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Businesses turning to performance management software solutions

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Constructing an informed, reliable and responsive workforce is important to many businesses and having the ability to track performance is essential to this process. To streamline this, employers are starting to utilize performance management software.

Performance reviews are important but the process becomes more complex as the numbers of hires increases. This is where technological solutions offer advantages and these are profiled in this third article on the digital transformation of human resources. The first article looked at general trends affecting the sector (“Human resources departments are going digital”) and the second part addressed solutions to help with recruitment (“Application of workforce analytics for targeted recruitment”).

Performance review software is a growing technology within the human resources arena. The use of such software can make the process of carrying out appraisals easier and faster for managers and human resources professionals. Such technology also enables employees to provide their own comments and self-reviews.

The use of technology for performance reviews has been signaled by Katherine Jones, vice president of HCM Technology Research at Bersin by Deloitte, who recently stated: “We are seeing a major shift in the industry, and as performance management continues to change, so must the technology solutions that support it. Organizations today have a need to provide ongoing feedback, a link between individual goals and company-wide objectives and a multi-dimensional view of employee performance. It’s exciting to see solution providers offer features that support those activities.”

There are many providers of platforms, such as ClearViewActus; and Work Compass. There are many others in this fast growing sector. Most systems are flexible and allow for features like linked goals, connected objectives, configurable appraisals, and the ability for feedback to be given; for additional competency reviews, and for the sophisticated reporting of key performance indicators.

The importance of performance management is outlined by the website HR Bartender. The advantages are summarized into five main points. Firstly, the process is all about management involvement and employee interaction. The performance review process allows managers to set performance expectations; to provide feedback; and to coach employees. For objective setting, being able to profile a large and diverse workforce is important for consistency and here digital technology can help. The second area relates to goal setting. Goals need to be specific, measurable, achievable, and target driven. Setting these and assessing these can be made easier through digital platforms.

The third area is with setting learning and development objectives. Software can assist with a skills audit and it can also match employee expectations with the types of courses that are available and in ensuing that the selected courses are appropriate. The fourth aspect relates to feedback and coaching, which is important so that the employee understands what’s good and what could be improved. Systems that allow the employee to self-evaluate are also useful and matching the manager and the employees perceptions can be made easier through an interactive tool. The fifth area relates to capturing the outcome of the performance review conversation, where electronic systems are easier. It is important that such conversations are not confined to a once-per-year appraisal; instead they should be regular reviews to review performance goals together with learning and coaching outcomes.

By placing performance reviews in the digital domain this helps the employer and employee keep track of the performance review cycle better. It also allows human resources professionals to undertake analytics and to look at the spread of performance. This can lead to targeted training and help with activities like talent spotting. For example, performance review software enables managers to keep a running log of notes that can tell a story about the employee’s progress over time.

For more on the digital transformation of human resources, click over to the Digital Journal article “Increased take-up of digital technology by human resources.”

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U.S. proposes redefining when gig workers are employees

U.S. labor officials proposed a rule change that could make it easier for gig workers to be entitled to benefits.

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A rule change proposed by US labor officials that could make it easier for contract workers to be reclassified as employees shook investor confidence in the future of "gig economy" firms such as Uber and Lyft
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United States labor officials proposed a rule change Tuesday that could make it easier for gig workers such as Uber drivers to be reclassified as employees entitled to benefits.

The move by President Joe Biden’s Labor Department would lower a bar set by his predecessor regarding when someone is considered an employee instead of a contract worker.

It also comes as “gig economy” companies from rideshare platforms to food delivery services strive to maintain the status quo.

The new formula includes factors such as how long a person works for a company and the degree of control over the worker, as well as whether what they do is “integral” to a business, according to the proposed rule.

“We believe the proposed regulation would better protect workers from misclassification while at the same time providing a consistent approach for those businesses that engage or wish to engage with independent contractors,” Jessica Looman of the US Department of Labor said at a press briefing.

Being classified as employees would entitle workers to sick leave, overtime, medical coverage and other benefits, driving up costs for companies such as Uber, Lyft and DoorDash that rely on gig workers.

The proposed rule change is subject to a 45-day public comment period, meaning there is no immediate impact, but share prices took a hit on the news.

Uber and Lyft shares ended the formal day down more than 10 percent, while DoorDash was down nearly six percent.

“It’s a clear blow to the gig economy and a near-term concern for the likes of Uber and Lyft,” despite uncertainty about how the new rule might be interpreted across the country, Wedbush analyst Dan Ives said in a note to investors.

“With ride sharing and other gig economy players depending on the contractor business model, a classification to employees would essentially throw the business model upside down and cause some major structural changes if this holds.”

Uber and Lyft have consistently argued that their drivers want independence, provided benefits are added to the mix.

In California, the cradle of the gig economy, voters in late 2020 approved a referendum backed by firms such as Uber that preserved keeping drivers classified as independent contractors.

The measure effectively overturned a state law that would require the ride-hailing firms and others to reclassify their drivers and provide employee benefits.

The vote came after a contentious campaign with labor groups claiming the initiative would erode worker rights and benefits, and with backers arguing for a new, flexible economic model.

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How can organizations attract and retain IT talent?

Gartner has outlined three ways

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One of the biggest stories in digital transformation right now? Attracting and retaining IT talent. 

According to Gartner, the labor market has tightened in the last two years. They report that:

  • 60% of HR leaders are “significantly concerned” about employee turnover.
  • 62% of candidates have explored a career change in the last year.
  • Nearly three-quarters of candidates who receive a job offer have at least one other offer on the table.

Amid stories from the ‘Great Resignation,’ workers in all industries are pushing for higher compensation, better benefits, and increased flexibility — and IT talent is no exception. In fact, Gartner’s Global Labor Market Survey found that compensation is the top driver for IT talent attraction and retention. According to a recent Gartner IT Compensation Increase Poll, 50% of organizations reported increasing the salaries of key employees after they received a separate job offer — all in a bid to retain this talent.

How can organizations effectively attract talent and, most importantly, retain these employees? Gartner has outlined three ways.

Make monitoring and raising pay competitiveness a priority

As Gartner explains, “In order to pinpoint where additional funding will be necessary to address pay gaps in the short term, work with your HR team to identify IT roles and skills areas facing higher attrition risk and recruitment challenges due to noncompetitive compensation.”

Limited resources? Prioritize roles in high-risk areas, they explain.

Build flexibility into IT compensation through variable pay programs

“One way to minimize locking in compensation adjustments as long-term fixed costs,” explains  Lily Mok, Gartner VP Analyst, “is to use variable pay components that can be adjusted or removed as talent needs and market conditions evolve.”

Examples of these include skills-based premium pay, a signing bonus (lump sum or split up), and retention bonuses (eg. during a major period of transition).

Make sure managers can have successful pay-related conversations

According to Gartner, there are three important elements needed to make sure these conversations are effective. 

First, never forget empathy — especially since finances are a very personal topic and can be a sensitive issue.

Second, make sure the compensation package’s value is clearly outlined and understood. This includes pay, bonuses, benefits, etc.

Finally, be transparent about the organization’s pay structure, and how pay rates are set. After all, there are many sites out there (eg. Glassdoor) that features self-reported public pay data. 

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How will CIOs define success in 2021?

New research suggests CIOs are prioritizing digital transformation to “future-proof” their organizations and build resiliency.

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Recently, we reported IDC’s 2021 predictions, which noted that while CIOs have faced epic-level challenges this year, they’ll need to be in the front seat of the upcoming economic relief efforts.

At the top of IDC’s list was the prediction that by 2022, “65% of CIOs will digitally empower and enable front-line workers with data, AI, and security to extend their productivity, adaptability, and decision-making in the face of rapid changes.”

Since then, Gartner has also chimed into the CIO + Future of Work discussion. They identified “automation of routine work with AI, digital dexterity, and hybrid work with distributed workforce” as areas CIOs should focus on.

Now, a new report (based on a survey of over 100 Fortune 500 CIOs) from digital adoption platform WalkMe has uncovered how CIOs and IT organizations will define success in 2021, expanding on these aforementioned trends.

Multi-pronged approaches

In The CIO Outlook 2021, WalkMe — who commissioned Constellation Research for the report — found that 77% of CIOs list automation and AI as key to improving the effectiveness of IT. 59% say ROI from IT can be achieved through portfolio assessment and rationalization.

“CIOs are prioritizing overall digital change, keeping the organization safe, and improving the worker condition,” says WalkMe. Looking ahead, “CIOs must invest in finding the right models for enabling remote work while supporting their users.”

In order for organizations to adapt to change and become future-proof, CIOs need a multi-pronged approach, featuring:

  • No-code solutions
  • The automation of repetitive processes
  • Key software integration
  • Training and service through new approaches

As quoted in ITProPortal, Constellation VP and Principal Analyst Dion Hinchcliffe says:

“This data, gathered from top CIOs around the world, shows that they will be seeking dramatic improvements, especially significantly higher ROI (10-20 percent+) from their IT investment next year.” 

Want to read the full report? Find it here.

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