The importance of effective human capital management
One of the primary reasons for improving human capital management is employee retention – keeping employee turnover low.
A high turnover rate is cripplingly expensive and can cost employers a third of an employee’s annual salary. But keeping your employees satisfied enough to stay is a pretty low bar to set for yourself and your company, especially when you take into consideration the effect that employee satisfaction and workplace culture have on your bottom line.
A Gallup study found that highly engaged business units achieve…
- A 17% rise in productivity
- A 41% reduction in absenteeism
- A 10% increase in customer ratings
- A 20% increase in sales
- A 21% increase in profitability
In light of these statistics, your focus shouldn’t just be on doing the bare minimum for employee retention, it should be actively focused on employee engagement and satisfaction.
Improving human capital management isn’t hard. All of the steps mentioned below are more than achievable. The main challenge is getting HR, management and leaders to commit to and sustain each of the steps until they are absorbed into your company culture.
Why It Matters in 2023
Against the backdrop of numerous layoffs and ongoing economic headwinds, you might assume that most people are more intent on keeping their jobs in 2023. However, due to low unemployment rates in both the EU and the US (pdf) as well as a talent shortage during the post-pandemic recovery period, skilled workers still have an edge over other job seekers.
The upshot is that in a US survey, a majority of workers (61%) expressed that they are considering resigning in 2023. Though layoffs weigh heavy on public consciousness, 95% of respondents remained optimistic about their career prospects. Employee retention, therefore, continues to be a high priority in human capital management.
How to improve human capital management
1. Gather existing intelligence on employee engagement and satisfaction
Right now, there is already a bunch of data available for you to measure without having to send out any surveys or conduct any interviews.
The way your employees communicate in, for example, internal emails or Slack channels can tell you a lot about their level of engagement and satisfaction. Word choice, syntax and tone all reveal useful insights about how an employee feels, and whether they have an emotional connection to your business and their work.
Symanto’s APIs can read between the lines and get insights into how employees really feel and flag up incidences where employee satisfaction has dipped, and take steps to investigate the issues affecting your valued employees.
You can also use the Symanto Insights Platform to analyse GlassDoor reviews and discover any patterns that need addressing.
2. Consider the entire employee experience
Reading and analysing employee reviews, emails and surveys will also shine a light on the breadth of the employee experience.
From the hiring process, through to the exit survey, how do your employees experience your company? Looking at the entire journey will help you look at the day-to-day, more practical elements of working for your company.
Free food and Friday drinks are perks, but to really understand what’s important to your employees, it’s worth exploring their lifecycle at your company. Where are employees disengaging? Do employees feel supported in their roles? Are there any processes that are creating a sense of frustration and making things difficult for them to complete? Analyse the data, draw conclusions and implement solutions where needed.
3. Ditch the annual employee satisfaction survey for pulse surveys
Sadly, for many companies, human capital management amounts to little more than sending out a yearly employee questionnaire. But in today’s fast-paced economy, what kind of insight can you hope to get from the same survey year on year? The answer is very little.
For your insights to be actionable and relevant, you’re better off sending smaller tailored surveys more regularly to get a snapshot of employee satisfaction year-round.
Tailor your pulse surveys specifically about the main issues and challenges you want to explore.
Pulse surveys by their nature are short and easy to complete, minimising survey fatigue and enabling respondents to answer more accurately and honestly.
Consider incorporating one or two open-ended questions to encourage respondents to speak their minds and share their experiences more fully.
These surveys are easy to set up and deploy with tools such as SurveyMonkey and Typeform.
Save time by using tools such as Symanto’s text analysis software to help you quickly and accurately analyse survey data so that regular pulse surveys are sustainable for your team over time.
The Symanto Insights Platform is already connected to SurveyMonkey and Typeform meaning that within minutes you can get deeper insights into sentiment and the topics mentioned by your respondents.
4. Provide clear channels of communication
Confusion is the enemy of productivity. Your employees should feel supported in their work, and they should feel that they have an outlet to air their grievances and ask all necessary questions.
When starting a new project or implementing a new policy, make sure that everyone knows who their points of contact are. Hold a question and answer session, and make it clear that they should be free to ask questions going forward.
The key to effective human capital management is improved communication. Make sure that employees are well informed across departments by providing a clear internal communications channel.
5. Complete the feedback loop
All of your efforts thus far will lead to nothing if your employees feel their concerns fall on deaf ears. Your employees will have interesting, relevant concerns and questions that need addressing. Take them seriously, and your business will reap the benefits.
Your employees are a valuable resource for your company. Their collective experience covers every detail, every nook and cranny of your operations. So it’s no wonder that improving human capital management can solve business challenges.
Implementing changes suggested by your employees will also nurture a culture of communication. If employees see that their concerns are taken on board, they’ll be more likely to speak up in future.
6. Continue data-driven insights
As you adapt and implement changes to your human capital management strategy, make sure to measure and track changes to find out what has resonated best with your employees.
Have they started to talk more positively in email exchanges and in reviews about your company online? Do they feel more connected to your company?
These differences preclude other measurable changes such as increased sales and profitability. Noticing the impact of the new measures you put in place will help you prove their value to your company and refine your human capital management strategy.
Get Started with the Symanto Insights Platform
The Symanto Insights Platform enables you to effortlessly analyse qualitative survey feedback and other written content from your employees. Easily keep informed of satisfaction levels and monitor the success of your efforts to improve human capital management.
Get in touch or book your free personalised demonstration to get started.