Title page _default type size = 40 pt Times New Roman_

Document Sample
Title page _default type size = 40 pt Times New Roman_ Powered By Docstoc
					     <Insert Picture Here>
                              Performance Management
                              in the New World of Talent

IHRIM – Atlanta Chapter
Row Henson, HCM Fellow – Oracle Corporation
Molly Talanczuk, Manager, HR Technology - Cox Communications
 So Where is Talent Coming From and How Do We
 Shrinking Workforce          Multiple Generations

2.0%          1.7%

1.5%                               1.2%

1.0%                                      0.8%

0.5%                                                           0.3%
                                                        0.2%          0.2%   0.2%

       1950s 1960s 1970s 1980s 1990s 2000s 2010s 2020s 2030s 2040s 2050s

                      Labour Force Growth (Population = 16-65)

Disengaged Employees                                                                Leadership Development
Strategy Execution gets a failing grade

 “Less than 10% of strategies effectively
  formulated are effectively executed”
The challenges to achieving a
high-performance workforce …
 Workforce Not Engaged with Objectives

• Employees don’t understand their impact
• Employees not fully engaged with
  enterprise objectives
• Managers don’t have line of sight into talent

           Enterprise performance suffers
Performance Not Being Managed

• MBO process is unsuccessful
• Feedback is poorly articulated and delivered
• Employees not developed for success
• Fragmented process

           Employee not leveraged or developed
Not Creating a Performance Driven Culture

• Not truly paying for performance
• Top performers are not rewarded or enticed
  to remain
• Can’t identify tomorrow’s leaders

           • Rewards ineffective
           • Talent leaves
           • Jeopardizes organizational future
 Performance Management Drives Business Success

   Employee understands                                                   Employee understands
     company goals                                                       how to make a difference

               38% more engaged                                                        68% more engaged


Understand     Do not                                          Understand          Do not
             understand                                                          understand

                     The Towers Perrin Talent Report 2001: New Realities in Today’s Workforce
                   The Premium for Talent

Source: Quantisoft, LLC
 Engage and Develop the Workforce
• Engage workers and reduce
 turnover by 10%                                                 Companies using Learning &
                                                                 Performance systems can
• Reduce training facility, travel &                             reduce admin support by
                                                                 30%, improve overall
 instructor costs by 15-30%
                                                                 productivity, and cut a wide
                                                                 variety of costs
• Reduce related Print, Copy and                                      -- CedarCrestone
 Mailing fees by 33%
 A typical organization with                       10,000     employees
 And revenue of                                     $2.0B     per year, results in potential benefits of
 Avoid staff replacement costs                      $4.5M     over a 5 year period
 Improved HR staff productivity                     $3.0M     over a 5 year period
 Reduced training travel, facility,
 and instructor costs                               $7.0M     over a 5 year period
 Reduced print/copy/mail fees                       $0.3M     over a 5 year period
 Resulting in savings of                           $14.8M     with Learning & Performance
Source: CedarCrestone (available at
    Help the Emerging Leader find a Path
     – Pulls together relevant data about an
       employee’s talent information. This
       includes performance objectives, training,
       certifications, competencies, academics,
       awards, succession plans, and appraisals.

• Analyze gaps between desired proficiency and
  current performance level
• Identify and enroll in training to close gaps
• Identify potential candidates based on
  employee interest lists and talent profiles
• Provide self service career tools to employees
  and managers
• Update proficiency levels based on
  performance evaluation
• Find “hidden talent” in your organization
• Assess “bench strength” for critical skill areas
               Keep the High Potentials Engaged
                    Competitive Advantage – a business with a
                      highly engaged workforce has many
                        advantages over its competitors

• On average, they rate 86% higher with their customers

• They have 70% more success in lowering employee turnover

• They are 70% more likely to have higher productivity

• They enjoy higher profitability, have better safety records and
  deliver greater earnings per share to their stockholders

Source: Work Force Analysis – a Business Reality Check – Profiles International, 2008
     Prepare for Change with Succession Planning
        “A people process that enables organizations to
         improve retention while mitigating risk factors to
         the business.”

     • A means of identifying critical management
     • Identification and assessment of key skills and
       competencies required for the positions
     • Ability to provide maximum flexibility in lateral
       and upward moves in the organization
     • Assessment and development of top
       performers for future responsibilities

      Why Talent Matters: Value and Money

 Value of Top Performers – Two, three times even 12 times the performance of average
  employees (Ulrich and Smallwood)

 Cost of Losing Talent – 1 ½ times burdened salary.              Cisco estimates losses of $250K
  for each talented engineer it loses. Bristol Meyers Squibb loses $500K for each senior leader lost
  (HCI). Bill Gates says the loss of one top engineer to a top competitor will cost Microsoft $1 billion
  over the course of that engineer’s career

 Cost of Poor Hire – $300K average impact in knowledge-economy firm (Sullivan)
 Impact of “bad fit” executive hires – 40% fail within the first 18 months (Charan)
 Cost per Day – $7000 avg per day for operating without a key player (Sullivan)
   Why Talent Matters: Productivity

 Engagement Levels – Only approximately 25% to 55% of employees are engaged
  (Watson Wyatt and CLC)

 Breakeven Point – 6.2 months for a manager to become productive in a new job

 Manager Ripple Impact – On average, a manager’s actions             impact 12.4
  people in a company (Watkins)

 Deployment – Only about 20% of employees do what they do best at work

 Performance Expectations – Less than 50% of employees know what is
  expected of them at work (Stolovich)
 Performance Management – Employees that understand what is expected of
  them are 38% more productive than employees that don’t and employees who
  understand what is expected of them and how that contributes to the goals of the
  business are 68% more productive than employees that don’t. (Towers Perrin)

 Organizational Learning – Few organizations do a good job of sharing “what
    Business Intelligence

                                  Predictive Modeling

I                      Correlated Analytics
P                   Contextual Embedded
A                   Analytics
             Metrics Delivery

Reporting vs. OLAP vs. Data Mining

  Extraction of    Summaries,         Knowledge
  detailed and     trends and         discovery of
  roll up data     forecasts          hidden patterns

  “Information”   “Analysis”          “Insight &

 Who left last    What is the          Who are the top
 month?           turnove trend for    performers at risk
                  the last 3 years?    of leaving?
     TM Metrics that Matter: Performance

                                                         Impact of perf
                                 Perf Mgmt /             mgmt on business
                                 Learning                results

                  % of ees               Pay for
                                                            of perf mgmt
                  unreviewed             Performance
                  for > 2 yrs.           Alignment

                        Perf. ratings                     Perceived
                        distribution                      credibility of
                                            Efficiency of perf mgmt
             % employees reviewed
                                            perf mgmt
             Number of reviews              process
             completed on-time

                     Meeting The Challenge
Drive Business Results
  Clearly define and link individual performance to enterprise objectives
Process for Sustained Change
  Iterative and collaborative communication
Transfer Ownership to Users
  Planning/linking objectives, defining responsibilities, training plans, and
    career and succession planning
Increase Employee Success
  Improve quality & timeliness of feedback
  Enable performance driven development
Support End-to-End Talent Mgt.Business Processes
  Link the right rewards directly to performance
  Link feedback to development plans
  Integrate competencies across Talent lifecycle
  Understand that Performance Management cannot operate effectively
     in a silo