10 HR Practices That Will Kill Innovation

Innovation comes from a single source, your employees. Why does one employee perform ‘just okay’ at one company and becomes a rock star at another? Why do some companies seem to consistently innovate while their competitors are always lagging behind?  The focus of this article is to highlight the strengths of organic innovation and market leadership that results from it. Organic innovation thrives in an environment where employees are empowered, encouraged to make mistakes, take chances, and collaborate freely. The opposite of that is a work environment of uncertainty, fear, lack of support, lack of respect, and lack of job security.  Needless to say, unhappy employees don’t innovate.  Human Resource department is ultimately responsible for creating an environment that fosters innovation. Based on my research, here are 10 HR practices that will kill Innovation at your company.

1. HR is The Law Police

Have HR act as the enforcer of the law and always talk legal lingo, such as “watch your back” and “cover-the-corporation’s ass.” Instead, be a “partner of the employee” and represent the employees’ best interest. This changes the tone of your entire organization and informs the your HR practices and policies.

2. No Performance Reviews

Companies who have a yearly performance review process for the sake of having it, never conduct those reviews on time or they try to avoid having one altogether. When they do have it, they do not take tangible actions towards positive employee growth. They don’t give out bonuses, promotions, or salary increases based on the performance review. Also, there are no peer-to-peer 360 evaluations. Worst, there is no communication about any of it.

3. Punish Employees for Asking for a Performance Review

This is sort of related to the previous point. In the absence of a performance review or even any communication about it, there have been cases where, when an employee does ask for a performance review, the managers make up or write incorrect reviews. This allows them to justify not paying salary increases, bonuses, and promotions. Unfortunately, employees fear that they might get laid off and that fear grows into disloyalty.

4. Constructive Dismissal

Lawyers have come up with a program called “Constructive Dismissal” or “Constructive Discharge.” It is designed to lay people off while minimizing the employer’s liability. Especially in the absence of hard evidence of performance issues. The idea is to make the working conditions of an employee so unbearable that they would choose to leave.

5. Over Worked Without Comp. Time

There is no compensation (comp. time) policy while the underlying assumption and culture is that employees consistently work more than 40 hours a week. One employee said, ‘there is only so much free perks you can give to keep me there for 80 hours. It eventually affects my work-life balance.’

6. Haves and Have Nots

Have a clear divide between haves and have-nots between senior executives and rest of the company. A study shows that if executive compensation is more than 200% of the average salary of non-executives, there is a major animosity among the employees.

7. No Employee Appreciation

There is no formal employee appreciation and acknowledgement program for extraordinary work. Employees feel that if they go above and beyond, no one would care. An employee confessed that she used to frequently check emails and work on deliverables over the weekend and her boss never once acknowledged it.

8. No Employee Education and Training

Companies have an employee education and training program (because the law requires it) but always find reasons to reject employees’ requests for training. I have heard of many reasons such as, “we are short staffed,” “your past performance does not indicate you need this particular course,” “your past performance is not so good,” and “I prefer you focus on improving your performance before requesting to take these course.” The yearly education fund ($5250 mandated by the US Government) is also handled in the similar way, where managers find reasons either not to approve coursework or not pay for it.

9. Manage by Fear

Manage by fear. In general, there is a constant state of fear, uncertainty, confusion, and lack of open communication in the company. It feels like everyone is either a task manager or a task performer. There is a lack of clear vision and strategic direction but people are still overworked. There is a constant state of being in a fire-fighting mode.

10. Top Down Management as an Excuse

Top Down Management Style: This is generally a control issue. Furthermore, this is typically the excuse managers give to their employees when they want to avoid important conversations about bonuses, raises, performance reviews, job changes, lay-offs, and budget. They always say “this came from the CEO’s office” essentially closing the door on any meaningful discussions.

Innovation comes from people who are passionate about their profession, their industry, and their employer. Innovation only happens when people live and operate in a nurturing, safe, respectable, and happy fun environment. Organizations who successfully create such an environment always surpass their competitors.

Following piece was added on 12/30/2022. I found this topic to be compelling and frequent enough that I had to add.

HR must constantly identity toxic employees and have a process and/or program on how to handle them. Of course handle them appropriate to their transgression.  Toxic employees, at the low end of their impact, waste everyone’s time, slow down projects, make people uncomfortable. At the high end of their impact, break up teams, delay projects to the detriment of revenue or customer satisfaction, cause loss of customers, threaten law suits for no reason and the list goes on. One fundamental problem they cause is they stifle innovation which has a significant short and long term impact on competitiveness, growth, revenue, customer experience, and people’s jobs.

It is even more important to identify the non-toxic employees and have programs and practices to amplify what they are doing and showcase their results. That’s one way to combat the affects of the toxic folks and save your culture.

Here is an infographics that sums it all up. Thanks to e-Learning Infographics and Loyalty marketing provider, Rymax, Inc.