Date post: | 06-Mar-2018 |
Category: |
Documents |
Upload: | truongtruc |
View: | 218 times |
Download: | 2 times |
Copyright © 2009 Metrus Group, Inc.
William SchiemannCEO, Metrus Group
SCNetwork Subscriber GroupMarch 2009
Growing the HR Value Proposition
Copyright © 2009 Metrus Group, Inc.
Metrus Research and CasesMetrus Research and Cases
• We have learned a lot about HR effectiveness from:
• Based on:– 75 recent human capital thought leader interviews– ASQ study of over 2000 organizations– Quality Progress study of over 800 organizations– Ongoing audience surveys– Custom corporate & non-profit surveys of HR– Many more….
Copyright © 2009 Metrus Group, Inc.
Coming SoonComing Soon……
Reinventing Talent is an outstanding blend of research and practice. It reports compelling research on the value of investing in talent and offers specific recommendations on how to develop people equity through alignment, capabilities, and engagement. The book confirms what good people managers do and offers specific guidelines for those wanting to upgrade their people management skills.
Dave UlrichProfessor, Ross School of Business
University of MichiganPartner, The RBL Group
Published by:
Copyright © 2009 Metrus Group, Inc.
Key TrendsKey Trends
1. Unprecedented uncertainty
2. A glut of suppliers locally & globally
3. Increasing diversity
4. Automation and Asia
5. Human capital and knowledge an increasing component of customer and financial value
6. Speed
Copyright © 2009 Metrus Group, Inc.
Key ImplicationsKey Implications
1. Businesses must create value fastera. Customers have a choiceb. More sophisticated; expect morec. Differentiation a challenge
2. Human capital stakes are higha. Alignment means productivityb. Customers expect Capabilitiesc. Engagement can tip the scale
3. Expectations of HR increasing rapidly
Copyright © 2009 Metrus Group, Inc.
Key Implications (contKey Implications (cont’’d)d)
4. Value driving decisions more than ever beforea. Strategies sound? Aligned?b. Right Information?c. Business acumen?d. One size fits all? e. Resource efficiency?f. Adaptability and flexibility?g. Accountability?
Copyright © 2009 Metrus Group, Inc.
Value EqualsValue Equals……
Quality of Relationship/ServiceCost of Relationship
Copyright © 2009 Metrus Group, Inc.
0 10 20 30 40 50 60 70
Marketing
Human Resources
Procurement/Purchasing
Legal
Research & Development
Finance/Accounting Services
Security
Information Technology
Communications/Public Affairs
Customer Service
Manufacturing/Production/Operations
Quality
1993
2006
HR Internal Service ratings Improved, but HR Internal Service ratings Improved, but still ranked lower than most functionsstill ranked lower than most functions
2007
Why?
Copyright © 2009 Metrus Group, Inc.
The KeysThe Keys
• A Great Value Proposition
• High People Equity
• The Right Measures
• Resource Leverage
• Assess Impact!
Copyright © 2009 Metrus Group, Inc.
Research on Research on HR LeadersHR Leaders vs. vs. FollowersFollowers
• HR Leaders operationally defined as:– Influence with C-Suite– Ample budget– Rated highly by (internal) stakeholders
Copyright © 2009 Metrus Group, Inc.
The Path to HR Success: The Path to HR Success: Have a Strategy that Defines ValueHave a Strategy that Defines Value
0% 20% 40% 60% 80% 100%
Employees knowthe business
strategy
HR Strategy tied toorg. strategy
Org. has a clearpeople strategy
HR Follower HR Leader
Copyright © 2009 Metrus Group, Inc.
Our organization has a clearly defined Our organization has a clearly defined people strategy.people strategy.
0 20 40 60 80
CustomerSatisfaction
Productivity
FinancialPerformance
EmployeeRetention
Percent of Companies where HR has defined people strategy
High on Performance MeasureLow on Performance Measure
Copyright © 2009 Metrus Group, Inc.
HR has clear strategy that is tied to the HR has clear strategy that is tied to the strategy of the organization.strategy of the organization.
0 20 40 60 80
CustomerSatisfaction
Productivity
FinancialPerformance
EmployeeRetention
Percent of Companies where HR has strategy tied to organization's strategy
Low on Performance Measure High on Performance Measure
Copyright © 2009 Metrus Group, Inc.
Employees at every level can describe the key Employees at every level can describe the key elements of the business strategy.elements of the business strategy.
0 10 20 30 40 50 60
CustomerSatisfaction
Productivity
FinancialPerformance
EmployeeRetention
Percent of Companies where employees understand the business strategy
Low on Performance Measure High on Performance Measure
Copyright © 2009 Metrus Group, Inc.
Elements of an Effective StrategyElements of an Effective Strategy
Mission & VisionMission• Purpose for existing from
the customer’s view• Our value to society
Strategic Goal #…Strategic Goal #2Strategic Goal #1Vision• What success will look like• Celebration headlines for
future employee meetings• Our strategic goals
Driver # 1
Driver # …Driver # 5 Driver # 6
Driver # 3
Driver # 2
Driver # 4
Drivers• Areas where we must
excel if we are to achieve our strategic goals
Assumption # 1 Assumption # 2 Assumption # …
Founding Assumptions• What we believe about
the future, our markets, our own organization and the competition
M M M
M
M
M
MM M M
Copyright © 2009 Metrus Group, Inc.
Value MapValue Map
CustomerEquity
ShareholderEquityPeople
Suppliers
Environment
Product/Service
Value Creation
Copyright © 2009 Metrus Group, Inc.
Financial
OperationsPeople
Map Key:
Market
ManagementExcellence
- Vision- Coaching- Modeling
Alignment- Service goals- Sufficient talent
pipeline- Rewards for Loyalty
Core Values
Service Benchmarks
Inventory Turnover
Customer Loyalty
Price
Market Share
Strategic Business MapStrategic Business Map——Value PropositionValue Proposition
CustomerRetention
Capabilities- Communications- Customer Knowledge- Teamwork
Engagement- Enjoy Service - Fast Paced- Up under pressure
Product availability
ProductivityNet
Income
GrossSales
Copyright © 2009 Metrus Group, Inc.
NetIncome
BUSINESSOUTCOMES
PEOPLEDRIVERS
Engage-ment
Alignment:- Goals- Rewards- Pipeline
UniqueCapabilities
“A”RetentionPrograms
Talent Acquisition -Branding
-Onboarding
HRDRIVERS
HR Business Acumen
PEOPLEENABLERS
ManagementExcellence
Your CoreValues
Sample HR MapSample HR Map——Value PropositionValue Proposition
Financial
OperationsPeople
Map Key:
Customer
HR Drivers
BUSINESSDRIVERS
Cost
CustomerValue
PEOPLEOUTCOMES
Productivity
Key RoleTalent
Retention
Copyright © 2009 Metrus Group, Inc.
What Are Your Unique Strategy Drivers?What Are Your Unique Strategy Drivers?
1. elements of your business strategy that differentiate you?
2. What would you expect your people to observe and do differently?
3. What is HR’s explicit connection to your people and business strategy?
Unique
Copyright © 2009 Metrus Group, Inc.
Key Message #1:Uniqueness of Value
Value is created when behaviors, activities and investments are
aligned with the business strategy
Copyright © 2009 Metrus Group, Inc.
The KeysThe Keys
• A Great Value Proposition
• High People Equity
• The Right Measures
• Resource Leverage
• Assess Impact!
Copyright © 2009 Metrus Group, Inc.
Conference Board ResearchConference Board Research
“While senior management is fond of saying that employees are the
firm’s most precious asset... evidence suggests quite the
contrary.”
L. ScheinManager’s Guide to Corporate CultureConference Board Report 926
Copyright © 2009 Metrus Group, Inc.
Shareholder Equity
Customer EquityRelationship Value Brand Equity Product/Service Value
People Drivers
People EquityAlignment Capabilities Engagement
ProductivityTurnover Internal Service Quality
HR Drivers
People Investments, Initiatives
People Equity is Key Driver of Shareholder Equity
Copyright © 2009 Metrus Group, Inc.
Industry LeadersIndustry Leaders
71%
18%
65%
37%
0%10%20%30%40%50%60%70%80%90%
100%
Quality Performance Financial Performance
High People Equity Low People Equity
Copyright © 2009 Metrus Group, Inc.
Turnover Turnover –– OverallOverall
7.7%
16.7%
Top Quartile PE Bottom Quartile PE
Copyright © 2009 Metrus Group, Inc.
Alignment• Are we going in the same direction?
Capabilities• Do we have what we need to succeed?
Engagement• Are we advocates?
People EquityPeople Equity
Copyright © 2009 Metrus Group, Inc.
Building AlignmentBuilding Alignment
• Communicating the unique goals of the organization
• Clear priorities
• Roles aligned with goals
• Performance management
• Clear measures
• Rewards for performance
Copyright © 2009 Metrus Group, Inc.
INFORMATION
TALENT
RESOURCES & TOOLS
Do Your People Have the CapabilitiesDo Your People Have the CapabilitiesThey Need?They Need?
Copyright © 2009 Metrus Group, Inc.
Engagement as AdvocacyEngagement as Advocacy
Willingness to:
– Put in extra effort (time, energy, thinking)?
– Go beyond the minimal job description to solve organizational problems and help it achieve higher performance?
– Encourage people they value—friends and family perhaps—to:• Consider working for this organization?• Support this organization’s products
or services?• Invest in this organization (publicly traded)?
Copyright © 2009 Metrus Group, Inc.
The Engagement Hierarchy
Satisfiers
Commitment
Advocacy
Copyright © 2009 Metrus Group, Inc.
0% 10% 20% 30% 40% 50% 60%
Engagement measured
Capabilities measured
Alignment Measured
HR Follower HR Leader
On the Road to HR SuccessOn the Road to HR Success
Copyright © 2009 Metrus Group, Inc.
ALIGNMENT CAPABILITIES ENGAGEMENT
Mismanaged People Equity Leads To . . . Mismanaged People Equity Leads To . . .
• Overstaffing
• Missed goals
• Burnout-working hard, but not smart
• Sub optimized performance
• Dissatisfied customers– Work product– Relationship mgmt
• Employee frustration; turnover
• Overstaffing
• Supervisory burnout
• Low productivity, growth and margins
• Talent Loss
• Payroll drag: employees retired in place
• Lackluster performance
Copyright © 2009 Metrus Group, Inc.
Alignment Capabilities Engagement Profile Superior Performance
Under Equipped
Strategic Disconnect
Under Achiever
Frustrated / Cynical
Wasted Talent
Retired In Place
Cheerleader
Which Profile Do You Manage?Which Profile Do You Manage?
Copyright © 2009 Metrus Group, Inc.
POSSIBLE MEASURES
Common Across
Strategies
Cost Leadership
Innovation Customer Intimacy
PEOPLE:Alignment
• Goals alignment• Customer
alignment• Values alignment
Capabilities• Talent match• Resource match• Information
match
Engagement• Satisfiers• Commitment• Advocacy
Different Strategies, Different MeasuresDifferent Strategies, Different Measures
• Goals/Values:− Efficiency− Spartan
• Revenue per employee
• Goals/Values:− SOA applications− Autonomy
• Innovation awards
• Goals/Values:− Customer focus− Empowerment
• Tenure
• Efficiency analysis
• Cost awareness
• Idea generation• Creativity
• Service skills• Customer
knowledge• Service recovery
• Task fulfillment • Diversity • Team fulfillment
Copyright © 2009 Metrus Group, Inc.
People Outcomes and DriversPeople Outcomes and Drivers
1. What are the most important outcomes of people in your organization?
2. What are the factors that drive those outcomes?
3. How will we uniquely manage and grow People Equity?
Copyright © 2009 Metrus Group, Inc.
Key Message #2:People Equity
Human Capital impact is the result of alignment, capabilities, and engagement in your strategic
context!
Copyright © 2009 Metrus Group, Inc.
The KeysThe Keys
• A Great Value Proposition
• High People Equity
• The Right Measures
• Resource Leverage
• Assess Impact!
Copyright © 2009 Metrus Group, Inc.
The Path to HR Success:The Path to HR Success:Measure Against the Strategy Measure Against the Strategy
0% 10% 20% 30% 40% 50% 60% 70%
HR Scorecard used todrive & evaluate
success
Measures in place forpeople strategy
HR Followers HR Leaders
Copyright © 2009 Metrus Group, Inc.
The organization has a set of strategic measures to The organization has a set of strategic measures to evaluate progress in implementing the people strategy.evaluate progress in implementing the people strategy.
0 10 20 30 40 50 60
CustomerSatisfaction
Productivity
FinancialPerformance
EmployeeRetention
Percent of Companies where HR has strategic measures
High on Performance MeasureLow on Performance Measure
Copyright © 2009 Metrus Group, Inc.
Traditional People MetricsTraditional People Metrics
Satisfaction
Training
Hours
Turnover
DiversityBalance
Leadership
Courses
Headcount
PositionsFilled
AppraisalsCompleted
Copyright © 2009 Metrus Group, Inc.
……HR Metrics Often Fall Short In:HR Metrics Often Fall Short In:
• Creating Executive Buy-In
• Driving Resource Allocation
• Demonstrating Value
Copyright © 2009 Metrus Group, Inc.
Types of MetricsTypes of Metrics
ImpactTalent Meets
Customer Needs
EffectivenessRecruit Talent
that Stays
EfficiencyNumber of
Requisitions Filled
Copyright © 2009 Metrus Group, Inc.
Using People Equity to Illustrate Examples Using People Equity to Illustrate Examples
• Self audits can be a start– Quick, but can be highly biased
• Objective audits– More exact, but more costly– Can work out more complex formulas for measuring
units, teams, individuals
• Surveys often provide 80/20 estimate– People are the stakeholder– Behaviors are connected to perceptions
Copyright © 2009 Metrus Group, Inc.
A C E48 52 61
EAST
A C E49 53 53
A C E56 52 63
A C E29 56 53
WEST
A C E61 84 76
A C E37 51 45
A C E43 28 76
A C E54 26 54
A C E34 25 40
A C E66 84 83
A C E
49 61 69
A C E58 87 80
CENTRAL
A C E44 27 51
A - Alignment C - Capabilities E - EngagementRed = Trouble Yellow = OK Green = Strength
People Equity ScorecardPeople Equity Scorecard
Copyright © 2009 Metrus Group, Inc.
Drivers & Enablers of People EquityDrivers & Enablers of People Equity
PeopleEquity
Alignment Capabilities Engagement
Leadership
Values/Operating
Style
Direction/Strategy
Supervision
Innovation TechnologySystemsHR Systems
Unique Strategy Elements Structure
Copyright © 2009 Metrus Group, Inc.
Some Potential Strategic HR MetricsSome Potential Strategic HR Metrics
• Key People Outcomes: High Performer Retention
• Alignment, Capabilities, and Engagement—People Equity —Predicts:– High Performer Retention– Customer Satisfaction– Productivity, Quality & Financial Performance
• Key Drivers of PE for Your Organization: Core Values, Leadership, HR Systems, Strategy, Information
• Measures that Differentiate You from Your Competition (e.g, Service vs. Efficiency)
Copyright © 2009 Metrus Group, Inc.
1. What does your People Equity profile look like?
2. Are there systemic gaps that can be closed?
3. How much variance is there in your organization?
4. Are we selectively and differentially applying solutions to different units?
5. Are we using strategic information (e.g, PE) in leadership development and succession planning?
Using Measures for Insight and DecisionsUsing Measures for Insight and Decisions
Copyright © 2009 Metrus Group, Inc.
Key Message #3: Measures that Matter
Create and deploy measures that matter! Make sure your metrics help
you make decisions
Copyright © 2009 Metrus Group, Inc.
The KeysThe Keys
• A Great Value Proposition
• High People Equity
• The Right Measures
• Resource Leverage
• Assess Impact!
Copyright © 2009 Metrus Group, Inc.
Who Are Your Stakeholders?Who Are Your Stakeholders?
• Funders?• Influencers?• Customers/Users?• Partners/Interested Parties?• Government/Community?
• Are all of your stakeholders equal?
Copyright © 2009 Metrus Group, Inc.
HR Value
Remember, Stakeholders Judge Value on Remember, Stakeholders Judge Value on Three DimensionsThree Dimensions
HRInvestments, Initiatives
HR Impact HR RelationshipsHR Products& Services
Copyright © 2009 Metrus Group, Inc.
An extensive analysis of over 30,000 employees in 76 healthcare facilities throughout the United States showed higher levels of People Equity to reliably predict hospital loyalty among Physicians and Patients. People Equity was also linked directly to financial performance. A meta-analysis showed higher levels of People Equity to be a highly reliable predictor of employee’s desire to remain employed with their current hospital.
Alignment
Capabilities
Engagement
Increased Patient and Physician
Loyalty
Decreased Loss of Key Personnel
PeopleEquity
Enhanced Financial Performance
LinkageLinkage
Copyright © 2009 Metrus Group, Inc.
2.5
3
3.5
4
4.5
5
5.5
2 2.5 3 3.5 4 4.5 5
Impo
rtan
ce
Funder ExampleFunder Example
Quality
Training
Strategy &Business Acumen
ExecutiveRecruitment
Compliance FamiliarityLow Moderate High
Copyright © 2009 Metrus Group, Inc.
HR Value
Remember, Stakeholders Judge Value on Remember, Stakeholders Judge Value on Three DimensionsThree Dimensions
HRInvestments, Initiatives
HR Impact HR RelationshipsHR Products& Services
Copyright © 2009 Metrus Group, Inc.
26
38
44
44
45
46
50
56
57
37
41
36
40
37
39
35
34
30
38
22
20
16
18
15
15
10
13
Is proactive: anticipates your needs andrequirements
Understands your business needs
Communicates required info accurately andclearly
Do what they promise when they promise
Completes service accurately the first time
Is available when needed
Responds to requests in a timely manner
Possesses required knowledge and skills
Responds in a supportive and helpful manner
Favorable Neutral Unfavorable
HR Strengths and WeaknessesHR Strengths and Weaknesses
Top 3
Bottom 3
Copyright © 2009 Metrus Group, Inc.
Internal Service Ratings Across Functions Internal Service Ratings Across Functions ––Technology FirmTechnology Firm
20 30 40 50 60 70 80 90 100
IT - 69%
IT - 75%
IT - 85%
Finance - 63%
Finance - 64%
Finance - 69%
Law - 46%
Law - 47%
Law - 40%
HR - 26%
HR - 31%
HR - 34%
Understanding my business
issues.
Resolving problems
satisfactorily.
Timely response to requests.
Copyright © 2009 Metrus Group, Inc.
Variance Across UsersVariance Across Users
LegalQuestion Group N Size Percentage of People Responding % Fav Diff
Co. Total 1260 34 21 Region 1 50 57 -37Region 2 80 43 7Region 3 100 40 -10Manufacturing 310 14 44Sales & Mktg 220 46 4Legal 60 40 10Fin & Bus Serv 100 60 3Admin 80 50 0IT 130 26 28R&D 90 27 17 Metrus Norm
Human Resources - a. Responding to requests in a timely manner
Trend
55% 27% 18%
20% 20% 60%50% 25% 25%30% 40% 30%58% 26% 16%50% 41%50% 17% 33%75% 25%100%54% 23% 23%44% 33% 22%
50% 35% 15%
Copyright © 2009 Metrus Group, Inc.
Key Message #5:Measure and Manage Impact
Measure and Communicate Impact!
Copyright © 2009 Metrus Group, Inc.
Copyright © 2009 Metrus Group, Inc.
A Call To Action ChecklistA Call To Action Checklist
Is our People Strategy aligned with the unique business Value Proposition & Strategy?
Do we have a people value map?
Does our plan address key job & performance groups (knowledge workers)?
Do we have a high People Equity (Alignment, Capabilities, Engagement)? Key job groups?
Do we have the Right Measures in place?
Have we allocated our Resources strategically?
Have we demonstrated Impact?
Copyright © 2009 Metrus Group, Inc.
Great Sources for Additional InformationGreat Sources for Additional Information
• The Workforce Scorecard: Managing Human Capital to Execute Strategy– Huselid, Becker, Beatty, Harvard Business School Publishing, 2005
• People Equity: The Hidden Driver of Quality– Kostman and Schiemann, Quality Progress, May 2005
• Bullseye: Hitting Your Strategic Targets– Schiemann & Lingle, Free Press, 1999
• Internal Customer Service: Has It Improved?– Seibert & Lingle, Quality Progress, March 2007
• The HR Value Proposition– Ulrich and Brockbank, Harvard Business School Press, 2005
• People Equity: The New Paradigm for Measuring and Managing Human Capital– Schiemann, HR Planning, April 2006, Volume 29.1
Copyright © 2009 Metrus Group, Inc.
[email protected] www.metrus.com953 Route 202, Somerville, NJ 08876 (908) 231-1900, ext. 101
Metrus Group is an industry leader in strategic performance measurement, assessment, and organizational change. For nearly twenty years we have partnered with the most successful – and challenging – organizations in the world to help them achieve superior, sustainable business results through the development of their People Equity and the creation of a high performance, measurement-managed culture.
Our Services Include:HR Strategy, Value and Performance MetricsPeople Equity Assessment & SolutionsBalanced Scorecard/Dashboard Design and AssessmentDevelopment of Quantifiable Performance MetricsEmployee Surveys and Linkage ResearchLeadership Development and TrainingCorporate Ethics, Alignment, and Accountability AuditsMeasurement-Driven Organizational Change
About MetrusAbout Metrus
Copyright © 2009 Metrus Group, Inc.
Thank You!Dr. William Schiemann
Metrus [email protected]
908-231-1900