Cornerstone's Talent Management Blog

Tough Times Make Talent Management Essential in the Public Sector

Charles Coy — Wed, 08 Feb 2012 19:12:12 +0000

Public Sector Talent Management

Tough Times Make Talent Management Essential

Fiscal and political realities are causing havoc for federal, state and municipal entities. Budgets have never been tighter, spending cuts are inevitable, and many reductions will come in the areas of talent and training.

With those buffeting winds, public sector employers must gauge the impact these cuts will have on talent in light of generational shifts, impending retirements, and the need to fill leadership positions and skill gaps. It’s clear that investing in talent is essential to maximize employee productivity and maintain the highest possible levels of service for constituents. It’s been proven that talent management solutions can help public sector employers deliver better training at a lower cost, develop and engage their people, and plan for the leadership and talent needs of the next generation.

In fact, talent management technology has become, you could say, table stakes for the public sector because of the pressure to streamline talent processes in ways to improve efficiency, reduce risk and lower costs.

Technology – specifically cloud-based or SaaS (Software-as-a-Service) talent management solutions – can play a crucial role since traditional strategies and tactics are no longer sufficient. Governments will need technology to play a transforming role in service delivery and operations.

With effective talent management technology and strategies, good processes can translate to tangible outcomes. In addition, public sector employers can integrate information, communications and operational technologies. Leveraged technology can be used for planning, management and operations across multiple process areas to generate sustainable public value for constituents.

Specifically, talent management technology can help public sector employers in many areas, including:

PERFORMANCE MANAGEMENT - Assessing and managing performance is always important, but especially so in times of hiring freezes and downsizing. Up-to-date performance appraisals (and dare we say interim or ongoing performance evaluation?) can identify the top performers whom the agency would like to retain and appraisals can inform the difficult decisions around redeployments or furloughs, if required. Technology makes it far easier to link individual performance management to organizational performance.

SUCCESSION MANAGEMENT - As the overall unemployment rate declines, private sector companies are hiring, so state employees may be seeking jobs elsewhere. To further complicate matters, some employees may take early retirement or defer retirement for a few more years. Demonstrating that there are still opportunities for promotion — or even for lateral transfers — can help to keep strained employees from actively searching for other prospects. Succession management technology allows you to build career paths and talent pools for employees, as well as understand where serious talent and leadership gaps exist so you can address them today.

LEADERSHIP DEVELOPMENT – Leadership shortages are so acute that leadership development programs should be retained to the greatest extent possible, even if they must be modified. Most government and public sector employers suffer from the same problem: not being able to fill positions quickly enough. Public sector employers need strategies and tools in place to transfer knowledge and develop a new talent “bench.”

DEVELOPMENT PLANS FOR ALL EMPLOYEES - Leadership positions and critical roles are obvious choices for targeted career development through performance, succession and learning initiatives. However, career development for all employees is a worthwhile investment. In the private sector, organizations with high-quality development plans for all employees have 26 percent higher revenues than companies that do not.

COMPETENCY MANAGEMENT - Establishing meaningful competencies – the knowledge, skills and behaviors that are used to develop people in your organization – is a critical step for the success of your talent management initiative. These competencies will allow you to build job profiles that will guide career development, training and performance improvement across your organization. You will also find it easier to deliver the ROI because the business impact of career planning is 45 percent higher for organizations with good or excellent leadership competencies.

CAREER DEVELOPMENT PLANNING - Performance management must be more than an assessment. It actually is an opportunity to engage employees in their work and help them establish goals. For best results, incorporate activities that will help employees to develop the skills needed to meet both individual and organizational goals. Also, you should have supervisors review plans with employees periodically, ideally on a monthly or quarterly basis.

TALENT POOLS - One of the biggest mistakes that the private sector made during the recession was the elimination of entire business units without any attempt to identify and retain high-performing and high-potential employees. Building internal talent pools can prevent public sector employers from making the same mistake.

INFORMAL LEARNING - For most employees, learning on the job from peers is the most effective and powerful method of learning. However, these initiatives don’t happen by accident. Creating the appropriate structures and providing the right tools can take learning out of the classroom and into the workplace where it belongs – and deliver more ROI on your investment dollars.

For the public sector to meet today’s challenges of doing more with less means integrating learning, performance and succession – via technology - with a seamless development strategy for managers and employees across the enterprise. For a deeper discussion of the issues facing government agencies and other public sector organizations, please see our whitepaper on the subject: Making the Best of It: Why Tough Times Make Talent Management Essential in the Public Sector

Talent Management for Healthcare

Charles Coy — Thu, 02 Feb 2012 22:39:07 +0000

Talent Management for Healthcare

When it comes to talent management technology, healthcare is playing catch-up. But the times they are a-changing.

In the last few years, our old pals at Bersin & Associates argued that healthcare has lagged behind other industries in adoption and implementation of talent management automation and processes and that many healthcare organizations are working to make up for lost time. (Bersin & Associates 2009 Talent Management Factbook)

Any healthcare organization looking to jump-start a talent initiative should keep a few things front of mind:

Build with an eye toward integration - E-learning may be a natural starting point for healthcare organizations implementing new talent initiatives, but onboarding, performance management and succession initiatives all benefit from strong tie-ins to a learning management system (LMS). For example, performance assessments can automatically generate development plans for any area where deficiencies are identified. Don’t overlook targeted, formal development programs for employee supervisors. Extra training will prepare them to mentor and coach employees and maximize the value of your investment.

Automate job descriptions with a foundation of competencies - Establishing the competencies – the knowledge, skills and behaviors that are used to develop people in your healthcare organization – is a critical step for success of any talent management initiative. In the healthcare setting, it’s a requirement because compliance demands it. Maintaining one set of job descriptions and competencies is one way to integrate multiple locations common in large healthcare systems into a single culture and to build job profiles that will guide career development, training and performance improvement across your organization. You will also find it easier to deliver the ROI because the business impact of career planning is 45 percent higher for organizations with good or excellent leadership competencies. (Bersin & Associates, Competency Management 2008)

Build internal talent pools - Every healthcare organization needs to fill positions in critical roles such as nursing, IT and senior management. Yet, suitable candidates are hard to find. Most healthcare employers understand that the only solution is to “grow their own” talent. Implementing appropriate talent management and learning tools and processes makes identification of high-potential employees and development of critical skills far easier to accomplish.

Collaborate to build a comprehensive succession strategy - Most healthcare organizations have a critical need to develop their next generation of leadership. The current senior leaders must understand the critical need to address this gap. HR can – and must – play a crucial role in facilitating this conversation, and technology can provide a key assist to identify the gaps and assign development plans for designated successors.

Leverage the power of Software-as-a-Service (SaaS) - SaaS technology allows healthcare employers to rapidly implement talent solutions at a far lower cost and with greater operational efficiency than traditional legacy on-premises ERP implementations of the past. The advantages include rapid deployment and easy scalability, and a lower cost with higher satisfaction, as well as less time to ROI.

In the end, empowering your people is the essential first step toward addressing talent challenges and delivering safer, higher-quality patient care and satisfaction. Using talent management technology, employers can manage their staffing, training and performance operations with healthcare-specific functionality, including competency-based job descriptions, pre-integrated training and continuing-education content – all in a single, secure location.

Talent Management and Succession Planning in Higher Education

Charles Coy — Fri, 27 Jan 2012 19:16:15 +0000

Readiness in the Face of a Talent Crisis

Talent Management and Succession Planning in Higher Education

America’s higher learning institutions educate and develop society’s future thinkers and leaders. It’s ironic, then, that it seems many don’t develop their own administrative staff or leadership talent.

Administrator Talent Crisis

Research shows talent and succession planning is lacking at America’s colleges and universities. The American Council on Education (ACE), for example, reports in a survey that the talent pipeline of potential administrative leaders in academia is getting short shrift, as ACE reports that less than a third of all sitting chief academic officers are aspiring to presidencies or chancellorships.

That’s not good, but it gets worse. Research also shows that many tenure-track faculty members also are deciding to stay in the classroom, reluctant to pursue new challenges as administrators.

Here are some startling statistics that fortify the notion that academia’s talent pipeline needs serious tending. For example:

Nationally, more than 40 percent of the top investment executives within universities and endowments left in 2005 and 2006, according to a 2007 compensation survey by Mercer

A national study of 323 chief academic officers, conducted by Eduventures Academic Leadership Learning Collaborative, found that 43 percent of provosts surveyed are holding their positions for shorter periods of time.

A 2009 study of chief academic officers by the ACE found that the average tenure was 4.7 years on the job — less than half that of presidents

Where to Go From Here

It’s a dicey situation, but not an impossible one to overcome. For starters, effective succession planning starts with performance management supported by learning and development programs. Follow that “curriculum” and universities soon will discover potential leaders from within the ranks. Of course, one thing you don’t want when filling critical administrative posts is guesswork.

For many universities, performance management is merely an annual HR process to appraise performance, as opposed to an effort to improve performance or identify future leaders. Saddled with homegrown, paper-based processes, institutions often use performance management tools and approaches that fail to take advantage of the automation, integration and depth of technology available today. Or institutions may have processes that don’t enable managers to have meaningful, actionable discussions with their direct reports.

The solution is more strategic talent and peformanance management processes, supported by the right technology that can better lead, manage, develop, reward and assess employees in a concise, standardized way.

To make succession planning a reality, university leaders need a performance management system that:

Provides cascading goals that align the objectives of the institution with the professional goals and needs of the employee. Managing and measuring the employee performance of each of these goals is critical to performance management, but without automation and integration, it becomes a time-consuming, daunting task.

Assesses critical competencies and skills based on pre-defined criteria for staff success. Institutional leaders need an easy-to-use system that helps them predict and address potential competency gaps, performance strengths and opportunities.

Reviews and measures performance on a ongoing and interim basis. The cascading goals an employee will be assessed by might not reflect the institution’s current goals and objectives. Automated and integrated systems make managing and assessing performance an ongoing process — always keeping the employee and the institution aligned.

Identifies and tracks high-performing individuals. Performance management enables institution leaders to know who is a high-potential employee with the skills and motivation to transition into a leadership or administrative staff position.

Enables the creation of development plans that engage employee career development. Identifying high-performing, high-potential employees is great, but even more important is creating career development plans for those employees.

Ultimately, institutional leaders have an opportunity to better gather insight into the skills, knowledge and competencies that succession-ready employees have at hand – and, further, to turn this insight into action and talent they should develop for the future.

Credit Unions: Preparing People Resources for Growth in 2012

Charles Coy — Fri, 23 Dec 2011 17:31:35 +0000

Credit Unions: Preparing People Resources for Growth in 2012

Efficient processes for training and performance management are essential for supporting long-term financial growth within this highly regulated industry

Bank Transfer Day had a significant impact on credit unions. Not only did the movement generate more public awareness of CUs, it also resulted in new member gains. According to the Credit Union Times, the one month spike of 210,000 new members was “incredible” compared to recent years. In fact, membership growth in September and October 2011 represented 75 percent of CU’s 2010 growth.

Experts estimate that this growth opportunity for CUs will extend into 2012, and those who have the right resources in place to take advantage of it will be rewarded with increased memberships and loans.

Additionally, it is also projected that 2012 will see a lot more consolidation of small credit unions. In October 2011, there were 7,409 credit unions, and the Credit Union Times predicts that number will dip below 7,100 in the coming year.

Obviously one of the more important resources in CUs and any other organization are its people. Efficient processes for employee training, development and performance management are essential for supporting long-term financial growth within such a highly regulated industry. And when merging organizations, establishing consistent learning and performance management initiatives becomes even more critical.

Improving Efficiencies and Reducing Costs

One example of a CU that has taken steps to better support its employee development goals and meet evolving industry requirements is GECU, El Paso’s largest locally owned financial institution and one of the largest credit unions in the state of Texas. GECU employs more than 700 people to serve over 298,000 members across its 14 branches, call center and support departments located within its Operations Center.

GECU had historically used instructor-led training for its employee base. However, as the credit union continues to grow, the dedicated resources and oversight required for in-person training, coupled with the time and travel required for having employees attend these sessions, was no longer efficient or cost-effective.

The CU decided to invest in a learning and talent management software solution that could help the organization increase its utilization of e-learning, which in turn would help to reduce employee training costs and reduce the time spent on managing employee development programs. Additionally, GECU aimed to streamline its internal and external reporting and compliance processes, as well as automate its employee performance management initiatives.

In particular, GECU wanted to invest in a software-as-a-service (SaaS) solution to support these initiatives. They wanted a technology solution that would be configurable and reliable enough to not only address their HR and employee development needs today, but also easily scale with the business as it continued to grow.

Immediate Impact

Since GECU implemented its learning and talent management software solution and updated its processes for learning and development and employee performance management, they’ve seen an immediate impact on the organization. With increased access to and use of online courses, the CU is on track to significantly reduce its reliance on manpower-heavy instructor-led training. For example, using the system’s reporting and analytics tools has helped GECU reduce time spent compiling reports by 75 percent.

And, managers and employees now have greater access and control over uploading, forecasting and customizing training courses. This has led to a more relevant and streamlined schedule of coursework for all employees.

For credit unions looking to take advantage of the growth opportunities ahead in 2012 -- or enable improved consistency and alignment following a merger -- now is the time to invest in and enable your human capital. To read more about GECU’s leaning and development and people management initiatives download the case study here.

Five considerations for TM buyers in the wake of SAP/SuccessFactors

Charles Coy — Tue, 13 Dec 2011 00:26:09 +0000

New Beginnings & Historical Parallels

Five considerations for TM buyers in the wake of SAP/SFSF

Last week SAP announced its intent to acquire SuccessFactors for $3.4 billion – which just so happens to be the predicted size of the entire talent management market for 2011 (according to Gartner and Bersin & Associates). This news is important for almost as many reasons as there have been opinions published over Twitter and in blogs in the aftermath.

Technology vendors in the talent management space have witnessed a lot of consolidation lately. For starters, just about every top-tier Learning Management System (LMS) – other than Cornerstone – was acquired in the last two years, reflecting the realization by performance management vendors that training and development must be a part of the broader talent management spectrum.

But the SAP/SuccessFactors deal represents a different kind of market shift - less about basic consolidation and the fleshing out of vendor portfolios and more about market validation and an expansion of the conversation outside our immediate neighborhood.

So what’s Cornerstone’s take (another voice in the bedlam)? We think the merger of SAP and SuccessFactors is a significant moment with at least five key possible outcomes to consider if you are a potential buyer (or just an interested observer):

1. This is the beginning of talent management, not the end.

The acquisition of SuccessFactors is a serious validation of human capital management in general. Jason Averbook puts it more passionately: “SAP has just broadcast to the world the single-most persuasive validation of Human Capital Management technology to date. It is a declaration we can all, as vendors and practitioners, lean on as we create workforce technology strategies and HCM business cases for years to come.”

Beyond business processes, SAP’s self-declared push into the “Cloud” market is a major validation of Software-as-a-Service as a delivery model.

So the talent management market is alive and well. If anything, SAP’s acquisition feels a little bit like the old “if you can’t beat ‘em, join ‘em” from the perspective of the ERP players. And hopefully that realization ends up benefitting organizations by raising the profile of talent management process and technology.

2. Confusion and distraction will certainly be among the immediate consequences.

After a major industry event like this one, everyone immediately has one big question: how long will it take for the acquirer to integrate the acquired company? Integrating product sets and corporate cultures is never easy work, especially so in the case of a traditional software giant absorbing a fast-moving, cloud-based vendor.

One of the biggest challenges is likely to be the rationalization of the companies’ offerings. How do you make the merging products (and related services) work together? Which older, outdated products must be eliminated? How do you make the user experience work between disparate products? How about data models and customer support programs and….on and on.

Naomi Bloom catalogs the product rationalization challenge in her recent blog post “SAP/SuccessFactors -- Help Me Count the HRM Codebases”.

This is an ambitious assimilation of technologies and strategic approaches. Results may come, but there will certainly be a lot of growing pains along the way. And while SAP and SuccessFactors wrestle the eight-headed snake, other vendors will continue to innovate and serve their clients.

3. Innovation will continue to come from the best-of-breed talent management vendors.

While big ERP vendors like SAP certainly bring new attention to the talent management technology world, if history is any indicator, product innovation is not likely to be spurred by these combined companies in the foreseeable future.

Josh Bersin argues that this is precisely why the best-of-breed talent management vendors will continue to exist (and thrive) – “primarily because of the tremendous levels of innovation still yet to be achieved in talent management. New areas, like social recruiting, social performance management, social rewards, social learning, mobile talent management, talent analytics, talent risk management, employee engagement management, contingent workforce management and many others, continue to become more important to customers every day.”

Bersin goes further to note the worrying “upgrade interlock” problem that faces ERP/talent management customers. This means that, typically, every new release of an ERP vendor’s talent management offering is dependent on a new release of the HRMS.

On the other hand, organic talent management SaaS/cloud vendors are releasing new and improved functionality on a quarterly basis, in some cases. It comes down to a matter of being fast and nimble, accusations rarely leveled at lumbering ERPs.

4. HR technology should be owned by HR and not IT.

One of the other possible implications of an ERP vendor acquiring a talent management company is that it means that IT assumes control of HR technology. And we all know how well that works today.

For HR technology to realize its potential business benefits, it must be governed by HR itself. Relying on IT to source, implement and administer talent management software sounds like a recipe for limited business impact.

5. Organically developed talent management has never been more meaningful.

It won’t shock the reader to hear that Cornerstone OnDemand sees the SAP/SuccessFactors merger in the most positive of light. The merger validates the work of all the best-of-breed talent management SaaS/cloud vendors in the space for the past 10-15 years.

However, the considerable questions raised around integration and the role of the ERP as provider of talent management software leave a significant opportunity for the nimble, innovative, best-of-breed providers that remain in the market (and there aren’t many of us left).

With so much transformative possibility in the industry today – around social tools, mobile access, talent mobility, employee engagement, workforce planning, analytics, etc. – it seems like what we all need to focus on most is rapidly developing innovative products to match the ambitions of forward-thinking HR practitioners and good talent management processes.

Disruption often (always?) leads to opportunity. Tien Tzuo, founder and CEO of Zuora, reacted to the SAP/SuccessFactors news this way: “I’ve seen this movie before. When Siebel bought Upshot CRM in 2003, it instantly signaled to the world that SaaS CRM was the future, and catapulted Salesforce.com from ankle biter to the de facto industry leader.”

Tzou’s analogy has remarkable parallels today.

Bringing Change to the Nonprofit World

Julie Brandt — Mon, 12 Dec 2011 22:48:58 +0000

Bringing Change to the Nonprofit World

“It is not the strongest of the species that survives, nor the most intelligent. It is the one that is the most adaptable to change.”
Charles Darwin

Some people love it, some people don’t. But whatever a person may feel about change, it is a constant in our world today. This is true in business, society, and even in nature, as pointed out in the quote from Darwin. In the nonprofit world, change has an even more significant place.

If you think about it, most nonprofits operate to fulfill a profound and compelling change initiative. That change initiative may include ending hunger, relieving hardship after a natural disaster, lowering the school dropout rate for inner-city children, or helping the unemployed get back to work. Whatever the specifics of the initiatives are, almost every nonprofit has at the core of its mission the desire to make a change for good in the world.

Big world changes most often occur in a series of smaller ones, and the ability not only to adapt to change but to create it and orchestrate change is a critical skill in the survival of any organization. That’s why, at the Cornerstone OnDemand Foundation, we’ve put together a workshop and webinar on Orchestrating Change as part of our Architecture of Transformation series.

On November 10, 2011, we held our first Orchestrating Change workshop in Santa Monica, cohosted with the Taproot Foundation. The workshop presents a hands-on, practical approach to creating change within an organization by specifically addressing four fundamental needs that any person being asked to change must have met. Those fundamentals are:

Knowledge (what people need to know in order to change)
Skills (what people need to do in order to change)
Condition of Mind (what people need to believe in order to change)
Architecture (what people need in order to be accountable for change)

By addressing people’s needs first, there are many ways to design a change successful initiative. There is no one change model or approach endorsed in the workshop—other than to put the needs of the people being asked to change foremost in the strategy. By all accounts, the workshop was a great success, and the participants left with a clear idea of where to begin when designing a change initiative for their organization.

Julie Brandt is Executive Director of the Cornerstone OnDemand Foundation.

Honor Volunteers on MLK Day of Service - Cornerstone OnDemand

Julie Brandt — Mon, 12 Dec 2011 22:31:25 +0000

Honor Volunteers on MLK Day of Service

Dr. Martin Luther King Jr. once said, "Life's most persistent and urgent question is: 'What are you doing for others?'"

Each year, Americans across the country answer that question by coming together on the Martin Luther King Holiday (January 16, 2012) to serve their neighbors and communities. The MLK Day of Service is a part of United We Serve, President Obama's national call to service initiative. In addition to honoring the legacy of Dr. King, it calls for Americans from all walks of life to work together to provide solutions to our most pressing national problems.

This is a wonderful opportunity to bring an awareness of the importance of service to an ever-broadening audience. And while admirable as this initiative is, it’s also clear that people volunteer to support their neighbors, communities and a host of nonprofit and philanthropic agencies every day, many times without any form of recognition. It’s true the people who volunteer typically aren’t doing so for recognition. Nonetheless finding a meaningful way to acknowledge their work and thank them for their service is an important form of positive reinforcement. What many people—and perhaps even many nonprofit organizations—may not realize is there is just such a way to do that through the Drum Majors for Service Award.

MLK Drum Majors for Service are volunteers who perform extraordinary everyday acts of service with reliability and commitment, but who seldom receive recognition. Service is called by a variety of names. To some it may be outreach; to others, it may be mission driven; to still others, it may be volunteerism, or even regarded as a calling—but no matter what you call it, there are many Americans who serve every day, every month, every year through a variety of nonprofit organizations and as volunteers for community groups, addressing a variety of unmet critical needs.

There is an easy, powerful and inexpensive way to recognize extraordinary volunteers who are MLK Drum Majors for Service with a special Presidents Volunteer Service Award (PVSA) called the Drum Major for Service Award. This award can be given by anyone—a neighbor, a coworker or supervisor, a nonprofit, a fellow volunteer—as a way of bringing special attention to the accomplishments of someone who has given back to their community through an act of service.

If there is someone you know who deserves this kind of recognition, take advantage of the opportunity to give an award in conjunction with the upcoming MLK Day of Service. To learn more about the MLK Day of Service, visit www.MLKDay.gov for more information.

Julie Brandt is the Executive Director of the Cornerstone OnDemand Foundation.

Exciting Developments in the Nonprofit World

Julie Brandt — Mon, 12 Dec 2011 22:20:29 +0000

Exciting Developments in the Nonprofit World

On Tuesday November 15, 2011 the White House sponsored its first Forum on Nonprofit Leadership conference in Washington DC. I had the honor of attending, along with key representatives from the nonprofit sector, foundations and funding organizations, the corporate sector and several departments of the Government.

This was truly a ground breaking experience—in part because it was the first meeting of its kind to bring these disparate yet relevant groups together in a formal way, but more importantly, because of what we were convened to discuss—leadership development in the nonprofit sector.

Both the Government and the corporate sector understand the importance of leadership development as it relates to mission achievement and organizational effectiveness. And of course, both have the resources to invest in this important pursuit. When it comes to the nonprofit sector, however, providing development opportunities to current and emerging leaders isn’t quite so straightforward.

Central to the issue is the fact that when a nonprofit receives a monetary grant, there is an expectation that the money be used only for programs that benefit the nonprofit’s clients. In fact, it is almost frowned upon for nonprofits to allocate money to developing their own people—that’s considered overhead.

And yet, people are the cornerstone of any nonprofit, just as they are in any corporate or Government organization. Perhaps more so than in any other sector, providing nonprofit employees with opportunities to grow, develop and get engaged in their work is critical to mission success. One of the core objectives in the conference was to begin the process of changing that.

The White House Forum on Nonprofit Leadership provided all of us the opportunity to hear insights and observations from many key thought leaders in the nonprofit sector, the corporate sector and the Government. But perhaps the most exciting part of the day was when we broke into four groups of approximately 60 people each to tackle key issues and propose solutions for:

Making leadership development widely available for nonprofits
Tackling issues of funding for leadership development
Bringing greater diversity to the nonprofit employee population
Developing a talent pipeline for nonprofits
Building a framework for social innovation

Most impressive to me was the fact that all of us came together to put our best thinking on issues that confront the nonprofit sector as whole. Although we all represented unique organizations, our task was to focus on the nonprofit landscape, as opposed to certain organizations or pillars within the nonprofit sector.

Many ambitious and innovative ideas came from these sessions. But we all know ideas are only interesting thoughts unless you act on them. The commitment of this group was to continue working through the ideas and strategies proposed in the forum, and to reconvene in six months to assess progress and determine next steps. On whole, it was an incredible “starter conversation” that—if followed through to fruition—promises some exciting developments in the nonprofit sector.

To learn more:

http://about.americanexpress.com/news/pr/2011/whf.aspx

http://www.nonprofitalternatives.org/page/the-white-houses-views-on-nonprofit-leadership/

Julie Brandt is the Executive Director of the Cornerstone OnDemand Foundation.

Skilled Workers Shortage in the U.S.: Who’s to Blame?

Charles Coy — Fri, 09 Dec 2011 17:58:50 +0000

Skilled Workers Shortage in the U.S.: Who’s to Blame?

Investing in employee development and encouraging talent mobility are two ways employers can address what some suggest is a “false skills shortage” in America

Peter Cappelli’s Wall Street Journal piece about “Why Companies Aren’t Getting the Employees They Need” drummed up a lot of fervent replies to the author and exposed the frustration associated with the chronic under-employment in the U.S. economy.

In the article (and a couple of follow-ups, including one in Human Resource Executive), Cappelli argues that the perception of a shortage of skilled workers in the U.S. is mere illusion. It’s not the fault of the national education system, but instead of employers and their hiring practices and failure to invest properly in employee skills and alignment.

Cornerstone’s recent survey, conducted with Harris Interactive, most notably found that employee churn could cost U.S. businesses up to $2 trillion next year. But beyond this startling problem with retention, our survey highlighted some other interesting underlying conditions that underscore some of Cappelli’s theories about the “false skills shortage” in America.

The first issue Cappelli points out is that U.S. employees don’t have the skills because employers don’t train them anymore. Apprenticeship and management training programs have disappeared, he writes, and on-the-job training is rare as well.

This certainly is supported by the data we pulled from the Harris survey, which found:

Only 23% indicated that they are provided with tools, resources and/or a development plan to help them improve their performance; and

A scant 7% indicated that they had been assigned a personal development plan to help improve upon their own performance (as an outcome of a performance review process).

Cappelli goes on to note that employers get nervous about making large investments in employee skill or career development when another company is likely to swoop in with better wages and hire them away. This is a justifiably disconcerting notion to employers and may help to explain some of the fear of investment in development programs.

Employees will always be very responsive to monetary compensation, naturally. Could I be swept from my post here at this noble blog if someone came around waving a big stack of money? Maybe. Who’s offering?

But when it comes to matters of employee retention, employers have to use the tools at their disposal. Employee engagement and happiness start with being a great place to work. It continues with offering employees a clear sense of alignment with the business and a sense of possibility within the organization – “Is what I’m doing for this company making any difference whatsoever? Why am I performing these tasks? And where can I grow internally if I can demonstrate success in this role?”

This theme, too, is carried forth in our survey findings:

Of employed U.S. adults who have experienced their employer’s performance review process, only 28% said they are given a clear understanding of how their job performance impacts their employer’s business results.

Finally, and really pulling together the other points above, Cappelli notes that one way out of this perceived shortage of skilled labor is for employers to focus on promoting from within. As he says, “Employees have useful knowledge that no outsider could have and should make great candidates for filling jobs higher up.”

This type of internal talent mobility is absolutely in the sweet spot of the ongoing conversation in talent management today. Using process and technology to get the best from your current employees and to ensure that they have opportunities to find the right roles in the organization that make best use of their evolving skills.

Unfortunately our survey data paints a bleak picture of how well employers are faring on this score:

49% feel their current employer isn’t invested in their career growth; and

Only 20% have established career goals with their manager/employer.

We encourage you to learn more about our survey. It’s not all so dire, but it does cast light on some real areas of opportunity for employers, especially in a time when so many are concerned with Cappelli’s illusory skills shortage.

Stopping the Exodus: Findings from the Cornerstone OnDemand / Harris Employee Performance Management Study

Charles Coy — Tue, 06 Dec 2011 21:28:47 +0000

Stopping the Exodus

Findings from the Cornerstone OnDemand / Harris Employee Performance Management Study

The last few years of dire economic news and high unemployment have instilled fear in employees and bred complacency in managers. A recent article in CFO magazine quotes Leigh Branham, a consultant at Keep the People: “I have a friend who is a CEO, and he says all of his CEO friends are high-fiving each other because the war for talent is over and employees are tree-hugging their jobs,” Branham says. “Personally, I don’t think that’s a lot to celebrate. It just disguises disengagement.”

Of course, all that would change if there was actually mobility in the workplace.

Significant employee churn is precisely what Cornerstone OnDemand's recent employee survey (with Harris Interactive) is predicting will happen within the next year. The research finds that 15 percent of those surveyed plan to leave their current job within the next twelve months.

That’s an estimated 21 million Americans and a potential price tag of $2 trillion to U.S. employers in 2012.*

Performance Management. The Root of the Problem?

Our survey findings go further to suggest that the cause of this exodus – and the solution – may be rooted in the employee performance management process, including the annual performance review ritual that many organizations are going through at this very moment.

Cornerstone’s survey reveals that half (50%) of employed U.S. adults who have experienced their employer’s review process feel more valued by the company when they receive a performance review that is focused on helping them succeed in their role.

That’s great, but wait -- of those same people surveyed, when describing their job within the past six months:

Only 37% said they’ve been given useful feedback from their manager/employer;

Only 34% indicated that they’ve received training and development to help them better perform their job;

Only 32% said that their performance goals are aligned with their company’s business objectives; and

Only 20% have established career goals with their manager/employer.

The Scaffolding Is Broken

As we’ve commented in this blog and elsewhere, the nature of work in the 21st century changed. The majority of U.S. job growth this century has come from jobs requiring complex interactions with other people.

In this new workforce, employers typically need their people to be self-directed and self-motivated in completing work that is far more specialized and technical than “assembly line” work of the past. And this is not just a knowledge work vs. manufacturing work kind of debate.

We’ve also previously referred to the work of management expert Gary Hamel. He contends that, “New problems demand new principles. Put bluntly, there’s simply no way to build tomorrow’s essential organization capabilities – resilience, innovation and employee engagement – atop scaffolding of 20th century management principles.”

A major part of this 20th century “scaffolding” is the traditional performance review. But does the performance review of today actually do what it is intended to do – which is to help improve a person’s job performance -- or is it simply an annual rite of passage that people endure for raises, bonuses and promotions?

Is The Performance Review As We Know It Dead?

Absolutely not. But it does need to evolve with the way people work today and the needs of tomorrow’s workforce. Yes, there’s been more talk about social reviews, but that alone is not an answer.

Failing to evolve employee performance appraisal is a dangerous notion and one that directly impacts employee retention, satisfaction, productivity, engagement and more.
On the flip side, employees who receive meaningful, actionable feedback and have access to training, resources and tools to improve their performance and reach their career goals are happier, more fulfilled and become champions for your company.

The goal, then, is to evolve the performance management process broadly around a few core principles:

1. Moving from annual performance appraisals to ongoing, more-frequent feedback.

Interim feedback is more helpful to employees trying to make sense of their achievements and contributions in a job role.

The Cornerstone/Harris poll found that typical performance assessments are just not helpful:

Only a third (34%) said the feedback they receive helps them improve their performance and succeed in their role

Only 23% indicated that the feedback they receive will help them advance in their careers

2. Moving from transactional reviews (checking the boxes with little intent beyond compliance) to interactional, transparent and feedback-based appraisal.

The Cornerstone/Harris poll found that too many performance review processes are murky: only a fourth (25%) of those surveyed indicated they are given specific examples of their work to support the feedback they receive.

The research also points to current reviews as being inaccurate. Of employed U.S. adults who have experienced their employer’s performance review process less than half (45%) said the feedback they receive is a fair and accurate representation of their performance.

3. Get feedback from the right people at the right time.

The Cornerstone/Harris poll found that peer-based or social feedback is a rare occurrence:

53% said no one other than their manager/employer provides feedback during their performance review process

Only 21% indicated that peers provide feedback during the review process – but 43% said peer feedback and opinions would be the most valuable to them in the review process

Only 13% receive feedback from project leaders

4. Performance appraisal in a vacuum is not enough. Make appraisals lead to tangible, actionable outcomes (especially training and development to close gaps).

The Cornerstone/Harris poll finds that performance reviews don’t often lead to measures for actually improving performance or closing identified gaps:

Only 23% are provided with tools, resources and/or a development plan to help them improve their performance

16% not only said their employer’s review process doesn’t provide them with useful, actionable information, but another 16% said it was a waste of everyone’s time

About the Survey

Harris Interactive^® fielded the study on behalf of Cornerstone OnDemand from September 20-22, 2011 via its QuickQuery^SM online omnibus service, interviewing 2,141 U.S. adults aged 18 years and older, of whom 1,143 were employed full/part time. Data were weighted using propensity score weighting to be representative of the total U.S. adult population on the basis of region, age within gender, education, household income, race/ethnicity and propensity to be online.

For a comprehensive report of the findings, please visit the survey results page.

*Sources and statistics

Number of employed people in the U.S.: 140,025,000 (http://www.bls.gov/news.release/empsit.t01.htm)
15 percent will leave within a year: 21,003,750 (Cornerstone OnDemand / Harris Interactive research)
Average wage index for 2010: $41,673.83 (http://www.ssa.gov/oact/cola/awidevelop.html)
Number of firms in the U.S.: 21,351,320 (http://www.census.gov/econ/smallbus.html)
Average cost to recruit and train one employee is estimated at 2.5 times an employee’s salary = $104,184.57 (Deloitte 2009: “Managing Talent in a Turbulent Economy: Clearing the Hurdles to Recovery”)
Overall cost to U.S. businesses = $2,188,266,662,138

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