Category Archives: talent management

Healthcare’s Looming Talent Troubles

If you are an HR leader in the healthcare sector, there’s good news and bad news on the jobs front. The good news is the Department of Labor’s Bureau of Labor Statistics reports that healthcare jobs will be among the fastest-growing in the nation by 2026. BLS projects health care will account for about 2.3 million new jobs over the next nine years.  Growth is good.

The bad news? Pinpointing exactly how to fill those jobs won’t be easy, depending on location.

A recent U.S. healthcare labor market analysis from Mercer compares future supply and demand of workers to project workforce availability across 50 healthcare occupations through 2025. According to the report, the projected supply of healthcare workers in several states will fall short of demand.

In terms of category, more than half of the new jobs the BLS forecast – around 1.6 million combined – will come from employment of personal care aides, home health aides and registered nurses, driven by an American population that’s trending older, sicker and more sedentary.

“These high-growth jobs will likely have gaps in demand and supply of workers,” said Jason Narlock, senior consultant, Workforce Strategy and Analytics at Mercer, in a company statement.  “While BLS figures show employment for Home Health Aides is expected to grow forty-seven percent in 2026, our analysis shows that providers might find it tough to fill all these roles – with each state facing a likely gap of 2,000 workers on average by 2025.”

Potential gaps in key worker availability will greatly impact healthcare employers as they consider the future-ready workforce they need to deliver quality patient care, Narlock explains. Mercer recommends employers should:

  • Understand full exposure to potential workforce risks – both external and internal. In addition to considering external labor market risks, employers must also understand the flow of employees in, through and out of its organization for the full picture.
  • Be proactive to mitigate the impact – While employers can’t control what is happening in the external labor market, effectively managing internal labor markets can help mitigate exposure to these risks.
  • Figure out how proposed workforce changes will impact patient health and satisfaction. Before making large investments, employers can use data and analytics to better understand the likely impact of changes on patient metrics.

“The good news is that much of this work relies on data that healthcare systems already collect,” Narlock said. “It’s not a matter of getting new data, but better leveraging data to develop empirical insights that will drive strategic workforce planning and build a future-ready workforce.”

HR: It’s About Quality, Not Quantity

Most organizations are structured along the following lines: On one side you have the competitive differentiators — sales and marketing, product development, customer service. And on the other, you have compliance and cost containment — finance, legal and HR. The competitive-differentiator side tends to get the lion’s share of funding and attention — and that’s the side HR and recruiting needs to be on, said Recruiting Trends & Talent Tech Conference Co-chair Elaine Orler.

“Talent is the only real competitive differentiator,” said Orler, who spoke during a session at the conference on future trends in talent technology. “That’s how we win.”

Too often, HR must scrape and beg for the money for implementing the tools, systems and resources to make talent acquisition faster and more effective, she said. It needs to reorient its mindset away from cost-containment to value-added, and have the confidence — and the data — to successfully present this argument to the C-suite so it can get the resources it needs.

“We need to have those straightforward conversations — that if we only have 30 days to find a candidate, we’re only going to come up with C-players,” she said. “We need to advocate for 40 days, and 20 percent more salary, for example, to fill that position with an A-player.”

Orler, who’s worked as a recruiter and technology consultant for 20 years and is now senior vice president for professional services at Talent Sonar, also discussed her predictions for what we can expect to see in talent acquisition during the next year and beyond. One trend will be “total talent management,” she said, in which organizations will need to take into account the growing number of non-employees who fill critical talent roles. HR needs to take ownership for the contractors, gig workers and temps who fill these jobs and help them develop their careers and skills, even though they’re not full-time employees, she said.

Another development will be the realization that machines are not going to take over after all — but millennials and Gen Z will, and HR needs to help companies adapt to the different way in which the younger generations prefer to interact with their employer, said Orler. “We’ve got five generations in the workforce now — that’s unprecedented,” she said. “We’ve got to address how to manage the mixed workforce, and technology will help us do that.”

Then there’s what Orler refers to as “Suite Play 2.0,” or the growing availability of “plug and play” talent applications enabled by so-called “partner ecosystems,” in which HR tech vendors share their APIs with other pre-approved vendors to make it easier for clients to install new point solutions on their platforms without going through all the implementation and integration headaches of yesteryear, said Orler. “This is going to make things easier and faster,” she said.

Finally, talent acquisition will increasingly be measured by quality, not quantity, she said.

“If I could ask you to do one thing, it would be to refuse to allow TA to be measured by time-to-fill,” Orler told the audience. “Time-to-fill only generates quantity. Measure quality instead — that’s how we can show that we’re on the value-added side of the business, not the cost-containment side.”

‘Listen Up, Hiring Manager’

If you’re a recruiter who feels as though you don’t have the respect of hiring managers, you’re probably not alone.

During a mega-session yesterday titled “Getting Hiring Managers to Focus on Great Recruiting” at Recruiting Trends and Talent Tech event, San Francisco State University Professor John Sullivan said that only one out of three hiring managers think recruiters have a positive impact on their businesses. But he also told those attending that recruiters have a number of options at their disposal for changing that dynamic.

Sullivan said that the best way to get the attention of hiring managers is to approach them with data that matters to them.

Recruiters, he said, shouldn’t waste their time trying to change what hiring managers care about, because they won’t change. Instead, he said, they should focus on what they do care about: money.

“Managers live in a world that’s data driven, but mostly it’s about money,” Sullivan said.

If recruiters want to get through to hiring managers, Sullivan said, they need to be able to explain how what they do impacts each of these four areas: business goals, bonuses, getting promoted and time.

“Don’t bother coming in to talk to hiring managers about diversity or time to hire, because it just glazes them over,” he said. “But if you come in and tell them you can increase their sales by 20 percent, then they will listen to you, instantly.”

Sullivan noted that recruiters have a compelling story to tell. “If you do great recruiting, you can increase revenue by 3.5 times,” he said, adding that leadership development has roughly half that impact.

“Every other manager on the planet measures process effectiveness,” Sullivan said. “But only 33 percent of firms actually measure quality of hire?”

How can recruiters know they are doing a good job if they’re not measuring the right outcomes? he asked.

At the same time, Sullivan said, everyone else in the organization measures failure rates, but not recruiters. (New hires, he said, fail nearly half the time, with a 46 percent churn over an 18 month period.)

Not good, he said.

Sullivan advised those attending to show hiring managers what a weak hire costs their organization. “How much damage can one employee do?” he asked. “A lot. They can cost you 10 times their salary.”

M&As: Keeping Talent Long-Term

Mergers and acquisitions are hard, but post-merger success can be harder: Up to 90 percent of mergers end up failing, according to the Harvard Business Review. While mergers are complicated and the factors that can contribute to failure are many, one of the biggest impediments to success is when talented employees from both organizations decide not to stick around post-merger.

Willis Towers Watson’s 2017 Global M&A Retention Study finds that, while acquiring companies have been increasingly successful in retaining at least 80 percent of their employees who’ve signed retention agreements through the end of the retention period, only about half retain at least 80 percent of such employees a year after the retention period ends.

“It’s a tale of two results,” says Mary Cianni, WTW’s global M&A practice lead. “Acquirers have made good strides at keeping key talent for an initial period, but there’s room for improvement one year later.”

Companies are failing to use the retention period to capture these employees’ “hearts and minds” for the long term, she says. Retention bonuses — the primary financial award used by companies — are important, but are only part of the equation, says Cianni.

“Personal outreach by leaders, strategic promotions and employees’ participation on task forces are also beneficial and will pay dividends in the years ahead,” she says. Total rewards (learning and development and career opportunities for hi-pos, in particular) can also be key.

The report (based on data from 244 respondents in 24 countries) finds that companies which prioritize early communication with senior leaders — 24 percent of the acquiring companies asked senior leaders at their target companies to sign retention agreements prior to the initial merger agreement signing — tend to have better luck at retaining those leaders than those that do not.

Of course, culture is also important: Nearly half (44 percent) of the employees who left prior to the end of their retention period blame the new or changing culture of the combined organization as the reason for leaving. Other top reasons for leaving include being aggressively pursued by competitors (36 percent) and not liking their new role (25 percent).

“The most successful acquirers realize retention agreements can buy time, but not loyalty,” says Scott Oberstaedt, WTW’s director of executive compensation. “And by not using their arsenal of tools to build loyalty during what can be tumultuous periods, companies often lose talent that would serve them well in the long run.”

Are Employers Too Powerful?

It’s not often that a philosopher’s book makes even a small splash in the business world. This one may be an exception: Private Government: How Employers Rule Our Lives (and Why We Don’t Talk about It) by University of Michigan philosophy professor Elizabeth Anderson. The book, published earlier this year by Princeton University Press, has attracted attention in Forbes, on the daily public-radio business show Marketplace and elsewhere.

It’s not hard to see the interest for business leaders. Anderson argues that despite our faith that the nation is rooted in freedom and egalitarian values, many Americans work in oppressive conditions, with bosses who exercise tyrannical control over their lives both at work and home.

Anderson sketched parts of her thesis in a 2015 lecture at Princeton, according to a university transcript [pdf here]:

“Most workers in the United States are governed by communist dictatorships in their work lives. Usually, those dictatorships have the legal authority to regulate workers’ off-hour lives as well—their political activities, speech, choice of sexual partner, use of recreational drugs, alcohol,smoking, and exercise. Because most employers exercise this off-hours authority irregularly, arbitrarily, and without warning, most workers are
unaware of how sweeping it is. Most believe, for example, that their boss cannot fire them for their off-hours Facebook postings, or for supporting a political candidate their boss opposes. Yet only about half of U.S. workers enjoy even partial protection of their off-duty speech from employer meddling.”

“Far fewer enjoy legal protection of their speech on the job,
except in narrowly defined circumstances. Even where they are entitled to legal protection, as in speech promoting union activity, their legal rights are often a virtual dead letter due to lax enforcement: employers determined to keep out unions immediately fire any workers who dare mention them, and the costs of litigation make it impossible for workers to hold them accountable for this.”

Employment lawyers might challenge some of Anderson’s claims, and most HR executives likely would say they don’t recognize the business world she describes.

But Anderson’s book comes at a volatile time in America, and it’s difficult to predict which public-policy issue will next catch fire. If the nation’s recent populist anger swings in a new direction, it’s not hard to imagine Anderson’s work providing intellectual fuel for a left-wing presidential candidate such as Bernie Sanders or Elizabeth Warren in 2020. Private Government provides a sneak peak at possible stump-speech talking points.

In longer-range terms, this book also could influence the common perception about business as did Michael Moore’s 1989 documentary Roger & Me, or Nickle & Dimed, Barbara Ehrenreich’s 2001 book about her attempt to live on a minimum wage.

Asked in a Q&A with Princeton University Press editors how she would prefer workplaces to be organized, Anderson says this:

“I argue that workers need a voice in how the workplace is governed. Other measures, such as making it easier for workers to quit, and laws protecting workers’ privacy and off-duty activities from employer meddling, can certainly help. But these can’t substitute for workers having a say in how the workplace is governed. Labor unions once gave voice to more than a third of American workers. These days, outside the state sector, few workers are represented by a union. Yet unions are not the only way that workers can have a say in workplace governance. In Europe, so-called co-determination, in which workplaces are jointly managed by owners and workers, is common. I make the case for exploring different ways workers could have a say, to open up a topic that is hard to frame in today’s impoverished political discourse.”

 

GE is Reinventing Talent Management

The Sept.-Oct. issue of the Harvard Business Review has an interesting package of articles on the 16-year tenure of recently retired G.E. CEO Jeff Immelt (including an essay by the man himself on what he learned during his time leading the company). One of what may be among his lasting impacts on the company is the campaign to use algorithms to transform the way GE develops and retains its 300,000 employees.

As writer Steven Prokesch notes, GE is now positioning itself as a tech-focused industrial company and has hired thousands of software engineers and other digital natives. These employees tend to have little patience for bureaucratic processes and a thirst to grow in their careers. As a result, GE’s HR team is coming up with a raft of analytics-based applications to help them develop their careers and networks, identify high potentials and match them up with training opportunities. “It’s GE’s version of Match.com,” James Gallman, who helped lead the effort at GE and is now Boeing’s people analytics director, told Prokesch.

GE’s analytics push is focused on six areas of talent management: career and succession planning, training, high potentials, networks, talent retention and cultural change. The tool for career and succession planning is the furthest along, writes Prokesch. It uses data on the “historical movement of GE employees and the relatedness of jobs (which is based on their descriptions”) to help users identify potential new opportunities throughout the entire company, not just in their own business or geography. The app is also intended to help leaders do a better job of succession planning by identifying “nonobvious candidates,” for example. “When we’re thinking about who could possibly fill a particular role, we have a technology that helps us come up with additional possibilities,” HR exec Paul Davies told Prokesch.

GE’s training app, still in the prototype stage, recommends training to help an employee do a better job and advance in his or her career. The company plans to connect it to an existing performance-development app for GE’s salaried employees that provides them with a steady stream of constructive feedback from their managers (Under Immelt, GE did away with the forced-ranking model implemented by former CEO Jack Welch, which has fallen out of favor in most of corporate America).

GE’s HR team is also building an app that uses a technique called the “Pareto frontier” to draw on “outcomes” data such as salary increases, bonuses, promotion rates, etc., to identify high-potential employees. It’s also building an app for networking that’s designed to  help employees identify others within the company they can go to for help or advice on a particular problem.

The team is also testing an app for talent retention that’s designed to predict, within a six-month window, when managers and employees in a given function are likely to jump ship. It will identify certain circumstances — such as when a team member leaves — under which people often quit, so that managers can intervene by, for example, talking about the next roles they might play.

Finally, GE’s “cultural change” app would help it identify factors within its organizational structure that may affect its efforts to become a nimbler, more customer-focused entity. For example, the app — still in the early stages of development — would measure whether people serving on large teams feel differently about the company than do people serving on smaller teams.

As Cade Massey, a professor at Penn’s Wharton School, tells Prokesch, although none of these apps will be a magic bullet for talent retention and development, they will give GE much more to rely on than intuition and bias in terms of what works and what doesn’t. “As analytics progresses, it offers a chance to make more rigorous those intuitive methods and to de-bias some of that judgement,” he says.

A Nation of Apprentices

According to U.S. Labor Secretary Alexander Acosta, only 3 percent of the American workforce are apprenticeship graduates. But if President Trump’s new apprenticeship program delivers as promised, that number will soon be a lot higher.

Indeed, the Trump administration is now focused on getting universities and private companies to pair up and pay the cost of such learn-to-earn arrangements., according to the Washington Post, which noted that the president has accepted a challenge from Salesforce.com CEO Marc Benioff to create 5 million apprenticeships over five years.

“Our program will be geared toward all industries and all jobs,” Acosta said during a White House press briefing Monday. “The point here is to foster private-private partnerships between industry and educational institutions … so that when [students leave the program] they have the skills necessary to enter the workforce,”

President Trump also spoke about the need for a more robust apprenticeship program during his first full Cabinet meeting on Monday: “Apprenticeships are going to be a big, big factor in our country. There are millions of good jobs that lead to great careers, jobs that do not require a four-year degree or the massive debt that often comes with those four-year degrees and even two-year degrees.”

Many employers and economists on both sides of the aisle welcome the idea of apprenticeships as a way to train people with specific skills for particular jobs that employers say they can’t fill at time of historically low unemployment, according to the Post piece, which notes the most recent budget for the federal government passed with about $90 million for apprenticeships, and Trump so far isn’t proposing adding more.

More from the Post:

But the Trump administration, like President Barack Obama’s, says there’s a need that can be met with a change in the American attitude toward vocational education and apprenticeships. A November 2016 report by Obama’s Commerce Department found that “apprenticeships are not fully understood in the United States, especially” by employers, who tend to use apprentices for a few, hard-to -fill positions” but not as widely as they could.

The shortages for specifically-trained workers cut across multiple job sectors beyond Trump’s beloved construction trades. There are shortages in agriculture, manufacturing, information technology and health care.

George Brooks, leader of People Advisory Services at Ernst & Young, applauds the decision to focus on apprenticeships.

“Apprenticeship programs look like a win-win solution for employers, employees and society,” he says, before adding that companies must play their part.

“What resonates beyond the announced apprenticeship program is the need for companies we work with to fill many new types of jobs that will be in heavy demand, such as cyber, drone management, robotics management, etc., that are growing too quickly to wait for four-year STEM students to graduate or for older workers to go back to school,” Brooks says. “By the time these people have the traditional degree, technology will have evolved even further. That workforce challenge is why we see leading organizations starting their own training-apprenticeship-mentoring programs, thus building their own future workforce.”

 

 

Tackling Turnover at Taco Bell

As you might expect, labor is a huge deal for fast-food restaurants such as Taco Bell Corp.

Making sure stores are appropriately staffed with engaged workers is a top priority for the Irvine, Calif.-based firm, which has 830-company-owned outlets and 30,000 employees (nearly half of whom are 22 years old or younger).

As Taco Bell Vice President of People and Experience Bjorn Erland explained yesterday during a session titled “Taco Bell Enhances Its People Strategy with a New Analytics Recipe” at this week’s WorldatWork Total Rewards Conference and Exposition, controlling turnover is a major challenge for the firm.

During the Great Recession, Erland said, Taco Bell’s turnover rate decreased dramatically; but beginning in 2012, it began to rise again while engagement scores began to fall.

Leadership was hearing that pay was a major reason people were leaving. But in order to come up with the right game plan, HR knew it needed more data. So it brought in global consultancy Mercer to better understand the key drivers behind the high turnover and identify ways  to address it.

When it looked at why workers stuck around, Taco Bell, a unit of Yum! Brands, found that a flexible work environment and strong culture were major drivers. As to why people were leaving, factors such as a high level of stress, lack of training and better opportunities elsewhere emerged as a big contributors.

In an effort to better understand the part pay practices were playing, Mercer studied more than 500 company owned U.S. restaurants and 20,000 employees over a 13-month period.

“We looked at workforce factors such as starting pay, pay levels and bonus payments,” said Rick Guzzo, a partner in the Washington office of Mercer. “Then we looked at how long [people] were working at Taco Bell, their average age … and external factors such as store size and where the store was located.”

Well, the big “Aha!” for Taco Bell was learning that earnings were far more important to workers than their rate of pay. Were they working enough hours, including overtime, to bring home a bigger paycheck? (Erland noted that Taco Bell’s pay was competitive with others in the industry.)

In light of these finding, Erland said, the company began to increase its use of “slack hours” to increase the amount of employee take home pay. “Turnover improved when employees were able to bring home more earnings,” he said.

Indeed, the study found that employees who worked 100 hours or more a month were 71 percent more likely to stay than those working fewer hours. “This was eye opening. It’s not a guarantee, but it’s almost like a guarantee,” Erland said.

The research also found a strong correlation between poor store performance and regional general manager turnover.

“You can’t stabilize team-member turnover unless you stabilize the turnover above the restaurant [level: area coaches and RGMs],” Erland said.

Erland noted that 600 out of its 900 company owned store managers had new supervisors in 2015. “That’s just not normal,” he explained. “So we put in place a process in which the COO and I approve any area coach moves” and added “a bonus plan for area coaches that was tied to RGM stability.”

The other thing area coaches often did, he said, was take an RGM who was a superstar in an A store and put them in an F store to turn it around. “What you end up getting are two Cs,” he said. “So we told them don’t move them around; keep them at the A store and we’ll figure out the F store… . As a result, they didn’t move RGMs around much at all last year.”

Next year, Taco Bell is also looking to test the idea of applying variable pay to filling its late-night shifts. “It’s hard to get someone to come in at midnight and work until 4 in morning,” Erland said. “So we have to differentiate the pay [for those workers].”

Hours before Erland shared his story, Taco Bell issued a press release that announced the second stage of a partnership with Roadtrip Nation. The partnership highlights various career paths within the organization, in order to make it easier for current and future employees to match their job needs and goals with the firm’s career opportunities.

Stories of current employees and alumni are featured on the Roadtrip Nation platform, so both current and prospective employees can gain a better understand of what needs to be done in order to achieve their career goals, whether it’s managing a Taco Bell restaurant, working in the marketing department at headquarters or taking skills to another industry all together.

“The platform aims to foster networks and communities and empower team members by hearing about their lessons learned and career paths of others,” according to the press release.

One alumni interviewed and featured is Fred Mossler, former senior vice president of merchandising at Zappos and an entrepreneur. Mossler’s first job was cleaning dishes at Taco Bell, where he worked his way up to a supervisor.

Hurting for Talent in HR?

In the never-ending quest to boost HR’s profile in the C-suite, CHROs must first surround themselves with top-notch talent in their own departments, according to new research from Korn Ferry.

The problem, the same survey finds, is that serious talent gaps exist within the HR suite.

The Los Angeles-based advisory firm recently polled 189 chief human resource officers, finding that “as the HR function becomes more strategic and high-profile, HR professionals need to step up their game when it comes to business insights and achieving results,” according to a Korn Ferry statement.

More specifically, CHROs were asked to name the skills they find are most lacking as they search for human resources talent.

A mere 4 percent reported having no difficulty finding the necessary skills to round out their HR teams. Otherwise, respondents said:

  • Business acumen (41 percent)
  • Ability to turn strategy into action (28 percent)
  • Intellectual horsepower (10 percent)
  • Analytical skills (7 percent)
  • Diversified experience (6 percent)
  • Relational skills (3 percent)
  • Technical skills (1 percent)

Of course, the role of the HR function, and the CHRO, is much more complex than it was even five short years ago, says Joseph McCabe, vice chairman of Korn Ferry’s Global Human Resources Center of Expertise.

“Disruptors such as digitization and globalization are creating an environment of constant organizational change,” says McCabe. “HR leaders must understand the business challenges that occur as a result of these disruptions, including the impact on the business strategy, and be able to quickly adapt and act.”

The Korn Ferry poll allowed respondents the chance to do a bit of self-examination as well, asking CHROs what competencies were most important to helping them handle the ever-changing environment in which they operate.

By far, the most common response was “tolerance for ambiguity,” cited by 52 percent of the CHROs surveyed. Twenty percent pointed to the confidence to make bold, yet informed decisions as most critical, followed by the ability to sustain analytical thinking and motivate others (11 percent) and the ability to listen to and accommodate others’ methods (6 percent).

The study finds that a failure to cultivate both “hard” and “soft” skills could be costly for a CHRO; a reality that respondents seem to recognize. Indeed, when asked to name the top reason that a CHRO would get fired from an organization, the largest percentage (37) said “personality issues/inability to work well with or lead others,” with 34 percent reporting that an “inability to direct connect HR efforts to tangible business outcomes” would be the most likely cause for being let go.

“Today’s CHROs are judged both on what they do and how they get things done,” says McCabe. “While it’s critical that HR must act quickly to adapt to changing business strategy, it’s also important to align their team and other key leaders to foster engagement and a shared vision.”

‘Flexing’ to Close Gender Gap

Seventy percent of working mothers say having a flexible work schedule is extremely important to them, according to a Pew survey. (So do 48 percent of working fathers.)

To that end, a new job board is looking to leverage workplace flexibility to help close the gender gap, according to this new piece in the New York Times Upshot section:

A new job search company, Werk, is trying to address the [gender-gap] problem by negotiating for flexibility with employers before posting jobs, so employees don’t have to.

Facebook, Uber and Samsung are among the companies with job listings on the Werk site, in which all the positions listed “are highly skilled jobs that offer some sort of control over the time and place of work. People can apply to jobs that let them work away from the office all the time or some of the time, and at hours other than 9-to-5, part time or with minimal travel.”

Another option the site offers gives workers the freedom to adjust their schedules, no questions asked, because of unpredictable home and/or family obligations.

The story quotes Gerard Masci, founder and chief executive of Lowercase, a start-up eyeglass maker in Brooklyn, who just hired a vice president for communications on Werk. The company’s new hire works part-time and remotely, except for monthly in-person meetings.

“I don’t care if this week you work less if in a month you work more, and whether they work in the space or not is irrelevant,” Mr. Masci said. “All I care about is the productivity in the end.”

The full story is well worth a read for any HR leaders who are looking for ways to improve flexibility efforts without sacrificing productivity or quality talent.