The Value of Aligning HR with the Business Strategy
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Transcript of The Value of Aligning HR with the Business Strategy
The value ofaligning HRWITH THE BUSINESS
STRATEGY
What on earth does amarketer have to say about
ALIGNING HRwith an organisation’s
overall strategy?
marketers are concerned withPRODUCT, PRICE
PLACE, PROMOTIONwhy someone would buy us
now & in the future
“Marketing is too important to be left to the marketing department.”
DAVID PACKARD
CO-FOUNDER
HEWLET-PACKARD
So what’s all this got to do with
When it comes to influencing someone’s perception of a brand
PEOPLE > MARKETING
HR IS OFTEN DISCONNECTED FROM
THE REST OF THE ORGANISATION
AGREE THAT HR HAS
A COMMERCIAL MINDSET
52%
12%FOCUS ON
DRIVING
REVENUE
THIS YEAR
USING HR AND COMMERCIAL
EXPERTISE TO ADD VALUE
26%
What are theseguys doing?
2,000 > 1,600
innit!
BEDQUARTERS
SHOWROOM
on their websiteFANTASTIC CUSTOMER SERVICE
PASSIONEXPERTISEPROFESSIONAL STAFF
they talk about
CEO explaining the benefits
giving customers confidence
owning the experiencebecoming the most recommended bed company
3 MINS AFTER
ARRIVING
NATIONAL RETAILERTRY BEFORE YOU BUY
COMPETITIVE MARKET
on their websiteOUR PEOPLE MAKE US WHO WE ARE
WOWEXPERIENCE
they talk about
CEO “GIVING OUR CUSTOMERS
GREAT SERVICE SO THEY KEEP COMING BACK”
aligned with strategy
0 1 2 3 4 5 6 7 8 9 10DETRACTORS PROMOTERS
PASSIVES
THE NET PROMOTER SCORE
How likely is it that you’d recommend brand [ABC] to a friend or colleague?
% OF PROMOTERS
MINUS
% OF DETRACTORS
Net Promoter Score Calculation
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
0% 10% 20% 30% 40% 50% 60%
Change in S
ale
s
Net Promoter Score 1999
US Airline Growth and Net Promoter Score
1999 – 2002 (Satmetrix)
American
Delta
United
Continental
Alaska Airlines
Southwest
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
-20% -10% 0% 10% 20% 30% 40% 50% 60%
Sale
s Volu
me G
rowth
Net Promoter Score
Effect of Net Promoter Score on UK Car
Industry 2004 (LSE)
Peugeot
Fiat
Vauxhall
Renault
VW
BMW
Ford
Toyota
Honda
-5%
0%
5%
10%
15%
20%
-30% -25% -20% -15% -10% -5% 0%
Sale
s G
rowth
Net Promoter Score
Effect of Net Promoter Score on UK
Mobile Networks 2004 (LSE)
O2
T-Mobile
Vodafone
Virgin
Orange
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
-20% -10% 0% 10% 20% 30% 40% 50%
Change in S
ale
s Volu
me
Net Promoter Score in 2012
Large Supermarkets Sales Growth Since 2012
TescoMorrison’s
Waitrose
Asda
Sainsbury’s
5 key drivers of aKNOWLEDGEABLE
INTERESTEDEXPLAINING BENEFITS
SUGGESTING PRODUCTS
SAYING GOODBYEcustomer’s net promoter score
XX
X
5 key drivers of aKNOWLEDGEABLE
INTERESTEDEXPLAINING BENEFITS
SUGGESTING PRODUCTS
SAYING GOODBYEcustomer’s net promoter score
50%
Net Promoter Score
75%
£4.45It’s worth more than
per transaction
250 STORES X10 TRANSACTIONS PER DAY X 363 SHOPPING DAYS PER YR X
£4.45 INCREASE IN AV BASKET VALUE
= £4,038,375
Thingsto takeaway
USE HR & COMMERCIAL
EXPERTISE TO DRIVE VALUE
TO THE ORGANISATION
26%
be in this group
1
What is your organisation’s strategy?
BROCHURES
REPORTS
MAGAZINES
WEBSITE
ASK
a single metricthat matters
BUILD
MEASURE
LEARN
HYPOTHESIS
Make friendswith themarketing dept.
RESOURCES
NET PROMOTER SCORE• www.satmetrics.com• www.npsbenchmarks.com• www.hbr.org/2003/12/the-one-number-you-need-to-grow
STATISTICAL SIGNIFICANCE• http://docs.statwing.com/examples-and-definitions/t-test/effect-size/• Calculator http://getdatadriven.com/ab-significance-test
OTHER• CIPD HR Outlook 2015 http://www.cipd.co.uk/hr-resources/survey-reports/hr-
outlook-winter-2014-15-views-profession.aspx• The Lean Startup• Slides and Video – Search Google – Octopus HR Software CIPD Presentation• Free trial of Octopus, quotes, white papers, product videos etc.
www.octopus-hr.co.uk