CASE STUDY - ELECTRONIC ARTS

Transcription

1 Appendix C CASE STUDY - ELECTRONIC ARTS Website: Location: Based in Redwood City, California, with 31 global locations around the world Founded: 1982, public company Total employees: 8,400; 40 percent within the United States, 60 percent outside the United States Employee demographics: 50 percent Millennials, with the rest being a mix of Gen X and Baby Boomers What it does: Develops video games Interviewee: Gabrielle Toledano Executive Vice President and Chief Talent Officer, overseeing HR, Real Estate and Facilities, and Corporate Social Responsibility BACKGROUND In some industries, employee age can play a crucial role in the business, such as when it s important to have an affinity with the customer s interests. Video game pioneer Electronic Arts understands this well, because its players (EA s term for its customers) range in age from up-and-coming Generation Zers to Boomers. The company s workforce reflects that demographic: half of the employee base is made up on Millennials, with most of the remaining employees comprising Gen X and Baby Boomer employees. We have to have a generationally diverse workforce, because our employees make the games that appeal to these different audiences, says Toledano, who 161 Clash of the Generations: Managing the New Workplace Reality, Valerie M. Grubb 2017 by Valerie M. Grubb. All rights reserved. Published by John Wiley & Sons, Inc.

2 162 CASE STUDY - ELECTRONIC ARTS has been with the company for more than a decade. She adds, We have a huge diversity of roles at EA to reflect the diversity of EA s players. Because generational knowledge is so critical to the company s success, EA has spent a great deal of time (and money) figuring out what s important to employees at each stage of their lives and uses that information to better manage its workforce: We ve identified the behaviors and values we need to exhibit for employees of all ages, and then we created programs and a culture at EA that enable us to lead more effectively given this information. With more than 25 years in human resources, the HR veteran has noticed how workplaces, particularly those of younger companies or in more progressive fields, have become less hierarchical and more team based, with a focus on community to encourage camaraderie. There s also a shift in what s deemed acceptable in the office. A few years ago, you d restrict people from accessing external websites. Browsing the Internet on the job was a red flag, she observes. But that has changed, particularly at EA, where staying up to date with innovations and fostering creative thinking, including through online social interactions, is the cornerstone of the business. Toledano admits that EA may be an extreme in these areas, in terms of its leniency: We re a video game company based in California, so our mind-set is different. Employees are playing video games, surfing the web, doing whatever they want. We re in tech and entertainment, so you have to be inclusive and open-minded if you want to be a modern business and not restrict your talent pool. You have to be able to evolve. This mind-set allows for a more creative employee community and work environment. COMPANY CULTURE When asked about the corporate culture, Toledano mentions the importance of transparency and how Millennials have played a large role in increasing the practice within the company. The cohort s desire for openness and accountability has resulted in sweeping changes in many areas. One is the company s approach to mentoring. Understanding younger consumers expectations is critical to the company s future. We used to sell discs only to retailers, explains Toledano, but now we also sell direct to consumers digitally. We needed a workforce of digital natives, which is what Millennials are. Almost everything has been digital their whole lives. That prompted us to create intergenerational communities that we call guilds. Unlike the traditional system of mentoring, which has seasoned employees guiding the newer hires, EA s guilds spread across functional areas, including software engineering, production, design, and analytics. These guilds foster cross-generational idea sharing, as well as a better understanding of generation-based and work styles based on your generation. The result has been a more closely knit workforce who communicate easily and even better a surge in ideas, many of which have made it into the video games that EA produces.

3 Career Development 163 CAREER DEVELOPMENT Toledano states that career development ranks at the top of employees wishes and Millennials are voicing this desire with passion and clarity. They seem to want more feedback than other generations do, she says. They want to make sure there s another opportunity following the current one, to ensure their mobility. There s none of the old-school custom of waiting until you re tapped on the shoulder. Employees, in particular Millennials, really want to know how the company plans to help them progress. That has made EA reexamine its approach to employee development, the result of which is a more transparent system that clearly and succinctly details the skills, competencies, and experience an employee needs to move up a level on the ladder. There is no guessing it s very clear what s needed to move from software engineer level 1 to software engineer level 2, for example (each level and position have very specific requirements that an employee needs to meet before he or she is considered for a promotion). The how also matters, though an employee may have the capabilities and experience to get promoted, but it also matters how well he or she works with others and how he or she gets the job done. The employee s supervisor makes the determination on the soft skills (the how) and if he or she is indeed ready to be promoted. Toledano describes this further: You can t just have the what, so your teamwork, your values, all that matters when getting a job done. When asked how they accomplished this, she responds, We ve done a ton of job-leveling work to describe transparently how you can get from one level to the other. This effort is the culmination of years for work and is subject to constant evolution and updating. Toledano has always made it a point to have at least biweekly one-on-ones with her direct reports but acknowledges that not all managers provide such frequent dialogue and feedback, which is something Millennials need. This desire for more frequent check-ins led to the abolition of the annual review process and forced ranking that is de facto in many more traditional companies. Instead, EA s current methodology provides quarterly reviews (without a rating scale attached). To help guide managers on what to do during these sessions, they are provided questions to ask their employees (although they can add to the list as well, of course). The conversations are more coaching in nature, stressing opportunities and development areas. The guidelines and questions make the process both more transparent and consistent among employees. The resulting Managing for Results program, built in house, provides a laser focus on career development and coaching, as well as 360-degree feedback from peers and other hierarchical levels. Combined, this data makes for more constructive and developmentally focused conversations. While Toledano acknowledges that some of these changes arose to appease Millennials, the whole process of performance management was in need of an overhaul and many companies are heading toward more frequent check-ins anyway. Regular, consistent feedback, she says, is just basic good management

4 164 CASE STUDY - ELECTRONIC ARTS and more useful in the long run to develop employees. And while some managers feel that the new system requires more time commitment, it also has led to more engaged employees and higher performance. It has forced managers to rethink their management styles and spend time on their employees career development, which formerly took a back seat to their other managerial responsibilities. To help employees learn the new system and methodology, EA rolled out a lot of online training for managers to educate them on the importance of more frequent check-ins with their employees. With these changes in career development in mind, EA retired its old performance management system, which Toledano says was driven by the goal of documenting problems for legal purposes. None of that documentation helped anyone legally, she says. In fact, it hurt us, because most managers don t write down negative performance issues. She says that some managers would even give higher ratings than warranted by an employee s performance, then turn around and want to fire the employee: The old previous system of measuring performance was broken. And that broken system caused problems for Toledano, who would have to explain to an employee why a bonus didn t match his or her rating. She knew a huge revamp was in order, and when trying to decide just how to implement it, she reflected back on her time at Microsoft, where Bill Gates adamantly opposed the forced distribution rating system, seeing it as an artificial assessment of true performance that squeezed people into predefined boxes. Bill s was a good side to be on, she says, looking back. You can t be boxed into something that s arbitrary, not fact based. It was never a good practice to explain to someone that his or her rating was low just because he or she was new. That was not motivating top performers. The transparency that Millennials desire has also affected how salaries are communicated. If employees want to know how they compare to their peers, management can provide a breakdown (taking privacy into consideration, of course). For example, if a software engineer wants to know how he or she ranks in pay, managers often provide a spreadsheet of other salaries at his or her level, with the names suppressed. As an unexpected benefit, this policy falls right in line with 2016 s California Fair Pay Act, which aims to close the gender-pay gap by requiring employers to be transparent about how much employees who performed substantially similar work earn. Toledano predicts that such laws will become nationwide in time: I m all for that, too! Under the merit-based Managing for Results system, there hasn t been a single problem with distributing bonuses without ratings, and the conversation now focuses on an employee s quarterly performance and where her or his career is headed. Employees want to know what s going well and what they can do better so that they can be successful, says Toledano. And the new system is working not only for Millennials but also for Gen Xers, who make up a majority of the managers giving the reviews. Their employee engagement is going up, they re getting good feedback, they re retaining their employees they re happy, she adds.

5 Summary 165 Another change in the company environment was the elimination of the term poaching, which refers to one department stealing an employee from another. Poaching used to be forbidden at most companies, but at EA that policy has since changed in favor of allowing employees to have more mobility. We need to show these opportunities to our employees, Toledano says, returning to the idea of transparency. There s no such thing as poaching, as far as I m concerned. Today, EA has an internal job posting system as robust as its external one, and employees can apply for any position they like. The company expects managers to create robust and engaging roles for their teams. If employees are high potential and not engaged, EA benefits when a manager from another team can recruit them into his or her team and keep them within the company. Toledano offers managers this advice on transparency: don t make a one-off decision that sets a precedent that can t be justified by the context of the situation. Don t support something that you wouldn t be able to justify if the decision got out to the whole company: I ve encouraged my teams to have a fairness filter. That s a personal value of mine. RECRUITING Millennials have proven to be quite different from their Gen X predecessors when it comes to hiring. We ve had to create a new and distinct method for onboarding our Millennial college grads in ways that we don t have to onboard Gen Xers, Toledano says. Freshly minted graduates crave community, and EA has created precisely that, which it is developing to apply to all new hires: Whereas in the old onboarding system, a new college graduates would show up for their first day and pretty much be on their own, we ve created an onboarding experience and connected them with a peer community that carries them through their entire career here. So on their first day, all the new graduate hires form a cohort, and it s emphasized (and reinforced) that they are a team, even once they go to their separate departments. That team (along with their managers and department coworkers) is a resource to help new employees as they adjust to work life at EA. SUMMARY Although Millennials have inspired many of the changes made at EA, the benefits have been felt across all generations. The workplace landscape is changing across all industries, but being the vanguard of these transformations has allowed the company which has long been known as a pioneer to remain a choice employer in its field.