Report Out of Human Capital Research: Rewarding, Engaging, and. APQC Member Meeting November 4, 2010
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1 Report Out of Human Capital Research: Rewarding, Engaging, and Retaining Key Talent Rachele Williams, program manager, Research Services APQC Member Meeting November 4, 2010
2 APQC s Human Capital Research Open Standards Research global metric research and benchmarking based on open standards Detailed, complimentary benchmarking surveys across the human capital life cycle available at HR planning, policy, and strategy Recruiting Employee training and development Rewards and retention / Payroll Redeployment and retirement Managing employee information/communications (HRIS) Collaborative Research multiple organization l i best practices collaboration on common sets of issues or processes One to two collaborative research studies planned per year in human capital Collaborative research agenda can be found at genda.pdf Next collaborative research study (topic TBD) kicks off 3Q of 2010 Custom Research Customized benchmarking for individual organizations 2010 APQC. ALL RIGHTS RESERVED. 2
3 Human Capital Resources on the Knowledge Base The Knowledge Base (KB) has a wealth of information on metrics, measures, andbest practices in human capital for members in the following topics: Recruiting Employee training and development Leadership development Talent management Succession planning Work force planning To register for the KB, go to and follow the prompts under Free Registration on the upper right APQC. ALL RIGHTS RESERVED. 3
4 Scope of the Research During this collaborative research study, we examined four areas: Employee rewards, engagement, and retention strategy Processes for rewarding, engaging, and retaining key talent Employee rewards, engagement, and retention practices Outcomes and measurement 2010 APQC. ALL RIGHTS RESERVED. 4
5 Collaborative Research Methodology Identify potential best practice partners Invite them to participate in the study Holdkickoff call Finalize data collection tools Planning Collection Adapt/Report t Participate in virtual site visits with bestpractice partners Collect information from the best practice partners using the data collection tool(s) Write case studies Analyze data Identify key findings, critical success factors, and enablers Analysis Hold virtual knowledge transfer session Discuss key findings, critical success factors, and enablers Share sponsor key findings 2010 APQC. ALL RIGHTS RESERVED. 5
6 Study Participants 3M AARP ConocoPhillips Co. Deere & Co. Infosys Technologies Ltd. Johnson & Johnson Occidental Petroleum Corp. Schlumberger Ltd. U.S. Army ARDEC 2010 APQC. ALL RIGHTS RESERVED. 6
7 Special Adviser Marc Drizin 2010 APQC. ALL RIGHTS RESERVED. 7
8 Employee Engagement Definitions and Strategy
9 Engagement g Defined Engagement gg is an ongoing gprocess to enhance the understanding of employee perspectives and organizational practices in an effort to recruit, retrain, reward, and retain talent. Employee Hold em Holdem An individual s sense of purpose and focused energy, evident to others in the display of personal initiative, effort, and persistence directed toward organizational goals. 3M Possessing passion for work he/she performs at the organization. Infosys Motivation of its employees is a core value, along with a commitment to technology and a determination to produce superior profits. Schlumberger 2010 APQC. ALL RIGHTS RESERVED. 9
10 Responsible for Employee Engagement g Best practice organizations partner with line managers and the business on employee engagement, with championship from senior leadership. Senior leadership backing and support is critical to employee engagement gg efforts within an organization. HR is a key facilitator of engagement and provides tools, templates, and processes to the organization. Ultimate responsibility for employee engagement rests with front line supervisors and managers APQC. ALL RIGHTS RESERVED. 10
11 Integration in Overarching Talent Management Best practice organizations integrate employee engagement with the recruiting and employment branding strategy. Recruiting/ Selection Performance Evaluation/ Management Employee Engagement Training and Development Rewards and Retention 2010 APQC. ALL RIGHTS RESERVED. 11
12 3M Example: Integrated Employment Brand Model Internal International Branding tool kit Traveling booth Internal Web sites Video contest DVD Internal commercials External External Web sites Events Multimedia exposure Corporate recognition External metrics Community activities 2010 APQC. ALL RIGHTS RESERVED. 12
13 Employee Engagement Process
14 Employee Feedback Mechanisms Best practice organizations gather employee feedback from multiple listening posts. Infosys examples: LITMUS survey Let s Interact on Themes that Matter to Us (LITMUS), an online employee engagement survey of issues that matter to its employees. Managers Portal a comprehensive Web site that serves as a communication platform for Infosys managers worldwide to share, assimilate, and analyze relevant business information HRD Blog a platform via which employees communicate with the HR head on various issues concerning them My Infosys a communication platform for employees to share their inputs and suggestions on various policies affecting them on an ongoing basis 2010 APQC. ALL RIGHTS RESERVED. 14
15 Feedback is ACTED upon Each regional group and technology center forms an action plan to address feedback from the survey. Top categories of actions Total Actions in Scorecard Number Complete Percent Complete % APQC. ALL RIGHTS RESERVED. 15
16 Employee Engagement Practices
17 Opportunities for Personal and Professional Development Best practice organizations provide meaningful and challenging work to all employees. The fundamental tenets of what comprise an engaged employee are the same despite age, gender, position in the company, region, or culture. The work provides them an opportunity to develop both personally and professionally. The desire for meaning and purpose in the workplace knows no borders. Vice president of talent solutions, 3M 2010 APQC. ALL RIGHTS RESERVED. 17
18 Tenets of Employee Engagement g at 3M Treat people fairly, through accountability and rewards, respect and warmth, and procedural fairness (by keeping promises, involving people in decision making, creating an operational rhythm, and distributing work equitably). Pay attention to the seemingly mundane, such as technology, support, and internal battles. Recognize and celebrate lb employee successes APQC. ALL RIGHTS RESERVED. 18
19 Employee Development at Infosys» Part time and distance education programs Entry level training» weeks comprehensive finishing school» Benchmarked against U.S. standards Higher education Continued education» Three tiered program focused on strategic, business, and operational leadership roles» Competency enabling for better management for self, teams, clients, and business Leadership development ILITE and e learning» Certification programs aligned with career streams» STAR role based training for competency building» Web based integrated training management system» 25 percent of training through e learning modules 2010 APQC. ALL RIGHTS RESERVED. 19
20 Customized Engagement Tactics Best practice organizations customize key talent management practices, where appropriate, to maximize engagement and retention. Employees are sophisticated consumers. A one size fits all approach does not work. Senior vice president and head of HR, Infosys SLB example: Career Orientation Reviews: One on one review of employee career objectives Every five years for all high value employees Ad hoc for other employees Thoroughdebrief of employee career so far Search for overlaps between employee expectations and company requirements Five year and ten year perspectives Results consigned to the HR database 2010 APQC. ALL RIGHTS RESERVED. 20
21 3M Retention Study Tailor employee messages, programs, and policies to meet the needs of specific groups: In it to win it Want career advancement, pay, and stock options In it for their family Want good benefits, 3M reputation and stability is important, flexible schedule In it to experience it Want supportive supervisors who teach, international travel, and a breadth of opportunity across functions 2010 APQC. ALL RIGHTS RESERVED. 21
22 Social Media to Engage Employees Best practice organizations use virtual collaboration and social media to create a sense of community between employees and the employer. Each best practice partner uses social media to create a sense of community among its employees around the world. Schlumberger BlueTube Infosys Infosys YouTube 3M Ideadirect 2010 APQC. ALL RIGHTS RESERVED. 22
23 Schlumberger CNPs 2010 APQC. ALL RIGHTS RESERVED. 23
24 Engagement and Training and Development: Onboarding Best practice organizations train employees in order to increase their engagement and magnify engagement efforts. The best practice partners have created extensive, formal new hire onboarding and entrylevel training. Schlumberger places new hires from universities into a three year technical or sales training program. Infosys enrolls new hires in a three to six month finishing school APQC. ALL RIGHTS RESERVED. 24
25 Engagement and Training and Development: Supervisors/Managers Supervisors and managers are engagement agents, the vital lynchpin between policies and execution of those policies. 3M use of short, targeted training videos Schlumberger offers different training depending on the experience level of the supervisor 2010 APQC. ALL RIGHTS RESERVED. 25
26 Engagement and High Potential/Leadership Training Engaged dleaders are themselves an area of continuous focus for training and development Leaders engage employees as a key leadership competency. Employees who receive training and development are more engaged. Leaders who receive training and development in order to engage others stay actively engaged as well APQC. ALL RIGHTS RESERVED. 26
27 3M Leadership Development 2010 APQC. ALL RIGHTS RESERVED. 27
28 Rewards and Recognition Best practice organizations create a rewards and recognition culture. The best practice partners have moved beyond the typical rewards strategy. Different rewards appeal to different types of employees. The partners use training and career opportunities (career ladders and career lattices), discretion over work, enhanced dflexibility l in work/life bl balance, etc APQC. ALL RIGHTS RESERVED. 28
29 Tangible Rewards We think in terms of total compensation for example, base pay, variable pay, stock options, and restricted stock units. Fair total compensation is a key foundation for all employees. Withoutit it, learning, growth, anddevelopment development are irrelevant. 3M Having the right salary for retention is fundamental. People won t leave the organization because of their salary; but if they are unhappy with their salary, it is the last straw. When the employee is dissatisfied and the salaryis not right, they start to think about moving elsewhere. Schlumberger 2010 APQC. ALL RIGHTS RESERVED. 29
30 Creating a Reward and Recognition Culture Through Performance Based Pay Best practice organizations reward employees based on performance, not tenure. 60% 50% Percentage of Salary that is Performance Related Pay (Median) 50% 40% 30% 20% 28% 15% 30% 20% 10% 0 7% Senior management/ Middle management/ Operational workers/office Executive Specialist ilit staff tff All Participants Top Performers 2010 APQC. ALL RIGHTS RESERVED. 30
31 Creating a Reward and Recognition Culture Through Work/Life Balance Best practice organizations take a comprehensive view of work/life balance. Work/life balance: Beyond flex time Beyond work from home policies The best practices cover: Health and safety Fitness Family friendly benefits Support for dual career families And the pursuit of dreams 2010 APQC. ALL RIGHTS RESERVED. 31
32 3M Healthy Living Resources A diversified, four part program designed to: Lower our long term health care costs and enhance employee productivity Reduce the demand for costly medical interventions and minimize employee productivity loss Help employees better manage their lives physically, socially, and emotionally Other employee objectives: Engagement Recruitment Enhance organizational commitment 2010 APQC. ALL RIGHTS RESERVED. 32
33 Engagement g During Times of Change The best practice organizations are aggressive in their efforts to retain talent during economic downturns and organizational changes. Role of the Schlumberger integration manager during an acquisition: Is in place for the complete lt duration of the integration ti process Is an essential component of the management team but does not replace the current HR manager Is focused solely on employee integration 2010 APQC. ALL RIGHTS RESERVED. 33
34 Retention of Key Talent at Schlumberger Identification of at risk populations: By the HR function Cross referenced referenced by business segments and geographies Continuous monitoring Immediately brought to the attention of executive management, for preventive action 2010 APQC. ALL RIGHTS RESERVED. 34
35 Employee Engagement Outcomes and Measurement
36 Engagement and Performance Management Best practice organizations hold leaders responsible for employee measures. The responsibility for employee engagement is placed at the feet of supervisors and managers, with executive championship pprovided by senior executives and support, tools, templates, and guidance from corporate HR. Build responsibility for engagement into leadership competencies. Build responsibility for engagement through hthe organization s performance management practices APQC. ALL RIGHTS RESERVED. 36
37 3M Leadership Competencies Thinks from outside in Drives innovation and growth Develops, teaches, and engages others Makes courteous decisions Leads with ihenergy, passion, and urgency Lives 3M values 2010 APQC. ALL RIGHTS RESERVED. 37
38 Engagement g and Business Outcomes Best practice organizations link employee engagement gg with business outcomes. How do the dil daily interactions ti employees have with their organization affect their attitudes, behaviors, actions, and the organization s success? 2010 APQC. ALL RIGHTS RESERVED. 38
39 Building a Stronger Brand Start Here! Employee Engagement Customer Engagement Share of Customer Sales Revenue 2010 APQC. ALL RIGHTS RESERVED. 39
40 Model of Employee Engagement Positive business outcomes Outcomes of an engaged work force: stay longer work harder recommend the organization Desired state: engaged work force Attraction Motivation Retention Components: Reputation management Work force selection Organizational orientation Components: Performance management Rewards and recognition Work/Life balance Stakeholder input Opportunities for advancement Training i and development Tools and technology Components: Daily satisfaction Effective senior leadership Ethics, diversity, and safety 2010 APQC. ALL RIGHTS RESERVED. 40
41 Questions/Discussion Rachele Williams, program manager, research services
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