Richard Letcher, Managing Director of Profile, A WilsonHCG Company, discusses the impact of COVID-19 on the standing and reputation of HR functions across APAC.
Over a couple of weeks last month, we conducted a survey on the effects of the COVID-19 outbreak on our working lives in Asia Pacific. We were overwhelmed with the response – 2,685 people filled in the survey, ensuring a robust data set. The majority of people who responded were based in Singapore, Hong Kong SAR, China and Australia, level-wise were mid to senior, Gen X, with 62% working in non-Human Resources roles. Here’s a summary of who filled it in:
Early in April, The Economist published an article on “The Importance of People People” which espoused HR’s enlarged seat at the table due to the COVID-19 outbreak and the growing need for firms to have a strong HR function, keeping employees healthy and their morale high, orchestrating flexible working arrangements and potentially making some employees redundant.
The article’s main tenet was that the profession’s influence has been growing over the decades from “pay and parties” managers to working on greater compliance in the 1990s to more involvement in rewards in the 2000s, following various C-suite pay misdemeanours. More recently, recruitment and talent management have been at the fore, following poor executive succession planning in some Fortune 500 companies and general skill shortages, as has employee relations with #MeToo troubles to contend with.
But how has HR performed in APAC over the last few months, through their efforts to tackle the COVID-19 outbreak from a people perspective? Has HR stepped up?
On the whole, the answer is “yes”, but things become a little more complicated once you scratch below the surface.
In our survey, we asked the question, “How do you feel the standing and reputation of your HR function, within your organisation, has been affected by the work it has done over the last few months with regards to COVID-19?” Here are the results:
Across all respondents, the percentage of people who thought that HR’s reputation has been enhanced, either “very much” or “somewhat”, was 53%, which isn’t too bad but it could have been better. The percentage was particularly high in Australia with 83% but lower in HK, Singapore and China who had 51%, 51%, and 39% respectively. China's relatively poor showing may be due to the fact HR functions there were the first to deal with the outbreak.
However, when you dig a little deeper into the numbers, and you look at the split between respondents who are HR professionals, and those who are not, it’s more of a skewed story, as you might expect. 71% of HR professionals feel that the reputation of their function has been enhanced “somewhat” or “very much” whereas only 42% of non-HR folks do, with 40% feeling that there has been “no effect”, and 18% feeling that the management of the situation has, in fact, negatively affected HR’s reputation.
Within quite a few organisations, however, it is clear that HR certainly has stepped up with their reputation suitably enhanced by the efforts they have put in since the outbreak began. In many others, this has not been the case with some survey respondents feeling lukewarm or even disappointed at HR’s performance. Why?
One answer might be that the business simply has a negative perception of HR as they have been adversely affected, personally, by the changing fortunes of their organisation. You’re not going to say that your HR department’s reputation has been enhanced when you’ve just had your salary cut or your role has just been made redundant.
It would also appear that, in this instance, size matters somewhat. When we sliced and diced the data, it became clear that small (below 200 people in the region) and large companies (above 5,000) rated their HR functions less well than in medium-size ones with 200 to 5,000 employees.
It could be that the HR teams in companies with smaller population sizes in the region are less experienced generally and have not had the capability and resources to put in place well thought through and communicated business continuity plans. APAC was also the first region to experience the outbreak, and probably little support came from global head offices on other continents at that time.
With bigger companies, the resources and capabilities are there, but within a large, complex organisation with people spread across a multitude of different countries experiencing the outbreak at different stages and in different ways, a perfect response is going to be difficult.
Interestingly, the more senior, and also older, the respondent is, the higher the appreciation for HR's efforts. This is actually quite pronounced.
This was also shown through the data on the different generations with Gen Y being more sceptical about HR‘s performance than Generation X and Baby Boomers.
This might be because the more senior, and therefore typically the older you are in an organisation, the more you are connected with what is going on in terms of the business continuity, communication and strategic HR plans, with lower-level individuals being kept in the dark somewhat (with an accompanying lower perception of HR’s competence as well as a, probably related, enhanced fear of what might happen to them). Overall, this might have skewed the results so that HR is, in fact, doing a better job than some think.
Sector-wise, there seems to be a slightly better view of HR‘s performance from respondents working within industry & commerce than financial services and professional services.
Despite this “OK” response to HR’s overall COVID-19 performance, it’s clear that within quite a few organisations, HR has indeed stepped up and has enhanced their reputation and standing within their organisation. To the point made by The Economist, this is indeed part of the general trend in HR. I have been recruiting HR professionals in Asia for almost 20 years, and I have seen an incredible change over this period from the traditional, transactional “personnel” function to one which is far more strategically aligned with the business.
This has largely been due to the demands of the business environment (think GFC, SARS, Asian credit crisis, the dot com bubble, the immense economic growth in China and Southeast Asia and the never-ending war for talent). HR has needed to step up. COVID-19 is yet another challenge - some companies have risen to it and continue on their path to having a bigger seat at the table but, sadly, others have not.