7 Reasons Your Human Resources Department Is Ineffective

Human Resources Departments struggle to handle the ebb and flow of business. When business is booming, there is increased demand for qualified candidates.  When the economy falters and business is slow, retaining the most qualified employess becomes critical and there is increased scrutiny of performance appraisal methods.

Why are so many HR departments within companies struggling?  Here are  7 of the top reasons:

1. Feast.  With the economic downturn, employers have been faced with a deluge of job applicants and the vast majority of these applicants are not suited to those job positions. Best HR practices include screening applicants in a way that won’t overwhelm your HR department, and which effectively filters applicants for the best candidates.
2. Famine.  Skilled people are still hard to find, even in this economy. Many positions go unfilled simply for a lack of qualified candidates, particularly in many skilled trades. Finding those employable gems may include new approaches to recruiting, including social media and job postings on forums such as Linkedin.
3. Fewer “job changers”.  Many people are risk averse in today’s economy and would rather play it safe and stay with a current employer than risk a job move.  Understanding what the market is, and how to approach candidates who are risk averse with a cost effective benefits and salary package is even more important than ever.
4. Benefits costs are soaring.  An increasing number of employers are deciding to put off hiring or rely on temporary workers to avoid such uncertainty. Using staffing agencies to help fill voids may actually be more cost effective in the long run than quick hiring decisions.
5. Reluctance to fill vacant positions causing increased employee stress.  With companies reluctant to hire, the workload of existing employees, with regard to the scope of responsibilities and total number of hours worked, is increasing noticeably.  This can result in employees becoming demotivated or taking more sick days to compensate for being stressed with greater work load.
6. Increase in litigation by the unemployed.  When faced with the loss of employment and income, people are much more apt to seek legal redress than when jobs are plentiful.  Having an HR policy that’s written and which states clear expectations can help reduce liability.
7. Low levels of employee commitment and productivity.  Studies suggest that employee loyalty is at an all time low, due largely in part to the prevalance of downsizing.   Such feelings generally result in decreased productivity; reduced attention to the quality of work and increased risk for customer dissatisfaction.

One cost effective way to deal with these staffing challenges is retained searches.  These days, retained searches are typically conducted for only the highest levels of staff, namely the CEO, CIO and CTO.  There seems to be a reluctance to use retained searches for non-senior staff.  The argument being that qualified applicants may be found by employee referral or via Craigslist and similar mediums.

Or, maybe less technology, more “hands on” is the answer.  Could it be that the candidate selection process depends too much on technology and companies are inadvertently eliminating qualified candidates solely on the basis of not having enough “key terms” listed in their electronically submitted resumés?

Thankfully, a few of the staffing problems we mentioned should resolve on their own in time as the economy improves.  We should start to see an improvement in employee productivity and loyalty; people who are more willing to change jobs and a decrease in employee stress as vacancies are filled and the workload is redistributed.

In the interim, there are some tangible steps you can do to avoid employee burnout and limit liability.  We’ll address these in a future article.  In the meantime, we’re curious if you are seeing any of these staffing issues within your company?  If so, how are you handling them?

By Jeff Garr, CEO and Frank Zych, Director of HR Services, HR Knowledge, Inc.

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