Talent Management. In the Trenches

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Matthew McLaughlin
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1 Talent Management In the Trenches 1

President, SumTotal Systems Former CEO, Chair of Click2learn

2 About Kevin Oakes Background Founder, CEO of i4cp Former Chairman, Jambok Former Chairman, ASTD Board Founder, President, SumTotal Systems Former CEO, Chair of Click2learn Founder, CEO Oakes Interactive The Executive Guide to Integrated Talent Management 2

3 Who we are: i4cp focuses on the people practices that make high-performance organizations unique. 3

4 Defining High Performance High-performance organizations consistently outperform most of their competitors for extended periods of time. These companies performed better over the past five years, based on these four indicators: 1. Revenue growth 2. Market share 3. Profitability 4. Customer satisfaction 4

5 The 5 Domains of High Performance i4cp research has shown that high-performance companies excel in five core areas: 1. Strategy 2. Leadership 3. Talent 4. Culture 5. Market (customer focus) 5

6 What We Do i4cp helps organizations leverage the core domains of high performance through 4 delivery vehicles: 1. Research 2. Peers 3. Tools 4. Data 6

7 Grounded in High Performance 7

8 Recent Reports The Future of HR: Moving to Performance Advisor Leadership Competencies: Readying for the Future Critical Human Capital Issues of 2012 Effective Internal Communications The State of Employee Healthcare Benefits Measuring Time-to-fullproductivity Measuring Quality of Movement Talent Management in the Trenches Tying Pay to Performance Innovate or Perish: Building a Culture of Innovation 8

9 i4cp Network

10 Connecting Companies 10

11 The Growth Leaders of Tomorrow You have to be efficient and at the same time, more effective in transactions, in relationships, and as leaders of the business. That s a real change for HR from the early industrial relations experts of yesterday to the growth leaders of tomorrow. John Lynch CHRO 11

12 Impact/Contribution to the Business HR Continues to Evolve Add Value & Maximize Upside Strategic HR Planning Organizational Design Culture & Image Talent Management Survey Action Planning Staffing EEO/AA HR as Business Partner Limit Liability & Protect Downside Labor/Union Relations Safety & Workers Compensation Employee Relations Benefits Compliance Training & Development Compensation Performance Management A Century of Evolution in the Function HR Information Systems (HRIS) Labor Employee Personnel Human Organizational Relations Relations Resources Effectiveness 12

13 Uniting the silos 14

14 Higher-performing organizations (HPO) are more effective at managing talent Overall, to what extent is your organization managing talent effectively? 15

15 What do HPOs include in talent management? 16

16 HR Must Help Managers Be Better It s the manager s responsibility to manage the relationship with each one of his or her employees. HR is there to help managers be the best managers of people they can be. Karla Gehlen EVP of HR 17

About the Survey 271 participants took the entire survey 175 were from organizations with 1,000 or more employees Note: The data presented in this deck

17 About the Survey 271 participants took the entire survey 175 were from organizations with 1,000 or more employees Note: The data presented in this deck only represents this population; responses from companies below 1,000 employees were filtered out 145 were from Global or Multinational organizations 18

Description of Correlations MPI: the extent to which various TM practices and activities correlate (influence) market performance (market share, profitability, revenue growth, customer satisfaction)

18 Description of Correlations MPI: the extent to which various TM practices and activities correlate (influence) market performance (market share, profitability, revenue growth, customer satisfaction) Integration: the extent to which line managers involvement correlates with the Design, Development and Execution of TM practices and activities Design and Develop: Correlation with line managers involvement with only the Design and Development of TM activities Execution: Correlation with line managers involvement with only the Execution of TM activities 19

19 Core Findings 20

frontline managers are involved as partners in the

20 Line Manager Involvement in TM High-performing companies are more than twice as likely to say that frontline managers are involved as partners in the design, development and execution of TM processes and services. 21

21 Line Manager involvement in the Design, Development and Execution of TM is highly correlated with Market Performance 60 52% % 22% 44% 10 0 Execution Low Market Performers Design & Development High Market Performers 22

Integration is the key Our TM strategies are

a single overall TM strategy 48% 44% 0 10 20 30

22 Integration is the key Our TM strategies are created to be an integral component of enterprise-level business strategies 52% 65% Our TM functions are planned and executed as part of a single overall TM strategy 48% 44% High Market Performers Low Market Performers 23

23 Common Barriers to Involvement Unclear expectations Not enough bandwidth Lack of training Lack of support from HR Lack of accountability/metrics Lack of incentives/rewards 24

Positioning Talent Management 80 70 60 50 40 30

ensures that we will have the right people in

24 Positioning Talent Management % 72% 36% 58% Our TM strategy is a business issue, not just Our TM strategy an HR issue. ensures that we will have the right people in place to execute future business strategy. Low Market Performers High Market Performers 25

One U.S. retail chain I know of essentially has no HR department.

25 Putting HR Out of Business? I tell my team that if we are doing our job properly, we put the HR function out of work. One U.S. retail chain I know of essentially has no HR department. They have a corporate compensation function, but hiring, development, employee relations, etc., are vested with leaders and people in the field. Larry McClure SVP of HR 26

26 How Important is Mgr. Involvement? Learning and training High-potential employee development Leadership development Employee engagement Performance management Low Market Performers High Market Performers 27

27 There is a high correlation with market performance when line managers are involved in 5 TM practices 1. Learning and training 2. Employee engagement 3. High-potential employee development 4. Leadership development 5. Career/employee development Learning and training Employee engagement Low Market Performers High-potential employee development Leadership development High Market Performers 27 Career/employee development 28

28 but not these two Compensation & Rewards Low Market Performers Recruitment & Selection High Market Performers 29

Another View In Hertz we found that full involvement of frontline leaders in selecting the right staff increases retention and performance significantly.

Effective frontline management involvement shows better business results at Hertz, especially if frontline leaders act as coaches, providing real-time,

29 Another View In Hertz we found that full involvement of frontline leaders in selecting the right staff increases retention and performance significantly. If one couples this with effective onboarding and integration, frontline development shows its full potential. Effective frontline management involvement shows better business results at Hertz, especially if frontline leaders act as coaches, providing real-time, situational feedback. In contrast, there is a lot of evidence at Hertz that poor selection will, by definition, result in more remedial training, which is pure waste. Karl-Heinz Oehler VP, Global Talent Management Hertz 30

Specific areas of mgr. involvement that are correlated with high performance organizations 1. Conducting review of current talent utilization 2.

30 Specific areas of mgr. involvement that are correlated with high performance organizations 1. Conducting review of current talent utilization 2. Indentifying short and long term needs based on an understanding of the business strategy 3. Working with HR to manage and identify resource needs 4. Indentify future leaders within their part of the organization 5. Arrange for one-on-one coaching or mentoring 6. Maintaining data that can be used to inform staffing decisions for key roles 7. Indentify critical succession issues or needs 8. Accept or release employees for development assignments 31

Strategic Workforce Planning A raised bar for future business partners will mean that those professionals understand they must engage managers differently, asking such questions as, can we talk about

31 Strategic Workforce Planning A raised bar for future business partners will mean that those professionals understand they must engage managers differently, asking such questions as, can we talk about what your business will look like five years from now, what effect will that have on the talent you need and the skills they ll need? Let s have a conversation about where you re going. EVP of HR Financial Industry 32

Workforce Planning 50 45 44% 42% 50% 40 35 30 25 20 14% 21% 21% 15 10 5 0

business leaders during our strategic planning process.

32 Workforce Planning % 42% 50% % 21% 21% Our workforce planning is driven primarily by longterm business strategy, not by short-term demands for talent. Low Market Performers There is sufficient dialogue between HR/TM and business leaders during our strategic planning process. High Market Performers We have adequate ability/resources within our HR/TM organization to link workforce planning with business strategy. 33

33 Case Study When we think of talent management responsibilities for our frontline managers, we primarily think of employee engagement, retention, attraction, reducing turnover, and trying to provide a better work environment. Paul Humphries EVP of HR 35

34 Case Study Global electronics manufacturer More than 200,000 employees worldwide Majority of employees are hourly manufacturing employees, such as operators, technicians, materials handlers Frontline Manager Challenge: Engage and Retain Workers 36

35 Case Study The Capability Acceleration Program: Identified ten critical jobs in the organization and the necessary skills and competencies Frontline managers determine the best ways to develop those skills whether through online learning, classroom learning, or projects and assignments Humphries says, through training, the cream does rise to the top 37

36 Case Study Counseling and services for frontline workers: Majority of Flextronics employees are hourly workers in lower-cost regions (China, Brazil, Malaysia, Mexico, and Eastern Europe) Reside in company-managed dormitories away from their families, and face a degree of monotony in their work Related social, financial & quality-of-life issues affect performance Supervisors are involved in developing counseling programs and providing related services to help reduce turnover and improve recruitment These support services include online learning, self-improvement classes, Internet cafes, psychological counseling, talent shows and intramural sports 38

37 Case Study Process Improvement Efforts: Hourly employees are involved in many Lean Sigma and Six Sigma process-improvement efforts designed to reduce lead time, improve quality, and reduce non-value activities Frontline supervisors are trained to manage in a more collaborative way through effective one-on-one conversations, group discussions, and problem-solving Says Humphries, We ve been missing an opportunity to get the involvement of the direct employees. It s a huge population, and it can create a real differentiator. If our employees can find ways to each save just one dollar a day, we can save around $60 to $70 million a year. 39

they ve done a great job at using data analysis to help run their functions

38 The Importance of Data Analysis If you look at every other function that sits at the executive table whether it s sales, finance, marketing, operations, etc. they ve done a great job at using data analysis to help run their functions and justify their approaches. Charles Piscitello SVP and Chief People Officer 40

39 Next Practice? % 25% We measure the impact of investments in TM services on business measures Low Market Performers High Market Performers 41

40 Highest Correlation in Study (.37) 60 50% % We track key performance indicators, as well as results, for all of our TM processes. Low Market Performers High Market Performers 42

you give managers control of something they want control of

41 Accountability Counts I think managers should be held accountable for the success and development of their people If you give managers control of something they want control of anyway and you make it easy for them, it will work. Bob Morrissey CHRO 43

Measurement Matters Senior levels of management regularly review TM metrics. 29% 56% We employ human capital analytics to help answer specific business-related questions.

42 Measurement Matters Senior levels of management regularly review TM metrics. 29% 56% We employ human capital analytics to help answer specific business-related questions. 14% 39% TM metrics are used for strategic business planning purposes. 14% 36% We integrate both human capital metrics with business metrics to demonstrate the effective alignment between TM functions and the strategies of the enterprise. 7% 36% High Market Performers Low Market Performers 44

You ve got to be able to provide data, but also to tell people how to use

43 Lot of Data. Not Much Information. The HR function provides a lot of data but not information. You ve got to be able to provide data, but also to tell people how to use it to make educated decisions. That s information. Business leaders want information they don t want more data. Skip Spriggs CHRO 46

44 Today vs. 5 Years From Now Effectiveness Metrics: When HR translates data into meaning, business results emerge Currently effective at doing Expected effectiveness in 5 years Connecting human capital practices to organizational performance Identifying where talent has the greatest potential for strategic impact 24% 55% 27% 60% Supporting organizational change efforts 35% 66% Contributing to decisions about business strategy and human capital management 32% 61% Using advanced data analysis and statistics 22% 56% Providing high-quality (complete, timely, accessible) talent measurements 27% 59% 47

It makes work more interesting and creates greater impact when you can

45 Storytelling is Critical The ability to look at data and determine what it reveals is an amazing skill. It makes work more interesting and creates greater impact when you can tell an effective story. Taking complexity and making sense of it is such a value. SVP of HR Entertainment Industry 48

46 Lower-performers are often more likely to measure tactical recruiting metrics than higher-performers Number of recruiter requests 59% 68% Hiring cycle time 66% 82% Cost to fill Acceptance rate of first offers 57% 56% 46% 50% High Market Performers Low Market Performers Percent of offers accepted 45% 56% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 49

47 Higher-performers are more likely to measure quality of recruiting efforts than lower-performers Employee referral rates 39% 61% Cycle time to competency or full productivity Employee referral rates by specific segment 15% 19% 26% 43% High Market Performers Low Market Performers 0% 10% 20% 30% 40% 50% 60% 70% 50

48 Quality of Hire Scorecard 51

49 52

50 Attrition Metrics Tactical Finding: When comparing large organizations (10,000+ employees), there is no significant difference between higher- and lower-performers likelihood of measuring tactical retention metrics. 53

51 Attrition Metrics Strategic Finding: When comparing large organizations (10,000+ employees) higher-performers are more likely to measure who is leaving the organization than lower performers. 54

52 Quality of Attrition Scorecard 55

53 Quality of Attrition Scorecard 56

54 Promotion Rate Promotion Rate is defined as a change in job code and an increase in salary in the HRIS system of record including progression promotions, internal hires, development assignments 58

55 Internal Placement Rate Internal Hire is defined as a current employee is selected for a role that was posted on an external job board 59

56 Quality of Movement Scorecard 60

57 Questions to get started How does our organization s partnership between the business and the talent management function compare to the data in the survey? How are we holding managers at all levels accountable for their roles in TM? How are managers rewarded for these roles? What metrics clearly show the impact of talent management on the business? What s in the way of engaging line managers in key talent management processes and activities? 61

58 62

59 For More Information: First Avenue South, Suite 403 Seattle, WA, U.S.A i4cp (4427) 2012 Institute for Corporate Productivity, Inc. Member companies may reproduce and distribute this file on an unlimited basis to their employees for internal management purposes only. Nonemployees (including outside consultants) may not be given copies of or access to i4cp s reports, online services or conference materials. 63

60 Appendix: Data Tables 64

61 Correlated with Market Performance Conducting review of current talent utilization Creating career development plans for individual employees Indentify future leaders within their part of the organization Verifying that training has achieved the desired outcomes Arrange for one-on-one coaching or mentoring Providing one-on-one coaching and mentoring Maintaining data that can be used to inform staffing decisions for key roles Accept or release employees for development assignments Providing appropriate development experiences for those with the potential to move into key roles Participating in the delivery of key training activities Top 10 TM Activities Correlated with line manager s involvement with Design and Development Conducting review of current talent utilization Indentifying short and long term needs based on an understanding of the business strategy Working with HR to manage and identify resource needs Maintaining data that can be used to inform staffing decisions for key roles Accept or release employees for development assignments Arrange for one-on-one coaching or mentoring Distinguishing between average and top performers in both compensation and rewards Indentify critical succession issues or needs Indentify future leaders within their part of the organization Ensuring line of sight between effort and company impact Correlated with line manager s involvement with Execution Working with HR to manage and identify resource needs Making sure compensation is aligned with business goals Conducting review of current talent utilization Indentifying short and long term needs based on an understanding of the business strategy Accept or release employees for development assignments Indentify critical succession issues or needs Making sure compensation is aligned with business goals Maintaining data that can be used to inform staffing decisions for key roles Indentify future leaders within their part of the organization Arrange for one-on-one coaching or mentoring 65

62 Involvement of line managers in various workforce planning activities: and MPI Integration Design and Develop Execution Working with HR to manage and identify resource needs High Market Performers Low Market Performers HR Professionals Non-HR Professionals

63 Involvement of line managers in various workforce planning activities: and MPI Integration Design and Develop Execution Conducting review of current talent utilization High Market Performers Low Market Performers HR Professionals Non-HR Professionals

64 Involvement of line managers in various workforce planning activities: and MPI Integration Design and Develop Execution Indentifying short and long term needs based on an understanding of the business strategy High Market Performers Low Market Performers HR Professionals Non-HR Professionals

65 Involvement of line managers in various recruitment & selection activities: and MPI Integration Design and Develop Execution Selecting candidates High Market Performers Low Market Performers HR Professionals Non-HR Professionals

66 Involvement of line managers in various recruitment & selection activities: and MPI Integration Design and Develop Execution Defining the requirements of the position High Market Performers Low Market Performers HR Professionals Non-HR Professionals

67 Involvement of line managers in various recruitment & selection activities: and MPI Integration Design and Develop Execution Sourcing candidates High Market Performers Low Market Performers HR Professionals Non-HR Professionals

68 Involvement of line managers in various performance management activities: and MPI Integration Design and Develop Execution Collecting data for performance evaluations High Market Performers Low Market Performers HR Professionals Non-HR Professionals

69 Involvement of line managers in various performance management activities: and MPI Integration Design and Develop Execution Developing performance goals with measurable outcomes High Market Performers Low Market Performers HR Professionals Non-HR Professionals

70 Involvement of line managers in various performance management activities: and MPI Integration Design and Develop Execution Conducting performance reviews High Market Performers Low Market Performers HR Professionals Non-HR Professionals

71 Involvement of line managers in various performance management activities: and MPI Integration Design and Develop Execution Developing performance improvement plans High Market Performers Low Market Performers HR Professionals Non-HR Professionals

72 Involvement of line managers in various career/employee development activities: and MPI Integration Design and Develop Execution Creating career development plans for individual employees High Market Performers Low Market Performers HR Professionals Non-HR Professionals

73 Involvement of line managers in various career/employee development activities: and MPI Integration Design and Develop Execution Providing one-on-one coaching and mentoring High Market Performers Low Market Performers HR Professionals Non-HR Professionals

74 Involvement of line managers in various career/employee development activities: and MPI Integration Design and Develop Execution Monitoring progress of individual development plans (more than once or twice a years at performance appraisals) High Market Performers Low Market Performers HR Professionals Non-HR Professionals

75 Involvement of line managers in various career/employee development activities: and MPI Integration Design and Develop Execution Identify and recommend rotational or crosstraining assignments High Market Performers Low Market Performers HR Professionals Non-HR Professionals

76 Involvement of line managers in various succession planning activities: and MPI Integration Design and Develop Execution Providing appropriate development experiences for those with the potential to move into key roles High Market Performers Low Market Performers HR Professionals Non-HR Professionals

77 Involvement of line managers in various succession planning activities: and MPI Integration Design and Develop Execution Maintaining data that can be used to inform staffing decisions for key roles High Market Performers Low Market Performers HR Professionals Non-HR Professionals

78 Involvement of line managers in various succession planning activities: and MPI Integration Design and Develop Execution Indentify critical succession issues or needs High Market Performers Low Market Performers HR Professionals Non-HR Professionals

79 Involvement of line managers in various learning & training activities: and MPI Integration Design and Develop Execution Verifying that training has achieved the desired outcomes High Market Performers Low Market Performers HR Professionals Non-HR Professionals

80 Involvement of line managers in various learning & training activities: and MPI Integration Design and Develop Execution Monitoring training completion and compliance needs of individual employees High Market Performers Low Market Performers HR Professionals Non-HR Professionals

81 Involvement of line managers in various learning & training activities: and MPI Integration Design and Develop Execution Participating in the delivery of key training activities High Market Performers Low Market Performers HR Professionals Non-HR Professionals

82 Involvement of line managers in various learning & training activities: and MPI Integration Design and Develop Execution Providing input into training needs High Market Performers Low Market Performers HR Professionals Non-HR Professionals

83 Involvement of line managers in various leadership & highpotential development activities: and MPI Integration Design and Develop Execution Accept or release employees for development assignments High Market Performers Low Market Performers HR Professionals Non-HR Professionals

84 Involvement of line managers in various leadership & highpotential development activities: and MPI Integration Design and Develop Execution Indentify future leaders within their part of the organization High Market Performers Low Market Performers HR Professionals Non-HR Professionals

85 Involvement of line managers in various leadership & highpotential development activities: and MPI Integration Design and Develop Execution Arrange for one-on-one coaching or mentoring High Market Performers Low Market Performers HR Professionals Non-HR Professionals

86 Involvement of line managers in various compensation & rewards activities: and MPI Integration Design and Develop Execution Distinguishing between average and top performers in both compensation and rewards High Market Performers Low Market Performers HR Professionals Non-HR Professionals

87 Involvement of line managers in various compensation & rewards activities: and MPI Integration Design and Develop Execution Making sure compensation is aligned with business goals High Market Performers Low Market Performers HR Professionals Non-HR Professionals

88 Involvement of line managers in various compensation & rewards activities: and MPI Integration Design and Develop Execution Providing recognition for good performance High Market Performers Low Market Performers HR Professionals Non-HR Professionals

89 Involvement of line managers in various engagement activities: and MPI Integration Design and Develop Execution Ensuring line of sight between effort and company impact High Market Performers Low Market Performers HR Professionals Non-HR Professionals

90 Involvement of line managers in various engagement activities: and MPI Integration Design and Develop Execution Involving employees in departmental decisions that effect them High Market Performers Low Market Performers HR Professionals Non-HR Professionals

91 Involvement of line managers in various engagement activities: and MPI Integration Design and Develop Execution Meeting regularly with employees to monitor work satisfaction High Market Performers Low Market Performers HR Professionals Non-HR Professionals

92 Involvement of line managers in various engagement activities: and MPI Integration Design and Develop Execution Linking the employees interest with work assignments High Market Performers Low Market Performers HR Professionals Non-HR Professionals

93 For More Information: Corporate 411 First Avenue South Suite 403 Seattle, WA, U.S.A Telephone i4cp (4427) Fax Research 8950 Ninth Street North Suite 115 St. Petersburg, FL, U.S.A Telephone Fax Institute for Corporate Productivity, Inc. Member companies may reproduce and distribute this file on an unlimited basis to their employees for internal management purposes only. Nonemployees (including outside consultants) may not be given copies of or access to i4cp s reports, online services or conference materials. 97

FS2. Integrated Talent Management = High Performance. Kevin Oakes Institute for Corporate Productivity (i4cp)

FS2. Integrated Talent Management = High Performance. Kevin Oakes Institute for Corporate Productivity (i4cp) FS2 Integrated Talent Management = High Performance Kevin Oakes Institute for Corporate Productivity (i4cp) Integrated Talent Management Equals High Performance Kevin Oakes, CEO Institute for Corporate