Reducing Tribal human capital risks requires organizations to go beyond performance and retention. There are 14 distinct human capital risks, and each one needs to be identified and managed. Left unattended, you may find your organization with a culture you didn’t intend to have, excessive unemployment claims disengaged employees, and high turnover.
Risks Associated with Recruitment & Sourcing
The first part of the employee lifecycle is hiring new employees into your organization. There are several risks you can address at this stage to maximize the fit of the new team member and minimize loss to your company. But the first step is to identify them.
Primary risks during this phase are:
- Poor recruitment and selection. It’s easy to bring people in for the wrong reasons or to ignore nuances or clues given in the hiring process.
- Failing to Verify Qualifications. Making sure that people have the skills and education they claim takes resources but it’s well worth it in the end.
- Poor Ethics. Because people often know how to interview well, it’s hard to know the real person with a standard interviewing process.
Risks Associated with Onboarding & Integration
During the second stage of the employee lifecycle, the new employee is getting used to the environment, learning the specifics of their job, and integrating with their boss and coworkers.
There are several risks to address during this stage:
- Poor Information Management. If onboarding and training materials aren’t ready and accessible, a new employee can take longer than necessary to become a productive team member.
- Remuneration Problems. An inefficient human resources system can mean that pay is delayed, personal information is mishandled, and a variety of other costly mistakes occur.
- Poor Leadership and Management. A new employee is most impressionable during their first year. Poor leadership or failures in management can cause a poor attitude, disengagement, and other problems.
Risks Associated with Development & Performance Management
This stage represents a significant portion of the risk in the employee lifecycle. Done well, development and performance management can create dynamic new leaders in your organization. Done poorly, this stage can be the cause of turnover and lawsuits.
Risks to manage carefully include:
- Lack of Compliance with Rules or Laws. Once the newness of a job wears off, employees may become lazy or shortsighted in their work. This can mean that important rules are disregarded, or that laws are broken. In both cases, there is a risk of significant financial loss. Ensuring compliance is worth the effort.
- Skills Shortages. If training is not well-developed, you may find that your team lacks the skills they need to perform their work successfully. When this happens, you have to stop production and do remedial training.
- Promoting the wrong people for the wrong reasons creates a variety of problems in any organization. Without clear guidelines for hiring, promotions, well-written job descriptions, and impartial interviewing procedures, unhealthy workplace dynamics will certainly develop.
- High Absenteeism. Having employees who are disengaged can cause absenteeism to rise. It proliferates through the office causing productivity and motivation of surrounding staff members to decline.
- Employee Retention. You want to make sure that your staff stays with you long enough to become productive and grow within your organization. Preventing unnecessary separations starts during the hiring process and long before employees give their notice.
Risks to Avoid During Separation
For better or for worse, every employee will eventually leave your organization. Effectively managing the risks at this stage can help everyone part on good terms and avoid damage to your reputation and remaining staff.
Risks to manage at this phase include:
- Lack of Succession Planning. Are you ready if key employees decide to leave the organization? Not having someone prepared for the role can set your organization back years.
- Sabotage. Unfortunately, a terminated employee can cause damage to your organization on the way out. This may happen when employee access isn’t terminated immediately, or proper exit procedures aren’t followed.
You Can Manage Risk Throughout the Lifecycle
Successfully managing all of these human capital risks may seem overwhelming, but it doesn’t have to be. Obviously, many of the risks can be mitigated with procedures, documentation, and training. But one quick training session or a day writing procedures isn’t going to move the needle. S3 Management Group is here to make it easier. We can help you reduce your human capital risk. Call today to learn more about what we’ve done for other Tribal organizations.