In the current world of work, people risk is always prevalent for every size of organization. It could take the form of surging or plunging team morale. A set of practices and convictions that translate into a workplace culture over time are components of the “things people feel”. Or, it could be seen in the job security and satisfaction enjoyed by the employees. Whatever the proportion and mix of people risk are for each organization, the product is finite and quantifiable in financial terms.
In its simplest form, people risk is the result faced by an organization due to the impact of events and decisions on its people – the human capital. Naturally, the crux of human resource development lies in creating the work environment and work culture that enhances performance by forging positivity and courage among the employees to show their best selves. An HR system can do this best by creating a culture of courage as opposed to fear.
You might also be interested to read: Managing Employee Attendance Smartly During COVID Crisis
Understanding the building blocks of people risk
To put it mildly, every occurrence in the workplace brings with it an accompanying risk. Broadly, people risk can be categorized into two domains:
- The preparedness of people to handle an event (like company-wide decisions such as digitization or the superannuation of a well-respected mentor): When people show reluctance to learn a new tool or skill, the cost of the delay is not immediately apparent. Nonetheless, it can be a drain on the organization’s financial resources in the longer term.
- The way the people act after a decision is made (how a style of leadership is received or how they react to risky conditions): This latter one is most apparent in the way both the administration and the employees react, in the current times, to the COVID-19 pandemic. Employees mired in uncertainty can make short-sighted or desperate decisions in areas such as inventory management. This has a direct impact on budgets and costs.
The right time to re-infuse the human touch
Without a doubt, people are the only appreciating assets of an organization. They gain experience, shore up a repertoire of skills, and learn to adapt to a variety of situations that present themselves in a line of business.
It can be safely said, therefore, that employees are the greatest asset. An organization would go out of its way to offer security through material and other means of assurance to its people.
Fostering and maintaining trust is the single most crucial challenge for the HR function in today’s post-crisis environment of remote work and virtual operations. The two-fold responsibility of top management, line managers, and team leaders for proper employee management is:
- Creating an environment that new talent is enthused to join – a virtual workspace that talented workers are ready to affiliate themselves with align to in terms of goals
- Retaining the job satisfaction and measurable, meaningful contribution from individuals (existing employees) who don’t meet as a team anymore
Trust develops when employees are convinced that the people and processes in place are in line with their goals and long-term interests.
Gleaning the best out of people risk management
Industry heads and CHROs are quick to point out that people risk isn’t essentially bad for an organization. By gauging the disruptive influence of the factors that create this risk, organizations can envision new ways of promoting the employee experience. For this, they first have to re-evaluate their values and priorities.
Doing away with certain aspects of leadership – such as fixed shift timings or a schedule-driven performance metric as opposed to a task-driven one – might be necessary. In short, it mandates reimagining the old order. By doing this, the people risk landscape becomes one that stimulates a proactive and performance-conducive work environment for employees.
- Managing People Risk In A Post-Crisis World – A Webinar By IRM India | Businessworld | Aug 2020
- How to Manage People Risk, Aon Insights: Human Capital Solutions | Aon | June 2018
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