3 Mercer/CCH Guide for Employersyoung person graduating from university or a 60 year old push of relevant content and information to the ‘‘nur-looking for a new opportunity. The brand and messaging tured’’ candidates allows them to establish the employ-must be appealing, adaptable, and based on the audience. ment brand and engages a more passive pool of candi- dates. Many companies are moving away from using a The biggest factor of Gen Y recruitment that compa- traditional Applicant Tracking System to power their onlinenies undervalue is the fact that approximately 30% of career centres and are now utilizing robust Customer Rela-Gen Yers own a blog and/or share everything online with tionship Management (‘‘CRM’’) platforms traditionally usedtheir networks and friends. This should scare any organiza- by sales and marketing teams.tion into ensuring their recruitment experience is candi-date-centric. No company wants a bad product or serviceonline review, and should do everything they can to pre- #4 — The Globalization of Recruitmentvent a poor recruitment review that can go viral through acandidate’s social and professional networks. Recruitment is no longer simply a locally focused activity, and more importance is being placed on sourcing talent regionally and globally. Companies are looking to#7 — Talent Management tap into new international talent pools and to uncover hard-to-find skill sets and talents in emerging economies. This is the one of area of human resources that seems Technology is enabling employees within progressive orga-to have been impacted the most by the recession. So many nizations to work virtually as part of a team rather thanof the companies we work with downsized this HR disci- requiring them to live and work in a specific office location.pline over the past two years. In 2011, we have seen the Recruitment has become a lot more complicated for theseresurgence of talent management as an organizational and companies, and recruiters now need to be able to recruitHR priority once again. Building talent is easier than buying across geographies and sell opportunities to candidatestalent in an increasingly competitive talent market, and from different cultures and backgrounds.companies need to once again increase their focus on themovement of internal talent through a more effective andproactive internal recruitment talent strategy. #3 — Candidate-Centric Recruitment Many of the companies we work with tend to have a#6 — The Continued Growth of the Contingent process-centric recruitment model, built around recruit-Labour Market ment policies and structures that take the human touch out of recruitment. Companies often forget that many can- Contingent labour is often a forgotten talent pool didates are also potential clients or even current customerswithin an organization. In most companies, contingent and need to be treated at all times with respect and pro-labour is a procurement focus rather than an HR one. One fessionalism. Candidates may not have the right skills andin every eight positions in Canada is contract or temporary experience you need today, but that may change in the— meaning that within your company today, approximately future. We work a lot with organizations who want to move12.5% of your workforce is not permanent employees. more towards building a positive candidate experience.Canadian organizations are beginning to realize the impact The best place to start is to look at your recruitment pro-contingent labour has to their bottom line, and are putting cess from the candidates’ point of view.more focus on the talent strategy of recruiting, developing,and engaging this often overlooked talent pool. #2 — Social Media Recruitment#5 — Talent Pipelining and Nurturing Arguably one of the biggest changes to recruitment over the past couple of years has been the growth and Recruitment shouldn’t be a reactive transactional func- focus on social media recruitment. Organizations are real-tion. There must be a proactive degree of focus built into izing the power of leveraging the big four social mediaevery program. Companies are beginning to develop and platforms (LinkedIn, Facebook, Twitter, and YouTube), andintegrate external talent nurturing and pipelining into their are also tapping into countless other online networkingrecruitment strategy and programs. There is an increasing sites that meet specific needs. Many organizations areemergence of in-house candidate sourcing and research failing to recognize that social media is simply anotherteams built into the recruitment structure. Recruitment is platform or medium of communication to utilize in theirquickly aligning more to the sales and marketing function, recruitment efforts. It is the recruitment message that is thewhere the focus is similar to client and prospect nurturing. key to success when trying to harness the power of socialCompanies are building talent communities where the networking mediums for recruitment. Most companies
Mercer/CCH Guide for Employers 4spend big bucks on sexy social networking applications,but often neglect to refine the ever critical messaging that Mercer identifies five key rolesneeds to engage and attract interest from talent prospects. HR leaders must play in M&AThe message needs to catch the interest of the candidateand engage them in a way that imparts the value of United States, New York, February 3, 2011working with your organization. Mercer shared on February 3 the five key roles senior human resources (HR) leaders must play before, during and As recruitment continues to evolve in 2011, there will after mergers and acquisitions (M&A) activity. These five keybe many more opportunities and platforms for companies roles reflect Mercer’s extensive M&A consulting experienceto harness the power of the mobile market — iPads and in all types of deals and across global industries and mar-other tablet computers, and even using Skype as a recruit- kets:ment tool. It is an exciting time with the emergence of newplatforms and technologies, but we need to remember it is 1. Serve as a trusted adviser to executives and the dealjust one of many recruitment channels that might be valu- teamable for your organization based on what skill sets andexperience you are recruiting for. 2. Be the HR/people subject-matter expert 3. Provide timely and actionable input before, during and after the deal#1 — The Increasing Demand for ‘‘Super’’Recruiters 4. Help shape the post-close organization Every great recruitment leader knows the biggest dif- 5. Manage the intense flow of information and relatedferentiator between a high performing and a poor per- employee anxietyforming recruitment function is the recruiters themselves.Recruiters are being asked by their companies to do more Empowering HR leaders to deliver on these keywith less these days, which makes it increasingly difficult to M&A-related roles is the guiding principle of Mercer’s 2011be successful. The pool of talented recruiters is unfortu- series of M&A ReadyTM training workshops. Now in itsnately quite small — we estimate that only 10% of the eighth year, the Mercer M&A Ready workshop series gives participants important insights into every aspect of the dealrecruiters in the market today are difference makers and process including; M&A transactions in the context of anhave the ability to make an immediate and positive impact organization’s business strategy; deal and HR team struc-on an organization’s recruitment outcomes. The profile of tures, roles and relationships; key human capital issues andthe recruiter has evolved over the years, and many of the HR’s role in managing them; and how HR can ultimatelytraditional skills of recruitment professionals are now obso- help realize the full value of the deal. Participants alsolete. The modern day ‘‘Super Recruiter’’ is technologically receive live deal experience via ‘‘real world’’ case studysavvy, and has the ability to research, prospect, hunt, and simulation.sell. They can also engage, nurture, assess and close toptalent for their companies. Does this sound like the profile ‘‘We believe 2011 is going to be a very strong year forof one of your organization’s leading sales representatives? deal activity. The availability of cash and credit to fund dealsMany would argue that recruitment in the future will align and the continuing trend toward ‘de-conglomeration’ willmore closely to sales and marketing than to HR. release pent-up M&A demand across the globe,’’ said Elisha Mayer, Senior M&A Consultant for Mercer. ‘‘Senior As the focus on recruitment becomes an organiza- HR leaders, who have not had to ‘worry’ about deals for ational priority once again, the demand for these Super few years, now have a fantastic opportunity to refresh theirRecruiters will continue to drive an increase in pay rates education about what it takes to successfully manage HR’sand salary levels for the industry. Companies will need to role in M&A. The smartest HR professionals are preparing for M&A activity in advance, testing their processes beforeensure they are staffed with these Super Recruiters to be they are actually needed and revising them as necessary.best in class recruitment organizations and to provide Early preparation helps HR professionals avoid costly mis-strong return on investment for their recruitment efforts. takes.’’ Simon Parkin and Shane Creamer are the co-founders In the Americas, 2011 workshops will be held in:of Granite Consulting (www.graniteconsulting.ca). GraniteConsulting provides innovative Recruitment Advisory Serv- ● Toronto — June 15/16ices and Recruitment Training programs to organizationsenabling our clients to recruit talent more effectively. ● Mexico City — June 15/16
Mercer/CCH Guide for Employers 6restored the Tribunal’s finding that the application of the What’s the Problem?Attendance Management Program to all employees repre-sented prima facie systemic discrimination. The reasons of Employer policies, strategies and practices to supportthe Court of Appeal were as follows: attendance objectives that ignore the human rights status of disability related absence and the duty to accommodate 1. Level 3 of the program enrolled employees with leave employers exposed to increasingly costly risks of dis- chronic disability issues into the program, even crimination. though the employer knew the employees had disability issues that could lead to elevated absen- teeism rates; Impact of the Duty to Accommodate? 2. The placement of employees with absences related to disabilities at Level 3 represented sys- It is important to remember that: temic discrimination (Level 3 introduced man- dated attendance sanctions for non-adherence); ● Disability related absenteeism attracts the Duty to Accommodate; 3. Placing employees at Level 3 based on partial days of absence as a result of graduated return to work ● ‘‘Accommodation’’ in the context of disability related activity represented systemic discrimination. absenteeism requires adjusting the average or norm attendance expectations; It is worth noting that the Court of Appeal found theB.C. Supreme Court erred in the test it applied in assessing ● Accommodation of disability related absences demandssystemic discrimination. The Court of Appeal affirmed the a redefining of the employment bargain, in effecttest of whether it was ‘‘impossible’’ to accommodate the accepting the delivery of a lower level of attendanceemployee without undue hardship. than what is delivered by employees without chronic or reoccurring disability issues (subject of course to the The Court of Appeal re-instated the Tribunal’s Order ‘‘undue hardship’’ limit).that the employer must cease applying the AMP toemployees with disabilities. How Much Absenteeism must be Accommodated?Critical Implications for Employer Strategiesto Manage Absenteeism In providing counsel and support to employer organi- zations with respect to attendance and disability manage- 1. Strategies and programs that expose employees ment this question is regularly raised. Given the individuali- with absences beyond ‘‘average’’ or arbitrary stan- zation required in connection with each accommodation dards, where such absences are caused by chronic issue, there is no clear or consistent answer. The limit is or reoccurring disability issues, will trigger systemic impacted by the unique circumstances of each attendance discrimination. management challenge. 2. Employers risk exposure to a significant risk of sys- While there is no room or place in the current equality temic discrimination and costly liabilities where rights context of disability related absenteeism for route attendance management strategies and programs approaches or responses to disability related absenteeism, involve: there is an opportunity for effective management on an individual basis. Effective management can reduce one or ● Holding employees with disability related more of the following: absences accountable to average or fixed attendance norms; ● amount of absence; ● Enrolling employees with excessive disability ● frequency or duration of absences; related absenteeism into programs that threaten future employment, in response to a failure to ● impact of absence on workplace; adhere to defined attendance averages or norms. ● duration of the employee’s presence in the workplace.
7 Mercer/CCH Guide for EmployersLessons to Learn: guarantee of accommodation of disability related absences to avoid or minimize the increasingly 1. Effectively and legally compliant attendance and costly risks of discrimination. disability management is complicated and impacted by the equality rights guarantees 5. Disability related absences can be managed in a attending disability and as a result disability related manner that responds to the employer’s legitimate absences. interest in minimizing the impact of the disability related absenteeism (i.e. minimize disruption and 2. A significant and growing percentage of workplace cost). absenteeism is disability related; increasingly psy- chological or non-evident disabilities. 6. Effective management of disability related attend- ance issues demands new strategies, knowledge, 3. Absenteeism/Attendance Management policies or tools and above all patience and persistence. 1 practices that are structured to hold all employees accountable to fixed attendance requirements, irrespective of disability issues, leave employers Notes: exposed to serious risks and costs attending disa- 1 Trends developing in Ontario with the new Human Rights Tribunal in bility discrimination. connection with complaints of discrimination based on disability and disa- bility related absenteeism evidence a heightened risk for employers and 4. Attendance Management Programs/Practices must escalating liabilities attending discriminatory terminations for disability effectively integrate the impact of the equality rights related absences. Q&A Are employers required to investigate every complaint of discrimination, even when the complaint is unlikely to be true? Employers have an implied duty to investigate allegations of discrimination and/or harassment in the work- place. This duty is often recognized as the key to an effective human rights regime, as it acts as the means by which the employer ensures that it is achieving the legislative ends of operating in a discrimination-free environment, and providing its employees with a safe work environment. In discharging this duty, employers are not held to a standard of perfection, but must at a minimum demonstrate that: 1. there was an awareness of issues of discrimination and harassment in the workplace at the time of the incident; 2. the complaint, once made, was treated seriously, and dealt with promptly and sensitively; and 3. the resolution to the complaint was reasonable in the circumstances. These criteria will apply in all circumstances, including those where employers do not believe that the complaint is likely to be true. Employers should never simply ignore an employee’s complaint, as the Tribunal may issue an order against an employer for its failure to properly investigate, notwithstanding the fact that the alleged conduct did not constitute a breach of human rights legislation.
Mercer/CCH Guide for Employers 8 enter an employer’s premises to investigate a complaint; Legislative Update ● ● substitute penalties; andNova Scotia ● attempt to mediate disputes, with the consent of theLabour Board Act Partially In Force parties. Bill 100, the Labour Board Act, S.N.S. 2010, c. 37, which Bill 128 received first reading on December 2, 2010,will merge six labour and employment boards into one, second reading on December 9, and third reading andwas partially proclaimed in force on February 8, 2011. Royal Assent on December 10. It was proclaimed in force on February 1, 2011. The in force sections have merged the Labour Rela-tions Board, the Civil Service Employee Relations Board, theHighway Workers’ Employee Relations Board, and the Cor-rectional Facilities Employee Relations Board into a single Ontario‘‘Labour Board’’. A full-time chair of the Board will beappointed for a five-year term, and existing arbitrators will Minimum Wage To Hold Steady for 2011rotate as cases come up for arbitration. After several years of increases, Ontario has The intention of the Bill is to create a more streamlined announced that the minimum wage rate will remain atand efficient process, and provide more consistency $10.25 per hour throughout 2011.among decisions. Provisions which will merge the Occupa-tional Health and Safety Appeal Panel and the Labour Stan- Ontario’s minimum wage rate has increased by 50 perdards Tribunal into the Labour Board will come into force cent over the last seven years. At $10.25, it is currently theon a later date. second highest minimum wage in Canada, behind only Bill 100 received first reading on November 19, 2010, Nunavut’s rate of $11 per hour.second reading on November 23, and third reading andRoyal Assent on December 10. In fall 2011, the government will appoint a committee representing both businesses and workers to provide advice on the minimum wage in advance of the 2012 Budget.Amendments Codify the Powers and Duties ofArbitration Boards Bill 128, An Act to Amend the Trade Union Act, QuebecRespecting Powers and Duties of Arbitrators and Arbitra-tion Boards, S.N.S. 2010, c. 76, is now in force. The Bill Reminder: Organ Donor Leave In Forcecontains amendments to the Trade Union Act which clarify February 28the duties and powers of arbitrators when resolving griev-ance disputes. The amendments consolidate arbitrators’ An Act to facilitate organ and tissue donation,powers which were previously spread throughout various S.Q. 2010, c. 38, which provides for organ donor leave,pieces of legislation and case law. became effective on February 28, 2011. Under the Act, a worker who donates an organ or tissue is entitled to an Among the amendments, the Bill codifies that arbitra-tors have the power to: unpaid leave of absence of up to 26 weeks to undergo the donation and recovery. An employer is prohibited from● summon witnesses and require submission of docu- dismissing, suspending, or transferring an employee who ments or other evidence; takes a leave for organ or tissue donation. Upon expiry of the leave, the employee must be reinstated to his or her● determine all questions of fact and law; former position, with the same benefits and wages.● extend deadlines; Bill 125 received first reading on November 11, 2010, second reading on November 25, third reading on● issue oral decisions; December 8, and Royal Assent on December 10.
9 Mercer/CCH Guide for Employers considerably shorter than periods in other restrictive cove- On the Case nants.Board’s decision that insurance agent was Mason v. Chem-Trend Limited Partnership,independent contractor was reasonable 2011 CLLC ¶210-005 (Ont. S.C.J.)● ● ● Manitoba ● ● ● Boisjoli worked for the Knights ofColumbus as a general insurance agent, responsible for No evidence that age was a factor inrecruiting, training, and assisting insurance agents, as well employer’s decision not to hire candidateas assisting customers. When he was terminated, hebrought a claim before the Employment Standards Board ● ● ● Ontario ● ● ● White was 59 years old when he wasalleging he was an employee. His claim was dismissed as hired by Queen’s University. Three years later, he applied ashe was found to be an independent contractor (see an internal candidate for a position as assistant area man-2010 CLLC ¶210-043). Boisjoli appealed. ager. He was the only internal candidate interviewed for the position, although he was not selected. The university The appeal was dismissed. The issue before the Board opened the competition to the public, and the positionwas whether Boisjoli was an employee or an independent was offered to an outside candidate. White believed thatcontractor. Such a decision is context-driven and depen- he was the most suitable candidate and that his age, whichdent on the facts of each individual case. The Board did not was 62 at the time, was a factor in the university’s decisionerr in analyzing its own statute, and in referring to the not to hire him. White brought a human rights complaint,common law test for determining who is an independent alleging discrimination on the basis of age.contractor, since the term is not defined in the legislation.The Board also did not err in considering materials which The complaint was dismissed. The fact that the inter-were not referred to by either party in their submissions. view notes were missing or destroyed did not indicate anFinally, the Board did not commit an error by following the intention to discriminate by the university. It would notSupreme Court test for independent contractors, and have invited White for an interview, taken notes, and thenfailing to recognize the line of cases setting out a test for deliberately destroyed the notes, particularly if it had nocommissioned sales agents. The Board considered the intention of considering him for the position. Therefore,facts before it in making a reasonable decision. the direct evidence did not indicate that age was a factor in the decision not to hire White. With respect to the circum- Knights of Columbus v. Boisjoli, 2011 CLLC ¶210-007 stantial evidence, both White and the successful applicant(Man. C.A.) were qualified for the position, and the committee estab- lished that they had legitimate concerns about White’s suitability for the managerial position. There was no basis to find that the university’s view that White was not suitableBroad restrictive covenant upheld for the position was based on stereotypes about his age.● ● ● Ontario ● ● ● When Mason was hired to work for White v. Queen’s University at Kingston,Chem-Trend, a world-wide company, he signed a docu- 2011 CLLC ¶230-005 (H.R.T.O.)ment that included a restrictive covenant. Upon termina-tion, he would be restricted for one year from competingwith Chem-Trend by providing services to, or soliciting bus-iness from, Chem-Trend’s customers. When Mason was Employee subjected to harassment byterminated after 17 years, he brought an action for co-workers was constructively dismissedwrongful dismissal. Chem-Trend claimed that Masonbreached his restrictive covenant after termination by using ● ● ● Ontario ● ● ● Disotell, who was 36 years old, hadhis knowledge and experience to gain business opportuni- worked at Kraft for 16 years. He was the subject of repeatedties for himself. Mason claimed the restrictive covenant was occurrences of harassment in the workplace, in the form oftoo broad. degrading, impolite, and derogatory comments made by a number of his fellow employees. Disotell complained to The wrongful dismissal application was dismissed. his supervisor about the comments, and the supervisorWhile the wording of the restrictive covenant was broad, it witnessed or heard a number of the comments as well.was clear, unambiguous, and reasonable. The broad geo- However, the supervisor did not report the harassing com-graphic restriction was reasonable, given the global nature ments, as required by the company’s harassment policy.of the business and the fact that Mason had worked for the Disotell went on sick leave and Kraft conducted an internalcompany in various regions in Canada and the United investigation of the situation. The investigation did notStates. The restriction on competition was also reasonable, involve interviewing any of the employees that Disotellgiven the knowledge of the industry that Mason had built claimed were involved in the harassment, or Disotell him-up, which would make him a competitor to Chem-Trend’s self. In addition, Disotell refused to return to the workplacebusiness. The covenant was only for one year, which was to participate in any investigation, although his offer to
Mercer/CCH Guide for Employers 10meet with head office employees was denied. Disotell Interview with Dr. DeLongbrought a wrongful dismissal action. Q: So why is ‘‘talent management’’ important today The action for wrongful dismissal was allowed. Given coming out of the recession?the length of time during which Disotell was subject toharassing comments, and the failure of the employer to DeLong: Despite the recent downturn, which tempo-conduct a serious investigation, there was a breakdown of rarily created an employers’ market for talent, no genera-the employment relationship. A reasonable person could tion of executives have ever faced such a complex andnot be expected to continue his employment in these difficult set of workforce challenges. These include increas-circumstances. Therefore, Disotell was constructively dis- ingly distributed employees who are working across cul-missed, and he was awarded 12 months’ reasonable tures, time zones, and reporting structures. There are alsonotice. growing shortages of skills in critical roles, such as systems engineers, actuaries, nurse managers, geoscientists, and Disotell v. Kraft Canada Inc., 2011 CLLC ¶210-008 (Ont. veteran project managers, due mainly to the retirement ofS.C.J.) aging baby Boomers. Retiring Boomers, combined with years of downsizing and limited hiring has also created a tremendous shortage of mid-career leadership talent. At the same time, in some areas, aging workers are NEWS FROM THE U.S. now staying on the job longer than expected. Companies must keep these workers productive and their delayed retirement is slowing career advancement for restless mid- careers. All this means there are now four generations in the workplace, with distinctly different orientations to The article below, ‘‘Expert says managing work, technology, and communication. How do you help talent is key to commanding today’s workforce’’, people learn faster and collaborate better in this environ- appeared in Ideas and Trends, #719, February 2, ment? Executives are facing all these challenges — whether 2011, published by CCH Incorporated, United they know it or not. And how effectively they handle them States, a Wolters Kluwer business, and is repro- is going to determine their organization’s ability to sustain duced with permission. If you wish to place an a workforce that can innovate and grow the business. order or would like more information on U.S. pro- ducts, please contact our Customer Satisfaction Q: There has been a lot written about talent manage- Hotline at (416) 224-2248 or 1-800-268-4522. ment in the last decade. Why did you think there was a need for another book? DeLong: Virtually everything you read about talent management — or human capital or workforce planning — is written from HR’s perspective. There are some excellentExpert says managing talent is key to books out there but, frankly, they put senior executives tocommanding today’s workforce sleep. Until now, nothing has been written about talent management from the perspective of senior line managers. Dr. David DeLong is co-author (with Steve Trautman) ofthe new book The Executive Guide to High-Impact Talent Q: Can you define ‘‘talent management’’ for us?Management from McGraw-Hill(www.HighImpactTalentManagement.com). The book DeLong: That’s part of the problem. There’s little agree-shows leaders who believe in the importance of investing ment in most organizations about what this and relatedin people what specific actions they can take to directly terms mean. One of the first things you should do as an HRimprove business performance. John Rex, the CFO of leader in this area is facilitate a discussion among seniorMicrosoft North America says, ‘‘Most executives I know are decision makers in your organization to decide whichfar more comfortable running financial or operational or terms you are going to use and what they mean in practice.product sides of their business. This book does an excel- For example, other concepts like ‘‘strategic workforce plan-lent job of clarifying every leader’s real role in developing ning’’ and ‘‘human capital’’ get used interchangeably intalent to grow their business.’’ Although written for senior companies all the time. If you think about it, there is oftenexecutives, each chapter has a section showing HR leaders no shared agreement and understanding about whathow to apply these ideas to collaborate more effectively you’re investing in.with their business partners. Dr. DeLong, who is awell-known keynote speaker and consultant, shared his As an HR leader, you should start by clearly defininginsights with CCH based on extensive research that went what you mean by ‘‘talent management’’, or whateverinto the book. Additional findings from his most recent term you choose to use. We have found the scope of theresearch are available at his company’s Web site: concept varies widely from one organization to the next. Itwww.SmartWorkforceStrategies.com. may mean managing the entire employee life cycle to you,
11 Mercer/CCH Guide for Employersbut your CEO might think only in terms of leadership devel- business units you support. This should be someone withopment, succession planning, and so on. Keep working to credibility in the business who can help you discoverclarify that definition both for line managers and your HR where your perceptions differ from senior management.colleagues. Then schedule a meeting with a senior executive who is an internal customer on the business side. Test your answers Q: But what do you mean by ‘‘talent management’’? and get feedback. You will gain credibility with your internal customers when you show you’re a student of the busi- DeLong: In the book I’ve written with Steve Trautman, ness issues they face. This is also a critical step in being able‘‘talent management’’ refers to all the investments in sys- to show how talent management investments are sup-tems, processes, and programs designed to enhance the porting the organization’s strategy.recruiting, development, performance, and retention ofemployees. That differentiates it from the concept of Q. What’s another way HR can work more effectively‘‘human capital’’, which is a broader term, often used to with their business partners?mean ‘‘people’’ and ‘‘human resources’’. ‘‘Strategicworkforce planning’’ is a more popular term for describing DeLong: Risk management is a popular term in busi-the front-end data collection, analysis, and forecasting ness today, but it’s often overlooked when it comes toactivities that determine talent management investments. talent. How are you talking to your business partners aboutThe key is these terms mean different things in different talent-related risks? Too many HR professionals limit thisorganizations, and they lead to tremendous confusion discussion to a mix of demographic and workforce data.unless you continually push to clarify them. And then they combine that with a presentation of rela- tively vague competency models. Q: So what can HR managers (or leaders) do differ-ently to engage with senior executives in leading talent The problem is most line executives find thesemanagement initiatives? approaches too disconnected from the reality of their operations. They need more specific tools and information DeLong: We have found many ways HR can work more to understand and act on the dangers of not having theeffectively with line management. Begin by demonstrating workforce and leadership team they’ll need in two or threeyou’re committed to making sure talent related invest- years. In our book, we describe how to use a series of toolsments are aligned to support the organization’s strategy. In for more effective risk management. But the place to start isour book, we show how your business strategy is unlikely to identify the presence of specific risk factors. Which ofto give you direction that’s specific enough to create this these represent the greatest threats to your business?alignment. To make your understanding of the currentstrategy explicit start by answering what we call the ‘‘big Shortages of essential talent. Given your stated objec-picture’’ questions. These are questions that demonstrate tives and the anticipated changes in your workforce andan understanding of your organization’s strategic context. If leadership team, what assumptions are you making aboutyou can answer them, then you ‘‘get’’ your company’s the availability of critical talent in the marketplace? Havestrategic intent. And then you’re much more likely to be you identified roles that you’re particularly concernedable to articulate how talent management programs are about when recruiting?supporting leadership objectives. Here are five examples ofthe questions included in our book. A high percentage of new hires. What risks do subpar productivity and increased new hire attrition pose for your 1. Who are the customers or customer segments our business? Do you know the real costs of failing to onboard company serves, listed in order of priority? new managers and workers as effectively as possible? 2. What are the products or services we provide now and which ones, if any, need to change as we Dissatisfied employees. Even though attrition probably implement current strategy? declined during the recent recession, what assumptions are you making about how changes in the economy, 3. What is our company’s value proposition and how retirement eligibility, and increased employment opportu- does it set us apart in the marketplace? nities will affect unplanned attrition in key parts of your business? 4. Who are our competitors (listed in order of pri- ority)? Why is each considered a threat, and what A shortage of talent in the leadership pipeline. Do you can we learn from them? have an age profile of your leadership team and your workforce, so you know specifically where retirements are 5. How does top management measure success now, most likely to come in the near future? and how might that change in the future? Loss of critical skilled employees. Given your business Take time to detail your understanding of each ques- strategy, what critical capabilities are most at risk in yourtion in writing to really test the depth of your knowledge. organization? How is your company determining whichThen test your responses with a trusted colleague in the individuals have unique knowledge essential to the future
Mercer/CCH Guide for Employers 12of your business? What processes are in place to effectivelytransfer that knowledge? CCH WORKDAY These are some of the most costly talent-related riskfactors. You can use these questions to test the quality ofyour department’s thinking about your vulnerability to CCH Workday is an online HR news blog pub-these risks. Then draw on this list to frame risk manage- lished by CCH Incorporated, United States, ament conversations with senior executives in language that Wolters Kluwer company.gets at issues your leaders really care about. Q: Are there solutions that are particularly effective formanagers who already know their most critical risks? Majority of corporate executives DeLong: We did more than 70 interviews with senior concerned that current leaders are illexecutives and top talent experts in researching our book. prepared to deal with impendingOne surprising thing we found was how uninspiring so convergencemany solutions are. Talent management has become arelatively mature field in a lot of organizations, but it’s (Posted January 31, 2011)amazing how mundane most existing programs are. More than two-thirds of corporate executives see Given the very real threat of serious talent shortages great danger in leadership being overwhelmed by theand their significant costs, there needs to be a lot more complex challenges brought about by the current trend ininnovation in the field. That said, we did document some which companies are experiencing convergence,notably creative — and effective — initiatives such as according to a new study released by Egon Zehnder Inter-Microsoft’s internship program, Westpac Bank’s CEO-led national. Convergence involves cross-industry collabora-culture change needed to support a new talent manage- tion, changing business models and companies makingment system, Pfizer’s customized program to improve the structural transformations. In fact, three out of four execu-quality and speed of executive transitions, and programs at tives report seeing convergence in their industry. The maina major retailer and in a high-tech R&D lab that accelerated drivers behind this trend are changes in customer expecta-knowledge transfer to support business growth. tions and technological innovation. Here are some questions you should be asking if your Convergence is impacting a whole spectrum of indus-goal is to find more innovative talent solutions: tries — from the advent of the electric car in the automotive sector to personalized medicine in the healthcare industry 1. Can you identify three to five companies in your — and technology and telecommunications innovation is region similar to your organization, and describe often at the forefront of these changes. And, as a hub what they’re doing to manage talent? technology, digital hardware and software is becoming all-pervading in traditional branches of industry such as energy, mechanical engineering, and medical technology. 2. Have you reached out to companies of similar size in different industries to learn specifically how One of the greatest challenges associated with conver- they’re addressing these challenges? gence, however, is having people with the right skill sets to manage the transformation. According to top executives, 3. When you look at new solutions, do you tie your nearly two-thirds of companies believe they do not have analysis back to those ‘‘big picture’’ strategy ques- sufficient leadership potential to deal with the changes tions I mentioned earlier? driven by convergence. ‘‘In the U.S., three quarters of exec- utives are fearful of leaders being overwhelmed by the 4. How would the more innovative solutions you’re increase in complexity brought about by convergence’’, considering better support the overall business said Mike Portland, co-leader of Leadership Strategy Serv- strategy and reduce critical talent-related risks? ices, Egon Zehnder International. In too many organizations today talent management is As a result, an intensified war for talent is increasingly‘‘owned’’ by HR. But recruiting, developing, and retaining taking place across industry — and geographic — borders.high-performing employees and great leaders is much too The study, conducted in winter 2010, queried 515 topimportant to be left to one group. Many managers and executives from multinational corporations, as well as smallexecutives still don’t understand what role they must play and medium-sized businesses in countries across thein this process, or how to do it. HR managers add much globe, including: Denmark, France, Germany, India, Italy,more value when they approach their business partners Netherlands, Sweden, Switzerland, and the U.S.using language, frameworks, and techniques that are ‘‘Convergence is resulting in corporations developing ultratime-efficient and demonstrate immediate results. demanding leadership profiles for executives who can
13 Mercer/CCH Guide for Employersmanage change and looking globally for the leaders that fit Edwards, senior vice president for AMA Corporate Learningthis profile’’, said Damien O’Brien, CEO, Egon Zehnder Solutions. ‘‘Just a small minority of organizations seemInternational. ready to manage a top-level succession in an emergency, which means most companies are taking a huge risk by The pressure on corporate executives has spiked sub- failing to address their bench strength issues.’’stantially and leaders are required to possess skills andcompetencies that were once thought of as impossible to According to Edwards, the survey data provide anfind in one individual. For example, leaders today are unvarnished perspective of current management succes-increasingly required to have a range of skills and compe- sion preparedness. ‘‘Our findings aren’t based on an officialtencies, from being vigorous and persistent to being cultur- response from corporate leadership, but instead comeally sensitive. from middle- to senior-level respondents at more than 1,000 organizations across the U.S. and Canada. In other Ambitious skill sets. Seventy-eight percent of top exec- words, the findings mirror what people really think. Andutives questioned said teamwork at the management level the respondents weren’t hesitant to share their opinions.has become significantly more important. This was the Barely 3 percent claim not to have an opinion.’’highest in India, with 92 percent of executives indicatingteams are increasingly critical to managing the challenges Similarly, survey respondents were critical of theirof convergence. In contrast, only 57 percent of German organization’s leadership pipeline, observed Edwards.executives believe teamwork is becoming more important. ‘‘Again, the respondents weren’t shy about their viewpoint.In addition, corporate executives across the globe cited Scarcely half believe their company’s bench strength isbeing ‘‘vigorous and persistent’’ and generalist knowledge even adequate, and merely 10 percent think it’s robust.’’and skills as the competencies most in demand now (1.6 Forty seven percent describe the leadership pipeline ason a scale of 1 to 4, from highly relevant to unimportant). adequate and 30 percent inadequate.The ‘‘necessary bite’’ ranked the highest of the skills inFrance (2.3) and the lowest in Italy (1.0). Planning for a smooth management succession is more critical than in former years, according to the findings. Resource challenges. Sixty-three percent of corpora- ‘‘A big majority, 71 percent, say it’s more important, 27 per-tions believe they lack sufficient personnel resources to cent that it’s about the same as in the past, and less thanimplement the changes made necessary by convergence. 1 percent think it’s less important, yet organizations neglectThis number was the highest in France (86 percent) and the to sufficiently plan for such unhappy contingencies’’, saidlowest in Germany (43 percent). In the Netherlands, nearly Edwards, who is not surprised by the survey findings. ‘‘Get-80 percent (78 percent) of executives see danger of leaders ting top leadership to focus on management succession isbeing overwhelmed by the increase in complexity brought a perennial challenge. After all, even great leaders may notabout by convergence. France ranked the lowest at 54 per- want to consider a worst case scenario. Moreover, finding,cent. growing and retaining leadership in waiting are not easy.’’ Collaboration. As a result of diminished boundaries For the past two years, Edwards said, senior manage-between industries, 45 percent of global companies indi- ment has been focused on cost cutting and survival. ‘‘Butcate they now offer products/services in partnership with now it’s time for investment in sustainability and competi-other companies (46 percent in the U.S.). tive advantage, which must be based on talent. Having the best people in pivotal leadership roles, prepared to step in Source: Egon Zehnder International at any time, is essential for future success.’’(www.egonzehnder.com). Source: American Management Association (www.amanet.org).Survey finds one in five companiesunprepared for leaders’ sudden loss Majority of U.S. employers offer workplace(Posted January 24, 2011) flexibility with informal approach most common One in five organizations is utterly unprepared to dealwith the sudden loss of its key leaders, according to an (Posted February 17, 2011)online survey of 1,098 senior managers and executives byAmerican Management Association Corporate Learning A new WorldatWork study, Survey on Workplace Flexi-Solutions. Only 14 percent were said to be well prepared, bility, provides an inside look at employers’ views on flexi-while 61 percent are somewhat prepared. bility. The study was designed to gauge the impact of flexi-Twenty-two percent report being not at all prepared. bility programs on employee attraction, motivation and retention and also examine the manner in which these The findings point to a looming management succes- programs are managed. The study revealed that while asion crisis among North American companies, said Sandi vast majority (98 percent) of U.S. employers offer at least
Mercer/CCH Guide for Employers 14one workplace flexibility program, most (nearly 60 percent) ● Companies tailor flexibility programs to fit the needs ofuse an informal approach, i.e., no written policies or forms, their workforces as well as their organizational priorities.up to manager discretion, etc., and four out of 10 say flexi- The most prevalent programs are flex-time (flexible start/bility is culturally embedded. The study found that a stop times), part-time schedules (with or without bene-stronger culture of flexibility is correlated with a lower vol- fits), and teleworking on an ad hoc basis (meet a repairuntary turnover rate. person, sick child, etc.). Each of these programs are offered to some or all employees in more than 80 per- ‘‘When it comes to workplace flexibility programs, cul-ture trumps policy,’’ said Rose Stanley, a practice leader for cent of surveyed companies; when offered they are alsoWorldatWork. ‘‘It’s not about the quantity or formality of the most commonly used by employees, with flex-timeprograms offered; it’s about how well supported and the highest ranked.implemented the programs are across the organization.’’ ● Organizations that have a stronger culture of flexibility Key findings from the study include: also have a lower voluntary turnover rate. In addition, a majority of employers report a positive impact on● The survey covered 12 flexibility programs and found employee satisfaction, motivation and engagement. that, on average, organizations offer six different types at one time. Different sectors emphasize flexibility pro- ● The study revealed several obstacles to the adoption of grams with varying degrees: compressed workweeks are flexibility programs, which included: lack of training; top more prevalent in the public sector (68 percent); part-time schedules are more common among management resistance (more so than middle manage- non-profit organizations (90 percent); and ad hoc ment); and lack of employee interest in programs such telework is more frequently offered by publicly traded as phased return from leave, phased retirement and companies (89 percent). Surprisingly, the study found no career on/off ramps. correlation between the number of programs offered and turnover rates. Source: WorldatWork; www.worldatwork.org.