Much room still for human performance improvement

Nia Sarinastiti, Senior Manager, Accenture

After a year of working to improve the workforce, a recent evaluation says there's still much work to be done in addressing people issues this 2004.

Based on a study conducted by Accenture on 200 executives in six countries, the results reveal that there is a major need for improvement. Survey participants were asked to indicate which three functional areas within their organizations were the most important in terms of direct value contribution (see table). As a follow up, they were asked to indicate how well they thought their top three functional areas performed compared to others in their industry. The results were stunning: Just 15 percent of respondents reported that all three of their most strategically important functions perform better than the rest of the industry, and 29 percent indicated that one or more of their most valuable functions perform worse than others in their industry. At a higher level, just 27 percent of respondents said that the vast majority of their employees, i.e., more than 75 percent of their overall workforce, have the skills necessary to execute their jobs at an industry-leading level.

The skills that the respondents consider in most need of strengthening tend to be general skills and abilities rather than those specific to an individual business or function. The top five skills that respondents consider important to strengthen, in the context of their company's strategic priorities, are: (1) management/leadership, (2) customer understanding; (3) teamwork; (4) knowledge of company products/services; and (5) general business acumen and project management.

A similar situation is evident when it comes to strategy. For the most part, all companies in the survey must make their employees more aware of their company's strategy and their role in executing it. Indeed, respondents indicated that a large percentage of their employees neither know their company's overall strategy nor fully understand how their jobs contribute to the company's ability to achieve its strategic priorities.

In fact, only 12 percent of respondents reported that more than 75 percent of their workforce fully understands the company's strategic priorities, and just 17 percent said that more than 75 percent of their employees understand the connection between their jobs and corporate strategy execution.

These figures should be alarming to senior executives because they suggest, at worst, actual misalignment between individuals' goals and objectives and overall corporate direction and, at best, a lack of clarity among employees about the links among individual, team and corporate objectives that are critical to establishing strategic alignment.

Addressing these shortcomings will not be easy. The executives in Accenture's survey acknowledged that they face myriad challenges in dealing with workforce issues, including managing employee performance, training and development; becoming better at recruiting and retaining key employees; infusing flexibility in the workforce and improving leadership's ability to manage change within the organization; understanding the value of each individual's contribution to the company and establishing appropriate and effective reward and remuneration programs consistent with contribution; motivating employees; and developing effective leaders.

Overcoming these challenges is key to raising the skill and strategy awareness levels of all employees.

Table:

Functions noted as having "Very Significant" Value Contributions

Sales 61% Customer Service 43% Human Resources 30% Corporate Development/Strategic Planning 30% Finance 24% Marketing 23% Information Technology 22% Research and Development 14% Manufacturing 12% Engineering 11% Logistics 10%