The document discusses strategies to retain key employees and avoid talent drain, emphasizing the role of managers in enhancing employee commitment through effective communication and support. It outlines various retention drivers, including fair feedback, internal communication, and career development, and presents case studies that illustrate successful management practices. The document also highlights the importance of flexibility in work arrangements balanced with accountability and introduces tools for managers to facilitate these discussions with their staff.

1. Preserving Key Employees and
Avoiding Talent Drain to Win the
Human Capital Fight
Peter Watson
HR Director - AstraZeneca
5 March 2011
HR Summit – Gold Coast Australia

2. Topics
• Framework for the Talent Retention Challenge
• What drives retention
• The role of the Manager
• Case Studies:
• AZ Managers‟ Program
• Flexibility with Accountability
• Targeted Retention
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3. What Drives Retention?
Remuneration
Work/Life Quality of
Flexibility Manager
Talents
Career
Work
Development
Challenge
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| Title of presentation | 00 Month Year (Go Header & Footer to edit this text) Source: CLC April 2004

4. Managers Control a Majority of the Most Effective Drivers of
Employee Performance &Retention
Impact of top performance drivers Impact of top retention drivers
Line managers directly influence a Line managers also control a majority of
disproportionate share of the most the most powerful drivers of employee
effective drivers of performance. The two intent to stay with the organization. The
strongest manager-influenced drivers, for two strongest manager-influenced
example, are: drivers, for instance, are:
•Providing fair and accurate informal • Facilitating internal communication:
feedback: 39% impact on performance 38% impact on intent to stay
•Clarifying employee performance • Advising on career development:
50.0 expectations: 36% impact on performance 50.0 37% impact on intent to stay
Driver impact Driver impact
on employee 25.0 on employee 25.0
performance intent to stay
0.0 0.0
Manager activities
Non-manager activities
Source: Corporate Leadership Council research.

5. The Role of a Manager as a “Connector”
The results of commitment:
Discretionary Effort & Intent
Two commitment types Four points of commitment to Leave
While employees can rationally and
emotionally commit to 4 different points of Discretionary
the organisation… Effort
Rational An employee‟s
1. Day to day work 3. Line manager willingness to go
Performance
Commitment 2. Teams 4. The organisation „above & beyond‟
the call of duty
…the unique role as „connector‟ enables
managers to strengthen employee
commitment in all 4 directions. Intent to Stay
Emotional Employee An employee‟s
desire to stay with
Retention
Commitment the organisation
Mgr
Team Org
Job
Source: Corporate Leadership Council research.

6. The 5 Top Retention Levers in the Hands of a
Manager
Role 2
Managing the employee‟s relationship /
engagement with the organisation
1. Amplify the good, filter the bad
2. Connect employees with the organisation
and its success
3. Instill a performance culture
4. Connect employees with talented co-
workers
5. Demonstrate a „credible commitment‟ to
employee development
Source: CLC

7. Case Study 1
AZ Managers‟ Programme
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8. Managers‟ Programme Overview
How to help managers‟ reframe their role?
How to help managers see both formal and informal
opportunities to engage their employees?
Move beyond theoretical concepts?
The answer….
Raw unedited anecdotes from employees
describing good, great and poor
experiences of work life with AZ
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9. Anecdotes – an example of the impact a manager can have
“at around nine months of being in and I got the conversation with my
manager where she said, now where do you want to go. And I said, hey,
are you trying to chuck me out already. I‟d rather like to keep this job if you
don‟t mind. But the conversation was tuned to the fact of, okay, well you are
getting close to the first year. Where do you see yourself being? Where do
you want to develop to? How can I help you develop that?” Well, it was an
amazing vote of confidence because it was, okay now I feel like I‟m part of
this and I can develop. And she said, okay, whatever you want to do, I‟ll
help you in any way I could possibly help you to get to that goal. And that‟s
was an amazing statement; particularly so early on and that was a real
endorsement.”
9

10. Feedback from Managers after the Programme
Anecdotes had strong impact on managers, and gave them insight into
the power of everyday interactions
Anecdotes / real stories not „case studies‟ – added realism to course and
allowed group members to easily relate and take home learnings
Every interaction with an employee is either a chance to motivate or de-
motivate
Quote from a participant, “The most „real‟ management training course I
have been on”
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11. Case Study 2
Flexibility with Accountability
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12. The Challenge & The Opportunity
Clear need to
change how Feedback from
Uncompetitive employees
in the external flexibility is
managed at that we‟re
market “inflexible”
AZA
Inconsistency of
flexibility across
the business

13. Flexibility with Accountability
Principles of Flexibility
Meeting business goals is the Performance is not
company‟s top priority defined by physical
presence
Flexible Working Employee –
Equity does not
guarantee
Arrangements manager
You days collaboration is
employees the Working From Home – Ad hoc
same outcome critical
Flexible start Finish times
Working outside business hours
Lifestyle Friendly Leave
Flexibility is a Toolkit Employees are not
entitled to
two-way street flexibility*
Performance matters
* Legal requirements exist to provide flexibility

14. Key challenge: balance flexibility with accountability
AZA‟s Flexible Work Arrangements
Principles Description
• Performance matters • Only employees with “meets expectations”
performance reviews may request flexible scheduling
• Meeting business goals is AZA‟s top • The needs of our customers and teams must be fully
priority addressed when designing flexible work arrangements
• Performance is not defined by physical • Acknowledges that from time to time, employees can
presence and do perform work activities from remote locations
eg. Home
• Equity does not guarantee employees • A flexible scheduling solution need not and will not be
the same outcome the same for all employees
• Flexibility must be a two-way street • Established flexible work arrangements must
themselves remain flexible
• Employees are not entitled to flexibility* • Flexible scheduling is not appropriate for all employees
or positions within the company*
• Employee-manager collaboration is • Open dialogue between managers and employees is
critical crucial
* Exceptions apply in case of legal requirements

15. Flexible Working Arrangements at AZA
Each of the offerings are designed to provide flexibility with
accountability consistently across the business
• You Days (Formally RDO‟s)
• Recognising evening
business activity
• Work from home (adhoc)
• Flexible start & finish times
• Lifestyle Friendly Leave

16. Vacation Care Programme
Offered 5 weeks per year
Children aged 4 – 13 yrs
Run by YMCA – qualified staff, excellent programs
On-site – AZ catering
Flexible booking – single days OK
Fantastic Feedback from staff

17. Flexible Work Proposal Toolkit
The toolkit is designed to help managers discuss
and explore flexible work arrangements with
their staff. It provides guidelines for
managers and staff on:
• how to plan,
• implement, and
• communicate a flexible work arrangement.
The toolkit provides guidance for managers to
assess requests on a case by case basis.

18. Flexible Working Arrangements on the HR website
FWA Overview
FWA Guide
FWA FAQ
FWA Toolkit

19. Posters, emails, AZTV, stress puzzle,
brochure
5 weeks
February to
March, 2010

20. Average Tenure has Increased by 50%
Tenure Profiles
(YTD 2007)
181 25 5 29
100
>5 yrs
80 3-5 yrs Today
2-3 yrs average
60
1-2 yrs
tenure is 3.9
Percent
years
40 <1 yr**
20 <1 yr
0
Sales Rep Territories* PCAM Sales Manager
Average
2.6 2.2 12. 7.3
Tenure
3
Note: * Excludes 3 staff with tenure > 20 yrs; ** New roles due to introduction of xxxxxx

21. Summing Up
Build a Brand
• Alignment with EVP
Create a Supportive Culture
• Manager engagement
• Principles, Mindset & Behaviours
Get the Mechanics in Place
• Policies
• Guides
• FAQs
• Toolkits

22. Case Study 3
Targeted Retention of Talents
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23. Determining the Need for a Targetted Retention
Plan – Assessing Departure Impact and Risk
High
Understand individual‟s
Understand individual‟s preferred financial and non-
preferred non-financial financial incentives and critical
incentives and critical employment factors.
employment factors.
Openly engage individual with
• Business critical project or initiative possible retention actions –
would be negatively impacted
Review questions on Risk
Departure Impact Assessment Tool and act to create Retention Plan.
• Business performance would be strengthen assessment.
adversely impacted
Identify potential successors
• No suitable replacement/succession
candidates exist Identify potential successors
Work to help individual
• Very tight labour market, skills produce greater value e.g. and make contingency plans
required in short supply – expensive to to replace if necessary.
stretch assignments,
replace
• Corporate knowledge and experience coaching feedback, Redeploy to position where
very difficult to replace performance objectives, he/she can have greater
learning and development impact and add greater value
opportunities. to AZA and decrease
probability of departure.
Low Departure Risk* High
• Possesses highly sought after or scarce skills
• Ready for a job move now – actively seeking
• Impacted by recent organisational change
• Unsuccessful in internal selection process
23 • Dissatisfied with aspects of employment
* Refer Talent Risk Assessment Tool

24. Targeting Retention of Talents
1. Make an assessment of „departure risk‟
2. Consider individual retention drivers
3. Formalise in a Retention Plan
4. Communicate with the Employee
5. Follow up and ensure action
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25. Targeted Retention Plan
1. Personal Information
Name Line Manager
Current Role Years in Current Role
Previous Role Years in Company
Date of Assessment
2. Compensation & Bonuses
Actual Increase Q2 Q3
Salary
Bonuses
3. Action Plan
Retention Objective Retention Activity Timing Accountable
4. Other Comments
5. Tracking
Name Comments Date
Name Comments Date
Name Comments Date
25 Authorisation
Divisional Director Managing Director
Date Date

26. 26 | Introducing AZengage| Octoberl 2010