Towers Perrin's HR Study
Spelling The Difference Between Winning Or LosingTowers
Allison Shirreffs
September 12, 2007
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Today's human resources departments are changing. Once relegated to paper pushing administrative duties, human resource (HR) departments are taking a lead role in companies of all sizes. The wealth of information collected and managed by HR departments is being used to identify trends and signal shortcomings. Today it's even common practice to ask your HR professionals for their input when creating a company's overall strategy.
Nowhere is this more apparent than in workforce planning. In recent interviews conducted by global professional services firm Towers Perrin, each of the dozen metro Atlanta companies questioned said workforce planning was a chief concern. Whether expanding their international presence or examining ways to combat their aging work force, these companies are using their HR departments to help determine where workforce gaps are or will be.
"Organizations are a lot smarter about what their workforce needs are going to be and where their capabilities are going to be," says Eric McMurray, managing principal at Towers Perrin. "The work we're doing for clients - especially over the last 12 months - focuses more on general workforce issues than on high potential [employees.] Organizations are looking at it in a way we've never seen before."
Making an honest assessment of a company's organizational capabilities is the first step in identifying current and potential workforce gaps. Companies can then strategize and design ways to fill those gaps. "Companies are working on some really sophisticated sourcing strategies," McMurray says.
In the case of OFS Fitel, a fiber-optics company based in Norcross, considering the "right expansion opportunities on the horizon" means knowing the company has the workforce and leadership capabilities to support such expansion. "In every department of telecom companies there is a shortage of bench strength," says Clem Johnson, vice president of HR. One of OFS Fitel's business goals is to "retain key knowledge" by securing the best and brightest high-tech talent the company can find. If it can secure the right kind of talent, the company will be better prepared to go after expansion opportunities.
Turner Broadcasting System, Inc., is a major producer of news and entertainment products around the world and is the leading provider of programming for the basic cable industry. TBS, a Time Warner company, employs more than 9,000 people worldwide. "We assess programming to determine the people and skills needed," says Loretta Walker, senior vice president of HR. "That's driven by business strategy."
One piece of the company's strategic effort is to make sure its employee base "reflects the markets we serve," Walker says. TBS leaders constantly ask themselves, "Do we have the talent that can be innovative, creative and collaborate and understand the diverse audiences we serve?" " Companies are recognizing that people make a strategic difference," says McMurray, who sees this happening across functions and all levels.
Due to low birth rates at the turn of the century, the college-aged percentage of the population is expected to decline by 2017. Prestigious – and expensive – schools such as Emory University predict they'll be hardest hit. Confronted with the strategy question "Do we recruit or re-tool?" the university decided to be more assertive when it came to recruiting, says Peter Barnes, Emory's vice president of HR. Plans to step up international recruiting in areas like South Africa, England and Central America are in the works. As part of that plan, Emory is working to add more intellectual leaders to the staff. "We want to build a place where top minds want to be," he adds.
At Georgia Pacific (G-P), the CEO, president, business unit leaders and HR representatives meet regularly to discuss workforce gaps as well as diversity planning and employee development. The company predicts shortages when it comes to mid-level engineering, plant management and technical resources as baby boomers retire over the next decade or so. To remedy the gaps, G-P established an aggressive college-recruiting program for its entry-level engineering program.
Georgia Gulf Corporation's strategy is to develop efficient business processes and then structure job functions and requirements around those processes. "We then strive to place the right people in the positions we need," says James Worrell, vice president of HR.
The health care industry is in a relatively unique situation. Faced with physician and nursing shortages as well as the financial challenges for an overall system that needs revamping, health care organizations are working diligently to attract and retain quality employees.
With 9,000 employees and 20 health care centers in metro Atlanta, Emory Healthcare is formalizing its approach when it comes to manpower. "Atlanta is a competitive market in terms of job candidates," says Margaret "Peg" Bloomquist, chief HR officer. The metro area's population is growing at a pace greater than the national average, and this amplifies the demand on the city's health care institutions. "The need for RNs and ancillary services will not go away," she adds.
This is something Children's Healthcare of Atlanta, one of the leading pediatric hospitals in the country, knows well. In the midst of a $380 million expansion, Children's plans to hire 300 employees by the end of the year, bringing its total number of employees to nearly 6,500. Changes in Medicaid reimbursement coupled with an increase of "charity care" patients have forced the not-for-profit to boost its fundraising efforts to recoup lost revenue. To do so, the organization needs to attract and hire employees with excellent fundraising skills.
More than ever before, it's the attraction and retention of the right talent that's paramount. "Do we have the right talent for where we're headed?" is a question companies are getting better at asking, McMurray says. And they're creating leadership and succession planning programs around the answer.
The leadership factor
More companies are interested in developing their own leaders. In an effort to avoid placing employees in roles they're not prepared for, McMurray sees companies invest heavily in developing criteria to identify employees with leadership capabilities. "We see a lot of effort put into development programs – not just from training programs but around individuals getting the right experience. We're seeing more and more of the experience piece," he says.
Assessing the need for critical talent takes a true partnership with the company's business lines, says Michael W. Rickheim, Jr., vice president of global talent acquisition for Newell Rubbermaid Inc. As a global marketer of consumer and commercial products with sales of approximately $6 billion and over 23,000 employees, it's important to have criteria in place that assists in determining the type of employees that will make the best leaders. And it's not merely about skill levels. Newell assesses behavioral traits as well.
In its successful effort to cut down its turnover rates, John Wieland Homes and Neighborhoods began determining its "high potential talent" not only by identifying an employee's skills and track record, but also by considering personality traits based on HR assessments. "HR is more of a partner now," says Laura McMurrain, senior vice president of organizational development. "It acts as a consultant to other units."
FOCUS Brands Inc., a leading multi-concept restaurant franchisor and operator with more than 1,750 locations in the United States and abroad (including Carvel ice cream and Schlotzky's), is working on creating a leadership pipeline and established its emerging leader program to assist with this. The approximately two dozen employees who participate in the yearlong program have been nominated by their supervisors and must submit papers describing why they want to be in the program. "We prefer to develop our own people," says Jean Boland, vice president of HR and leadership development.
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In some instances, it takes transforming company culture to make sure initiatives like these are handled correctly. At Newell Rubbermaid, says James "Jim" Sweet, chief human resources officer. "We hold leaders accountable for developing people."
"If organizations put people into roles they're not prepared for, they feel like a failure and it hurts their confidence and they go do something else," McMurray says. "It can create a bad mixture if done poorly."
If employees don't feel their leaders and direct line bosses are good at what they do or they care about them as employees, they're apt to leave. "The soft stuff retains people. People don't really leave for pay. It's the manager or the supervisor's lack of management skills," Walker says. "The key to success is our people." TBS has put a significant amount of time into developing its leadership model and in establishing programs – such as business resource groups and professional development opportunities – that show employees the company is paying attention to them.
John Wieland Homes and Neighborhoods conducted a company member survey to assess the perceived value of its benefits. The homebuilder expanded its wellness benefit and is striving to " help employees with the things that mean something to them," McMurrain says.
Post Properties is evaluating its talent management system, and as part of that, the company hopes to grow competencies internally. Doing so is made more difficult by the lack of company loyalty often seen in today's younger employees (members of Generation Y or those born after 1982). As the company tries to figure out what Gen Y-ers want, McMurray shakes his head. "Nobody's cracked the code yet," he says. Most seek rewarding and fulfilling work at a company they respect, good work/life balance, and competitive compensation, he says. "The value proposition they're expecting from an employer is very different than we've had to deal with in the past," he adds.
Post believes its strong external brand gives the company a competitive advantage when it comes to recruiting. The Post name is synonymous with a quality product and that's helped, says Linda Ricklef, senior vice president of human resources. "We build the best and have the best."
The brand matters
Establishing a connection between a company's external and internal brand is necessary to not only land talent, but to keep it. "There needs to be alignment between what's going on externally and internally so that the internal brand fits the value proposition in the marketplace," Ricklef says.
A regular on such lists as Fortune Magazine's "100 Best Companies to Work For," Children's Healthcare sells itself as a place where employees can not only find a job with competitive pay and benefits, but also make a difference in the lives of the organization's customers, the children of metro Atlanta and the southeast. "Attracting people who really buy into that is huge," McMurray says.
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At Rollins Inc. a consumer and commercial services company known best for wholly owned subsidiaries such as pest control company Orkin, the company's hiring approach is "hire hard to manage easy," says Henry Anthony, vice president of HR. It starts with the selection process and bringing in employees that fit the culture."
At G-P, seeking candidates with values and beliefs consistent with company culture is a big piece of the acquisition and retention process. "Job candidates need to have both skills, knowledge, values and beliefs that fit with Georgia-Pacific," says Julie Brehm, senior vice president of HR. "Our model is to set expectations up front, provide feedback and reward employees based on the long-term value they create."
Several companies, like G-P, have established pay-for-performance programs. Georgia Gulf prefers an approach of "employment for performance," Worrell says. "We believe it's very important to understand what is fair compensation for an employee's job/productivity in terms of the economic value to the company."
To determine what that is, the company continually assesses a position's value to the company and reassigns resources when necessary. "Rewards, work and the work environment need to be aligned," he adds.
Work/life balance is an issue companies have been dealing with for years, but companies are getting more creative in an attempt to satisfy different employee constituencies. What Gen Y-ers want may differ from the needs of baby boomers nearing retirement or those of working mothers.
Approximately 80 percent of Children's employees are women and the company's work/life balance programs focus heavily on addressing the needs of working mothers.
In 2004, the organization implemented quarterly baby showers for mothers, fathers and adoptive parents. Various speakers address topics like flexible scheduling and childcare. "The theme is, ‘We want you back,' " Matzigkeit says. Children's partnerships with companies like Sittercity.com make it easier for these employees to return to work after having children.
Wellness programs are another important piece of the push for work/life balance. Such programs aren't new, but company attitudes toward them are changing. McMurray advises companies to view an employee's health as a long-term asset and to influence them to do the same.
McMurray would like to see organizations approach wellness in a broad way and not offer what he refers to as "one-off" incentive programs. "I see this as a personal responsibility. Employees know they're not supposed to smoke and that they're supposed to exercise," McMurray says. "Where organizations err is in making that isolated intervention."
He suggests making wellness an organizational and cultural issue. Want employees to eat better? Remove unhealthy food choices from cafeteria offerings and provide healthy foods instead. Want employees to exercise? Make it convenient for them to do so. And if there are vending machines in the break room, make sure they're not full of unhealthy snacks. "We're seeing a lot of our clients make the transition," McMurray says. "They're looking at health care as more than an annual enrollment event."
Children's is an organization that takes wellness very seriously. "We want our people to be healthy," Matzigkeit says. To that end, Children's launched a 12-week "Healthy Habits Pilot" for employees. Health screenings, free gym membership and access to a dietician were included. A total of 150 employees lost more than 600 pounds. "It was very popular and produced extraordinary results," Matzigkeit says. Children's also offers health risk assessments, disease management and smoking cessation programs.
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Other companies, such as Rollins, have realized cost savings due to their wellness programs as employees have become healthier and more productive.
All of these issues – workforce planning, bench strength, identifying and training future leaders, wellness, work/life balance, soft benefits and so on – are becoming areas where human resource departments are making an impact.
"Organizations will win or lose based on how involved HR is in their role," says McMurray, adding that the organizations that win are the ones with the best people, something HR can do a thing or two about. "Anyone who has ever played on a team knows the teams that win draw better people. It's much easier to acquire talent when you're winning."
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