Differentiation Framework July 13, 2013 Differentiation Framework The following paper contains a discussion of (1) Jack Welch’s differentiation framework, (2) A, B, C position categorization and (3) process that must be in place for successfully differentiating your workforce. Jack Welch’s 20-70-10 Differentiation Framework No other principle brings more controversy, and is more misunderstood than Jack Welch’s 20-70-10 differentiation framework. In a 2005 USA Today online interview posting, Jack Welch was asked if his view on differentiation had softened since having a heart attack and attending church more frequently, with the implication that differentiation is inherently amoral, even immoral. Quite the contrary, Jack insists …show more content…
Support or ‘B’ positions (1) support strategic positions and minimize downside risks, exhibit little performance variables and moderate to low discretion in work, (2) are compensated based on job level, (3) can cost the organization and destroy value if mistakes are made, and (4) mistakes in hiring are easily remedied through hiring of replacements. Surplus or ‘C’ positions (1) have little strategic impact even though they may be required for the firm to function and little to none discretion in work (2) are compensated based on market price, (3) mistakes in this position are not necessarily costly, and (4) mistakes in hiring are easily remedied through hiring of replacements. I prefer this approach for the following reasons: a. Increased awareness and focus on strategy and what must be done exceptionally well to win. b. Makes clear those positions that are not only strategic (A positions) but also have the potential to destroy value (B positions). c. Ensures efficient use of resources by making significant investments in the positions that provide the greatest opportunity for improvements in business performance. d. Ensures a disproportionate representation of ‘top talent’ or ‘A’ players in strategic positions where they add the most value in creating wealth. e. Ensures that HR’s primary responsibility and focus is the ‘advocacy and delivery of strategic talent’ and that investments in the workforce are based on strategic
Human resource departments today have a more distinct, calculated position within organizations, and human resource strategy influences the bottom line. “One of the challenges for HR leaders is convincing executive leadership teams that human capital is one of the most important resources in which the company can invest” (Mayhew, 2014, p.). Subsequently, “this return on investment is an essential part of the argument for including HR as part of an overall business strategy” (Mayhew, 2014, p.). Human resource departments utilize the information given to them from company executives and leaders, coupled with their respective expertise on all things personnel, and they plan and implement staffing concerns for the betterment of the organization. From preparing job analysis, to comparing inventory and forecasting, it is the responsibility of human resources to consider the objectives of an organization and fulfill those goals while operating the specific planning relative to HR.
B. The firm would stand to gain much additional revenue if its competitors did not follow suit by raising their prices.
B. The existing policies of the company in relation to rewards and recognition for the workers
The goal of a strategic position is to create the largest gap possible between the value that a firm creates
corporate-level strategy you think is most important to the long-term success of the firm and
a. For your strategy to be successful, are there any underlying assumptions that you have made?
HR Perspective – Superior talent is considered an investment if it is effectively utilised by an organisation (Carmeli & Schaubroeck, 2008). The SMH position has the potential to provide a return on investment through active and profitable contribution to the organisation's goals and objectives; achieved by way of a recruiting and developing talent
10. A strategic approach to HR requires that organizational HR leaders be included in the decision-making
Q1: Why is it important for HR Management to transform from being primarily administrative and operational to becoming more strategic contributor?
Human Resource management has a high impact on the overall organization being managed. HR management makes certain that human talent is used successfully and resourcefully to accomplish organizational goals. As an organization core competency, human resources has distinctive competencies that generates high value and sets apart an organization from competitors in areas such as productivity, quality and service, employee skills, and innovative changes. HR management activities can be grouped into categories which include strategic HR management; equal employment opportunity; staffing and talent management; compensation and benefits; and employee and industry relations. This paper will
In the past it was noted by Snell, Youngy and Wright (1996:62) that organisations would purposely 'take human resource out of the strategic equation'. Today it is widely accepted that linking HR to strategy because of a shift in ideas concerning competition and firm advantage (Snell, Shauder and Wright (2001:3)). This shift was identified by Quin (1992:241) "with rare exceptions, the economic and producing power of the firm lies more in its intellectual and service capabilities than in its hard assets"
(To make a summary of the article while answering the question, the answer directly related to the questions are highlighted )
“Effective HR professionals really have to succeed by understanding the business, the market and the customer as well as the Chief Executive or the Marketing
The field of human resources (HR) plays a critical role in the performance and success of organizations. As organizations have become increasingly more complex, the effective management of HR has become even more important. The traditional perception of HR as only an administrative office is no longer valid. Instead, contemporary HR is directly involved with the internal organizational structure, business operations, and variety of functions carried out by employees on a daily basis (Reed & Bogardus, 2012). HR functions impact the organization’s strategic planning, improvement processes, and goal achievement. Six core bodies of knowledge provide the foundation for all of these HR functions. These areas are: strategic
E. Continued focus on improving efficiency and effectiveness in the organisation, from procurement, to supply chain to customer service delivery.