn. Many organizations will recognize the misfit of job descriptions in the job centre, difficulties in coaching of multidisciplinary teams or the increasing necessity for people to sit close to their team and other teams they work with.
HR representatives see the need to adjust the processes in their department to keep up with supporting the agile organization. Eyholzer and Leffingwell (2016)[i] have provided six themes that can help HR departments to understand what they need to work on to create a better fit in the agile organization. I have combined the fundamentals of traditional HR with the themes Eyholzer and Leffingwell (2016) have introduced. By doing this we can see that a gap appears.
Figure 1 Traditional HR vs Agile HR
The two images in Figure 1 help us to identify the biggest differences in the basics of traditional HR, represented on the left part of the figure, and agile HR on the right. It boils down to the following four concrete tips for HR:
- Start hiring for cultural fit, rather than hiring the right person for the job;
- Focus on the growth of the employees;
- Move from a demand and control situation to a focus on performance where the need to monitor employees decreases;
- Reward employees with the right salary rather than high bonuses.
In the following paragraph these four gaps will be explained.
Hire for cultural fit & embracing the new talent contract
Employees want frequent interaction with their colleagues and they are constantly looking for new and challenging topics. They want to take responsibility, are actively involved and can manage themselves. They want to grow and develop themselves and teamwork is more important than ever before. The need for HR to hire employees with a perfect CV and skillset matching the job profile should no longer be necessary as in agile organizations these employees will grow and develop these skills on the job. Applicants have a bigger chance to get hired if they are a good fit for the team.
"Each applicant would need to do an assessment that focuses on personality rather than on core qualifications for the job. We can see who you are and how you would behave at work. If this candidate does not fit the Stryker culture we won’t continue the process.” explained Lisette Groen, Senior HR business partner.
To attract people that fit the organizational culture, companies broadly share their values and analyse, observe and assess how individuals interact with these in their recruitment outings.
Netflix is hiring for a dream team “one in which all of your colleagues are extraordinary at what they do and are highly effective collaborators”. They won't hire or retain so-called "brilliant jerks." "The cost to teamwork is just too high”. To find the right fit they campaign their values thoroughly. Even in some vacancies the first or the second competence applicants need is to ‘fit the Netflix culture’.[i]
Hiring for cultural fit means that employees can work together and learn from each other. HR professionals should focus on defining the profile that matches their organization and share this knowledge with the entire organization as a source for recruitment. A redefinition of the organization’ values might be needed to refine the values and to meet the agile culture.
Focus on the growth of employees
HR representatives always state the importance of talent development as one of their most important activities. In agile organizations, T-shaped profiles bring value to multidisciplinary teams. In a T-shaped profile the employee has one specialism, but also has basic knowledge of different disciplines which allows them to support their team on other topics unrelated to their specialism – and above all, the employee has developed communication skills that enable cross-functional efficiency. It is important to find the right balance between in-depth knowledge and cross-functional skills of employees. And to create curricula based on these profiles.
HR can stimulate employees to develop skills and new career paths within their organization, or if it benefits their employees, to be open to support them on options outside of the company. It takes a lot of effort not just to develop in-depth knowledge and general knowledge, but also to find the right balance between the two.
Move from monitoring to focus on performance
Organizations that formulate a clear purpose attract employees that are intrinsically motivated and give less about status and money (Jacobs, van Bussel, Tielemans, 2016[ii]). Traditional organizations tend to focus on monitoring their staff to make sure they do exactly what the boss told them to – limiting them in bringing new ideas that might add value to the business. This is also known as demand and control: tell people what to do and make sure you monitor if they have really done it. The agile mindset builts on the strengths and creativity of employees. Since demand and control processes hinder this, it is important to get rid of them as soon as possible when going agile. When it comes to self-steering teams and a performance focused way of working, employees will be challenged to improve performance, not only on the quantitative level, by the amount of work they deliver, but also the quality of their work matters. Giving teams more or different responsibility will open a whole new dimension in terms of motivation and teamwork.
Reward employees with the right salary
The same happens when rewarding procedures are being reinvented. Where traditional organizations reward mostly on a personal level, agile organizations are moving to a process where bonuses and targets are based on the results of the team, rather than individual level.
As the need for organizational agility increases and a new generation with different needs enters the job market we see a shift in the way salaries are being calculated. The Millenials value creative benefit packages. That’s why employers are including other benefits like an attractive workspace or inspiring company values that employees can relate to.
I like to use a distinction between controlled motivation and autonomous motivation (Jacobs et al., 2016). Controlled motivation is caused by receiving a bonus or money for doing the job. Autonomous motivation brings people to action by the true interest they have in the job or task. Autonomously motivated employees show higher performance (Jacobs et al., 2016). There is a shift from controlled to autonomous; from extrinsic to intrinsic motivation. Employees want to work on something that is valuable and applicants no longer base their decision purely on the salary. The applicant makes his or her decision based on the opportunities they get to grow, the benefits other than salary and their gut feeling about the cultural fit with the organization.
HR can adjust their processes, but I believe there’s much more within the power of HR that can be done to support the professionalization of organizational agility. One way is to rethink HR values, to translate them into useful tools and processes that facilitate an agile mindset on the workforce. Another way is to validate whether existing HR activities like recruitment, performance, personal development and rewarding still meet the requirements of an agile organization. To take it to the next level, leadership should be involved to carry out the new values that come with the transformation.
[i] Eyholzer, F; Leffingwell, D. (2016). Agile HR with SAFe® 4.0 - Bringing People Operations into the 21st Century with Lean-Agile Values and Principles, Just Leading Solutions LLC http://www.scaledagileframework.com/agile-hr-with-safe/
[ii] Jacobs, R; van Bussel, G; Tielemans, M. (2016). Het roer om - Om agile werken succesvol in te voeren, is het zaak dat de medewerkers ook achter de nieuwe strategie staan. Maar hoe krijg je ze mee? PW De Gids.nl Maart 2016
[iii] media.netflix.com, (2017) Netflix Culture -- Always Trying to Improve https://media.netflix.com/en/company-blog/netflix-culture-always-trying-to-improve