HR as Product: Be the Brand of Choice!

It is time for Human Resources practitioners to rethink their role and that of the HR department, not only for the purposes of contributing to the organization's bottom line, but also for their own survival.
HR continues to balance the demands of several different roles: business partner, internal consultant, operational and administrative expert and both employee and employer advocate. This may sound like business as usual, roles that aren’t likely to create a mad rush of HR people arming themselves for the future.
In reality, however, they are new. Although the questions may be the same, the answers most assuredly are not. The ongoing challenge is to establish new deliverables and to sustain strong partnerships with both internal and external customers. The ability to see the big picture—and to deploy the resources to address the big picture—will be more important than ever.
If you were to ask your employees today, "What does the HR Department do?" would they mutter something unintelligible to you and make a run for it? If that is the case, your human resources department needs to rethink its role and do some in-house marketing, marketing research and public relations.
First, you need to ask yourself some important questions:
Do you know what your HR department’s reputation is among the employees? When HR is mentioned, do managers picture savvy strategists, backward bureaucrats, or pleasant, people-pleasers?
Do employees understand and appreciate the importance of the HR department in furthering the organization's mission and objectives?
Does the HR department make an effort to market its services to the organization? If it does not, then it has the reputation it deserves. You can, however, easily correct this reputation.

The key is to open up conversations with all levels of employees, and present yourself in the role of facilitator instead of enforcer. You have to get out of the HR office and into the world of your organization’s employees. Finding these answers requires dialogue, which means that HR must communicate. That communication must consist of equal parts of listening and promotion. First, HR must listen carefully to what its customers need. Then it must promote what it has done and can do. HR staff must educate the organization about its capabilities and potential contributions. No one knows your capabilities as well as you do.
Employees, for the most part, still see HR as "those people who handle benefits and do interviewing." To position the HR function for the next decade, every HR practitioner need s to take on a public relations role—starting with your own employees. Think of yourself as a product and do some smart marketing.
During the past few years, HR has worked hard at educating senior management about the value it adds to the organization. Managers and employees are less familiar with HR's new role as business partner. Increasingly, these internal constituents will need to embrace the importance of the HR function. It won't be easy, but ongoing communication, and actually meeting the organization’s real and expressed needs, will help HR earn respect throughout the organization.
The marketing of the HR department requires you to demonstrate your problem-solving skills, so others will know you do much more than simply process papers. The best form of advertising is the actions you take. By your actions, processes and programs, you can promote the HR department as a flexible, adaptable, solutions-oriented partner, a resource to whom the organization can turn when it needs problems solved.
According to Shari Caudron in her article Brand HR: Why and How to Market Your Image, "If you want HR to be perceived as more strategic, more valuable, more credible more whatever, you need to start thinking like a business with a product and market your overall brand image."
As organizations continue to outsource non-value-added activities, HR is facing competition from outside vendors. If HR practitioners do not strive to build up the profession's overall image and reputation, they will lose services to organizations that understand what customer service and accountability are all about. These are Caudron’s eight great tips for building and enhancing the HR department's image and reputation.

Identify your customer's needs and perceptions.
The first step in creating or enhancing a brand identity is to determine who your customers are and what they need from the HR function. You will also want to know your customers’ current perceptions of the HR department. Begin this process by identifying your customers. Are your primary customers executive managers, line managers or the entire workforce? What products and services do they use from HR? What would they like to receive from HR? Do they use HR services from outside HR vendors, and if so, why? How do they perceive the internal HR department?
HR departments could conduct employee attitude surveys to obtain answers to these questions, but to get truthful and more useful information, Caudron suggests it is worthwhile to hire an outside consultant to conduct the interviews in private. She states, "employees would more likely state their true feelings about HR if they are guaranteed anonymity."
It is important to conduct this type of analysis, to understand the difference between what you are providing and think your organization wants from you, and what they say they need. In today's organizations, there are so many perceptions about what role HR should play. HR conducts so many activities...training, recruitment, personal welfare, salary and bonus, and a whole range of other concerns, that "HR brand" development is challenging. In order to correct this, HR practitioners must research their current "brand" to figure out where they stand.

Craft an identity based on customer needs.
Cauldron says that after you determine the needs and current perceptions of your existing customers, you can decide how you would like your customers to perceive the HR department. It is important to note that the function of the HR department will differ from organization to organization. In one organization, internal customers may want the HR department to provide great service in all of the traditional HR areas.
In others, customers may expect HR to take responsibility for productivity and growth. You have to decide what "brand" identity works best for your particular culture and then work to create a mission statement and organization that supports that identity.
As another example, in your organization, it may make sense to outsource routine tasks such as payroll processing so that the remaining HR staff can concentrate on more strategic matters. To achieve a solid brand identity, you cannot be all things to all people.
You can try, but you will fail in the eyes of significant numbers of your customers.

Develop a mission statement that resonates with meeting customer needs.
Having determined your identity, Caudron suggests taking the time to design a mission statement that will guide you through the changes and improvements that you need to make. The mission statement should define the HR function, the values and core principles the department will uphold, and the benefit HR expects to provide to the rest of the organization. For example, the Los Angeles County HR Department's mission statement follows:
“To provide a human resources program that carries out Board priorities for a comprehensive and equitable County personnel system;
To assist departments in developing and maintaining a high quality workforce, enabling them to provide critical services to the public;
To establish Countywide policies and provide monitoring and oversight necessary to ensure consistent application of human resource policies, including recruitment, selection, promotions, training, discipline, employee benefits administration, workforce reductions, classification, compensation, employee appeals and disability benefits; and
To ensure fair and equitable job and promotional opportunities and services for both current employees and individuals seeking employment with the County of Los Angeles.”
It is important to have a mission statement as it helps define your future goals and direction. The mission should not be empty rhetoric. It is a charter that outlines the HR pledge to the rest of the organization.

Deliver your promises.
Supposing, based on your customer input, the HR department needs to improve its customer service and supportiveness. This might require hiring more employees, empowering the receptionist to make decisions, or conducting team-building sessions. Customers want you to be more responsive. Caudron recommends that since forging your new identity means delivering a promise, you must ensure that the staff, practices and systems in your department all work to support the goal of customer service. Staff your department with people who are easy to work with and who are willing go the extra mile for line managers. Deliver what you promise in your mission statement.

Update your image.
Few consumer products are packaged without a distinctive logo and type of packaging. Can you imagine mistaking a can of Pepsi for a can of Coca-Cola? A bottle of Coors for a Bud Light? These companies understand that the look of their products communicates powerful messages to consumers.
The same applies to HR. If your HR department has made substantial improvements and changes, then you can use the packaging as a means of communicating those improvements to others. Develop a separate logo for your HR department, if you’d like, that expresses your mission, your commitment to customers, and your goals. The most important packaging piece, however, is the HR department itself.
If you want your HR brand to deliver the message of quality service, ensure that visitors to the department get what they need, with no hassle, friction, or needless hoops to navigate. You can spend millions of dollars redesigning your department and developing a logo, but if the people in HR are impossible to deal with, you have accomplished nothing in the eyes of your organization.

Spread the word.
After you have determined your identity, created a system in which you can consistently deliver on your promises, and packaged the HR department in a manner that conveys improvements, Cauldron suggests it is time to "toot your horn." For example, if you want human resources perceived as a strategic partner, take the time to quantify the strategic impact of a recent HR program or decision. Communicate this impact in board meetings, through your organization's newsletter, your Website or Intranet, or by developing special HR performance reports. The key objective, for positive notoriety, is to back up the overall message with hard data and specific success stories.

Enhance your visibility.
Another good marketing technique for HR, not only inside your organization, but also to the human resources world at large, is to publish articles in magazines and speak at HR seminars or conferences. This validates the internal changes you have made and may capture the attention and interest of your management group. You can heighten this visibility within your organization by including the program-specific managers and employees in the article or at the conference podium with you. Professionals love hearing from "real people" and they will spread the good word for you in your organization.

Continuously improve. Keep on keeping on.
Just as in the business world, where companies have to continuously review, revisit, and update their brands to meet customers' changing needs, so this advice applies to HR. In the rapidly changing world of business, the HR profession must regularly be willing to make tough decisions about what it will and will not stand for. Every HR professional can craft initiatives using the same toolbox. The best will try new things, challenge conventional wisdom, and ask more questions more often.
With careful attention to forging an identity, your HR department can learn to provide what your internal and external customers expect. Your organization will love you and your HR staff members will take their place as “players,” making a difference in the real world of your organization.

Courtesy: Judith Brown, Director of HR Research, International Personnel Management Association

Business Life Cycle- 5 stages of small business

In the small business life cycle not every business will go through every stage, and not all small businesses will succeed as a result of these stages. However, they are proven stages or small business that are an important part of running a small business, whether from home or from a formal office.

Stage One

The first stage of any small business is obvious – establishment. At this stage, the business is being created, planned and the early days of its operations take place.

For some, this is the only stage that a small business may see, as it is by far one of the most difficult to survive. Many things can go wrong at this stage; thus, good business planning a crucial and necessary part of it.

Without a good business plan, it is impossible to get a small business off the ground, running and eventually moving through to the next stages of its life cycle.

Stage Two

The second stage of small business in the small business life cycle is the growth period.

During this stage, a business has an initial time of negative profit until it breaks even and begins to show increased revenues that allow it to truly grow. This is also the stage that the real test of a business comes into play.

How the business is managed and how it is able to compete within its designated market will determine whether it will survive, heading to the next stage - or whether it will decline and reach the last stage of its life.

Stage Three

The third stage of small business is about expansion. This is the point at which a business gets to the point where there is sufficient revenue being brought in so that there are no doubts of its survival and it can expand its horizons.

This includes taking on staff, expanding the office space of the business or even investing in equipment to deal with a larger base of clientele. This stage also entails producing more products if necessary.

Stage Four

The fourth stage of small or other business is about maturity.

The business is now stable enough to survive most unforeseen circumstances. It has enough backing, capital and support to ensure that even if the market becomes unstable, it can pull through.

This may be accomplished by rearranging its management plan, getting rid of one product to replace another or adding an additional product to an already existing product line.

However, if the market declines, it may survive, though its profits may take a temporary slide backwards.

Stage Five

In the small business life cycle the fifth stage of small business, is about decline. In fact, it is the easiest stage to reach for any business because it is the point where a starting business will fail.

An existing business, even a mature one, can decline in profits, take heavy losses and eventually either fail or cease operations to avoid further losses. As any small business owner can attest to, the stages of business are necessary and a normal part of the small business life cycle.

Source- morebusiness.com

Mergers and Acquisitions

Introduction:

A merger is a combination of two companies to form a new company, while an acquisition is the purchase of one company by another with no new company being formed. A merger occurs when one firm assumes all the assets and all the liabilities of another. The acquiring firm retains its identity, while the acquired firm ceases to exist. A majority vote of shareholders is generally required to approve a merger. A merger is just one type of acquisition. One company can acquire another in several other ways, including purchasing some or all of the company's assets or buying up its outstanding shares of stock. The term "acquisition" is typically used when one company takes control of another. This can occur through a merger or a number of other methods, such as purchasing the majority of a company's stock or all of its assets.

Reasons for Mergers and Acquisitions:

The management of an acquiring company may be motivated more by the desire to manage ever-larger companies than by any possible gains in efficiency. There are a number of reasons why a corporation will merge with, acquire, or be acquired by another corporation. Sometimes, corporations can produce goods or services more efficiently if they combine their efforts and facilities. Collaborating or sharing expertise may achieve gains in efficiency, or a company might have underutilized assets, the other company can better use. Also, a change in management may make the company more profitable. Other reasons for acquisitions have to do more with hubris and power.

Regulation of Mergers and Acquisitions:

Mergers and acquisitions are governed by both state and federal laws. State law sets the procedures for the approval of mergers and establishes judicial oversight for the terms of mergers to ensure shareholders of the target company, receive fair value. Generally, state law tends to be deferential to defences as long as the target company is not acting primarily to preserve its own positions. Courts tend to be sceptical of defences if the management of a target company has already decided to sell the company or to bring about a change of control. Because of the fear that mergers will negatively affect employees or other company stakeholders, most states allow directors at target companies to defend against acquisitions. Because of the number of state defences now available, the vast majority of mergers and acquisitions are friendly, negotiated transactions.

Motives behind M&A

i) The following motives are considered to add shareholder value:

Economies of scale, increased revenue / increased market share, cross selling, synergy, taxes, geographical or other diversification and resource transfer.

ii) The following motives are considered to not add shareholder value:

Diversification, overextension, manager's hubris, empire building, manager's compensation, bootstrapping and vertical integration

Mergers and Acquisitions: Doing the deal

Start with an Offer

When the CEO and top managers of a company decide that they want to do a merger or acquisition, they start with a tender offer. The process typically begins with the acquiring company carefully and discreetly buying up shares in the target company, or building a position.

The Target's Response

Once the tender offer has been made, the target company can do one of several things Accept the Terms of the Offer, Attempt to Negotiate, Execute a Poison Pill or Some Other Hostile Takeover Defence.

Closing the Deal

Finally, once the target company agrees to the tender offer and regulatory requirements are met, the merger deal will be executed by means of some transaction. In a merger in which one company buys another, the acquiring company will pay for the target company's shares with cash, stock or both. When the deal is closed, investors usually receive a new stock in their portfolios - the acquiring company's expanded stock. Sometimes investors will get new stock identifying a new corporate entity that is created by the M&A deal.

The Human Side of M&A Activity

Plenty of attention is paid to the legal, financial, and operational elements of mergers and acquisitions. But executives who have been through the merger process now recognize that in today’s economy, the management of the human side of change is the real key to maximizing the value of a deal. The management of the human side of M&A activity, however, based upon the failure rates of M&As, appears to be a somewhat neglected focus of the top management’s attention. People issues occur at several phases or stages of M&A activity. More specifically, people issues in just the integration phase of mergers and acquisitions include:

(1) Retention of key talent;

(2) Communications;

(3) Retention of key managers; and

(4) Integration of corporate cultures.

HR issues in three Stage Models of Mergers and Acquisitions

The three stages: (1) Pre-combination; (2) Combination and integration of the partners; and (3) Solidification and advancement.

Selected HR Issues in the three Stages of M&A

Stage 1: Pre-Combination

Identifying reasons for the IM & A
Forming IM & A team/leader
Searching for potential partners
Selecting a partner
Planning for managing the process of the IM and/or A
Planning to learn from the process
Stage 2-Combination and Integration

Selecting the integration manager
Designing/implementing teams
Creating the new structure/strategies/ leadership
Retaining key employees
Motivating the employees
Managing the change process
Communicating to and involving stakeholders
Deciding on the HR policies and practice
Stage 3: Solidification and Assessment

Solidifying leadership and staffing
Assessing the new strategies and structures
Assessing the new culture
Assessing the new HRM policies and practices
Assessing the concerns of stakeholders
Revising as needed
Learning from the process
Role of the HR Department in M&A activity

1. Developing key strategies for a company’s M&A activities

2. Managing the soft due diligence activity

3. Providing input into managing the process of change

4. Advising top management on the merged company’s new organizational structure

5. Overseeing the communications

6. Managing the learning processes

7. Re-casting the HR department itself

8. Identifying and embracing new roles for the HR leader

9. Identifying and developing new competencies

The strategic contribution of HR as consisting of the “Five P’s”: Philosophy, Policies, Programs, Practices, and Processes.

Conclusion

Merger and Acquisitions success entirely depends on the people who drive the Business, their ability to Execute, Creativity, and Innovation. It is of utmost importance to involve HR Professionals in Mergers and Acquisitions discussions as it has an impact on key people issues. As Mergers and Acquisitions activity continues to step up globally, Companies involved in these transactions have the opportunity to adopt a different approach including the increased involvement of HR professionals. By doing so they will achieve a much better outcome and increase the chance that the overall deal is a total success.