All of us in the human capital community have some level of experience with implementing and utilizing HR technology.  Some have been successful long term implementations with strategic business plans in place– but many of us have seen that is the exception rather than the rule.  What are successful companies doing to make their technologies work for their people and their bottom line?

With ten years of survey data, and lots of experience doing business cases for HR technologies, Lexy Martin of CedarCrestone authored a white paper on how to use that material to support business case development. The Value of HR Technologies: Metrics and Stories seeks to uncover the value organizations have achieved from various workforce technologies from looking at ten years of research as well as through three in-depth customer case studies showcasing the benefits and impact these organizations achieved from these technologies.

Join us for this eye opening free webcast  (July 31 at noon e.t.) that looks at how in-depth research can change the way we view HR technology. We’ll highlight the United Nations’ substantial cost savings from its global integrated ERP implementation in human resources, finance, and customer relationship operations; Applebee’s common-sense approach to creating a talent management-based organization in an industry with incredibly tight profit margins and how it helps them open new sites; and Oracle’s groundbreaking use of Web 2.0 tools, integrated with HCM technologies, and areas that may over time show hard dollar savings. These real life studies will showcase how your organization can increase efficiencies and ultimately improve the bottom line.

 

A recent Human Capital Institute Webcast touched off a torrent of questions and comments by our HCI members.   David Marzo , Vice President, Solutions Architecture , The Newman Group and Frank Horvath , Principal Consultant , The Newman Group presented this webcast– and they were gracious enough to guest on this blog today and answer some of your questions.  Here are their answers to the queries:

 

Erin asked: In applying the P&L mentality to talent management, how do you recommend determining ROI on talent quantitatively (specific to training and, on a separate note, project based role)? What factors are most important when considering talent ROI?

Hello Erin:  Our recommendation in determining P or L is based on a simple business/mathematical formula:  (labor expense – reduction in labor expense – operating expense + profit margin = P or L).  Your question about ROI, specifically in regards to training and a project based role will have to be determined on the labor expense divided by the training dollars invested.   A specific example that quantitatively made an impact was with a client that that invested in sales training.  We calculated the dollars invested in the training, labor expense on the books and the amount of additional revenue that was generated after the training was conducted.  We then compared current investment in sales labor expense to return on investment for training and sales revenue generation.

Andrew asked: I’m curious when best practice might not be best for the organization: 

Hello Andrew: Best practices are not “best” for an organization when that practice does not align to your business strategy.  We’ve counseled many business leaders to critique best practices for lessons learned and creative solutions to solving their business problems.  There is not a “one size fits all best practice”.  The key is to “adapt” not “adopt” a “best practice” for your organization.  A best practice and/or approach that has been successful for one organization may not be the right practice and/or approach for another.  We believe that using “best practices” is an opportunity to have discussions relating to what practice or approach will generate success within your own organization.  This is based on the business problem/challenge you are trying to solve, your cultural and other strategic alignment considerations.

Sherryl asked: How aligned are these maturity levels with People CMM?

Hello Sherryl: Great question.  The maturity levels referenced (as part of the presentation) have no formal alignment with SEI’s People CMM (PCMM) framework. The maturity levels were qualitatively developed by The Newman Group based on our experience working with a diverse group of Fortune 500 companies and presented as a self-assessment tool. 

Len asked: How do you define competency vs. skills? Another word what is the deference between skill set and competencies?

Hello Len: Competencies are behavioral based and often come as a result of direct experience. Skills are often task oriented and can be easily trained. A good example is what I read on an IT blog some time ago – “being proficient in Excel is a skill whereas analytical thinking is a competency”. Some people are gurus at manipulating Excel spreadsheets but don’t know how to interpret the results.  Conversely, some people can analyze and interpret the data but don’t know how to fully utilize the spreadsheet.

Todd asked: Is there a difference between designing the organization around critical roles vs. operational requirements? I’m not clear what it really means to design the organization around critical roles.

Hello Todd:  We find that most organizations start their organization design with an org charts, job descriptions, and functional reporting relationships.  There is typically little if any dialogue with the business leaders to determine how best to achieve operational requirements.  Our point of view is that from an Organization Design and/or Workforce Planning perspective, you want to understand what jobs are most critical to meeting your business objectives.  There is no “vs.” between critical roles and operational requirements.  They must be aligned.  This boils down to the roles that have the most significance to achieving your business goals and objectives. You’ll want to define the roles that are critical today and into the future to ensure you’re aligning your talent to the business outcomes you want to achieve.

Sherryl asked: Do you find that HR execs are able to convey this “big picture” end to end TM focus, or do they still get hung up on facets, like OD, training, etc?

Sherryl: As a consultancy, we’ve been fortunate to work with some dynamic business leaders who have the ability to create a vision and therefore communicate an idealistic state – one that aligns all of the HR functionalities to business strategy, objectives and/or priorities. The majority of our clients (i.e. HR executives) understands and appreciates the importance of better engagement with their business counterparts and wants to integrate their delivery of HR services.  On the other hand, we know there is a lot of literature published about “getting a seat at the executive table”, “talent management”, “HR strategy” and “HR value propositions”.  While all this is information is helpful in the evolution of our impact as HR practitioners, we believe that the only way to truly impact the P&L is to quantify the our contributions to the business.

Brenda asked: Can you define CRM?

Hello Brenda: Apologies for the use of an acronym. CRM stands for a couple of things but in the context of our presentation and within the general recruitment industry represents “Candidate Relationship Management”. The activities and efforts that allow for relationships with candidates that can be maintained (effectively managed) over time.

Len asked: What are some of the key business measures that you have recommended to your clients?

Hello Len: We are often asked about metrics and more specifically metrics that actually make a business impact. Staffing.org and others maintain a strong opinion on metrics and what should be measured. We continue to see companies evaluating metrics like: Quality of Hire, Time to Contribution (or Competence). These metrics require data from multiple sources but begin aligning talent acquisition efforts with post hire activities (i.e. developmental planning, learning & development, etc).

Peterson asked: You mentioned early in the presentation that some large organizations are doing workforce planning very well. We have been looking at this topic for some time and have not seen anyone of our size ($16bil/85k employees) who is doing it well or in a systematic way. Can you comment on how they are doing workforce planning?

I’d start by saying that we feel workforce planning is the strategic aspect of talent management that will influence other (HR) functional activities such as talent acquisition, learning & development and succession planning. Our research validated that 1.) There is no universal definition and 2.) Many companies have attempted to do workforce planning on a large scale and have failed because a systematic approach was not taken. The late Thomas P. Bechet did great work in this area and provided several frameworks for doing workforce planning. The Conference Board published a report on several companies who doing workforce planning and has identified five approaches to workforce planning which included:

1.      Traditional (i.e. Headcount Gap Analysis)

2.      Workforce Analytics

3.      Forecasting & scenario Modeling

4.      Strategic Workforce Planning

5.      Human Capital Planning

Do you have questions or comments? Join the conversation here!

 

 

 

 

 

 

 

 

Tomorrow the Human Capital Institute will be hosting a free webcast devoted to this topic, presented by Judy Sweeney, VP and Head of Research at Taleo.  We talk extensively about the who’s and the what’s of the multi-generation workplace, but what are we doing in practicality to attract, inspire and retain these future leaders? Is your human capital initiative in line with the future leaders of your organization?

A study by the Chartered Management Institute uncovered the following:

“Careers literature on Generation Y suggests the growing development of microcareers, where tenure in any job is much shorter, and characterises young managers as highly impatient and far more willing to move jobs regularly. Although the findings demonstrate a trend towards shorter stays with any one organisation for a third of young managers, there is still a significant proportion of the sample who are staying on a longer term basis: 31 per cent had been in their current jobs for more than 6 years and 32 per cent had been there between 3 and 5 years.”

So– one of our funademental problems is retention, always.  Yet this is not about workplace generalizations, it’s about workplace strategies that work for the long term.  Join us at noon e.t. on 7/15 to share your best practices– and learn some new ones.

In the past, companies handled talent management as a simple cost of doing business. “Personnel” was a necessary evil– remember Dilbert’s Catbert, the Evil HR Manager? Today, talent is taking its place among finance, sales and operations as a key driver of business strategy. Just as an emphasis on Profit and Loss  drives strategy for finance, sales and operations, the same P&L implications also apply to talent.  Yesterday , David Marzo , Vice President, Solutions Architecture , The Newman Group and Frank Horvath , Principal Consultant , The Newman Group addressed that topic on a Human Capital Institute Webcast.  Dave and Frank cut through the “consultant noise” and defined what it’s all about:      

Talent Management + Talent Acquisition + Workforce Planning + Organization Effectiveness + Succession Planning + Competency Mgmt = the Right People, at the Right Time, in the Right Role, AT THE MOST ECONOMICAL COST   

We had a great webcast and here are some of the questions that you– our HCI members– asked:

How aligned are these maturity levels with People CMM?

How do you define compentcy vs skills. Another words what is the difference between skill set and competencies?

Is there a difference between designing the organization around critical roles vs. operational requirements? I’m not clear what it really means to design the organization around critical roles.

 In applying the P&L mentality to talent management, how do you recommend determining ROI on talent quantitatively (specific to training and, on a separate note, project based role)? What factors are most important when considering talent ROI?

 Do you find that HR execs are able to convey this “big picture” end to end TM focus, or do they still get hung up on facets, like OD, training, etc?

 What are some of the key business measures that you have recommended to your clients?

 You mentioned early in the presentation that some large organizations are doing workforce planning very well. We have been looking at this topic for some time and have not seen anyone of our size ($16bil/85k employees) who is doing it well or in a systematic way. Can you comment on how they are doing workforce planning?

Great questions, HCI members. Let’s discuss! 

Yesterday I blogged about the stratospheric rise of the economies and populations of China and India and their surging economy– obviously something that has a huge impact on talent strategy and the global marketplace.  Today that’s tempered with a few words of warning, things you may want to know about your global partners.

Combined, China and India represent over 2/5ths of the worlds population. Put in a different light: nearly half of the global workforce.  

Yet we need to temper that with a few cold realities.  Socially, economically and politically these countries each have issues that undermine their ability to assimilate quickly to a global economy.  Yale Global writes:

“Both China and India are still desperately poor countries. Of the total of 2.3 billion people in these two countries, nearly 1.5 billion earn less than US$2 a day, according to World Bank calculations.  For all its Nobel Prizes and brilliant scholars and professionals, India is the largest single-country contributor to the pool of illiterate people in the world.”

We’ve also all heard about procurement issues in China, notably in 2007.  Knowledge at Wharton recently interviewed Marshall W. Meyer, professor of management at Wharton, who has made many trips to China to research the rapid growth of its economy and the successes and difficulties it has had in growing so quickly. In this interview, Meyer discusses the recent controversy surrounding China’s exports of substandard toys and pharmaceuticals to the United States, and the implications for supply-chain management.

I encourage you to read this series– some real opening information about the status of SCM and its economic impact.  Are these issues affecting your TM strategy?

Tony Blair recently spoke at Yale’s2008 Class Day. He noted that “for the first time in many centuries, power is moving East. China and India each have populations roughly double those of America and Europe combined. In the next two decades, these two countries together will undergo industrialisation four times the size of the USA’s and at five times the speed.”

For those of us who work in global organizations– and that’s nearly everyone– those figures are stunning.  Think about the implications of 4x the size and 5x the speed of what’s occuring in America right now.  Bring those numbers down closer to home– 5x the speed of your company, your department, your job. 

Dominic Barton wrote in the McKinsey Quartely “Whether or not you do business in China, you can’t ignore it. Everyone knows the superlatives: how it consumes a huge percentage of global resources—25 percent of the world’s steel and 50 percent of the world’s cement, for example; how it is home to some of the largest companies on Earth, four of which cracked the most recent Fortune Global 500 list; how its economy will soon rival those of leading countries such as France and the United Kingdom.”

Executives around the world expect competition from Chinese companies to increase, mainly because of their low production costs, yet surprisingly few are acting to meet the threat, a McKinsey survey shows. A separate survey of executives based in China reveals widespread global ambitions.

So if those are all the superlatives, what are the obstacles?  What do we as talent strategists need to understand to compete and partner in a global economy?  Part II of this blog will focus on Eastern business, social and generational problems– but in the meantime– what are you and your company doing to understand increasing global competition and partnerships?

According to a recent conversation with John Challenger, CEO of Challenger, Gray & Christmas– a lot.

“The country is coming to terms with permanently higher gas prices,” Challenger says.

Employees are hurting, and companies are responding by offering compressed work schedules, four-day weeks, telecommuting, gas cards and car-pooling.

These are more than short-term fixes, Challenger says. They are the beginning of a revolution in the office that will result in productivity being the central value of work, rather the number of hours logged by employees. They also dovetail with other trends like globalization and a 24-hour view of the workday that accommodates all time zones—Asia, Europe and the United States.

Tom Knight, a partner with Axiom Consulting Partners in Chicago agrees.  His recent study with Mark Masson highlights the need for companies to develop creative compensation in the face of an impending recession.  In this paper that speaks specifically to sales professionals, Knight notes “as the administrator of the sales compensation plan, HR professionals are uniquely positioned to leverage these insights to develop contingency plans. When designed and executed well, contingency plans not only optimize sales costs, but also motivate and retain sales professionals, thereby enabling the company to emerge stronger and more competitive from a down economy.”

A recent conversation I had with a senior account executive highlights the need for creative planning. Faced with a 60 mile round trip commute and little increase in 2008 base salary, he struggled with the decision to take a job closer to home.  A savvy HR department caught wind of this and set up a plan for him to telecommute 3 days a week. He stayed with the company; they averted the need to recruit a new sales star.  A smart decision all around– attract, retain, motivate. Isn’t that our mantra?

Let’s start a conversation– what is your company doing to be creative in a tough economy? What best practices can we share?

Who won?

Dr. John Sullivan recently wrote in his blog that the war for talent is over. Guess what? The candidates have won.  Of course this is up for debate, but we as human capital professionals are all –now more than ever– cognizant that high performers are in high demand.  So …what does this mean for hiring managers and HR execs? Are we ready to surrender to our candidates and do whatever it takes to retain, grow and attract our workforce?

No, of course not. We just need to be smarter, more strategic and more in tune with the best practices. Alice Snell, VP of research at Taleo, writes in her blog about what companies view as their HR challenges in 2008:

Welcome to the Talent Strategy corner of the world! It’s my distinct pleasure as the Director of Talent Strategy at the Human Capital Institute to share and collaborate with you on webcasts and magazines, and this blog will provide us with an additional space to become better informed, exchange ideas and develop best practices.  If you haven’t taken a look at what HCI offers, I encourage you to take a look at our thought provoking content.

So what is your view of the talent strategy world?  Each of the blog entries you’ll see posted here will provide a new– possibly (and maybe hopefully!) controversial — view of what the trends are in our world.  Together, they’ll tell a cohesive story of where we have been , where we are, and where we are going as a talent management community.