Hiring and Retaining the Right People (Excerpts from the U.S. Construction Industry Talent Development Report from FMI)

Transcription

1 Hiring and Retaining the Right People (Excerpts from the U.S. Construction Industry Talent Development Report from FMI)

2 Agenda Preparing for a Changing Workforce Finding and Retaining the Best Talent Survey Respondent Data Talent Development Practices Succession Planning 2

3 Retaining Employees of All Generations The Aging Workforce:

4 What challenges do you face in retaining different generations? What tactics have you used to attract Millennials? How would more effectively leading different generations help your organization?

5 Multi-generation workforce Boomers Born: Age: years old Gen X Born: Age: years old Millennials Born: Age: 33 years and younger

6 A Changing Workforce 40.0% 35.0% What percentage of your company's workforce falls into the following generational categories? 37% 38% 30.0% % of Total Response 25.0% 20.0% 15.0% 19% 10.0% 5.0% 5.2% 0.0% Veterans (born before 1946) Baby Boomers (born ) Gen-Xers (born ) Millenials (born ) 6

7 Retaining Employees of all Generations

8 FMI Corporation

9 Attracting and Retaining Boomers To Boomers, job changing is okay as long as they do not lose any ground Boomers tend to stay in the organization because they feel they are making a difference difference

10 Leading Boomers Lead Boomers by: Becoming a coach Challenging them to keep growing (in their own way) Facilitating, not dictating results Offering them flexibility, authority and respect

11 Attracting and Retaining Gen Xers Create opportunities to move laterally and vertically within the organization Allow an appropriate level of autonomy Address how individual needs can be met within the organization

12 Leading Gen Xers Lead Gen Xers by: Providing a fair and Balanced work schedule Leading with a coaching style Providing immediate feedback and credit for results Pushing them to keep learning just in time for every new mission

13 Employees Leaving/Retirement 30% 25% What percentage of the following groups will you lose to attrition or retirement in the next 5 and 10 years? 26% 20% 18% 18% 20% 15% 10% 12% 9% 9% 11% 7% 13% 5% 0% Executives Senior Managers Project Managers Field Managers Other 5 Years 10 Years U.S. Construction Industry Talent Development Report 13

14 Who should we focus on? The talent shortage is intensifying

15 From Hanson Dodge Creative. 2013

16 MillennialScenario Chris 23 year-old estimator Chris is just out of college and has an overly optimistic view of his chances of promotion. He has explained that he took the job because it allows for time for him to spend in competitive mountain-biking, but the pace of the organization is too slow for him. You want to keep Chris because he is a hard worker and has great long-term potential with the organization, however, he has grown increasingly frustrated with how things work there.

17 Biggest Leadership Mistakes 17

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19 Top Strategies to Attract and Retain The top three strategies companies focus on to attract and retain talent: Being an employer of choice 79% Providing comprehensive benefits and rewards Training/learning opportunities Market-competitive compensation 56% 55% 59% Clearly defined career paths 24% Maintaining a diverse culture Building the position/hiring practices 11% 15% Strategic onboarding practices 0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% % of Total Response No, 30% Does your company offer career paths? Yes, 70% 19

20 Motivating & Retaining Millennials Work-life Balance Meaning & Passion Training & Development Mentoring & Coaching Stretch Assignments Career Progression International Assignments Rotational Assignments Instant Feedback Flexibility

21 Leading Millennials Lead Millennials by: Keeping them focused with speed, customization and interactivity Putting them in roles that push their limits Treating them as professional colleagues

22 VIRTUAL TEAMS

23 Finding and Retaining The Best Talent Which of the following is your company using to recruit the best talent? Internships/co-ops 77% Job postings on your company's website Internal employee referral program with incentives Online recruiting tools (e.g., Monster.com, Careerbuilder.com) Professional recruiters 68% 63% 59% 59% External referrals 44% Association job boards Job postings in professional journals 24% 28% Other 9% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% % of Total Reponse 23

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25 Why do people stay?

26 Motivators Worksheet Motivators 1-10 Achievement seeing favorable results of ones work Recognition attention or favorable notice or praise Work itself nature of work (varied, challenging, interesting) Responsibility for own work or work of others Advancement promotion in rank within the organization Growth opportunity to rise in company or enhance skills Salary total compensation, salary and benefits Relationships interactions with peers, supervisors and others Status pleasure derived from position of stature in the organization Job security stability of job, low fear of loss of work

27 Factors Driving Motivation Generational Peer Group Silents Boomers Xers Millennials Life Stage 20 s 30 s 40 s 50 s 60 s 70 s Exploring Nurturing Taking Charge Re-Evaluating Recollecting Reflecting Career Stage Beginning Launching Plateauing Managing the Doldrums Sorting Things Out Restructuring Personality Type E or I S or N T or F J or P Generational Source: Generations by William Strauss and Neil Howe Life Stage Source: Elizabeth Kubler-Ross Career Stage Source: Hudson Model Frederic Hudson

28 Most Difficult Core Competencies to Develop for Field Managers Communicating Effectively Strategic Thinking Coaching and Mentoring Leading others Business Development Financial Management Risk Management Project Control Negotiating Skills Team Building Operations 8% 28% 28% 26% 25% 23% 21% 19% 42% 47% 62%

29 Most Difficult Core Competencies to Develop for Project Managers Strategic Thinking Communicating Effectively Leading others Coaching and Mentoring Business Development Risk Management Financial Management Negotiating Skills Team Building Project Control Operations 7% 24% 24% 22% 16% 33% 38% 47% 45% 58% 56%

30 Most Difficult Core Competencies to Develop for Senior Managers Strategic Thinking Coaching and Mentoring Communicating Effectively Leading others Business Development Team Building Risk Management Financial Management Negotiating Skills Operations Project Control 2% 2% 11% 17% 15% 30% 33% 43% 41% 48% 48%

31 Talent Development Practices (1 of 5) Which of the following practices does your company plan to use in the next year to increase employee performance and development? Annual performance reviews Formal in-house classroom training Formal classroom training by outside vendors Personal development plans Web-based training Coaching Regular meetings of the entire workforce Mentoring Programs Teambuilding activities Continuous professional education (CPE) Profit-sharing for non-managerial employees Peer review/360 degree feedback Professional/Executive coaching Job rotation/cross training Staff attitude/climate surveys Train-the-trainer training Action planning (individual) Developmental work assignments Action planning (team) Knowledge or skill-based pay Self-directed teams Group or team-based compensation Other 1% 6% 15% 12% 10% 33% 30% 29% 28% 27% 25% 24% 22% 38% 54% 53% 51% 50% 46% 44% 44% 44% 83% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Axis Title 31

32 Succession Planning Process Develop vision and values Develop strategies and objectives Identify the leadership requirements Assess the organization and the candidates Identify potential candidates Identify gaps in performance capabilities Create a development process Start the development plan Assess progress Develop and implement the transition plan 32

33 Implications for Future Leaders Need to Think Differently Strategically Understand how to Motivate and Inspire Importance of Development of Individuals vs. People

34 BirdDog Recruitment and Application Tracking Software & Services Reduce risk, total recruitment cost and time to hire Solve immediate hiring need or plan for future growth Turn a panic hire situation into an ongoing hiring strategy Drive applicant flow from multiple sources Build an online talent community for future opportunities

35 Resources Now Available at BirdDogHR.com

36 Plan to Attend! 2014 AGC Construction HR & Training Professionals Conference! Phoenix, AZ October 15-17, 2014 Learn more and register at meetings.agc.org/hrted

37 Interested in this topic? Register for the NEXT free webinar, sponsored by BirdDog. Building Your Talent Pool for Future Growth October 7, 2014 from 2:00-3:00 pm EST Register at 37

38 Survey Respondents: Primary Type of Work Heavy/Highway/ Utility, 3% Other, 4% General Contractor, 71% Specialty Trade, 1% Architecture, 2% Construction Manager, 14% Engineering, 6% 38

39 Survey Respondents: Role Training Director, 2% Vice President, 32% Other, 4% Chief Financial Officer, 5% President/CEO, 25% Owner, 8% Human Resources Director, 15% Chief Operating Officer, 5% General Manager, 2% 39

40 Annual Construction Revenues $100 to $499.9 million, 44% $50 to $99.9 million, 21% $500 million or more, 15% $25 to $49.9 million, 15% Less than $25 million, 5% 40

41 Number of Employees (At Peak Season) , 49% , 11% 1,000-1,999, 8% 2000 or more, 5% Fewer than 100, 28% 41

42 Workforce Demographics/Trends 20% of management or supervisory positions are held by Hispanic descent employees 10% of management or supervisory positions are held by women The percentage of women working in the construction industry has risen from 5% to 8% 42

43 Racial/Ethnic Groups in Management/ Supervisory and Technical/Craft Positions 90% 80% What are the current percentages of the following race/ethnic groups in management/supervisory and technical/craft positions? 80% 70% % of Total Response 60% 50% 40% 30% 20% 10% 0% 5% 2% African American or Black Asian or Pacific Islander 11% Hispanic or Latino White, not of Hispanic origin 2% Other 43

44 Changing Workforce Preparation Which of the following is your company doing to prepare for a changing workforce? Promote internally to key positions Train to improve performance in specific competencies Provide internship/co-op programs Employ "best practices" to retain key talent Network with community and industry groups Establish core competencies by position Increase recruiting efforts at schools, colleges, and/or universities Identify current gaps in core competencies Increase recruiting for experienced industry talent Develop project competencies needed in the next 5-10 years "Poach" employees from other firms Recruit in non-traditional labor pools Offer phased retirement or contract work for retiring employees Other 1% 15% 21% 21% 84% 78% 72% 70% 64% 61% 58% 53% 50% 45% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% % of Total Response 44

45 Internships and Co-Ops National Association of Colleges and Employers 2011 Internship and Co-Op Survey Increase internship hiring by 7% this year; Co-ops 9% Full time offers to interns 67% of the time After one year, retained at 75.8%; new hires recruited without internship/co-op experience retained at 60.7% Benefits Increased retention rate Reduced training periods Improved personnel selection 45

46 Best Practices to Attract and Retain There are so few of us left after the last three years that we are all crosstrained into all other jobs. In order for the company to succeed, everyone must perform. In order to keep the benefits employees like, the company must succeed. Accessibility of upper management mentoring and having fun in a not so fun industry. Clearly indicating that we promote from within and that it s talent, not seniority that gets you there. Hire the right people, pay them well. Recognize their achievements and allow them to grow and make mistakes they can learn from. We encourage our employees to rotate through positions project management, field supervisions, estimating, etc. Broad exposure increases their knowledge of the business and keeps things interesting and challenging for them. Work with each employee individually and give them an opportunity to be what they want to be; helping them get there. 46

47 Establishing an Ethics Culture FMI s 2004 Ethics Survey 61% of survey respondents thought that the industry was tainted by unethical acts. 84% reported that they had experienced, encountered or observed construction industry-related acts or transactions that they would consider unethical in the past year. The economic downturn has made it worse. More companies are living in the gray. Potential for financial loss or gain is a strong incentive for companies, and the individuals within them, to take a detour from the ethical straight and narrow way. 47

48 Make Ethics Tangible FMI interviewed 20 CEOs and compliance managers Ethics starts at the top the leader must champion ethics policies, practices and attitude. Keep your ethics policy simple, and tie it back to key values. Get buy in from everyone in the company. An ethical culture starts with hiring the right people. Ethics can be taught. Review, monitor and report ethics behavior. Take action on ethical violations. 48

49 Ethics and Compliance Programs Establishing standards and procedures to prevent and discover wrongdoing. Providing for periodic risk assessments. Ensuring corrective measures are carried out. Promoting periodic communication and awareness of the ethics code. Providing an effective training program for ethics education. Providing and advertising an anonymous hotline for reporting breaches of conduct. 49

50 Ethical Compliance % of Total Response 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Does your company have a formal code of conduct in place? 81% 12% 7% Yes No This is being considered. % of Total Response 80% 60% 40% 20% Does your company have a formal ethical compliance program in place? 0% 67% 20% 12% Yes No This is being considered. 50

51 We have seen an improvement FMI s 2013 Talent Survey We asked Does your company have a formal code of conduct in place? 82% said yes, 11% said no, and 7% said it was being considered. We also asked if companies had formal ethical compliance programs in place? 69% said yes, 19% said no, and 12% said it was being considered. 51

52 Training Budgets and Expenditures 81% of the survey participants indicated they prepare a yearly training budget. Percentage of payroll spent on training is higher in the construction industry than what other companies are spending at 3.3%. 73% of companies have decreased their budget since the recession. Does your company prepare a yearly budget for training activities? No, 19% Yes, 81% 52

53 Talent Development Practices (2 of 5) Annual Performance Reviews 83% of respondents continue to perform an annual review. Performance Culture: one in which employees are motivated to perform at the highest levels of their ability, with resulting excellence in organizational outcomes. Set clear, realistic expectations. Provide feedback regarding how effectively people are meeting those expectations. Ensure appropriate consequences for behaviors and/or outcomes. 53

54 Talent Development Practices (3 of 5) Training According ASTD s 2010 State of the Industry Report U.S. organizations spent $ billion on employee learning and development. Nearly two-thirds of that total was spent on internal learning while the remaining amount was allocated to external services. 54

55 Talent Development Practices (4 of 5) Personal Development Plans Extension of performance review process that allows manager and employee to identify and advance towards reasonable developmental goals. Advantages include: improving performance and enhancing knowledge by promoting a climate of continuous learning and professional growth. Gives employees the responsibility for their own personal and professional development. 55

56 Talent Development Practices (5 of 5) Web-based Training Increasingly popular over the past few years. Benefits include reduced travel expenses, less time away from the job and just-in-time. Certain topics are more conducive to learning through this type of delivery format. 56

57 Developing High Potentials What are you doing to develop your high potential employees? Does your company have a formal process to develop high potential employees? Is it part of a structured management succession process? No, 62% Yes, 38% No, 71% Yes, 29% 57

58 Developing High Potentials Identify the employees worth keeping. Create development plans. Determine current employee engagement level. Stretch employee development. Make learning a priority. Have informal and regular conversations with your keepers. Allow boomerangs. 58

59 Best Practices in Developing High Potential Employees Identify high potential people, tell them and then carefully select various work experiences with development in mind and promote and increase salary at a faster pace. Our Talent Management process includes a talent review whereby all employees are ranked and their strengths and weaknesses discussed, with a development plan then prepared for each individual. This process identifies high performers and they are included in a leadership mentoring program, whereby each individual is assigned to a company leader to be mentored for one year with quarterly reporting on results, things learned, etc. We have a leadership development program that targets high potential employees who are part of the succession process. More than 50% of our current senior management of the company has participated in (or is currently participating) in this program. 59

60 Succession Planning 60

61 New Challenge and Opportunities Transferring ownership to a new generation of leaders. Capturing and embedding the cumulative knowledge of outgoing employees. Developing intentional, purposeful succession plans. Growing high-potential employees' ability to lead versus manage and think strategically versus operationally. Preserving organizational culture so it can be propagated for future generations. Shaping business models to meet the demands of a volatile and uncertain market. 61

62 Recommended Reading Managing the Millennials: Discover the Core Competencies for Managing... by Chip Espinoza Not Everyone Gets A Trophy: How to Manage Generation Y by Bruce Tulgan Y in the Workplace: Managing the "Me First" Generation by Nicole A. Lipkin The Generational Imperative by Chuck Underwood 62

63 Founded in 1953 by Dr. Emol A. Fails, FMI provides management consulting and investment banking for the worldwide construction industry. Visit us at FMI delivers innovative, customized solutions to contractors; construction materials producers; manufacturers and suppliers of building materials and construction equipment; facility owners, managers and developers; engineers and architects; surety companies; and industry trade associations. FMI s experienced professionals assist businesses with strategic planning, leader and organizational development, business development, research, mergers and acquisitions, peer groups, private equity placement, project execution and training. 63

64 BirdDog Recruitment and Application Tracking Software & Services Reduce risk, total recruitment cost and time to hire Solve immediate hiring need or plan for future growth Turn a panic hire situation into an ongoing hiring strategy Drive applicant flow from multiple sources Build an online talent community for future opportunities

65 Resources Now Available at BirdDogHR.com

66 Plan to Attend! 2014 AGC Construction HR & Training Professionals Conference! Phoenix, AZ October 15-17, 2014 Learn more and register at meetings.agc.org/hrted

67 Interested in this topic? Register for the NEXT free webinar, sponsored by BirdDog. Building Your Talent Pool for Future Growth October 7, 2014 from 2:00-3:00 pm EST Register at 67