For a business, risks come in diverse forms. Nevertheless, risk mitigation becomes an exciting topic when it comes to HR. A fine example of this can be seen in screening and recruitment of candidates – we often ensure that we have unbiased and robust hiring processes to curb the risks of making a bad hire. Now just think of the impact on organisational performance, team, individual, workplace culture, turnover and diversity. This is just one example. Think of all the procedures and policies that are in place to manage workplace risks.
Let’s delve deeper to uproot some of the key HR risks for a workplace. Here are few where HR plays a pivotal role in mitigating and safeguarding any collateral damage to the business.
1. Dearth of Critical Skills
Not having the right talent with the right expertise and proficiency required to compete, grow or innovate can severely hamper a company’s future.
These are stuffs that HRs do all the day. In fact, it’s their bread and butter. HR department is the one that looks after workplace planning when it comes to risk management. Nevertheless, there is a growing need to render that to the rest of the organisation as well.
HRs need to gather data and analyse to build a convincing case for adding it to the company’s risk map. Also, it is advisable to focus on getting the same on the organisation’s agenda, if not already.
2. Behaviour and Ethics
Hardly a day goes by without another business hitting the news headlines for all wrong reasons. A lot of scandals that we see or hear originate from some or the other unethical behaviour. According to business experts, the topmost risk for a business is ethical violation. In fact, reports show that ethical violations are the most challenging to deal with in terms of brand damage.
This is the reason why HR ought to nurture a work culture that encourages ethical behaviour. Simply put, it’s all about doing things the right way. Don’t forget that any brand or reputation damage could also impact employee engagement, retention and recruitment negatively.
Here, it is advisable to draft a code of conduct followed by establishing an ethics panel or community in the organisation.
3. Violation or Loss of Intellectual Property
If your business deals with customer information, then losing data by your employees is something that can drown your business. Cases of data loss have witnessed a steep surge in the last decade than ever. Remember that customer data is irreplaceable as well as highly sensitive thus, demanding extreme caution.
If your employees are responsible for handling sensitive data, then HR ought to ensure that employees are engaged in the same via giving them training and proper induction. Further, it is also expected from the HR to make sure that they don’t hire a potential fraudster.
4. Mergers & Acquisitions (M&A) Risks
Yes, mergers & acquisitions bring in a fistful of problems especially in terms of employees. This is certainly of great importance especially for a service-oriented firm where human capital is almost everything. This is one of the key reasons a CEO should never ignore employee feedbacks during M&A.
Lot of risks pertaining to M&A can backfire to HR in the long-run. Any risks or threats related to employment law, diligence, etc., would bounce back at the human resource department. However, one cannot neglect other concerns such as ensuring that the newly hired people feel engaged and cared, induction and training programmes are executed appropriately etc. ought to be taken into consideration as well.
5. Regulation and Compliance
Violating any regulatory or statutory compliance could cost your entire business. Again, it all comes down to processes and policies. Human resource department is accountable to work in tandem with the compliance people to ensure that every employee in the organisation is well-versed of all the potential risks of a statutory compliance breach. Thus, ensure that your training modules and programmes entail adequate and necessary information on compliance related issues.
Closing the Curtains:
All in all, the focus ought to be on the HR strategy. Understand that we are witnessing a volatile and ambiguous business ecosystem that is undergoing changes at the speed of light. Thus, it is important that human resource people and businesses keep abreast with all the changes and revive their HR strategy on a periodic basis to keep up with the fast moving business ecosystem.
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