Customer loginNews & Events
Why PRM?
People Relationship Management (PRM) is the application of the best-practice from Customer Relationship Management (CRM) to the discipline of Human Resources. PRM aims to build one-to-one relationships with and between employees to attract the right employees, develop them and manage their careers to retain them as productive contributors.
PRM brings into focus the whole employer/employee relationship, down to the most basic drivers of employee motivation. The starting question is, “do organisations really need to worry about keeping their talent loyal?”
Are your employees loyal enough?
The principle argument for employee loyalty is an economic one. A study conducted by the International Labor Bureau concluded that it costs 5 to 7 times more to hire and train a new individual than to retain an existing employee. Adding together recruitment fees, training time and costs, in addition to the period in which a new hire adapts to a new corporate culture can mean an average of two years until the breakeven point at which an organisation starts to benefit from its investment in a new hire. Today, employee loyalty is at record lows, 30% of all employees leave before competing two years with a company. Some leave because their profile does not fit the needs of the position and by extension the company, others because they are not sufficiently motivation to continue in the job.
Demotivation has a strong impact on enterprise performance
Beside purely economic criteria, there is a factor generated by the reality of professional cycles. In practice, a key management challenge is dealing with the fact that employees naturally tend to become less motivated over time. To stop recruitment becoming a loss-generating activity for organisations, it is critical to put in place measures to ensure employee performance and motivation. This is an urgent and pressing topic for many top managers. A Tower Perrin study carried out last August (Reconnecting with employees, attracting, retaining and engaging your workforce, www.towersperrin.com) reported the shocking figure that only 15% of European employees feel motivated and engaged in the success of their company.
To the professional cycle, structural demographic issues – the famous ‘age pyramid’ – mean an ageing workforce which is going to mean organisations have to invest even more in the retention of its 30 and 40-year-olds. The outlook is bleak for those that do not do so; a reducing amount of talent in the marketplace will mean unsatisfied individuals looking more quickly at the increasing opportunities outside of their current employer.
Moving from thought to action
More and more organisations are today feeling the effects of the issues outlined above. However many professionals have now understood the new dynamic that is developing, very few organisation have managed to start putting in place measures to address these challenges. This raises what is perhaps the biggest challenge – getting things done. Theory is great, but in reality most organisations have more forces pushing towards inaction instead of progress. Among these brakes on action, organisational diversity is emerging as a real challenge. Globalisation and the Internet are making the world a smaller place and today’s companies are operating in different countries, with multiple organisation structures, speaking different languages and across diverse cultures. How can the same management practices be embedded in entities that may differ in size, culture and organisation? How can operational managers be consistently pushed to take full responsibility for their people?
PRM builds a dynamic and collaborative approach to the relationship between each individual and the organisation. This approach offers some answers to the critical issues that threaten corporate profitability. This newsletter is being edited together to both reflect on today’s real challenges as well as provide ideas and concrete examples on how to initiate change.
Patrice Barbedette
Founder, Jobpartners
