Beyond Hiring and Firing: The Hidden Costs of Reactive HR (and How to Avoid Them)
Are you solving today’s challenge with tomorrow’s vision in mind?
As leaders, it’s easy to get caught in the urgency of the moment. But sustainable success demands alignment with your long-term strategy—and that means involving your People leader early. At HRBoost, our Dedicated Team Approach ensures your People Partner is right there with you, helping turn challenges into strategic wins. Our very own Booster, Shenise Cook shares some recent examples. We hope you enjoy
After a delightful weekend celebrating Homecoming at my Alma Mater (University of Illinois – Urbana Champaign), I started Monday morning asking my multiple devices for the top news stories. Among them were news of layoffs at Starbucks, various commentaries on AI, and an ongoing conversation on Return to Office (RTO) efforts initiated last week by a Wall Street Journal article. Whether because of finance, technology, policy, or some other event, employers of all sizes are impacted by change. As leaders consider these shifts, on-demand HR advice by phone, virtual HR consulting, and strategic HR consulting services can help translate headlines into workforce planning actions. The key is not to anticipate any one, nor have the perfect solution. Rather, it is important to maintain an awareness of how changes may impact the business and proactively identify solutions that make it nimble.
While the budgetary percentages vary across industry, geography, and level of specialization, most research agrees that the cost of labor is the single largest expense for small employers. Yet, it is often given limited consideration — hire more or let people go. There are, however, a variety of alternatives to these extremes when business leaders give some attention to workforce planning. A la carte HR services and custom HR retainers are two flexible engagement models that let you scale HR support without overcommitting. And while there is more often a short-term event that leads to these tactical responses, a long-term HR strategy can often save businesses the monetary, time, and culture costs that come with reactive decisions.
Why think long term? Here are some examples…
“Michelle” was a top candidate for a remote role. Initially seeking hybrid, she was especially excited for an opportunity that would ease her life in the sandwich generation — taking care of both children and parents. With no commute time, this would allow her to work a 40-hour week with an income to sustain her family’s needs. While her employer was open to continuing remote work after the pandemic, they’d never invested in learning how to sustain an engaged culture. With nothing in place to create a community and a manager with no experience in remote leadership, “Michelle” slowly began to disengage after on-boarding. Her work was still valuable, but she wasn’t noticed, and she never got a full picture of her work’s impact. Without connection, when a recruiter sought her out and the hybrid role paid a little more, she left with little hesitation. The challenge: A proactive People Partner or fractional HR Director service could have supported remote leadership training, and employee engagement programs to retain her.
“Mark” was a key contributor on an account. The accounts discontinued due to their own financial strain. While the company had given him accolades during his tenure, he was let go with some of his other team members. Three months later, Taylor” — who was on a similar account and had been with the company for 30 years — retired. Somebody thought of calling “Mark”, but he’d already begun working with another company. The challenge: It took them six months to fill the role. A workforce planning approach — supported by HR advisory services, talent pipeline planning, and boomerang employee outreach — could have reduced the time to fill and prevented the skills gap.
“Stacey’s” company was flourishing. Fairly new, but excited for a role with benefits, Stacey personally committed to staying at the company while pursuing an MBA. While in the program, the opportunity arose to earn the MBA with an AI specialization and Stacey took advantage of it. With changes in the industry that negatively impacted profits, leadership elected to conduct layoffs based on tenure. So, a month from completion, Stacey was laid off. In a strategy meeting a couple of months later, leaders discussed various opportunities to leverage AI and potentially create a competitive advantage through early adoption. The challenge: they had no one on the current team with the skill set. They would have to hire. Strategic HR consulting and skills-based workforce planning — including learning & development roadmaps — can avoid costly tenure-based layoffs that sacrifice future capabilities.
There are tons of examples, but these are often scenarios I see without considering opportunity costs and businesses with strategic and development plans without employee development plans. The cost to hire has undoubtedly increased in recent years. Salary inflation is real as is inflation in general. With many opting for alternative living arrangements, using their skills for independent income generation, and/or leveraging the increased ability to work remotely — the times to fill positions are longer. And even when filled, employees are more frequently leaving for “better” opportunities. How much does recruiting and onboarding cost per hire? Many are not tracking those numbers but will often find that 90 days does not create a positive ROI. Yet, there are still employers that don’t proactively keep a pulse on the engagement and sentiment of their employees or seek to understand why they stay. A regular cadence of HR compliance support, employee engagement surveys, and on-demand HR consulting by phone can help leaders stay ahead of avoidable turnover. Something WE DO PROVIDE at HRBOOST!
There are a variety of options between hire and termination. Temporary reductions, dual roles, employee development plans, and redesigning roles are just a few that you can use to fill gaps in the good and challenging times. A la carte HR support and custom HR retainers let you tap virtual HR services as needed — from HR policy development to employee relations consulting — without adding permanent headcount. We live in a world with a more rapid pace of change than the generations before. And new challenges rarely come with perfect solutions, but there are often options. If you’ve found yourself in these or similar scenarios, know that you are not alone and that there are solutions. Moving forward, it’s important to consider your challenge against your long-term strategy and include your People leader (or in our clients’ cases — People Partner with our Dedicated Team Approach), to identify viable longer-term solutions that address the challenge and ideally give you flexibility. If you need help, know that we are only email, phone call, or contact form away for on-demand HR advice by phone, a la carte HR services, or a custom HR retainer. In fact, we offer FREE Discovery consultations and talk proactive solutions with free information from first discussions. Book to learn more HERE!
~ Shenise Cook
Executive HR Advisor
HRBoost, LLC®
