Author and presenter of HR Energy program for HR managers, certified HR according to the world's leading standards SHRM-SCP and GPHR

FROM THE PHILOSOPHY OF ABUNDANCE TO THE PHILOSOPHY OF SCARCITY: AN HR'S VIEW OF THE CHANGE THAT IS TAKING PLACE1

- In recent years, we have seen how approaches and technologies in the HR sphere evolve, how often they were aimed at employee development, at building human-centric, empathic relationships. Can we call this a general trend, and if so, how do you see it developing after the events of February this year?

- Before last February, many of our companies set out to expand their presence on both the Russian and international markets. International standards, though, require constant improvements and transformations in business efficiency, people management methods, and environmental and social agendas. For this purpose HR-function should systematically develop corresponding competences and train leaders capable of leading the company to the necessary level. In the new reality, we have yet to understand what the new business demand will look like and what the priorities will be. It is already clear, however, that the issues of globalization have been pushed far into the distance. I guess you could say that until February 2022, the philosophy of abundance dominated: generous budgets, development prospects, upward trends. Now comes the time of the "philosophy of scarcity," when the main objective is to ensure that core processes run smoothly with minimal effort. The long-term strategy for HR is to continue to work with people in a consistent way even in difficult times. There is now a special emphasis on creating a unified culture in which anyone, regardless of beliefs, religion, or views can work in a stable, safe, and respectful environment. This can be called both creating a culture and maintaining a safe environment, and the trendy foreign term "creating an inclusive space" (or DE&I2). Current realities call for immediate risk management. However, it is important not to forget not only about the current risks associated with running the business, but also about measures aimed at managing long-term risks. That is why in the strategic HR agenda there is still a place for the topic of sustainable corporate governance, environmental issues and social impact (ESG3). ESG is hardly the first operational priority in the current difficult situation, but addressing this topic is essential to lay a solid foundation for the future.

- It is hard to believe that the largest Russian companies, which for the last ten years were setting up business according to ESG principles and were rated by world rating agencies, will stop monitoring labor protection and other social indicators, as they did to meet the world's leading standards.

- Indeed, ESG is a system of measures reflecting the high level of quality management of the company. It may seem that in the current difficult situation it is not the time at all to engage in environmental and social initiatives. I would say that it is not the time to blindly copy Western requirements. But as before, issues of labor safety, impact on communities in the company's geography, and environmental safety of business should be high on the agenda of serious companies, and they coincide with ESG objectives. This is exactly the minimum that will be maintained even in conditions of severe deficit.

- In the current environment, it seems that the role of HR needs to transform from performing only operational functions to understanding the strategic goals and priorities facing the business. How can this be achieved?

- HR by definition is the support that ensures the operation of the main value chain of the product. The task of HR is to support key business processes, and this support should be of high quality. In particular, it is necessary to find, attract and retain talented employees, train the right skills in time, pay them correctly, and resolve labor disputes. A strategic vision for HR is to understand what the service philosophy is, and to prepare today to help the business meet the challenges that may arise in the future.

- What needs to be changed to make this support function of HR work as effectively as possible?

- Your question touches on the now very common topic of business partnerships. The first question to answer is, "What exactly does this business have a need for?" In a sustainable business that has big plans for growth, there is a real need for systemic, long-term people management. One-day businesses may want to maximize short-term profits by any means, and the effectiveness of HR there can be measured by the solution of very down-to-earth operational tasks. Apart from the business need for high quality HR, there is also a question of the HR themselves beaing prepared to be true partners. Partnership is not an easy thing. Partnership means equal burden and equal responsibility. In English there is an expression "I have your back" which means that I defend you from behind. It means one may not need to look back, because there is definitely someone having your back, ready to help you at any moment. There are such people among HR, but they are very few. Some people do not have enough skills, some lack personal strength.

- What percentage of companies in the current environment do you think will continue to invest in employee development?

- I wouldn't be willing to give a quantitative estimate. In a situation of scarcity, which we will yet face, of course, spending on employee development will be reduced. Perhaps there will be less spending on mass audiences if such spending does not pay off. But it's imperative to continue to apply HR tools in a targeted way, for the backbone of the organization, for those who will be needed for the core business processes. It's important to quickly understand the new requirements and identify that core workforce. On the one hand, the organization must articulate priorities for investing in people. On the other hand, this is a time like never before when you take personal responsibility for your career, your development, and your personal success.

- Inequalities in access to different opportunities in organizations create grounds for labor conflicts. Who should stand up for employees?

- It is well known that the best battle is the one that never happened. One of the most important strategic tasks of HR is to create a culture of positive interaction which eliminates conflicts. This is one of the reasons why systemic investments in DE&I and ESG are important. If there is a friendly and safe environment in the team, if social policy is introduced, if a decent compensation system is developed, if needs of each person are taken into account, there should not be conflicts, there is no place for them. But, of course, the risk of conflicts is always there. And HR has a special competence here, which is labor dispute management, implemented on two levels, tactical and strategic. Tactical work consists of putting out fires. You need to be able to sort out the problem, involve all stakeholders in the solution, and reach the best agreement. The strategic level of conflict management involves being proactive and creating institutions and practices for preventive conflict management, including building relationships with labor unions and workforce councils.

- You have described an empathic, human-centered organizational environment with well-established processes. Can such an environment be formed in the current environment?

- Imagine having a bowl of soup: lots of ingredients and just a spoonful of salt. This metaphor captures the proportion of conversations about people-centricity in the total volume of a company's problem-solving. The right attitude toward people should permeate the structure of the company and be embedded in its business process. But human-centricity alone won't bring in revenue; all the other ingredients need to be handled as well. As for empathy, you need to be able to feel the state of people at work and find a way to make changes that will improve the climate and increase results. For example, my years of experience implementing mentoring programs have shown that mentors and mentees can experience a whole range of emotions in the program, including the most difficult ones: rage, anger, misunderstanding, fear. Empathy is first and foremost an understanding of this "dark" component. There is no need to be afraid of it, it is a signal that speaks of the need for dialogue and a change in current approaches.

- How empathic are HR people?

- HR specialists are no different from other people, and it is typical for humans to sometimes be extremely sensitive and sometimes deaf to other people's needs. You could say that empathy is equal to client-centeredness, and maybe even equal to strategic thinking. Empathic perception of reality is quite uncomfortable, because you have to feel far more than just pleasant things, you have to discern another person's pain and discomfort, share another person's joy or pride. I think empathy is a skill, and it can be developed. But development is a systemic thing that requires commitment and practice.

- What advice would you give to HR people right now?

- I have been asked many times recently: "Is the concept of HR business partnerships still relevant in the current realities?" My answer is: "Of course; more relevant than ever”. There are various economic, political and social aftershocks - you always need smart and competent people, capable of solving complex problems. And the best chance will be with those who know how to grow, overcome difficulties, and form real partnerships with others.

1 Anastasia Mizitova was interviewed by Lidia Lebedeva specially for Socio Digger.

2 DE&I (D -diversity, E- equity, I- inclusion)is the corporate policy of observing the principles of diversity, equalit