by Ross O’Brien
In this series of blog posts, we have been looking at Porter’s Value Chain Analysis as a useful tool for business people seeking to maximize the value they deliver to customers while also seeking to gain a competitive advantage as they execute their strategy. If you have not yet read the previous articles, let me encourage you to read at least the introductory article linked here, as it will set the foundation for this and all the other articles in the series.
Beyond the traditional use of the analysis, we have also unpacked how the tool could be used as a way to help a follower of Jesus steward the resources of God’s company. In this fifth part of the series, we continue to examine the support activities of the value chain, this time focusing on Human Resource Management.
Dinesh Pratap Singh’s visualization for Porter’s Value Chain: CC BY-SA 3.0
Human Resource Management
HR Management Through a Traditional Lens
Traditionally, HR activities include:
- Job design and staffing
- Attracting, recruiting and selecting employees
- Socializing, training and developing employees
- Evaluating and compensating employees
- Labor relations
In the past, HR managers played an important role but were not seen as truly strategic to the firm’s success. However, over the past twenty years the role of HR has grown in significance, in some cases even breaking into the C-Suite. In fact, some refer to the field as “strategic human resource management.” In the current economy, human capital plays as critical a role in the success of a business as does financial capital or tangible assets. “Right-sizing the firm,” “getting the right people on the bus,” and “empowering employees” so that they are truly “engaged” in the life of the firm are all common phrases related to HR management.
The Container Store’s hiring philosophy illustrates the value of human capital. It is as follows:
- 1 great person = 3 good people
- The Container Store only hires great employees.
- Since they get at least a 3x return on the investment, the Container Store pays 50 – 100% higher than the average retail salary.
Most store managers, and even those in the company’s headquarters started as part-time employees. This demonstrates a two-way loyalty: the company showing loyalty to employees as they work their way up through the ranks, and employees showing loyalty by remaining with and working diligently for the company.
We might expect high-tech companies to be considered one of the best places to work, but The Container Store is a retail-based company. Even so, year after year the company appears on Fortune’s 100 Best Companies To Work For list. In other words, establishing good HR practices sets excellent companies apart from the rest.
HR Management Through a Spiritual Lens
One can easily argue that establishing HR practices that treat people with dignity, helping them grow in their knowledge, skills and abilities (KSAs), and compensating them in a way that provides security is a spiritual expression of the grace and love of God. This is high and holy work, even if the manager is not a follower of Jesus and does not have this spiritual understanding. Through common grace God’s principles work even when those involved do not know him.
However, a follower of Jesus brings to the table a unique perspective on the activities of HR management which include:
- Each person is created by God in his image.
- Each person is gifted by God with a unique personality, strengths and interests.
- Each person is loved and valued by God, purchased at the price of his son.
For these reasons, our attitude towards each person who comes across our path and the way we treat them is critical. Through the work of HR management, faith-oriented businesses have the opportunity to demonstrate the grace and love of God.
In hiring, the “person-job fit” and “person-organization fit” are critical. However, hiring managers who follow Jesus need to prayerfully consider each candidate, seeking not only the interest of the company but also the well-being of the candidate. Do not hire out of a false sense of compassion, putting the wrong person in a job that will lead to his or her failure. Also, don’t forget, the company belongs to God. As his steward, you must take care to hire the right person to help his company succeed. At the same time, remember that God sometimes uses the weak and insignificant things in the world’s eyes. David was the runt of the litter. Gideon was hiding out in a pit when the angel approached him. Peter was an impetuous fisherman. Yet God used each of these and many others to accomplish his purposes. Pray diligently for wisdom as you carry out your hiring activities.
Once hired, equip your employees for their role in the company and in life. For the faith-oriented company, training and development take on a spiritual element. Helping a person grow into the man or woman God designed them to be is both a privilege and a responsibility. While this certainly includes training to equip the employee with the KSAs (knowledge, skills and abilities) necessary for the job, it goes beyond this to include socialization into the company’s values, developing the soft skills that will help employees inside and outside the workplace, and more.
As his steward, you must take care to hire the right person to help his company succeed. At the same time, remember that God sometimes uses the weak and insignificant things in the world’s eyes.
For example, a freedom business in Calcutta, India, teaches its employees how to sew as a part of their work, but also provides reading and writing education, as many of the women who work there did not have the opportunity to attend school. A dairy company in Uganda, partners with a non-profit trauma counseling organization to provide their employees with counseling to deal with their backgrounds, including enslavement as sex workers or child soldiers. Your employees might not have these extreme backgrounds, but they do bring their own issues and needs into the workplace, and you get to co-labor with God in his restoring work in their lives.
In the Coffee Shop example used in previous articles in this series, our shop owner might feel led to hire trauma survivors, ex-offenders, handicapped or others who society has marginalized. This can be a rich blessing for these people and a rich example of God’s redeeming grace and restoration. However, the shop owner must realize the inherent challenges of working with people who do not have work experience and who, often for reasons beyond their control, bring to the workplace emotional and physical issues that make it hard for them to work and hard for others to work with them.
By meaningful compensation, I don’t mean simply paying more than industry averages. I mean thoughtful consideration of multiple factors, including the value of your employees’ contribution to the company, their financial needs and the company’s ability to pay, and even non-financial blessings that motivate and encourage employees.
In these kinds of cases, socialization, training and development activities take on even greater significance. The Shop must develop appropriate training and development opportunities that take into consideration the specific needs of their employees. Further, as in the case of the dairy, the Shop can partner with other organizations to provide specific assistance that it might not be equipped to offer. There should also be consideration given to the percentage of employees hired with unique needs. At the dairy in Uganda, approximately 50% of the employees come with a background of trauma.
Meaningful compensation also reflects our stewardship role. By meaningful, I don’t mean simply paying more than industry averages. I mean thoughtful consideration of multiple factors, including the value of your employees’ contribution to the company, their financial needs and the company’s ability to pay, and even non-financial blessings that motivate and encourage employees. As we saw with The Container Store, thoughtful compensation has the pragmatic effect of improving retention and performance. But equally important for the faith-oriented business is the expression of the grace and love of God demonstrated to your employees through the company’s compensation plans.
For the faith-oriented company, employee evaluation also takes on a spiritual dimension with the goal of helping the employee flourish more fully.
Coffee shops and other food retail businesses typically hire less experienced, entry level employees. In this way, they are able to keep their operating costs low. Our Coffee Shop owner must prayerfully make the decision regarding compensation. Paying too much could result in the Shop failing financially, which would not help anyone. Paying too little results in higher turnover as well as a missed opportunity to communicate the inherent value that people have as children of God.
Finally, for the faith-oriented company, employee evaluation also takes on a spiritual dimension with the goal of helping the employee flourish more fully. Honest feedback on employees’ work performance, even when it involves correction, demonstrates a respect for that person and a belief in him or her. Take the time to see your employees succeed and praise them for it. Look for examples of success, but also be willing to address mistakes in a respectful and caring way. If your company operates in a culture other than your own, take the time to learn how to communicate praise and criticism in a culturally appropriate way.
The business owner has the opportunity to provide employment in a way that helps meet physical and emotional needs, restoring and building up the lives of her employees. But she also has the responsibility to communicate with her employees the reason for and source of her love and faith.
As a follower of Jesus, remember that our Lord called us not only to provide food for the hungry (Matthew 25), but also to make disciples (Matthew 28). Our Coffee Shop owner has the opportunity to provide employment in a way that helps meet physical and emotional needs, restoring and building up the lives of her employees. But she also has the responsibility to communicate with her employees the reason for and source of her love and faith. Doing the former without the latter disrespects employees as it overlooks their eternal needs while focusing on the immediate needs. Doing the latter without the former disrespects the Gospel by failing to see that Jesus came to meet spiritual, physical and emotional needs.
In conclusion, HR management plays a critical role in the financial and spiritual success of a business. Establishing policies and practices that result in human flourishing and spiritual growth is possible with careful consideration and prayer.
Read Part 1 >> Value Chain Analysis Through a Spiritual Lens: Introduction
Read Part 2 >> Operations and Outbound Logistics Through a Spiritual Lens
Read Part 3 >> Marketing and Customer Service Through a Spiritual Lens
Read Part 4 >> The Role of Business Leadership Through a Spiritual Lens
Read Part 5 >> Human Resource Management Through a Spiritual Lens
Read Part 6 >> Procurement and Technology Through a Spiritual Lens
The series has barely scratched the surface on these ideas but hopefully has prompted you to think more deeply. We would love to hear from you about how you integrate faith with each of the value chain activities. Please send those examples to: email@example.com.
Ross O’Brien has been teaching at Dallas Baptist University since 2003. Prior to that time, he started and ran a small Internet firm in Birmingham, Alabama after working for AT&T’s Business Network Sales division as an Account Executive. Ross’ Ph.D. is from the University of Texas at Arlington in Business Administration and his MBA is from Dallas Baptist University. He began the undergraduate entrepreneurship program at DBU as well as the Center for Business as Mission, in which he serves as the Director. Through the Center, Ross teaches undergraduate and graduate classes in Business as Mission, has taken students on travel study courses to learn about business practices in Israel, Chile, Sierra Leone and Bangladesh, and helps host The Lion’s Den DFW event each spring.