Transform Talent Management S W P V R E G E N C E


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Webinar presented to HCI (Human Capital Institute) on March 2, 2010

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Transform Talent Management S W P V R E G E N C E

  1. 1. Transform Your Talent Management Capability Through Effective Strategic Workforce Planning: A Case Study March 2, 2010 Jan Ahrens John Director, Strategic Workforce Planning ©2009 Regence
  2. 2. Agenda The Current Landscape Regence—Our Journey Approach Lessons Learned Impact ©2009 Regence 2
  3. 3. The Current Landscape Strategic Workforce Planning (SWP) SWP is a Relatively While workforce planning has been around for decades, only recently New Practice has attention been focused on its strategic value: 92% of companies have some level of workforce planning, but only 21% take a strategic, long-term approach to addressing their talent needs Identifies Key Roles Enables senior leadership to understand and forecast future talent and Workforce Data needs based on relative value to strategy execution: to Drive 74% of executives consider workforce planning a priority in their Performance organizations, while only 57% of HR professional perceive it as a corporate priority Only 25% of organizations are able to help business leaders forecast revenue and operating budgets Prioritizes Talent Informs the business and HR of the “build, buy, or borrow” actions Management and investments needed to close critical talent gaps: Actions and Almost 70% of the surveyed organizations are changing their talent Investments management programs based on the results of their workforce planning analytics High performers had higher Engagement, EVP satisfaction overall, and lower turnover intentions than the overall sample Sources: • Sibson Consulting, Rewards of Work Study, 2009 • Bersin & Associates, The Modern Approach to Workforce Planning, 2009 • HCI, Identifying Business Value in Workforce Planning—Articulating the Return on Strategic Workforce Planning, 2008 ©2009 Regence 3
  4. 4. Three Types of Workforce Planning 21% Strategic Workforce Planning Business Strategy Business Strategy Degree of People Investment and Segmentation and Segmentation of Workforce of Workforce Workforce Analysis Workforce Data, Workforce Data, Basic Workforce Analytics and Analytics and Data and Analytics Forecasting Forecasting Traditional Workforce Planning Business Plan Business Plan Business Plan Business Plan and Headcount and Headcount and Headcount and Headcount Increased Value to the Business ©2009 Regence 4
  5. 5. Keys to Making Strategic Workforce Planning…“Strategic” Driven by business strategy and objectives Accurate and objective segmenting of the workforce Consistent process and approach Readily accessible analytics HR capability to lead change ©2009 Regence 5
  6. 6. Poll Question If you were to implement strategic workforce planning, which of the following challenges/barriers would you experience: Lack of resources Little support from top management Lack of business case Lack of capability or defined methodology Lack of tools and technology Two or more of the above Three or more of the above ©2009 Regence 6 6
  7. 7. Agenda The Current Landscape Regence—Our Journey Approach Lessons Learned Impact ©2009 Regence 7
  8. 8. Who is Regence? Regence, a member of Blue Cross and Blue Shield Association, is the largest health insurer in the Northwest/Intermountain region, serving members in ID, OR, UT, and WA We have 2.5 million members accessing health care across the country and around the world, and process nearly 3.5 million claims a month We have 6,200 employees and partner with more than 52,000 providers and 2,400 facilities in nearly 1,000 communities Our $8.9 billion company defines success by how well we advocate for—and make a difference in—the health of our members…a promise we have kept for more than 90 years. ©2009 Regence 8 8
  9. 9. Where we were in 2008 Rising health care costs Increasing focus on health care reform fueled by political debates Aging workforce—potential loss of critical knowledge Changing landscape—with more competition from national players Expanding product lines that required new capabilities Broadening use of technology to provide instant validation Understanding the current workforce and the required future organizational capabilities and talent was a top priority for the business and HR. ©2009 Regence 9
  10. 10. New Problems Required a New Approach Key Questions Targeted Outcomes How do we identify which Understanding of our Current and Future roles are most and least Talent Needs critical in driving results? Clear connection between the business strategy What capabilities are and our people strategy absolutely essential, and what investments are Right skills in the right places to drive execution needed? of our strategic objectives How do we predict and Control of Workforce Dynamics analyze the implications of Better insight into the internal and external our internal workforce workforce dynamics to ensure we have the right dynamics? people in the right roles at the right costs How do we better anticipate dynamics in the Talent Management as a Core Business external labor? Process Established and repeatable processes to do the work, owned, and driven by the top of the organization ©2009 Regence 10
  11. 11. Our Journey Announced pension Incorporated SWP plan changes and into annual more layoffs planning process Launch SWP Completed 19th Year 2 Researched Scheduled Installed web-hosted consulting firms & Launched SWP Launched 3 additional 16 tool; rolled up enterprise- (and final!) SWP selected Sibson engagement SWP pilots Divisions wide data for year one ‘08Q1 ‘08Q2 ‘08Q3 ‘08Q4 ‘09Q1 ‘09Q2 ‘09Q3 ‘09Q4 ‘10Q1 ‘10Q2 2008 2009 2010 Jan moves from Built internal Began Launched additional Analyzed input Roll out Director OD to capability of announcing plans, provided just-in- by Strategic succession Director SWP role HR staff layoffs time training for other roles in annual planning for all HR staff Engagement Strategic roles Survey Initiated Diagnostic Developed initial Baseline EVP collateral for Assessment of HR Strategic roles in 3 Divisions Building Accountability & Buy in: If you build it RIGHT…they WILL come. ©2009 Regence 11
  12. 12. Agenda The Current Landscape Regence—Our Journey Approach Lessons Learned Impact ©2009 Regence 12
  13. 13. Our Approach Upfront Considerations What expertise did we need? Decide on the appropriate subject matter partner—credibility and track record Ability to move fast was critical Must transfer capability, we could not afford to be consultant dependent Available as ongoing lifeline How could we make SWP sustainable? Ensure internal HR capability and business ownership for the long run Require a repeatable, yet customizable process Access to robust analytics—real time decision making Where should we start? Build support and address resistance early on Start small and grow from there Select pilots from both ends of the spectrum (large and core to the business/small and more fringe) Use our successes as leverage ©2009 Regence 13
  14. 14. Our Approach Conceptual Framework Business Strategy and Objectives Actions and Investments Strategic Workforce Planning Talent Development Succession Management 1 “Actions to develop current and “Talent portfolio and Type next generation Specific talent” decision process” 2 HR and Line Role Number Operating Requirements Plans to Differentiation Differentiation Integrated Execute the Performance 4 Strategy Management and Talent Acquisition Actions/ Rewards “Branding, Investments 3 sourcing, and Gaps and “Reinforcements that engagement” Priorities drive accountability” Strategic Workforce Planning serves as the headwaters to make informed decisions on Human Capital Priorities and Investments. ©2009 Regence 14
  15. 15. Our Approach Conceptual Framework Segmentation enables you to understand and manage your human capital like a portfolio of assets. Impact Talent Segment Investments Over Time Roles that drive Strategic Critical to driving long-term competitive the strategy advantage, with specialized skills or knowledge Strengthen Core The “Engine of the Enterprise,” unique to the company and core to delivering Roles that on its products and/or services support Protect the strategy Requisite Cannot do without, but whose value could be delivered through alternative staffing strategies (other than full-time headcount) Streamline/ Outsource Roles Misaligned impacted by Talent whose skill sets no longer align the strategy with the company’s strategic direction Redeploy Segmentation strategically values talent and enables prioritization of talent needs and talent investments. ©2009 Regence 15
  16. 16. Agenda The Current Landscape Regence—Our Journey Approach Lessons Learned Impact ©2009 Regence 16
  17. 17. Lessons Learned First Steps Piloted with three different divisions “Timing is everything:” The BOHICA Syndrome The Ugly Baby Syndrome “Strategies? What strategies?” “All of our roles are strategic!” “Layoffs tomorrow” “How can we…if we don’t know…?” TIP #1: Be ready to be an ACTIVE cheerleader & change agent. ©2009 Regence 17
  18. 18. Lessons Learned “We are where we should be” Rolled out consistent process for 19 Divisions: Each Division has a plan Over 105+ leaders involved Over 35 talent requirements developed out of 110 strategic roles (8% of workforce) 10 enterprise-wide actions and investments are being tracked Emphasized collaboration—Divisions and functions worked across silos Increased risk awareness (e.g., time to proficiency, build/buy decisions, etc.) Increased knowledge of workforce implications on business—web-hosted tool Gained ground: Old Way—“Think people first, position second” Proactive applications TIP #2: Link to the business and get the role requirements RIGHT. ©2009 Regence 18
  19. 19. Lessons Learned “We are where we should be” Exhibit 7: Staffing Needs to Fill Talent Gaps Exhibit 8: Cumulative Quarterly Staffing Costs Exhibit 5: Training Needs and Residual Talent Absorption (Ramping Up) Exhibit 6: Talent Gaps TIP #3: Speak the language of business, let the data talk. ©2009 Regence 19
  20. 20. Lessons Learned What People Are Saying… “ This is the first time we’ve ever talked about what we’ll need 3 years from now.” “ Great tool for making strategic decisions…viable option to look at future (e.g., Demographics, age, very telling).” “ Opened a window that not all skills sets/people are interchangeable. Helped us name premium roles.” “ A discipline that comes with repetition” “ Better understanding of the inter-relationships of my Strategic roles in other divisions. I’ll manage their availability to cover the most critical work.” “ Looking at this data will change the way we run our business.” “ Let’s use this again as soon as federal reform info comes out.” ©2009 Regence 20
  21. 21. Agenda The Current Landscape Regence—Our Journey Approach Lessons Learned Impact ©2009 Regence 21
  22. 22. Impact What is different today? SWP is now included in the annual business planning process—prior to budget setting SWP metrics are part of the Regence corporate balanced-scorecard Talent requirements for the majority of current/new “strategic” roles are in place Specific retention strategies have been created to address specific markets and talent needs Executive “pull” established for an enterprise-wide succession plan for all critical roles A Differentiation culture is emerging vs. a “everything, for everyone, all the same” culture Consistent approach in place across all major divisions for developing external sourcing strategies Quantified that our “strategic” roles averaged .5 STD below other company employees on engagement Clear definition and agreements on which roles are most critical to the organization Employee Value Propositions (EVPs) created for several “strategic” roles TIP #4: “It ain't over till it's over.” —Yogi Berra ©2009 Regence 22
  23. 23. Impact Connection between Strategic Roles and EVP ©2009 Regence 23
  24. 24. Impact Connection between Strategic Roles and EVP ©2009 Regence 24
  25. 25. Impact Connection between Strategic Roles and EVP ©2009 Regence 25
  26. 26. Final Words from a SWP Expert “ Opportunities are never lost. Someone will take the ones you missed.” “ Ignoring the facts doesn’t Image Source: billypalooza, change the facts.” —Andy Rooney ©2009 Regence 26