Principle n°6 — Functionality Economy

In the circular economy

The functional economy privileges the use over possession and tends to sell services linked to products rather than the products themselves. A classic example is the tire manufacturer who retains ownership of their products instead of selling them. He takes care of their re-treading and maintenance; the user is billed per kilometre.

The principle applied to HRM

• The prioritisation on human centred optimisation over contractual obligation

Concretely…

Functionality economy in circular HRM can go through:

• The composition and development of composite company workforces (open-ended contracts + fixed term contracts + temporary workers + self-employed + contractors + etc.) and the management of these composite workforce
• Human resources management within/between projects or between subsidiaries of a group
• …

Examples of good practices observed

Boston Scientific (Ireland) — Missions between sites/factories are organised, for example to facilitate the development of new projects or the subsequent transfer of productions.

L’Oréal Libramont (Belgium) — The internal mobility within L’Oréal group is very important. Each quarter, HRD of the plant holds a meeting with international HR to which the factory is attached and others on the continent. They share information on open positions and candidates who are ready to move. The Libramont plant recently “recruited” a production manager from L’Oréal Karlsruhe, in Germany. Another colleague arrived from the L’Oréal factory in Burgos, in Spain. These mobilities relate rather to managerial functions, but also to production profiles, even though if these are generally less mobile.

Peikko Lietuva (Lithuania) — When a project on which an employee is working on ends, the company has the following process: analyse whether they can integrate another project, offer the person the learning opportunities and then take on another role, and engage in a dialogue to discuss with the person concerned other future prospects for collaboration.

Diving into a large company today offers a picture that the workers who are part of its teams are themselves not necessarily conscious about. We meet there workers with classic open-ended contracts, full time or part-time, but also temporary workers, consultants, trainees, apprentices, employees working for a service provider or a sub-contractor… The latter are not recruited to “belong” to the company, but for the services they provide. The heterogeneity of employment status leads to what we call the blended workforce or “mixed workforce”, whereas external persons work in the same teams as employees. The HRM is part of Total Talent Management with different issues: how to manage the distribution between these different employee statuses, what remuneration policies to apply to them, what performance measurement in composite teams, what risk management, how to welcome these workers according to the statuses and how to separate them, what training for these different workers, what technology to manage the workforce with multiple statuses…

Edukacinės Sistemos (Lithuania) — The vast majority of workers are employed under a fix contract. When people are employed under a short-term contract for a specific project, a permanent position is generally offered to employees who demonstrate talent and passion.

An evolution in the world of work? – In the United States, a study shows that in 2014, companies employed 62% in the same proportion, self-employed and temporary persons, but also 19% in terms of volunteers, 6% of online workers via platforms and even 5% of robots or drones!