Workforce Planning to Meet Critical Business Needs

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1 Workforce Planning to Meet Critical Business Needs TEXAS PUBLIC POWER ASSOCIATION 2016 Annual Conference July 26, Austin, TX Presented by: Yvonne Morales Pelayo, CPS Energy Patricia Cruz, Leidos

2 Agenda > Introductions > Industry Overview > Demographics > Workforce Planning Cycle > CPS Energy Practical Example > Questions? 2

3 The Industry is Experiencing Unprecedented Change Most pressing challenges, according to recent survey of utilities Source: 2016 State of the Electric Utility Survey by Utility Dive 3

4 Focusing on Workforce Issues Utilities 1.9% 51% 15.4% 31-40% 26.9% 21-30% Total: 55.7% Eligibility to Retire in Next Five Years Source: 2015 APPA Workforce Survey What does this mean for you? > Loss of experience and knowledge > Need to capture knowledge of experienced workers and provide to the next generation > Need to effectively manage workplace with different generations > Increased competition for junior talents > Requires acknowledging that there is a difference in the workforce today due to demographics 4

5 Demographics Today s workforce includes four generations of people > Traditional ( ) > Baby Boomers ( ) > Generation X ( ) > Millennials ( ) 5

6 A Look into Each Generation Traditionalists Baby Boomers Generation X Millennials Core Values Follow the rules Anti-war/ government Balance diversity Achievement/ high morals Work Ethic Dedicated Workaholic Balance Ambitious Workplace View Get the job done Invented the 50-hour work week Project oriented Effective but gone at 5:00 p.m. Work Life Balance Work hard to maintain job Imbalance Balance work and family Balance: work, life, community involvement, self development Work Environment Hierarchical, top-down management Flat hierarchy, equal opportunity Functional, positive, fun, fast-paced Collaborative, fun, flexible, continuous feedback What they want at Work Work is not supposed to be fun To know that their ideas matter Independence and fun at work Team oriented, work with friends, provide rationale for work and value Communication Mail weeks/days Telephone hours minutes Text/social media seconds 6

7 Pop Quiz Which of the following generational groups currently makes up the largest number of employees in the U.S. workforce? > Baby Boomers > Generation X > Generation Y (Millennials) Answer: Generation Y (Millennials) 7

8 What Millennials are Looking for at Work > Good jobs 30 hours per week and regular paycheck > Engaging jobs > Advancement opportunities > Mentorship Overall, a purposeful life, active community, social ties, and financial stability 8

9 Other Challenges Number of students enrolling in colleges/ universities dropped almost 2% since last year Competition for neighboring utilities or other businesses Special skills & limited local labor pool Budget constraints 9

10 What To Do? Workforce Planning Looks at the utility s business strategy Assesses what talents are needed to meet business demands over a determined period of time Approximately 75% of utilities do not have a formal process or plan for projecting or meeting workforce needs, according to survey conducted by APPA 10

11 Workforce Planning Cycle Strategic Direction and Operational Needs Progress and Results Human Resources Current Workforce Situation Goals and Strategies Gap Analysis 11

12 1. Assess Strategic Direction and Operational Needs Evaluate Progress and Results Assess Strategic Direction and Operational Needs Assess Current Workforce Situation To determine workforce issues for a set period of time: > Review the utility s strategic plan > Develop understanding of operational needs > Assess organizational structure > Understand the external environment Define Goals and Strategies Conduct Gap Analysis 12

13 2. Assess Current Workforce Situation Evaluate Progress and Results Define Goals and Strategies Assess Strategic Direction and Operational Needs Conduct Gap Analysis Assess Current Workforce Situation Develop an understanding of the utility s current situation and assess current internal strengths and weaknesses: > Review of vacancies > Turnover rates > Retirements and terminations > Why people are leaving? > Why people are staying? > Critical positions at risk > Workforce demographics > Competencies for positions 13

14 3. Conduct Gap Analysis Evaluate Progress and Results Define Goals and Strategies Assess Strategic Direction and Operational Needs Conduct Gap Analysis Assess Current Workforce Situation Build understanding: > Big picture (strategic direction and external environment) > Internal workforce needs and capabilities Conduct gap analysis: > Identify talent needs and compare to current talent pool > Determine staffing gaps > Identify competency gaps What is needed to have the right people with the right skills in the right place and the right cost? 14

15 4. Define Goals and Strategies Evaluate Progress and Results Define Goals and Strategies Assess Strategic Direction and Operational Needs Conduct Gap Analysis Assess Current Workforce Situation It is necessary to develop workforce: > Goals to focus efforts on actions that will address the most critical business issues > Key Performance Indicators to describe the results expected and track progress > Strategies and actions to achieve the goals > Recruitment > Training and development > Retention > Succession planning > Performance management > Organizational culture 15

16 5. Evaluate Progress and Results Evaluate Progress and Results Define Strategies Assess Strategic Direction & Operational Needs Conduct Gap Analysis Assess Current Workforce Situation Evaluate the success of the workforce planning efforts: > Were goals accomplished? > Any lessons learned? > Obtain leadership feedback on success of recruitment & hires > Conduct satisfaction surveys 16

17 CPS Energy A Practical Example

18 Workforce Snapshot CPS Energy > 3100 employees > 26% of the workforce is retirement eligible > 75% are Baby Boomers which increases likelihood of near term retirements (vs other eligibles more likely to be longer horizon) > 77% of the retirement eligible are in the transmission & distribution and power generation operational areas > The number of retirement eligible employees has remained steady in recent years driving the need for workforce and succession planning 18

19 Workforce Planning CPS Energy Actions > Role segmentation exercise Reporting > Categories = Mission Critical, Core, Support > Supported succession planning and talent development efforts (focus) > Emphasized need for knowledge capture/transfer for Mission Critical and Core roles with retirement eligible incumbents > Distributed annually (business unit level) prior to annual budget process > Include key questions to identify staffing needs and drive HR service delivery > Retirement eligibility data & projections > Turnover data with emphasis on roles with highest turnover and top reasons for turnover (may include review of exit interview data) > Workforce demographics (gender, generation and tenure) > Succession planning data 19

20 Workforce Planning CPS Energy Talent Pipeline Strategy > Intern programs for college and high school students increased emphasis on high school students > Educational partnerships with local colleges/universities to support employer talent needs and strengthen pipeline of interns as future employees > Input supports curriculum development > Includes community colleges with technical/trade curriculums for critical technician roles and other hard to fill roles > Define and align culture > Branding that attracts millennials > Supports recruitment, retention and engagement 20

21 Succession Planning CPS Energy > Process > Performance & Potential > Readiness Assessment > Development Planning > Talent Development > Job Rotation Program > Competency Profiles > Third Party Leadership Programs > Metrics 21

22 Succession Planning CPS Energy Performance & Potential 22

23 Succession Planning CPS Energy Readiness 23

24 Succession Planning CPS Energy Development Planning The 70/20/10 model is a learning and development method that blends different approaches to provide well rounded learning: > 70% Learning from Experience: from on-the-job experiences, tasks, and problem solving > 20% Learning from Others: observing others and/or obtaining feedback from others (manager, coach, mentor) and assessing what worked well or could have been handled differently > 10% Learning from Instruction: from courses, reading and other self-development methodologies (e.g. certifications) 24

25 Succession Planning CPS Energy Development Planning 25

26 Succession Planning CPS Energy Program Metrics The metrics below are monitored and reported annually to identify trends and gauge effectiveness: > Talent Readiness: number of executive positions with 2 ready now candidates > Internal Promotion Rate: rate of internal candidates utilized to fill executive positions vs external hires > Internal Talent Utilization Rate: percentage of employee movement (e.g. transfers, reorganizations, promotions) that results in promotion 26

27 Questions? 27

28 Contact Us Yvonne Morales Pelayo Dir., HR Policy & Programs People & Culture CPS Energy Patricia Cruz Senior Project Manager Leidos Engineering

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