HR omissions, things that HR should do but doesn't delete


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A list of powerful practices that most HR departments don't use

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HR omissions, things that HR should do but doesn't delete

  1. 1. IMPACTFUL THINGS HR SHOULD BE DOING… BUT IT OFTEN DOESN’THigh-impact “Omitted Practices” to Consider 2011 © Dr. John Sullivan Professor, Author and Advisor to Management WWW. 66
  2. 2. Goals for today1. To make you think • But rather than thinking about improving your current practices • Instead, to get you to think about… what you’re not doing • And to consider adding 1-2 omitted practices that would really improve productivity 2
  3. 3. Is this the reason for the lower productivity?We proudly manage exclusively using the…Homer Simpson principles of management 3
  4. 4. The process I used for identifying these practicesI studied the most innovative HR firms to identify “next practices” (Google, Microsoft, Facebook etc.)Next, I examined the best practices of highly effective/well-funded business functions… to identify “omitted practices” that could be transferred into HR (Finance, supply chain etc.)I will have met my goal… if your reaction to at least a handful of these “omitted” practices is… “that makes sense, I wonder why we don’t do that? 4
  5. 5. Let’s look at omitted HR practices 12+ “next” and “omitted” practicesthat can increase productivity and… HR’s impact (with examples) 5
  6. 6. Next practice - Reward great people managementProductivity problem Many managers don’t spend much time or take their people management responsibilities seriously Although HR “owns” all of the key components (performance management, performance appraisal, competencies and reward systems), we do not usually reward people management performance What percentage of firms reward managers for (39%) 6 their performance on people measures
  7. 7. Next practice - Reward great people managementActions to take Develop a “people management scorecard” for each manager Measure, report and reward managers for outstanding people management results (reward through bonuses and requirements for promotion)Benefits What is measured, reported and rewarded is… done first and done best Mgrs. have already learned to respond to rewardsAn example > 7
  8. 8. Ex. – Quarterly people management scorecardName _________________ Dept._________ Below aver.Quarter # ______ Bot. 10% Top 25% Average Top 5%Key people mgmt performance factors 1.Team productivity & quality 2.Employee innovation impacts 3.Quality of hires 4.Retention of key employees 5.Development of leaders 6.Internal release of developed leaders 7.Employee satisfaction with feedback 8.Best practice sharing Average combined rating on the 8 factors ______ 8
  9. 9. Next practice – Identify productivity barriersProductivity problem Managers operate in a competitive world... that forces them to periodically increase productivity HR must offer help in the form of internal productivity consultants (IPC) I have found that the most effective approach for increasing productivity… is to utilize employees to identify and remove the barriers that prevent productivity improvement HR productivity consultants can help execute the process 9
  10. 10. Next practice – Identify productivity barriersAction Institute a productivity barrier identification and removal process which includes… surveys & small groups to identify the barriersBenefits When employees and managers are given the right tools, they excel at identifying these barriers Many barriers are relatively easy to break down Productivity can increase by double digits within monthsAn example > 10
  11. 11. Productivity improvement process Identify barriers to productivity “I need you to increase output by 25%, help me toidentify the factors that prevent you from doing that?” (200% in two months) 11
  12. 12. Productivity problems come from 20 key factors1. The manager 12.Prioritize to max2. Hiring/ retaining top ee’s impact / focus3. Learning/ sharing 13.Info. for better decisions4. Clear goals / 14.Team member capability5. Motivation/reward/ engage 15.Tools and equipment6. Employee skills degrade 16.Inputs/ raw materials7. Right job placement 17.Resources & budget8. 2 way communications 18.A lack of integration9. Performance metrics 19.Outside work factors10.Plans and strategy 20.Perceived barriers to11.Collaboration for innovation productivity/innovation 12
  13. 13. Even policies can impact productivityOur Dog Policy“Googles respect and affection for our caninefriends is an integral facet of our corporate culture.We have nothing against cats, per se, but were adog company…”Why does it work – Spend more time, more cross functionalcollaboration, aids recruiting/retention & personalized motivation 13
  14. 14. Next practice – Improve promotions through contestsProductivity problem Promoting the wrong people can have dramatic negative impacts on productivity, retention and morale Employees often assume that promotions are biased… and are not based on actual abilities Sometimes each team member has not had an equal chance to demonstrate their performance and capabilities 14
  15. 15. Next practice – Improve promotionsActions Promote people based on their ability to perform in a “work problem” contest (e.g. Iron Chef) In other cases, let employees appeal when they consider a promotion to be unfair (IBM)Benefits A chance to find and assess many candidates Fewer complaints about bias… because the results are performance-based and anonymous Superior results after a “contest” promotionAn example > 15
  16. 16. Internal competitions can improve performance MGM Grand sends a message that… performance triumphs over tenure (400%) Learn more about MGM’s commitment to it’s people: 16
  17. 17. Omitted practice – Convert HR impacts into $HR problem Current HR metrics fail to WOW senior executives… who only understand dollars, revenue and profit HR is often underfunded partially because it uses a different language (turnover, engagement, time to fill etc... vs. profit, productivity and ROI) A focus on cutting costs is not as impressive as increasing revenues 17
  18. 18. Omitted practice – Convert HR impacts into $Action Convert all major HR outputs into revenue impacts Include the $ impact of… great hires, employee innovations, reduced turnover of top performers and the value of developed leadersBenefits Senior managers can see the tremendous $ impact of HR directly alongside the business impacts of other functions (finance, marketing, supply chain etc.)Some examples > 18
  19. 19. A quick example to illustrate… the difference between rev. impact metrics and std. metricsStandard L&D metrics are OK1. 98% of employees are satisfied with L & D2. The cost of each L&D hour is down 12% These two could be labeled as “so what” metrics > 19
  20. 20. A quick example to illustrate rev. impact metricsBut revenue impact metrics… grab your attention1. $148k is the average yearly sales of a salesperson2. It is $197k if they completed a job rotation last yr.3. It averages $249k if they spend 6 hrs. a wk. or more on social networks… sharing best practices4. It is $301,000 if the salesperson did both5. For every 7 salespeople that do both, we increase revenue by $1 million6. We have 211 salespeople 20
  21. 21. Google calculates business impact of a single great hireOne top-notch engineer is worth “300 times or more… than the average … we would rather lose an Alan Eustace entire incoming class of Senior Vice President, Engineering engineering graduates and Research than one exceptional technologist.” 21
  22. 22. Next practice – Offer “free time” / flexibilityProductivity problem There is a need to dramatically increase ideas, productivity and innovation HR needs an additional effective tool to supplement the “barriers to productivity” reduction program Next generation workers expect flex scheduling, remote work & free time for their own projects 22
  23. 23. Next practice – Offer “free time” / flexibilityAction Provide top performers with 20 % time or ROWE optionsBenefits When top performing employees are allowed to make their own time and project decisions, productivity and innovation can increase dramatically (i.e. Genentech and 3m) Office/ real estate costs can be cut dramatically3 examples > 23
  24. 24. What is the value of 20% time?What is the measurable bus. impact of 20% time?54% of Google products started as 20% timeUp to 35% of their traffic comes from them (Rough estimate)Google programs initiated during 20% time:Google News OrkutGmail AdSenseGoogle Translate Google ReaderGoogle Earth Google TalkGoogle Maps Google Sky 24
  25. 25. What is the business impact of offering a flexible work environment? Results Only Work Environment •Pick your hours •Pick where you work •No in-person meetings requiredThe business impacts:ROWE individuals have 45% lower turnover ($13 million per year at $102k per employee)When workers switch to ROWE, their productivity jumps by 35% 25
  26. 26. Deloitte lets you design a flexible jobMass career customization (Deloitte)Every employee can dial up/ down their job… ascareer aspirations & personal needs change including:• Work hours• Travel demands• Job responsibilitiesUnlike flextime/ job-sharing, all at the location areautomatically enrolled to minimize any stigmaResults: most choose to dial up their career (66%),Voluntary turnover rates of top performerschoosing this option was 200% lower 26
  27. 27. Offering “no cost” short-term projectsA “free time projects” website They offer employees a chance to “bid” on short-term projects These “part-time job rotations” allow individuals to grow and learn in new areas The projects also increased the visibility of the participants These were “free time” projects without additional compensation Literally hundreds of projects have been staffed 27
  28. 28. Next practice – Increase non-monetary motivationProductivity problem Employee motivation needs to increase, especially during economic downturns The compensation function focuses exclusively on salary, benefits and bonuses… even though a significant % of motivation comes from… recognition, praise and feedback Salary increases and promotions are expensive and permanent… and the motivation might not even be maintained 28
  29. 29. Next practice – Increase non-monetary motivationActionsHR must develop non-monetary motivation tools for managers that are easy to use and that produce measurable resultsAlso consider a “how to best manage me” approachBenefitsResearch shows that recognition can be an employee’s highest rated motivation factor (before promotion, money & benefits) Source: Research Journal of Internatıonal Studıes - Issue 14 (May, 2010)Non-monetary motivation is significantly cheaperManagers can mass personalize the motivators2 examples > 29
  30. 30. Personalized mot. - Tell us what motivates you (besides $) A survey finds what individuals prefer Employees rank the types of reward and recognition that will have the most impact Some prefer a pat on the back, a small token of appreciation, or public notice in a staff meeting /companywide newsletter This enables managers to customize recognition, & promote employee satisfaction and retention Baptist Health Care 30
  31. 31. Another personalized productivity approach“What’s the best way to manage you” profileHow often do you want to meet?What is your preferred way to communicatePreferred method of feedbackYour preferred way to be recognizedTop motivators & frustratorsMost impactful rewardsIndividual contributor or team preferenceWhere would you like to be in 2 years? 31
  32. 32. Next practice – Bad manager identification programProductivity problem Managers oversee the single most expensive cost item at most firms… Which is? The employees (60% of variable costs) Manager actions have a significant impact on innovation, productivity & the development of ee’s Bad managers may be the #1 cause of turnover Bad mgrs. seldom hire “A” players / innovators Managers are often promoted using criteria other than their people management abilities 32
  33. 33. Next practice – Identify bad managersActions Develop a bad manager identification program Utilize a survey (for employees and managers) that identifies bad managers based on their actions Also use a productivity /performance index Utilize post-exit interviews as a final approachBenefits Fixing 5% of the bad ones may have millions of dollars of impact on productivity and innovation Dell, FedEx, Monsanto have implemented effective BMI programs 33Example >
  34. 34. Prevent bad managers from… bad hiringGoogle takes extraordinary steps to limit the damage “We do everything to minimize the authority and power of the manager in making a hiring decision” “Managers often want to hire people who seem just like them”. So …”hiring decisions are made by a group.” Lazio Bock, Google VP of People Operations 34
  35. 35. Omitted practice – Provide integrated HR solutionsProductivity problem Managers are faced with multifaceted problems that simultaneously require at least a partial solution from several different HR functions The solutions that are provided to managers by HR are almost always fragmented & independent Managers prefer a single integrated solution 35
  36. 36. A typical “fragmented” manager problemI learned the need for integrated solutions whena GM asked me for a single solution to hisproblem, which was… Increasing his output by 12% While cutting labor costs by 8% Increasing innovation by 23% Reducing employee turnover by 20% Increasing his customer satisfaction rate by 37% Increasing revenue by 6.5%What would the name of your integrated HR solution be? 36
  37. 37. Omitted practice – Integrated HR solutionsAction Develop a process for providing integrated solutions… that result from all HR functions operating as a boundaryless and seamless teamBenefits To a manager with problems, a single integrated solution only requires a single stop in HRAn example of the potential choices in an integrated solution > 37
  38. 38. When managers need increases in performanceand productivity… they have 6 basic HR choices Buy Build external talent internal talent (Employee, temp or outsource) Move More productive talent internally Make talent more productive and/or innovator Release weak Use substitutes and excess labor for labor (Technology or software) 38
  39. 39. Omitted practice – Increase innovation by collaborationProductivity problem Innovation has surpassed efficiency as the prime driver of profit Most HR functions don’t know the factors that increase innovation Google has led the way in understanding the factors that increase innovation > 39
  40. 40. What is required to increase innovation?Google uses fact-based decision-making… so theyhave a formula for increasing innovation (Algorithm)Innovation = Discovery + Collaboration +Fun! Source: K M World Magazine Webinar 2008 40
  41. 41. Omitted practice – Innovation through collaborationAction HR must take steps to increase both continuous self-directed learning… and cross-functional collaborationBenefits Continuous self-directed learning is superior to most corporate learning for increasing innovation Collaboration also reduces roadblocks and resistance (TTM) Collaboration increases excitement and professional competition… as well as learningSome examples > 41
  42. 42. Increasing innovation, sharing & collaborationExamples of the Google approach The Google “bump” 42
  43. 43. Additional Google collaboration approaches 150 ft. rule 20% time Cafe lines are measured (By Laszlo Bock) Learning by walking around – broadening manager span of control to limit restrictions Internal collaboration websites – • Google ideas – marketplace for sharing new ideas • Moma – directory for finding collaborators • Snippets – updates on all current project 43
  44. 44. Google has found some bold ways to increase collaboration and fun “Pajama day” at Google Martini “blowout” 44
  45. 45. Google increases continuous informal learningGoogle “Testing on the toilet” 45
  46. 46. Next practice – Proactive internal placementProductivity problemOften external talent must be recruited because of weak internal movement programsMost internal transfer and promotion programs fail… because employees are reluctant to move… or they are unsure about the best placement for their career & the company (MJ & baseball) 46
  47. 47. Next practice – Proactive internal placementAction Assign one or more recruiters to proactively identify individuals that would benefit from a move… and what the ideal placement would be for both partiesBenefits Increase productivity because of “smarter” internal job placement Improved leadership development Reduced turnover due to frustrationAn example > 47
  48. 48. Improve internal movementBooz Allen built a “career mobility team” It utilized recruiters to proactively move internal candidates faster and to more accurate placements Microsoft has a similar team National Oilwell Varco holds an NFL style draft for new hires after their first year 48
  49. 49. Omitted practice – Risk analysis in HRProductivity problem An increasingly important function throughout the business is risk analysis… which attempts to identify and quantify the risks (probability and costs) associated with potential problems HR encounters numerous high-cost risks in hiring, retention, layoffs, leadership succession, lawsuits etc. but it has no formal risk analysis function 49
  50. 50. Omitted practice – Risk analysis in HRActions Recruit someone from the business side to conduct HR risk analysis every six months Also conduct “failure analysis” after major errorsBenefits Not only will potential risks be identified but accurately estimating their large potential cost could help HR get fundingAn example > 50
  51. 51. Internal consulting center/ risk advisorAt Zappos, the HR function… “Operates as “risk advisors.” “HR doesnt decide”. We empower the manager to make a decision Source : #hrhappyhour 2010 51
  52. 52. Next practice – Stories for branding and referralsProductivity problem Social networks and media make it much easier for your employees to build your employer brand and to find referrals Stories are the most powerful and credible way of spreading a firm’s message… but most firms have no way of cataloging powerful people management stories 52
  53. 53. Next practice – Stories for branding and referralsAction Develop a story inventory and a process for gathering and providing access to great people management storiesBenefits With so many negative comments on the Internet, “authentic” stories can be a powerful counter argument ( Providing free access to stories is superior to other methods which may be viewed as propagandaSome examples > 53
  54. 54. Employee videos are powerful branding messages (Yielded 1,000+ videos) 54
  55. 55. Consider a story bookZappos publishes a book full of 300+ employeewritten stories about what it’s like to work there(Available on Amazon) 55
  56. 56. Microsoft developed an internal story inventoryMicrosoft “Spreadthelove” internal websiteTheir “Spreadthelove” website allows Microsoft employees to “write up” their own individual story about their career with Microsoft (their story might include pictures, testimonials and video) Employees can then share the web link and “spread the love” with targeted friends, family and potential referrals 56
  57. 57. Educate employees so they can better spread stories Source: Whirlpool 57
  58. 58. As time permits – some next practices Randomly ask how ee’s are being treated (Retention) A blocking strategy for retention Off cycle recruiting Internal social media for learning & collaboration Best practice sharing Generate a profit (HealthEast) Corporate Headcount “Fat” Assessment Plan Remote college recruiting 58
  59. 59. As time permits – some omitted practices Competitive analysis Prioritize jobs /individuals (recruiting & retention) Parallel benchmarking (SW Air) SWAT team Unintended consequences & “other pocket” costs Alerts and smoke detectors from precursors Lean or agile HR Apply the CRM model to HR cust. interactions 59
  60. 60. OMG ! “I want that one” 60
  61. 61. Did I make you think?Provide you with some new ideas? 61