Those who were the last Soviet pioneers, and then found themselves in post-Soviet Ukraine, remember very well how the Ukrainian labor market had started to develop. Or rather, continued to develop. There was no interruption. A young independent country largely inherited an outdated model of HR system of the collapsed empire. Even the companies that were the first to cut through a window to Europe for the Ukrainian goods, which implied they were progressive in many aspects, had the recruitment issue low on their agendas. The personnel departments were busy compiling the employees’ files, reminded the trade union of birthdays, and were taking care of the archives. In other words, they were engaged in many activities but were not working with the personnel.
The ‘personnel turnover’ became more dramatic when the offices of international companies appeared in Ukraine. The international companies became the main collectors of qualified personnel.
Such attention or rather the lack of it, businesses felt the hard way. People came to key positions and just as easily left. It was quite a natural process and even received a special term – ‘personnel turnover’. The ‘personnel turnover’ became more dramatic when the offices of international companies appeared in Ukraine. The international companies became the main collectors of qualified personnel. That time people started to speak about the shortage of personnel at the labor market.
The big makeover
Since the late 1990s, there has been a rapid transformation of the HR industry. Increasingly, the people involved in the formation of teams began to add an HR prefix to their job titles, although only a few knew its exact meaning. International and large companies, in which this personnel revolution took place even earlier, became the format carrier. Special programs on automation of processes were added to the ‘death boring’ paperwork. Oksana Marina, the HR business partner of Mining Assets Metinvest, witnessed the birth of the new industry. Her first job in HR began in the ‘Oil’ concern back in 1997. “Before that, I worked in the personnel department, and then I had won a competition and moved to HR. Then this word had already begun to denote personnel management,” she recalls.
The need to automate processes at the country’s largest industrial enterprises was the first challenge that the HR-pioneers faced
For HRs, Ukraine has become a real field for experiments and innovations. The need to automate processes at the country’s largest industrial enterprises in metallurgy and the mining industry was the first thing that the HR-pioneers faced. According to Marina, the implementation of the first HR projects had led to completely unexpected events. For example, when her team was busy describing jobs and evaluating each of the 25,000 employees of ‘Interpipe’, a strike broke out in one of the company’s workshops. “I will never forget the Wheel producing shop, where the General Director and I had to talk with the employees after they had received the payroll,” recalls Marina.
Colleagues of Marina took such a reaction to the HR-innovations into account in the future. Videos and detailed instructions on how technologies will simplify operations and work of an ordinary worker were only part of the preparations before talking with the employees at ‘Metinvest’. The project to set goals for and evaluate 16,000 employees at one of the metal works became the largest in the career of Yulia Ryakhovskaya, who heads the organizational development department of this company. “People are accustomed to work as it is convenient for them. They are not inclined to change their working habits only because a new icon has appeared on the computer, and a new application on the phone. And this must be taken into account,” she says.
PEOPLE ARE ACCUSTOMED TO WORK AS IT WAS CONVENIENT FOR THEM. THEY ARE NOT INCLINED TO CHANGE THEIR WORKING HABITS ONLY BECAUSE OF A NEW ICON ON A COMPUTER OR A NEW APP ON THE PHONE
International companies, which in the mid-2000s opened their offices in Ukraine, became model formats. Marina had an experience of ‘copying’. For example, the rapid recruitment and training system for the ‘Shvidko’ fast food restaurant chain was borrowed from the ‘McDonald’s’ model. “In this company there was already a human resources management. I would even say – a strategic HR management,” says this HR.
HR teams were growing and improving in quality with every new project. Ryakhovskaya remembers well how the transformation of Ukrainian HR sphere began. At a conference on ‘Change management’ in 2007 in the United States, a colleague from Coca-Cola asked her how many people in the company were involved in change management. “I was not very clear about the question since very few people used this term (in Ukraine). Then she told me that about 20-30 people were working on change management in her company. It seemed like a cosmos to me at the time,” she recalls.
In the mid-2000s, Ukrainian HR professionals had secured this line (HR change management). For example, under the leadership of Marina, over 200 people were implementing her first projects. “The team worked at the enterprise level and separate workshops level. When the project was over, I looked back and thought,“Lord, how did we do it?”, she says and does not hide her excitement.
According to Ryakhovskaya, the effect of successful HR projects can reach 30%, which is commensurate with the economic impact of direct investment in the company. The efficiency of HR activities ‘opens the door’ to the Supervisory boards of many companies for HR managers. Along with the executive and financial directors, the HR director becomes a full-fledged business partner. “An HR manager is no longer a person searching for employees, he is a professional who understands the specifics of his company’s operation and business processes,” said Ekaterina Kovalevskaya, head of the Supervisory board of the HRForum Association.
Robotization and automation of standard operations will allow (and force) people to pay more attention to creativity and originality
What will happen next?
In the future, the human capital market will face two trans-horizontal events at once: the coming of robots and the new generation of humans. However, it is not that bad – we will not be taken prisoners by the terminators and will not be expelled from the cities for a low status in the social network. Igor Novikov, Head of the Representative Office of the University of Singularities in Ukraine, is confident that the robotization and automation of standard operations will allow (and force) people to pay more attention to creativity and originality because AI cannot yet do elegant things.
The humanization trend, Kovalevskaya believes, will intensify with the advent of a new generation of millennials, who by 2020 will make up 75% of the total working-age population of the country. The young newcomers are less interested in the company, or the brand, but they are looking for the empathy and social responsibility component: what does the company do for the community, does the business bring global benefits, and is it environment-friendly? “This attitude towards companies on behalf of the future workforce is changing the tasks of HR-specialists,” Kovalevskaya notes.
As a result, the employers’ main task will be to organize a ‘happiness at the workplace’ for each employee. But how can you achieve this goal in a country where the words ‘work’ and ‘happiness’ have been perceived as antonyms for a long time? Natalia Kadya, a coach of ‘Erickson University International’ and a partner of ‘Marchenko&Danevych’ law firm, hears this question from business owners (her clients) more and more often. “Companies that provide happiness for their employees demonstrate several times higher results. This is confirmed by research – in numbers and statistics,” says Kadya.
COMPANIES THAT PROVIDE HAPPINESS FOR THEIR EMPLOYEES DEMONSTRATE SEVERAL TIMES HIGHER RESULTS
The point of application of HR-drivers’ force will also cardinally change. The labor market landscape will be changing along with the coming peak of robotization. Humans will desire to live longer, if not as long as robots, but definitely longer than they live now. Therefore, Dmitry Vavriv, Portfolio Delivery Manager of ‘Kantar Consulting Virtual Reality’ company, is sure that not IT, but biotechnology will be the most popular industry for talent. The current and future shortage of personnel can be described by nowadays statistics: IT companies open 20,000 vacancies a day. They do not manage to find employees for all the vacancies. Despite the fact that about 27,000 IT specialists graduate from the Ukrainian technological universities annually. The insufficient practical skills of graduates are the problem. Their skills do not meet the employers’ requirements.
According to Vladimir Kolomoyets, Head of the Ukrainian office of ‘Pedersen&Partners’, the illiteracy of graduates is a consequence of the past. In the late 1990s, no one wanted to be an engineer, a manufacturer or a powder metallurgy specialist. Everyone wanted to be bankers, lawyers or financiers. In other words, to be managers. They wanted “to come, take a beautiful office, get a huge salary, buy yourself a smart black car and then just walk, puffing up the cheeks,” illustrates Kolomoyets.
The result is disappointing. Because of this educational process gap, there are almost no qualified technical engineers in the country, and those who are left have long since celebrated their half-century anniversaries. «We do not have followers among the new generation,» says the recruiter.
A great share of ‘manufacturer’s defects’ produced by universities and the flourishing of biotechnology, which in essence is a specialized IT technology, will lead to the necessity to improve personnel training and motivation programs. This will be the task of the HR managers of tomorrow. As a result, the influence of the human resources managers on the economic efficiency of the companies will increase significantly. The strengthened role of HRs will place them on boards of directors of successful companies forever, and the dream of the ‘business partner’ inscription on the business card will come true for many of them.