Category Archives: SHRM

Effective Leaders Know their Leadership Stories

“What’s your leadership story?”

PeopleThat was the question posed to a roomful of attendees at the Society for Human Resource Management’s annual conference in Washington Monday. Speaking was Timothy J. Tobin, vice president of human resources for Marriott International, with headquarters in Washington as well.

And he had a host of things to think about that few probably had, based on the murmurs during and after his session, “Five Steps to Effectively Communicate Your leadership Story.”

Like what it really means to know your message and have a solid leadership point of view. And what it means to know yourself as a leader, why you are one and where you want to make a difference and have an impact. Equally important is understanding your core values and your personal mission.

“What contribution do you want to make? What do you want to accomplish? For whom?” he asked the crowd. “As Aristotle taught us many years ago, ‘knowing yourself is the beginning of all wisdom.’ ”

But even more crucial for those leading others in business, said Tobin, is to maximize those “moments of truth” with other leaders in order to better understand specific pieces of the business and interact with those who can actually help you — all the while, carrying yourself with credibility and consistency.

“Who you know,” Tobin said, “can be as powerful as what you know. But the most powerful of all is who knows you and what they would say on your behalf. Who are those people who can act as credibility substitutes and speak up for you when you’re not there? You gotta find these people.”

And how do you find, support and sustain such a network? By engaging others in the organization at every opportunity and in every decision that needs to be made.

“The four most important words in leadership,” said Tobin, are ‘What do you think?’ ”

Two more seemed to be equally important as session takeaways: perceptions matter.

“You are only as good of a leader as people around you believe,” he told his listeners. “Communicate your story. Make it epic. And when it comes to telling it, remember, you all have a voice.”

Mulally, Rowe Herald Hard Work, HR at SHRM

Alan Mulally, left, and Mike Rowe share the stage in SHRM’s open ing keynote. Photo by Chris Williams/SHRM

In an unlikely coupling of two friends — one described by his co-star as a kind of Howdy Doody “Boy Scout” and the other a well-recognized master of grunge, grit and grime — Alan Mulally and Mike Rowe kicked off this year’s Society for Human Resource Management’s annual conference heralding the importance of hard work and HR leadership.

In their joint opening keynote Sunday at the Walter E. Washington Convention Center in the nation’s capital, Mulally, former president and CEO of Ford Motor Co., and Rowe, host of Dirty Jobs on the Discovery Channel, shared their stories, and their messages about HR’s new stature in the business world, with a healthy dose of fun.

“Here’s what I think,” Mulally told a roomful of thousands of conference-goers. “I think human resource professionals rock!” His comment got raucous applause.

Sharing his keys to success, though — putting his people first; including everyone in all communications; and making sure everyone knows the company’s vision, performance goals and the status of every plan, to name just a few — he came back to the importance of HR.

“HR is the leader of many, many resources, and you’re making all of that happen,” he said.

Even in the country’s tough, post-9/11 years, Ford’s decision not to take federal bailout money was a transparent, collective one. “Watching our suppliers falling into bankruptcy,” he said, “knowing what was happening could bankrupt the nation, we made our decision [together] to do the right thing.”

And even then, he added, HR drove the communication, alignment and buy-in.

Rowe — who said he had worked for Mulally at Ford and then met him years later after becoming a voice behind many Ford commercials and later a television star — injected some hilarity into the “duet” by recalling how Dirty Jobs came to be.

As he told it, his concept came to him after reviewing tapes of himself trying to interview a sanitation official in the sewers of San Francisco, with many disgusting mishaps of every imaginable disgusting variety.

“I realized I was laughing; something very compelling was happening,” said Rowe. “But what was even more compelling than [the scatological Laurel and Hardy routine, for lack of a better description] was the knowledge and the real work” his interviewee was describing throughout it all. It seems the real work involved replacing bricks and understanding every nuance about why that had to be done.

“I let my guest be the expert he is … to connect [with viewers] the real miracle of how things really work and how jobs really get done,” he said, adding a lament that “we’re not valuing work enough, understanding how work gets done.”

But HR, he suggested, can take  the lead in understanding and facilitating this communication in an organization, about how things work there and what work needs to happen.

“Somewhere in your company is [this type of sewer specialist],” he said. “He’s probably little-known, but he needs to be heard.”

Mulally echoed the importance of facilitating the communication of work and what needs to be done as the only way an entire organization — in his case, Ford — can come together and “face reality.”

Added to his list of imperatives for successfully climbing out of the kind of “economic and financial reality we were facing in our toughest years,” he said, [were] respecting, listening to, helping and appreciating each other [and] building emotional resistance to trust the process.”

Lastly and most importantly, said Mulally, “is [to] have fun; enjoy the journey and each other” through everything you weather and accomplish.

Change is Coming to the HR Suite

The HR function as you know it will soon cease to exist.

OK, that’s being a bit dramatic. But you should still probably expect to see your HR department’s priorities shifting somewhat in the near future.

So says a new research report from The Society for Human Resource Management, which recently polled 485 C-suite executives in non-HR roles and 439 SHRM members from within the HR profession.

In Business and Human Capital Challenges Today and Into the Future, the Alexandria, Va.-based HR membership association asked both groups to identify the biggest business challenges they’re facing at the moment as well as the issues they figure will be most pressing in the years ahead.

(Interestingly, it seems human resource executives and their C-suite counterparts largely agree that HR is and will remain crucial to the organization’s success, but see the talent-related hurdles that lie ahead a little differently. Check out this executive summary for a few examples of where C-suite execs find common ground, and where their views diverge.)

The poll also asked C-suite leaders outside of HR to specify some of the changes their companies are making within the HR department, or plan to make in the next few years.

Overall, 71 percent said their current and future plans include broadening HR’s scope to help make the function … wait for it … more of a “strategic partner” to the business.

Among the actions non-HR C-suite executives are already taking to make HR more “strategic”? Twenty-two percent said they are “engaging top executives to develop HR strategy,” with the same number indicating they are “refreshing HR strategies such as selection, compensation, benefits and training.” Another 20 percent said they’re “getting senior executives more involved in implementing HR strategies.”

Looking ahead to the next 10 years, 21 percent of non-HR respondents reported that their organizations would be refreshing HR strategies “to align with evolving business goals,” while 19 percent said they will be “measuring the specific effects of HR programs” and 18 percent foresee “getting senior executives more involved in implementing HR strategies.” In addition, 16 percent predict transferring more HR-related tasks to line management.

Whatever tasks HR professionals will or won’t be carrying out one, five or 10 years from now, the C-suite seems to have reached a consensus in terms of the HR function’s ongoing importance.

“At the majority of organizations, both HR and non-HR C-suite executives view HR as having a strategic role,” notes the aforementioned executive summary. Indeed, 63 percent of non-HR C-suite executives said they see HR as such, with the most common perception being that of HR as a sort of transactional and strategic hybrid.

Whatever shape HR takes in the future, the function “needs to make the changes that will drive positive value and improve organizational effectiveness” in the days to come, said Deb Cohen, senior vice president of knowledge development at SHRM, in the research report.

“The HR profession suffers a multitude of critics both within and outside the ranks. HR does not need any more negative attention,” said Cohen. “If change will be constant … then HR needs to embrace its role in being an effective facilitator of change.”

Layoffs or No Layoffs, Employees Come First

Whatever side of the layoff story you find yourself on — now or in the 187065451 -- layoffsfuture, conducting them or avoiding them at all costs — don’t ever lose sight of your employees’ experiences.

That seems to be the collective message of two articles I came across recently, written on the same day, no less. One, from the Harvard Business Review site, written by the chief executive officer of Scripps Health, Chris Van Gorder, trumpets that company’s no-layoffs policy.

The other, from the Society for Human Resource Management site (registration required), details Target Canada’s recent “unprecedented” move to offer a $70 million severance package to the some 17,600 employees who are slated to be laid off by mid-year 2015 as the company exits the Canadian retail market.

A more recent HREOnline news analysis by Senior Editor Andrew R. McIlvaine, “Cushioning the Blow,” highlights the merits of giving severance to everyone. In that story, Sanjay Sathe, founder and CEO of San Jose, Calif.-based outplacement consultancy RiseSmart, is quoted saying that, “if the No. 1 goal of severance is to take care of employees, then the practice should be to offer it to all employees.”

Without a doubt, taking care of employees is at the heart of both the Target and Scripps Health examples mentioned above.

As Brian Cornell — CEO and chairman of Target’s U.S. parent company, Target Corp. — says in a statement:

“We do not take lightly the impact that our decision to discontinue operations in Canada will have on Target Canada’s team members who have worked tirelessly to make improvements to the guest experience. That is why we took the unique step of establishing the employee trust.”

More specifically, that’s why his company has set up a trust fund for employees to receive 16 weeks of pay, an amount that will be kept separate from Target’s restructuring process. Lisa Stam, a partner at Koldorf Stam in Toronto, calls the severance amount “unprecedented.”

Anil Verma, director of the Centre for Industrial Relations and a professor of human resource management at the University of Toronto’s Rotman School of Management, tells SHRM it’s “unusual” for a company to protect its employees with a trust fund. In his words:

“[Laid-off employees] will also accrue certain benefits, such as medical and life insurance. This act demonstrates that Target is a good employer.”

In defending his decision to establish a no-layoff policy, which “isn’t the norm in my [nonprofit] industry,” Van Gorder shares his belief that “a no-layoffs philosophy is good for employees’ physical and psychological health.” As he puts it:

“I’ve seen what it’s like to carry out mass layoffs — I had to do that in the 1990s at a hospital that was in bad financial shape. I vowed never to let myself get into that position again. Instead, nonprofits need to match institutional discipline with authentic good will toward employees, developing effective employee-assistance and wellness programs and eliminating anxiety about job security.

“Who knows? If enough nonprofits master this balancing act, then maybe we can teach the for-profit world something for a change. … In today’s economy, organizations are supposed to treat employees almost as free agents, with low expectations of loyalty on either side. … But paternalism works — even in the 21st century, and even in an industry undergoing disruption.”

Just some food for thought, I thought.

SHRM Stepping Back from HR Standards Work

SHRM-Logo2The Society for Human Resource Management recently alerted the members of its HR standards task force that it plans to end its current role in creating standards for the HR profession in areas such as cost-per-hire and performance management. In a letter to the task force, Deb Cohen, SHRM’s senior vice president for knowledge development, said that while SHRM believes “the HR profession needs consensus-driven HR standards,” its own priority is on competency-based certification. SHRM recently announced details of its new competency-based certification, which, as we’ve previously reported, has caused a rift between it and the HR Certification Institute.

SHRM will be transitioning out of its role as the American National Standards Institute administrator of the U.S. technical advisory group (TAG) for the HR standards, known as ISO/TC 260, sometime during the first quarter of 2015, Cohen wrote.

“One of the things we want to focus on is keeping our new competency model fresh and refreshed, because once you create a new model you need to ensure people know what they need to do to stay up to date,” said Cohen in an interview.

SHRM will also transition out of its role as an ANSI “Accredited Standards Developer” and will work with ANSI to find a replacement organization to carry on that work, she wrote.

“We’ve been actively reaching out to already-accredited standards-developing organizations and we’ve had some inquiries from folks interested in becoming accredited standards-developing organizations,” said Cohen. “We’re very hopeful we’ll find one soon and, frankly, if it takes a little while we’re prepared to help in any way.”

SHRM plans to continue being an “active member” of the U.S. TAG, said Cohen. “We’ll continue to have a voice and a point of view regarding new standards, and we’ll continue to vote and participate in meetings, because we think this is very important work. We just won’t be the administrator.”

Elizabeth Neiman, a spokeswoman for ANSI, confirmed that SHRM had given notice of its intent to withdraw. “We are grateful for their many efforts, as well as their stated intention to continue as an active participant in standards development work, both domestically and internationally,” she said in an emailed statement.

A source who spoke on background said the move confirms that SHRM wants to focus on its new competency certification and probably wanted to reassign the small number of staff members who’d been working on the standards. The source also said there had been some grumbling that ANSI seemed to care more about process than content and that too much time had to be devoted to “crossing the t’s and dotting the i’s.”

Cohen agreed that ANSI is “very process focused” but said that is simply part of their job.

“My sense of ANSI is that they want to ensure an open, consensus-driven process and, in order for that to happen, there need to be a lot of process checks,” she said. “I don’t think they have a dog in the hunt with regard to content—that’s not part of their purview.”

The new certification process carries high stakes for SHRM, the source said: The organization anticipates that its revenues will dip as it transitions from the previous HRCI certifications and waits for people to sign up for the new ones. In anticipation of this, the source said, SHRM recently conducted layoffs at its Alexandria, Va., headquarters and froze hiring for some positions.

Cohen declined to comment about the layoffs.

“SHRM is still committed to consensus-driven standards for the HR profession—we’re pleased to have been involved and plan to continue, but we’re changing the role we’ve been playing,” she said.

 

Yes, Money Still Matters

E000249For a few years now—especially since the 2008 financial meltdown that ushered in the Great Recession—we’ve heard how pay has become a smaller factor in determining employees’ overall happiness with their jobs.

But, in what could be seen as an indicator of order slowly being restored to the universe, it looks like the money matters most to workers once again.

That’s according to a just-released survey from the Alexandria, Va.-based Society for Human Resource Management. In a poll of 600 randomly selected employees at companies of all sizes, SHRM found 60 percent of respondents citing compensation/pay as the biggest contributor to job satisfaction. According to SHRM, compensation/pay last topped this list during the pre-recession period of 2006 and 2007.

In addition, 56 percent of employees reported receiving a raise in the last year, a six-percentage point increase from 2012. A smaller percentage, however (36 percent), indicated receiving a bonus in the last 12 months; a drop of three percentage points in comparison to 2012.

“Incomes have grown slowly since the recession, and that undoubtedly is having an impact on workers’ priorities and [is] one explanation for the leap to the forefront by compensation,” said Evren Esen, director of SHRM’s Survey Research Center, in a statement.

Esen pointed out that four generations of employees listed compensation/pay as either the first- or second-ranked aspect of job satisfaction. With the exception of executives, employees at all job levels ranked it as one of the top three contributors to overall job satisfaction. At 59 percent, the opportunity to use skills and abilities was the second-most cited factor, tied with job security.

Yes, cash may be king once again. But, as always, there are more variables in the job satisfaction equation. Overall, 81 percent of survey participants said they were satisfied with their current jobs, with many expressing optimism about the future. For example, 79 percent of respondents indicated they were determined to accomplish their work goals and were confident they could meet them. Further, 73 percent said they were satisfied with their relationships with their co-workers, and 70 percent were satisfied with their relationship with their immediate supervisor.

“While many employees emphasize compensation/pay when considering how happy they are in their jobs, a significant proportion also place importance on relationships with co-workers and supervisors,” according to Alex Alonso, vice president of research at SHRM.

“Fostering an environment that treats all employees equally and encourages communication among all levels of workers can be an effective way for employers to earn trust from employees and increase their satisfaction with their jobs.”

HR Is NOT Getting the Benefits Message Out

I know we’ve pounded the benefits-communication drum already in our magazine, website and blog, but Audrey Boone Tillman’s plea, if you 125728721-exec with bullhornwill, to HR leaders to pound that drum harder left me with some compelling new truths.

Tillman, executive vice president of corporate services for Columbus, Ga.-based Aflac Inc., presented findings of the 2013 Aflac WorkForces Report at her session — “Marketing Your Benefits: Developing a More Effective Strategy to Educate and Engage Employees About Benefits Options” — Monday at the Society for Human Resource Management’s Annual Conference in Chicago.

That’s a mouthful. I’ll cut to the chase. According to the report, 59 percent of employees would likely switch employers for lower salaries but more comprehensive benefits, and 79 percent agree a well-communicated benefits package would make them less likely to leave.

At the same time, 93 percent of employers believe they effectively communicate benefits, yet nearly half of employees say HR doesn’t communicate benefits enough. And here’s the kicker: Only 10 percent of employees feel their HR department is extremely effective at communicating benefits.

When you’re thinking about the overall cost of providing benefits, “think about the cost to the company if someone leaves for better benefits,” Tillman said, such as turnover, recruiting, lost productivity, training, the list goes on.

When it comes to the confusing labyrinth that is the Affordable Care Act, 75 percent of employees think their employer will and should be explaining how healthcare reform will impact them and their healthcare, yet only 13 percent of employers are actually planning to explain that.

For a complete rundown on who all was questioned for the survey, how many and from what industries, go to the company report’s website. In the meantime, I think it’s safe to say HR professionals are not marketing the benefits their companies are offering nearly enough.

“Too many HR leaders still think if they offer it and explain it at open enrollment and put out an email, that’s enough,” said Tillman. “The days of explaining what’s inside a glossy brochure once a year are over.”

Tillman urges employers and their HR and benefits teams to utilize “all the new touch points” available today that “far too few are taking advantage of,” including creating Facebook pages, mailing annual benefits statements to homes where spouses can see them, putting table tents in break and conference rooms, dedicating online email accounts to benefits questions, holding frequent town halls and lunch and learns, and putting videos on company portals featuring testimonials by employees who’ve been helped by the program in some way.

She even suggests pumping up the message with free shirts and free food. “You should be marketing benefits like the big vendors are marketing their goods and services on the expo floor below us,” she told attendees.

And when it comes to healthcare reform, “even to tell them, ‘We still don’t know enough’ is better than telling them nothing. Even ‘We have no news’ is fine,” she said.

Bottom line, employers aren’t finding ways to ask employees what they know and don’t know, need and don’t need, and employees aren’t asking about their options and how their companies can help them become better stewards of their health, finances and benefits.

And if you don’t think most employees need help, consider these two stats from the study: Nearly half (46 percent) of employees have less than 1,000 saved for unexpected health or life emergencies and 25 percent have less than $500 saved. And these are employees! These are the people who are working!

The good news, said Tillman, is that “employees want to hear from HR about employee benefits.” They want the ACA explained to them. They want to understand the “alphabet soup” of acronyms and terminology associated with it.

“This is a space where HR can really take the lead,” she said, “determining and explaining where the company will go in light of healthcare reform. This is where HR can really create value — for the company, for the employee and for HR.”

Future World College-Graduate Shortage Looms Large

college grad-122486537More bad news on the skills-shortage front since my last post on the subject. This time, the shocker comes in the form of a number, part of the McKinsey Global Institute’s recent World at Work report: By 2020, according to the report, the world could have 40 million too few college-educated workers.

Youch. That’s a huge shortage — as the late George Carlin might have said in his infamous oxymoron routine.

As Tracy McCarthy, senior vice president of human resources at Chicago-based SilkRoad technology, told the Society for Human Resource Management in it’s report (subscription required) on this matter,

This skills shortage, particularly for high-tech skills, has existed in the United States for some time now. If you look at the number of H-1B visa holders, you’ll find the majority are for high-tech skilled workers such as engineers.”

Yes, I’ve been aware of the skills shortage for some time now; I know about the scarcity of math-and-science-proficient engineers (something I keep telling my engineer son to bear in mind and use to his advantage as he plots his future); I just hadn’t seen a 40-million-shortage headcount by 2020 until now.

Ravin Jesuthasan, Chicago-based global-talent-management-practice leader for Towers Watson, says the future gap will come with some friction points too. As he puts it,

While there will be an overall shortage of college-educated talent, there will be dramatic differences across countries. Developed markets like the United States, Japan, Germany and the United Kingdom will experience huge shortages, while countries like India and Indonesia will generate significant surpluses as the key drivers of education, demographics and immigration play out differentially. The challenge for employers will be how they tap into these surpluses; making the mobility of work essential.”

What the McKinsey report does not cover, Jesuthasan adds, are the specific skills that businesses will demand and the gaps relative to those within the current workforce. As noted in Towers Watson’s Global Talent 2021 report, he points out, employers expect to place increasing emphasis on four skill areas: digital skills, agile thinking, interpersonal and communication skills, and global operating skills.

I guess you can look at all this as more fodder for the battle cry to bring the best thinkers of the world together now — from employment, academic, even governmental sectors — to try and solve this thing before the global marketplace closes up shop.

Time to Start Talking About Healthcare Exchanges

No harm in reminding one and all that you have until March 1 — according to the recently enacted Affordable Care Act — to notify your employees about state-specific healthcare exchanges to be set up before 2014.

This alert from the Society for Human Resource Mangement lays out what you need to be doing next, according to the new law, after you’ve satisfied your January 2013 healthcare-benefit cost-reporting requirement for 2012 W-2s, that is. (Appropriate informational links are included in the SHRM piece; note, though, that the SHRM site is a subscription-based one.)

In the piece, Jennifer Benz, CEO of Benz Communications, lists three specific communication requirements employers must satisfy by March 1:

State exchange basics. This is a description of the state exchange, the services provided by the exchange and how to contact the exchange (website and customer service number). One wrinkle: not all states have decided how they’re going to comply (the National Conference of State Legislatures provides an up-to-date chart of state implementation efforts). Employers in multi-plan states will have an even more challenging time.

Individual plan value. This explains whether employees will receive at least 60 percent coverage of essential health benefits through employer-provided coverage, and whether employees may be eligible for a premium tax credit if they purchase a plan on the state exchange.

Tax implications. Because health-insurance premiums under employer-sponsored coverage may be paid with pre-tax dollars, buying coverage through a state exchange may change an employee’s tax obligations. Employees using an exchange to purchase coverage may lose their employer’s tax-free contribution (if any) to their health coverage, also.

Although many benefits and HR experts are predicting the March deadline will be extended, considering the U.S. Department of Labor has yet to release proposed regulations or samples of a model notice, Benz suggests integrating the three-part notice into your overall health-benefits-communication strategy regardless.

“No matter what deadline the DOL ultimately sets,” says Benz, “employers need to be prepared to include [these three points] in their communication plans for 2013.”

Communicate your 2014 position before the legalese does,” she adds. “Be sure to use language that fits the notice into your big-picture approach to healthcare-reform compliance. For many employers, this strategy is going to include high-deductible health plans and incentive-heavy wellness programs, two benefit strategies that require robust, thoughtful communications in their own right.”

Employee Health Takes on New Meaning

Two different studies came to my attention at SHRM’s 2012 Annual Conference and Exposition — both underscoring a growing awareness that keeping workers working, and healthy and productive, is probably the best way to cut healthcare costs.

In essence — though as important cost-cutting factors — focusing on plan design and doctors’ and drug costs may be taking a back seat to keeping workers healthy and happy, at work.

One, a just-released report from The Standard Insurance Co.’s Workplace Possibilities program, titled Health-Related Lost Productivity: Causes and Solutions, kind of turns on its ear the notion that medical care and drug costs should be employers’ biggest worries.

It cites recent studies (one in the Journal of Occupational Environmental Medicine, “Health and Productivity as a Business Strategy: A Multi-Employer Study,” and two others by Mercer and Kronos on the Total Financial Impact of Employee Absences) showing that medical and pharmaceutical costs make up only 30 percent of the total cost of poor employee health.

The other 70 percent can be attributed to what The Standard calls health-related lost productivity costs. Those accrue through presenteeism (workers showing up but not producing at full capacity due to illness) and absenteeism. And the latter costs accrue through all kinds of demons: overtime for the workers left to pick up the pieces, turnover should patients never return, temporary staffing, working slow, late deliveries (because, let’s face it, replacements just don’t know the ropes like the employees themselves), replacement training, customer and variable product quality.

Michael Klachefsky, national practice leader of The Standard’s Workplace Possibilities program and author of the report, calls it the “iceberg concept.”

“These are the hidden costs, like the part of the iceberg under the water’s surface,” he tells me. “Our findings show the people left to pick up the slack are, on average, 15 percent to 44 percent more expensive, and 21 percent to 29 percent less productive.”

His research shows that, for every $1 employers spend on worker medical or pharmacy costs, they absorb at least $2.30 of HRLP costs.

“It’s intuitive,” says Klachefsky, “but no one ever measured it before.”

His company actually bases its services on this concept through numerous proactive fixes, such as on-site wellness and return-to-work consultants, ergonomic advice, products and services, and a blog — workplacepossibilities.com — devoted solely to educating employers and employees about ways to avoid medical leave and keep short-term disability from becoming long-term disability.

“We’re doing the 70 percent,” Klachefsky says. “Most others are addressing the 30 percent.”

Also at the conference, SHRM released its 2012 Employee Benefits Survey, showing more employers are offering benefits now that encourage employees to improve their health. Of the 550 randomly selected HR professionals surveyed by SHRM, 45 percent are now offering health and lifestyle coaching, up from 33 percent in 2008, and 35 percent are rewarding — through lower premiums or bonuses — workers who complete health and wellness programs, up from 23 percent in 2008.

“Employers recognize that providing employees with the opportunity to improve their health can increase morale, confidence and productivity,” says Mark J. Schmit, vice president or research at SHRM.

“Organizations continue to look for ways to manage costs as the economy slowly improves,” he says, “[recognizing that] healthier employees … help decrease healthcare costs to employers and employees.”