All posts by Trish

HR Decision Making Through the Lens of Pricing Psychology

MoneyI was reading an article on the Conversion XL blog, Pricing Experiments You Might Not Know, But Can Learn From and the insights shared were fascinating.  I started thinking about how these concepts can be applied to HR.

Here are some of the basic premises from the post:

  • What people say and do with regard to pricing are two different things
  • When given 2 options, people find it hard to distinguish between the 2
  • When 3 options are given, it is easier for people to compare the options
  • The Anchoring Theory suggests that if you give someone a number as a starting point, they will use it to estimate an unknown quantity

If we are to take each of those concepts and apply them to employee behavior in an organization, there are many hypotheses that come forward.

What You Say vs. What You Do

According to the article, what people say they will pay and what they actually are willing to pay for something are often two very different things.  Take for example, buying a car.  We all know that there is some range of stated pricing on new cars.  Since car buying is actually about negotiating a price, though, depending on your negotiation skills, the value of any trade-in vehicle, and other variables, you may drive away paying far less (or more) than another person who just bought the same car.

In the workplace, leaders know that what employees say they are going to do and what they actually do are often quite different.  It’s not that a majority of employees are trying to be deceptive, it’s just human nature.  Sometimes they over-promise, sometimes schedules change, and sometimes they truly have no intention on delivering what they say they will. The lesson is that just because someone says they will do something, it’s not necessarily true.

The 2-Option Approach

The idea with pricing is that if you offer two options, you would think it would be easy for someone to make a decision between them.  This does not prove true, though, because people often have a hard time distinguishing between them.

I have seen this come into play many times in the HR world.  Think about how many benefit plans your organization offers.  I have worked at places that offer two and it can be challenging for employees to choose.  In this case, they often just keep whatever plan they chose when they began employment.  Even if you throw an active open enrollment in the mix, it is still hard to compare.

The 3-Option Approach – The Decoy

The way to make the decision-making process easier is to add a third option.  In the article, the example used is choosing between a trip to Paris with free breakfast (Option A) and a trip to Rome with free breakfast (Option B).  Both cities are wonderful and have many good attributes, so people had a hard time choosing between the two.  When a third option was added, a trip to Paris without breakfast, it was much easier for people to choose and a majority chose Paris with breakfast.  The reason it works is that you offer a third option that is fairly similar to one of the choices and it makes that option stand out.

Go back to our benefit plan example and if you add a third benefit plan that is similar to one of the original two, employees should actually have an easier time deciding.

Anchoring Theory

The last thing I found intriguing was the idea of price anchoring.  The theory was developed by two psychologists, Tversky and Kahneman, in the 1970s. The theory is that if you give a person a number – any number – and then ask for a cost estimate of something, the person will use the number as a starting point for the estimate.

In HR, this could come into play in hiring and forecasting.  If you have a group of managers who are asked to forecast their hiring needs but they are not sure where to start, by giving them a number (maybe from prior year, from another division, etc.) you may be doing more harm than good.  It could influence their thinking in such a way that the number they decide to go with is close to the number provided.  This is one reason it’s helpful to use HR technology to provide many points of business data to leaders.  By using real data, decisions will be clearer and more fact-based.

Feel free to challenge the ideas or tell me you agree.  What have you seen in your organization?

How Valuable are Personality Tests

I’m not a lover of tests.  Whether it was tests in school, medical tests or tests at work, I’m not a fan.  So why is it that when I see quick little tests on Facebook that my friends take, I’m intrigued?  Now there are many that I chuckle at… for example, I saw one this past week that would tell you what your “Old Lady” name should be.  Nah- count me out on that one.  Today was different though.

Someone I trust, fellow writer Lisa Rosendahl, posted a link to a blog by a mutual friend, Jennifer McClure.  Jennifer participated in a personality test and offered a free code for readers to participate.  I tend to feel confident that I know who I am and how I feel, but I was curious, so I participated.

The test was designed to share how others see you based on your responses.  I must admit, I wasn’t surprised by the results.  My assessment basically said the following about me:

  1. I am ambitious, focused and compelling.
  2. I provide influential leadership that leads to results
  3. I have strong opinions and very high standards for myself and others.

There were a few more nuggets, but those were the major ones in the report.  The real value for me came in the part of the assessment that told about what would not be a good work environment for me.  I don’t know that I’ve ever taken one before that addressed that specifically.  Here’s what I learned:

  1. Other people should not put me on a work treadmill and expect me to do well.
  2. If people try to over-manage my agenda, I won’t stay motivated.
  3. I like to drive my success, so I need to be in charge of my own deliverables.

As I think through those things, it really makes sense.  When I think back to jobs that were good but just not the right “fit” for me, it usually was because they were highly-controlled, over managed workplaces.  Not the ideal setting for someone with my personality and skills.

I think having the extra portion of the assessment that shares how the assesse might work best, it sets you up to really evaluate your own work situation.  If you’re like me and find this interesting, I invite you to check out Jennifer McClure’s post and get your free code/ assessment today.  It just might make you approach work differently.

#HRHappyHour 186 – A Look Back, A Look Forward

On our most recent HR Happy Hour Show, Steve and I talked about the recently concluded SHRM Annual Conference, shared some information about our session about HR Technology selection and evaluation, and looked back over the last few years of the HR Happy Hour Show.

You can listen to the show on the show page here, or using the widget player below:

Discover Business Internet Radio with Steve Boese Trish McFarlane on BlogTalkRadio

The mid-year timing made it a good time to reflect back a little on some of our favorite shows, as well as talk about what the rest of 2014 has in store for the show. Also, new listeners to the HR Happy Hour Show can spend some time digging back through the show archives and play on-demand some of the shows that Steve and Trish mentioned, including ones with guests like Dave UlrichSherry TurkleMatt Stillman‘Live from Gettysburg’, and plenty more.

Additionally, you can subscribe to the HR Happy Hour Show on iTunes, or for Android device users, from a free app called Stitcher Radio. In both cases just search for ‘HR Happy Hour’ and add the show to your podcast subscription list. 

This was a fun look back and look forward for us, so we hope you enjoy it as well. Stay tuned, (and make sure you subscribe to the show/podcast) for more fun to come in the second half of the year.

#HRTechConf 2014: Technology in Sin City

HR Technology ConferenceIt’s that time of year when you start planning on whether or not you’ll attend any fall conferences or events.  For me, one of my favorite events each year is the HR Technology Conference.  I’ve been attending since 2009 and can attest to the great amount of learning that takes place as I wrote about in these posts:

I’m excited that the agenda is now posted for the 2014 event that takes place October 7- 10 in Las Vegas.  I’ll be leading a session with some of the top CHROs in the technology space.  I also have several of my Brandon Hall Group colleagues leading sessions as well.  I know that if you have any interest in gaining knowledge about HR and technology, this event will not disappoint.

The best part is that as a speaker, I have a discount code to share with you.  If you use the code SPKR14 (needs to be entered in CAPS) that gives a $550 discount off of the full conference rate of $1,945 – so the net is $1,395. This code does not expire.

So, come see me in October and connect with Brandon Hall Group at the HR Technology Conference!

 

The SHRM and HRCI Battle Is Not Critical to Good HR

I love HR
If you’re in the HR industry, unless you’ve been hiding in a cave the last couple weeks, I’m sure you’ve read countless posts about the fallout between SHRM and HRCI regarding HR certification.  While SHRM has always promoted HRCI as the place to go for HR certification (PHR, SPHR and GPHR), it has suddenly done an about-face and now announces that they will provide their own certification.

This whole debacle has left thousands of HRCI certified HR professionals in a bind- not knowing whether they should continue to keep up their HRCI credits or switch to what SHRM offers.  In either case, the part of the discussion, or lack of, that gets me is that there are hundreds of thousands of successful HR professionals who actively choose NOT to be certified. For those like me who have made this decision, it’s interesting to read posts by SPHR’s thumbing their noses at us, saying they wouldn’t hire us.  They say that without “demonstrating a body of knowledge” we are not able to progress and also that people like me are choosing not to stay up to date.

I have a news flash for those that think like this…

I personally know many people who stay up to date without HRCI certification.  After all, some of us are the very people that SHRM and other conferences call in to teach you so that you can get your credits.

Now, I do greatly respect anyone who has become certified.  My personal reasons for not getting it are just as valid as the reasons some people get it.  It has never hurt me from doing a good job, it has never stopped me from being promoted, it has never kept me from getting a job at a higher level at a new company, it has never prevented me from being the head of HR.  It has never stopped me from being chosen to speak at SHRM annual nor many other state SHRM conferences.  In fact, it has never kept me from being completely current in my chosen profession.

For me, the point is not to judge people who want to be HRCI certified.  It shows their dedication to being the best in HR they can be.  We also should not judge the people who are very excited about the idea of a new way to train, measure and certify HR through SHRM’s certification program.  They too have very high aspirations of being the best HR professionals.  Oh, and of course, not judge those who are doing it on our own, our own way.  We too are doing all we can to learn and stay ahead of the curve so that we can drive the profession forward.  All three types of HR pro are really going after the same result.  We want to be able to provide the best knowledge and advice to our leaders and employees.

Spend the time and energy on ensuring you are comfortable with your course of action instead of worrying about whether someone communicated something the “right” way or not.  We’ll all be better HR pros for it.

4 Ways HR Can Operate More Like a Profit Center

*Sharing one from the dusty archives that is still relevant today…

**Disclaimer** I am not an accountant and don’t even play one on tv.  That said, I am not implying that ideas in my post meet the generally accepted accounting principles.  You’d have to talk to your accountant for that kind of advice.  The post is intended to explore ways HR can communicate the value of services in a way that is understood by the leadership team in terms of ROI by considering ways to operate more like a profit center and less like a cost center.

_________________________________________________________________________

How much would you pay for a real competitive advantage when it comes to the people knowledge of your company? 

That is a question we should be asking the business leaders in the departments we support both as HR generalists and recruiters. Honestly, I am tired of hearing that the human resources department is just a cost center.  Why?  Because we add value, we support our internal clients, we are often proactive on business strategies to help the “real” profit centers succeed, we make sure you get paid, get your benefits, are able to relocate, provide your training, and more. Why aren’t we treated like the internal consultants that we are?

Now let me tell you that I talked to an accountant about this and had an hour long debate (ok, borderline argument) on why companies are not able to treat the HR department as a profit center.  In layman’s terms, it’s because a company cannot generate revenue from itself, however, it can offset expenses or offsetting revenue.  I realize that for those who are familiar with accounting this is greatly oversimplified, but it gets the point across.  Revenue and profit can come from external sources.  So, being internal, HR does not turn a profit.

Got it.

I’m not saying we throw all the accepted accounting principles and practices out the window.  My idea revolves around the way we “sell” HR and recruiting services internally.  Even though it technically does not turn a profit, why can’t we set up the way the profit centers use HR in a way that “charges” (ie. distributes the share of the expense for the HR department) out to the profit center based on the type of HR usage they have?

What if HR departments set up a fee schedule for all the ways that HR departments and recruiting teams add value to the company, then “charge” our internal clients by tracking our time spent on projects like external consultants would.  Maybe then they would place more value on the services they receive.  Here are some ways I think the department could operate more like a profit center:

1.  Charge back other departments for their use on:

  • Training courses offered
  • Recruiting and sourcing
  • Succession planning for their team
  • Conflict resolution
  • Coaching services
  • Compensation analysis
  • Employee surveys

2. Focus on expense reduction. Since HR cannot actually make revenue, the biggest impact they can have is to creatively reduce expenses.

3.  Review how vendor procurement is handled. This is an area where the HR department can take steps to being more involved.  It is usually handled by the finance department, so why not help in those business decisions if you are a recruiter or HR generalist?

4.  Use social media to aid in reducing external recruiting costs. Bring the knowledge and leadership of the sourcing process internal.

So, tell me what you think.  Should we take steps to operate more like a profit center and less like a cost center?  Share your views in the comments.

Are You Ready to Disrupt YOU?

There are only a handful of times in life that can be magical, disruptive, important moments. It could be a dramatic moment involving a birth or the loss of a loved one.  It could be one of those moments where someone says the exact thing you needed at the exact moment you needed it, good or bad.  I recently had one of those moments.

Layout 1

Last week I was honored to deliver the keynote for the SilkRoad Connections conference in Chicago.  (Thank you to the folks at SilkRoad for the opportunity and their hospitality).

As I walked through the empty ballroom early that morning, I felt the twinges of nervousness. As someone who often speaks publicly, I found this shocking and delightfully satisfying. The reason my nerves were at attention was not the event, nor the size of the crowd.  It was the fact that I was sharing material that was personal — my personal story of disruption that led to life changes.  I knew I wanted to talk to attendees about personal disruption.

Disruption often gets a bad rap because it invokes thoughts of people or events that shake things up in a negative way.  I was going to talk about how disruption, whether negative or positive, can have a very positive learning outcome. To do this, I shared my story and I have never felt so vulnerable. It was almost impossible to keep my emotions in check, but I did. I then related it to the personal disruption of the audience. By the time I left the stage an hour later, something very special had occurred.  I had created my own disruption. I will never again approach public speaking in the same way.

Disruption can be a valuable influencer in terms of taking your professional or personal life to the next level.  It inspires us, even forces us, to make changes that lead to new opportunities. This is critical in any business role, especially human resources where we tend to be a little more cautious about risk.  Knowing that we are the gatekeepers of legal and compliance issues for an organization, we spend much of our time reacting to organizational issues. This leaves us scrounging for time to spend on strategic planning and leaves virtually no time to focus on our own skill development.

Until … disruption.

Proactively creating a disruption in your thinking can be just the spark that you need…

- See the rest of this post at: Human Resources Today blog

Ceridian: Winning the Day with Dayforce?

It takes less than five minutes talking with members of the Ceridian executive team to realize that they mean business. Whether it’s their passion for athletics, like participating in the Tough Mudder, or their passion for raising the bar in the HCM space, it’s crystal clear. They come to play and to win.

win-the-customer-service-experience

There is something appealing about a company that leads introductions by sharing personal information about the executive team.  It certainly makes them approachable and you can see why clients like the culture they are creating and nurturing. It’s a highly competitive team, which leads to their significant goals for 2014 and beyond.

Strengthening the Payroll Offerings

Known in the industry for its strength in payroll and workforce management solutions, Ceridian is stepping up efforts in the international payroll arena.  The company is now able to provide solutions in key areas such as:

  • New hire onboarding forms and workflows
  • Interfaces to the local in-country payroll processor
  • Time and attendance and schedule compliance policies
  • Absence management, including entitlements and time-off workflows
  • Global reporting
  • Consolidated reporting and business intelligence
  • Foreign exchange conversion
  • Local format
  • Date, hour, numeric and currency formatting based on user culture
  • 24 x 7 support operating out of Ceridian’s Glasgow and Mauritius centers
  • Support in 15+ languages

For companies that have need for international payroll, these offerings are helping Ceridian grow beyond North American borders.

- See more at: http://www.brandonhall.com/blogs/will-ceridians-dayforce-win-the-day/#sthash.euWS6row.dpuf