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  • B.1: Respondents were asked to rate a number of different business priorities on a scale of 1-5, where 1 = not at all important and 5 = very important. B.2: Respondents also were asked to identify their three most urgent business issues (using the same list as above). Both Changing organizational culture and employee attitudes and attracting and retaining skilled staff were named by approximately 42% of respondents as one of their three-most urgent issues this year.  
  • Other diagnostic approaches do not track complete linkages and many do not provide evidence for the relationship to shareholder value HR Boutique – Mercer and Watson Wyett Survey House – Gallup Non-profit professional – Balanced Scorecard Collaborative Academic Research – Huselid, Becker, Ulrich Accenture is clear that we didn’t define this space, we are another player in this space, however, we have done our homework and understand the inherent deficiencies in the other models that are out there. For all other models, they haven’t collected data at all four levels and as a results create weak correlations and cannot predict causality between the tiers OR they imply causality and it hasn’t been established. Boutique – don’t consider some of the critical processes such as learning, leadership, etc. AND they simply jump straight from HC processes right to key business outcomes. These links will be very difficult to establish over time since we don’t understand the links to core capabilities and KPOs. Survey House – Gallup Q12 – 12 core areas that are required for superior performance. They focus primarily on the employee engagement box. And then tie employee engagement to business performance. Problem – does not provide evidence (although they make claims) between employee engagement LEAD to better financial performance. Correlation, but no causation. Non-profit professional group & Academic Research – these are both missing some of the key HC processes and although they may have made some statements correlating HC processes and business performance, they cannot really tell WHICH HC Processes are really responsible for the impact. These are Gallup’s 12 questions (Q12): Do you know what is expected of you at work? Do you have the materials and equipment you need to do your work right? At work, do you have the opportunity to do what you do best every day? In the last seven days, have you received recognition or praise for doing good work? Does your supervisor, or someone at work, seem to care about you as a person? Is there someone at work who encourages your development? At work, do your opinions seem to count? Does the mission/purpose of your company make you feel your job is important? Are your associates (fellow employees) committed to doing quality work? Do you have a best friend at work? In the last six months, has someone at work talked to you about your progress? In the last year, have you had opportunities at work to learn and grow?
  • These are Gallup’s 12 questions (Q12): Do you know what is expected of you at work? Do you have the materials and equipment you need to do your work right? At work, do you have the opportunity to do what you do best every day? In the last seven days, have you received recognition or praise for doing good work? Does your supervisor, or someone at work, seem to care about you as a person? Is there someone at work who encourages your development? At work, do your opinions seem to count? Does the mission/purpose of your company make you feel your job is important? Are your associates (fellow employees) committed to doing quality work? Do you have a best friend at work? In the last six months, has someone at work talked to you about your progress? In the last year, have you had opportunities at work to learn and grow?
  • First execution – you get a clear picture of how critical the HC processes really are and a baseline of data for Tiers 1 & 2 The second and third HCDF executions is where you can start to track HC processes to financial performance (overtime). Overtime Accenture will be building a strong multi-company database that will further prove the correlation between the tiers.

Accenture_HCDF_FOW.ppt Accenture_HCDF_FOW.ppt Presentation Transcript

  • Accenture Human Capital Development Framework Developed by the Accenture Human Performance Service Line & Accenture Institute for High Performance Business Project Overview
  • Workforce and HR Performance are a top Executive Priority… Source: The Accenture High-Performance Workforce Study 2004 … Yet few executives are highly satisfied with their progress on these initiatives
  • High Performance businesses are characterized by leading edge human capital capabilities. Human Capital Efficiency Workforce Adaptability Workforce Performance Talent Management Ability to Change Employee Engagement Leadership Capability High Performance Framework High Performance Anatomy Market Focus Distinctive Capabilities Human Capital Capabilities* * Tier 3 of Accenture’s Human Capital Development Framework
  • The Accenture Human Capital Development Framework is a tool to measure how well companies master these critical Human Capital Capabilities Productivity Quality Innovation Customers Key Performance Drivers Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Succession Planning Recruiting Workforce Planning Workplace Design Rewards and Recognition Employee Relations Human Capital Strategy Learning Management Knowledge Management Human Capital Infrastructure Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Workforce Performance Employee Engagement Workforce Adaptability Ability to Change Talent Management Leadership Capability Human Capital Efficiency Workforce Performance Employee Engagement Workforce Adaptability Ability to Change Talent Management Leadership Capability Human Capital Efficiency Change Management Revenue Growth ROIC or ROE (FS only) Total Return to Shareholders Future Value Illustrative Business Measures
  • The Framework produces a Scorecard indicating performance on all elements of the framework along with a detailed assessment of the results. Rewards and Recognition Employee Relations Human Capital Strategy Learning Management Knowledge Management Human Capital Infrastructure Change Management Workforce Performance Employee Engagement Workforce Adaptability Ability to Change Human Capital Efficiency Productivity Quality Innovation Customers Key Performance Drivers Business Results Leadership Capability Human Capital Capabilities Tier 1 Tier 2 Tier 3 Human Capital Processes Competency Management Career Development Performance Appraisal Succession Planning Recruiting Workforce Planning Workplace Design Tier 4 Talent Management Revenue Growth ROIC or ROE (FS only) TRS Future Value Illustrative Business Measures 3.4 3.2 2.8 3.3 3.2 3.7 3.8 3.2 3.2 3.6 3.0 3.8 3.3 3.5 3.0 3.2 3.2 3.4 2.9 3.2 3.1 3.9 3.7 3.0 2.7 Human Capital Efficiency Top Quartile Bottom Quartile Note: Numbers represent survey responses (means). Color codes indicate performance compared to benchmarks
  • Initial implementations of the Framework reveal that financially successful organizations have more mature human capital processes
  • Analysis of initial implementations of the framework have also answered important questions on the minds of executives today
    • What are the key activities that lead to a more engaged workforce? (see Outlook article, Harnessing the Power of an Engaged Workforce, February, 2005)
    • Are my assumptions about effectively managing and developing human capital correct? What are the surprising findings that go against common wisdom?
    • What processes most impact critical human capital capabilities like workforce performance, workforce adaptability, and leadership?
    • (see forthcoming Accenture white paper, The Accenture Human Capital Development Framework: Assessing, Measuring and Guiding Investments in Human Capital for High Performance )
    • 4. Where can I invest in people to get maximum value for my dollar?
    • (see Outlook article, Making the Right Investments in People , 2004)
  • Appendix
  • The Accenture Human Capital Development Framework
    • What: A diagnostic tool, that measures how well a company masters it’s human performance capability, and links the maturity of the organization’s human capital processes to business and financial outcomes.
    • Why: Enables organizations to set strategy, validate human capital investments and redirect investments for greater business impact.
    • How: Uses web-based surveys, executive interviews, and financial and HR data worksheets to collect perceptual and factual data.
    • Who: For use by any organization that wants to use a comprehensive, repeatable, metrics-based approach for managing their human capital programs and investments
  • The Accenture Human Capital Development Framework is much more comprehensive in scope than other frameworks. Accenture Human Capital Development Framework Survey House HR Boutique HR Scorecards Innovation Customers Key Performance Drivers Revenue Growth TRS Business Results Human Capital Processes Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Employee Engagement Key Performance Drivers Revenue Growth ROIC TRS Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Innovation Customers Key Performance Drivers Revenue Growth TRS Business Results Human Capital Processes Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Employee Engagement Key Performance Drivers Revenue Growth ROIC TRS Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Key Performance Drivers Revenue Growth ROIC TRS Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Key Performance Drivers Revenue Growth ROIC TRS Future Value Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Key Performance Drivers Revenue Growth ROIC TRS Future Value Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4 Key Performance Drivers Revenue Growth ROIC TRS Future Value Business Results Human Capital Processes Competency Management Career Development Performance Appraisal Recruiting Workforce Planning Rewards and Recognition Employee Relations Human Capital Strategy Human Capital Capabilities Tier 1 Tier 2 Tier 3 Tier 4
  • Other diagnostic approaches do not track complete linkages and many do not provide evidence for the relationship to shareholder value
    • Assesses one human capital capability only: employee engagement.
    • Simple and easy to implement 12 question survey administered to employees only.
    • Questions are very general and are unable to suggest the root cause of low or high levels of employee engagement, or suggest action-oriented advice concerning how to improve it.
    • Using standard measures across firms, Gallup has shown a correlation (not causality) between high levels of engagement and some intermediate and financial business results.
    • Comprehensive model that distinguishes between cause and effect, or between intermediate business results (tier 2) and current and future-oriented financial results (tier 1), and between HC processes (tier 4) and HC outcomes (tier 3).
    • Assesses the maturity of an organization’s processes, enabling the HCDF to suggest prescriptive, action-oriented advice
    • More accurate assessments based on input from employees, HR executives, business leaders, internal databases, and external benchmarks
    • Using standard measures across firms, the tool can show which HC processes most impact business results.
    Gallup Q12 Engagement Survey Human Capital Development Framework
  • Other diagnostic approaches do not track complete linkages and many do not provide evidence for the relationship to shareholder value (continued)
    • Does not use standard measures across firms, and thus can not offer users validation that human capital processes and capabilities impact business results. Rather, it offers a tool to be customized for the organization similar to the Balanced Scorecard. Over time, if both HC processes and business results improve in a single organization, a logical (but not statistical) connection may be made.
    • However, one of the developers of the HR Scorecard, Mark Huselid, has published research that shows a correlation (not causality) between some HC processes and financial results.
    • Links some human capital processes directly to financial results. Is not as comprehensive in its coverage of HC processes as the HCDF. Does not distinguish between HC processes and outcomes/capabilities, and does not include intermediate business results.
    • Assesses the effectiveness of HR programs by collecting data from HR personnel only. This enables some prescriptive advice about HR solutions, but it fails to assess the effectiveness of the programs in supporting employees.
    • Using standard measures across firms, the Human Capital Index has shown correlation (not causality) between HC practices and financial results.
    HR Scorecard/Huselid Watson Wyatt Human Capital Index
  • Data is collected through web enabled surveys, executive interviews and financial data worksheets. Time Commitment Audience 45 minute web based survey 5 – 15 HR Executives
    • Factual data collection (may be delegated)
      • business financial data (access financial Controller )
      • HR data web survey
    • Provide employee information for those taking the survey
    • Schedule interviews with executive committee
    • 1.5 days/week for 3 weeks then .5 days for 5 weeks to help manage effort
    Project Manager
    • Employees without supervisory responsibilities (~70%):
      • 20 minute web-based survey
    • Employees with supervisory responsibilities (~30%):
      • 30 minute web-based survey
    Cross section of 50 or more employees 30 - 45 minute structured interviews At least three executive interviews, one of which will be with an HR executive who can articulate the HR strategy, and two of which will be with business executives who can articulate the organization’s strategy . Executives
  • The first execution of the framework identifies strengths and opportunity areas. Subsequent executions measures the impact of human capital programs over time and allows identification of causal links. Company/Industry Data Collection Framework Execution 1 2 3 4 5 6 7…. Predictive Quality of Human Capital Investments First Execution Second Execution
    • Identify strengths, weaknesses, and process maturity in key human capital capabilities
    • Same as first execution plus…
    • Establish a baseline for measurement that makes it possible to track financial impacts over time
    • Identify causality between the tiers, not just correlation
    • Develop recommendations on specific actions to take to improve capabilities
    • Measure changes over time related to the effectiveness of human capital measurement
    • Provide a comparison of where the organization stands compared to benchmarks
    • Use as a significant input to operational/fiscal planning
    • Identifies workforce performance opportunities
    • Predict output of human capital investments
  • The Accenture Human Capital Development Benchmarking Database
    • Staffing firm
    • Motorcycle manufacturer (Harley-Davidson)
    • Professional services engineering/construction firms (2)
    • Equipment manufacturer (Briggs and Stratton)
    • Canadian utility
    • South African utility (Eskom)
    • Spanish utility
    • Software company (SAP America)
    • Mobile phone manufacturer
    • Government administration agency
    • Government defense agency
    • Investment bank
    • Insurance company
    • Retail/commercial bank
    • Health insurance provider
    The benchmarking database consists of approximately 35 organizations across 16 companies, across industries.