HRM 13

www.hrmreport.com • Q2 2010

SHINE A LIGHTHow Duke Energy’s people are guiding it through some dark times

BECAUSE THEY’REWORTH ITRecognition remains an essential tool inworkforce management

PLUS NOKIA SIEMENS NETWORKS • PITNEY BOWES • KFC • LESSONS IN LEADERSHIP

change?SexWhy corporate America could

benefit from gender reassignment

COVER HRM 13 _may09 25/03/2010 14:21 Page 1

OnlifeHealth (DPS) ad:25 June 23/3/10 14:45 Page 14

OnlifeHealth (DPS) ad:25 June 23/3/10 14:45 Page 15

Norwegian CruiseLines (DPS) ad:25 June 26/3/10 09:16 Page 14

Norwegian CruiseLines (DPS) ad:25 June 26/3/10 09:17 Page 15

UMR ad:25 June 23/3/10 14:55 Page 14

We’re all familiar with thephrase, “It’s the thoughtthat counts.” It’s usuallyemployed to mask the dis-appointment at receiving

a substandard gift from a friend or relative. Mostof us have been there: a hideous sweater, noveltysocks or something obviously picked from thelocal 7-Eleven at the last minute. The irony is thatthese kind of gifts really betray lack of thought andfailure to take the recipient’s interests into ac-count. A token doesn’t have to be expensive orglitzy, it merely needs to show that some time andeffort have been spent over its selection.

It’s a lesson that business would do well toheed. The last few years have been an unsettlingtime for both companies and their employees.An incredibly challenging economic climatehas seen the biggest wave of layoffs and com-pany failures in decades. For many, theprospect of wage increases and bonuses existsonly in the realm of fantasy. Simply having a

younger workers, the so-called Generation Y-ersand Millennials, whose digital-age upbringingshave left them accustomed to instant gratification.In order to keep them focused and engaged, a con-stant drip-feed of encouragement is required. Wemight be tempted to criticize this apparent needi-ness, but really we should be thankful that they canbe motivated in a manner that has such limitedimpact on the balance sheet.

Think back to the best present you ever had.Chances are it wasn’t the item with the biggestprice tag, but rather something more personal thatproved the giver really ‘got’ you. It may be slightlyoverstating things to say that the best things in lifeare free, but they can certainly cost a lot less thanyou might expect. n

Huw Thomas, Editor

job to go to on Monday morning has supplant-ed all other concerns.

In this situation, making sure that employeesknow they are valued takes on a huge degree ofimportance. Keeping up morale – and by associa-tion, productivity – is dependent on workers feel-ing that their employers are still thinking ofthem, even in these adverse times. Everyone isaware that budgets are tight and cost cutting isone of the most pressing business priorities, sothere is no necessity for such efforts to requirehuge amounts of expenditure. The smallestthings can have a major impact on how peoplefeel about their jobs. It might be a regular dress-down Friday, the ability to send e-cards to col-leagues or a message from the chairmanthanking people for their hard work.

This kind of recognition ranges from inex-pensive to completely free. Yet it can make a bigdifference to employee attitudes, as well as com-pensating for the economy-dictated lack of moretangible rewards. This is particularly true of

Employee recognition needn’t cost the earth.

“If there are areas where we see thatthere are some employeeengagement challenges or moraleissues, HR actually works to put someaction plans in place to improve orturn things around in those areas”Duke Energy’s Jennifer Weber (p34)

“As we bring new employees in,they come into this culture ofhealth; and we hope that these areprinciples that will be embedded inthem whether they stay or theyleave” Pitney Bowes’ JohnnaTorsone (p80)

“And at the end of the day, it’s not soimportant what’s on your businesscard, but what you really can deliver,and what your contribution is toyour customers’ success” NokiaSiemens Networks’ Hans-Jürgen Bill(p90)

All the small things

Editor’s note5

ED NOTE HRMUS13_mar10 29/03/2010 14:53 Page 5

90

28

34

Making connectionsHans-Jürgen Bill tells HRM aboutthe human implications of turningtwo companies into one and why jobtitles just aren’t that important

Skirting the issueWith anecdotal reportsshowing reports show thatcompanies with women atthe helm are on average 30to 40 percent moreprofitable, Stacey Sheppardasks whether corporateAmerica could benefit froma more feminine touch?

CONTENTS6

People powerJennifer Weber explains how Duke Energy’s employees are drivingthe energy giant through some dark times.

CONTENTS_HRMUS13_feb10 29/03/2010 10:14 Page 6

MHS GROW ad 2:25 June 23/3/10 14:41 Page 14

42

52

72

Benefiting the workforce

Healthy debate

The value of reward

52 The value of rewardThe effects of changing demographics onworkplace recognition programs, according toTom Miller

56 Debt of gratitudeIn a faltering economy, recognition could beviewed as a target for cost cutting. RPI PresidentKevin Cronin thinks that would be a mistake

60 The power of recognitionKFC’s Misty Reich explains the importance ofbuilding employee recognition into thecompany culture

68 Looking after the little guyMolly Brogan of the NSBA explains how

EXECUTIVE INTERVIEW

86 David Kwasny, RESTAT112 Laura Bernstein, VisionPoint120 Jim Haudan, Root Learning138 Mary Ellen Myhr, Associatesfor International Research, Inc.

ASK THE EXPERT

38 Tom Storey, Fairmont Hotels & Resorts50 Barton Halling, UMR89 Tom Beauregard, UnitedHealthGroup

INDUSTRY INSIGHT

108 Brian Harris, NOVAtime114 Michael McIntyre, TheUniversity of Tennessee

ROUNDTABLE

42 BenefitsRandy Clarkson, TransamericaWorksite Marketing, J. MarcPalmer, ConnectYourCare, JoelCarter, Secova and David Josephs,J.P. Morgan

small businesses are affected by the healthcaresystem and her hopes for the reform

80 The best medicinePitney Bowes’ Johnna Torsone tells HRM thatthe company’s approach to employeewellbeing could offer a solution to the nation’sbig healthcare questions

84 Real world changesMark Merrit dissects the route technology istaking PBMs

CONTENTS8


NOVAtime ad:25 June 26/3/10 09:18 Page 14

126

56

68Looking after the little guy

Who’s the boss?

Debt of gratitude

14 The brief 16 International news 140 Job market evolution142 Books 144 Final word – FredSchmitthammer, InceptionTechnologies

REGULARS

94 Reassessing recruitmentKay Kennedy, offers her advice on howrecruitment professionals can learn from theeconomic downturn

98 Back on trackA look at the philosophy of ApplicantTracking Systems

102 Take a closer lookIs your background screening programeffective?

116 Designs on e-learningDavid Guralnick explains how e-learning canhelp companies keep training anddevelopment costs down

CONTENTS10

WELLNESS WORKSHOP

72 Healthy debateMichael Burcham, Onlife, AdrianStewart, WellVentures LLC, David Ellis,UnitedHealthcare and Colleen Reilly,Total Well-Being TROUBLESHOOTER

82 Zachary Meyer, Ceridian Health& Productivity Solutions

PROJECT FOCUS

66 Gene Raymondi, eni110 Diana Durek, MHS

NEXT BIG THING

40 Debbra Palmer, Nike Inc.

122 High principlesPatricia Harned talks to HRM about thecurrent state of American business ethics

126 Who’s the boss?HR’s role in developing 21st century leaders

132 Moving on Michael Washbourn explains the effect thatthe recession has had on mobility programs


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Find Out MoreContact HR (+1) 212 920 8181

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The HR Summit is a three-day critical information gathering of the most infl uential and important CIOs from the human resources industry.

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A Controlled, Professional and Focused EnvironmentThe HR Summit is an opportunity to debate, benchmark and learn from other industry leaders. It is a C-level event reserved for 100 participants that includes expert workshops, facilitated roundtables, peer-to-peer networking, and coordinated technology meetings.

CREDITS HRM13.indd 12CREDITS HRM13.indd 12 29/3/10 10:11:2029/3/10 10:11:20

Ceridian ad:25 June 23/3/10 14:30 Page 14

UPFRONT14

Such scenes have been sympto-matic of President Obama’s

attempts to pushthrough the health-

care restructuringplans that provid-ed his presidential

campaign withsuch a strong and

popular platform. Thedebate should have been about

doctors, patients, insurance, drug

demonstrators from the membersof Congress making their wayto vote on the reforms.Racist and homopho-bic slurs were re-peatedly hurled atpro-reform law-makers walking by;another was spatupon. An observerlikened to a scene from thecivil rights era half a century ago.

President Obama on March 23,will give an additional 32 millionAmericans access to basic healthinsurance by 2019.

The signing of the bill comesafter nearly a year’s worth of po-litical wrangling, and is the cul-mination of what was often avenomous and uncomfortablypersonal exchange of views. Inone demonstration, baton-wield-ing police separated furious

HEALTH REFORM

On March 21, the ObamaAdminstration’s healthcare reformlegislation was passed by theHouse of Representatives, by avote of 219-212. The legislation,which was signed into law by

The legislation will give an additional

Americans access tobasic healthcare

32 million

How will the newhealthcare legislationaffect health insuranceprovisions for employees?

UPFRONT HRM US13:25 June 29/3/10 09:01 Page 14

UPFRONT15

companies and coverage; instead,much of the attention has been fo-cused on the legal and constitu-tional processes required to getany potential reform bill passedinto law.

Despite the obvious divisive-ness of the reform debate, andcontinued strong opposition fromthe Republicans, who are seekingto have the bill annulled onthe grounds that it goes againstcertain provisions of theConstitution, the Obama govern-ment has vowed to press ahead.

The bill will have far-reaching effects on thelives of ordinaryAmericans: morethan 94 percentof all non-elderlycitizens will haveaccess to health insur-ance by 2016, versus just83 percent now. Health insurerswon’t be able to deny coveragebased on pre-existing conditions.And generous subsidies will beavailable to lower-income familiesto help them get cover.

The bill also expands eligibil-ity for Medicaid as part of its cov-erage mechanism, as well asincreasing Medicaid reimburse-ments, which will make it easierfor patients on Medicaid to finddoctors who take their insurance.The so-called ‘donut hole’ cover-age gap in Medicare Part D plansis also set to be closed.

But what will the reformsmean for the relationship betweenbusinesses, employees and healthinsurers? According to industryobservers, employers most likelyto be affected by the health reformchanges will be those who mainlyemploy lower-income wage work-ers paying premiums that exceedwhat the legislation defines as af-fordable.

Those employers who aren’t

able to control their healthcareplan costs could have to pay anew 40 percent federal excise taxon health insurance premiumsthat exceed certain levels. Theycould also face annual assess-ments of $3000 a year per work-er if employees’ share ofhealthcare premiums fails an af-fordability test.

Beginning in 2013, the legis-lation could also cut the value ofa tax break for employers offer-ing prescription drug coverage toMedicare-eligible retirees, which

will most likely discouragebusinesses from pro-

viding such cover-age. This taxbreak is currentlyworth tens of mil-

lions of dollarseach year to some

major corporations. Inthat same year, flexible spendingaccounts, which make it easierfor employers to shift costs toemployees, could lose valueunder a new $2500 annual limit.

An employer survey con-ducted in January by TowersWatson and the NationalBusiness Group on Health,found that 71 percent of employ-ers believe health reform will in-crease the overall cost ofhealthcare services in the UnitedStates, while 69 percent believe itwill increase the cost of theirbenefit programs.

The survey also found that35 percent say health reform willlead to fewer employers offeringsubsidized benefits. Nearly half(46 percent) of employers believeit will decrease employer-spon-sored offering of retiree medicalbenefits, while very few — onlyfive percent — say it will in-crease, and just 27 percent ofemployers say it will causeno change.

More than

of all non-elderlyAmericans will have

access to health insurance by

2016

94%

A General Motors employee assembles an SUV at GM’s Lansing Delta TownshipPlant on 10 March. The carmaker is expected to add a third shift to the twoalready in operation in response to a February increase in US sales.

A striking worker wears a t-shirt depicting British Airways CEO Willie Walsh asHitler at Heathrow Airport in London, UK, on 20 March. The industrial action,which was taken over a dispute about pay and working conditions, has seen1100 BA flights cancelled out of 1950 scheduled services.

NEWS IN PICTURES

Unemployed people line up to speak with prospective employers at the LACareer Fair on 23 March. US Treasury Secretary Tim Geithner has warned that100,000 new jobs need to be created monthly to push the jobless rate downfrom its current 9.7 percent.


UPFRONT16

A GREEK TRAGEDY

As Greece struggles to rein in its 12.7percent annual deficit and €300 bil-lion ($400 billion) debt – 120 percentof GDP – a new wave of austeritymeasures are being introduced whichincludes public sector workers havingto accept a 30 percent cut in theirbonuses. Civil servants had previous-ly received bonuses twice a year, butthe Greek government needs to im-plement public spending cuts in orderto save €4.8 billion ($6.4 billion) thisyear. Civil servants’ wages had alreadybeen frozen and their allowances cutby 10 percent. Other austerity mea-sures include freezes on recruitment,raising taxes and changing the pen-sion system and raising the averageretirement age by two years to 63.5, asGreece attempts to convince the EUto provide a rescue package if it fails torepay its national debt.

EXTREME OVERTIMEThe number of British people work-ing 'extreme' unpaid overtime ofmore than 10 hours a week increasedby 14,000 to nearly 900,000 in 2009,according a new analysis of officialstatistics published by the TradesUnion Congress (TUC).

According to the TUC, if the av-erage person who works unpaid over-time did it all at the start of the year,they would not get paid until 26February. However, those doing 'ex-treme' unpaid overtime of more than10 hours per week wouldn't start get-ting paid until April 26.

In 2009, over five million peopleacross the UK clocked up an average ofseven hours 12 minutes of unpaidovertime a week worth £27.4 billion($40.9 billion) – or £5402 ($8067) each.

Teachers and lawyers are themost likely to do ‘extreme’ unpaidovertime, with around one in five em-ployees clocking up an extra 17 hoursof free work a week.

WORK FATALITIES

Unions in Australia are calling forworkplace health and safety law to bestrengthened due to a sharp rise inwork-related fatalities. Statistics fromthe national regulatory body, SafeWork Australia, report that there were177 fatal injuries in workplaces in2008-9, an 18 percent increase fromthe previous year.

A breakdown of the statistics re-veals that worker fatalities rose by 14percent to 151 in 2008-9, while deathsof bystanders increased by 37 percentto 26. Agriculture, forestry and fishing,and mining were the industries wherethere were the biggest increases.


17

LABOR LACK

China’s largest export region, the PearlRiver Delta, is increasingly sufferingfrom a lack of low-wage workers. Oncedubbed ‘the workshop of the world’ theregion is often the preferred location forlow-cost manufacturers and boastsnearly a third of the country’s total ex-ports. However, government policiesaiming to close the income gap betweenthe country’s richest and poorest inhab-itants have prompted an exodus of 22.5percent of migrant workers from the re-gion in 2009. The lack of low-wageworkers has been consistently pushingup wages throughout China’s exporthubs and the provincial government ofGuangdong province recently an-nounced that it will be raising the mini-mum wage by 21 percent as of May.Jiangsu province, neighboring Shanghaion the Yangtze River Delta, last monthraised its monthly minimum wage rateby 13 percent to 960 yuan.

TIME TO UNWIND

Companies in Dubai are recogniz-ing the benefits of providing theiremployees with the time and facili-ties to unwind at work. Stress-bust-ing recreational areas that have beeninstalled in offices are helping staff torelax and improve their productivity.The pioneering companies that haveadopted this approach are now urg-ing other companies to follow suit,stating that the provision of a work-ing environment that gives peoplethe opportunity to unwind and relaxgoes a long way towards keepingwork-related stress at bay.

One of the main causes of stressand fatigue is overwork, which cantake a hard toll on the body. It can betriggered by working too much ortoo hard, and can also be caused bynot knowing how to manage timewell or failing to take time out for restand relaxation.

FEELING PRESSURE

Stress levels of business owners inIndia have decreased in recent years,according to a survey of 7400 businessowners in 36 countries by global con-sultancy firm Grant Thornton. Of thebusiness owners asked, 56 percentnow feel stressed compared with earli-er figures, which reported that 76 per-cent claim to feel high levels of stress.

The pressure to perform has in-creased due to the economic crisis, butstress levels of business owners havealso risen due to competitor activitiesand pressure on cash flow.

The report showed that the fourmost stressful countries wereMainland China, Mexico, Turkey,Vietnam and Greece, whilst the leaststressful were Sweden, Denmark,Finland, Australia and Canada.

UPFRONT


UPFRONT18

FOCUS ON WELLNESS

NEXT LEVEL EMPLOYEE RECOGNITION

ward and incentive programs into asingle solution, IncentCore helpsyou to better align employee behav-iors with your business objectives.Now you can manage your opera-

tional excellence, recogni-tion, idea generation,

safety, training,compliance, salesperformance andall of your otherprograms with

one tool. The re-sults of your incen-

tive program aremaximized with IncentCore.

Streamline communications and in-crease program participation withthe click of a button. Reduce youradministrative costs and maximizeyour reward budget with this incen-tive management system.

IncentCore is the perfect solu-tion for every company in need of amanagement tool to assist with in-centive and reward program ad-ministration. Companies small orlarge, one incentive program ormany, points-based system or dol-lar value, IncentCore can be scaledto meet your needs.For more information regardingIncentCore or GiftCertificates.com’s otherproducts, visit www.GiftCertificates.com.

The results of the third annual inter-national wellness survey by BuckConsultants show an increased focuson employee wellness. In the US,more than 77 percent of employerssay that they offer some form ofwellness program for their work-force, whilst 64 percent indicatedthat they have a wellness strategy.

In every international regionoutside the US, the main wellnesspriority is to keep employees fit andhealthy so that they can performtheir duties with optimal productiv-ity. However, this is slightly differentin this country, where the top busi-ness priority for wellness programsis to reduce healthcare costs.Improving productivity was thesecond business pri-ority in the US followedby reducing absenteeism.

Another difference thatthe US registered withother international re-gions was in the mainhealth risks drivingwellness strategy.Whilst Africa,Asia, Australia,Canada andEurope allvoted stress asthe number onehealth risk, the USrated lack of physical

activity and exercise as the primaryrisk.

Barry Hall, a Buck principal whodirected the survey, puts the increasedfocus on wellness down to the currentprominence of healthcare reform leg-islation and its support for health andwellness as a preventative measure,and he believes that this could garnergreater investment in wellness in theUnited States.

The report highlighted some ofthe most popular global health promo-tion resources, including health riskappraisals, gym or fitness club mem-bership discounts, employee healthscreening and onsite educational class-es. In the US, 42 percent of survey re-spondents reported that they measurethe effect that wellness programs haveon the cost of healthcare. Of these, 43

percent say that costshave reduced by two

to five percent.

The average salary offer to new college graduates in the Class of 2010 is

down two percent from 2009

$48,351

FAST FACT

Source: National Association of Colleges and Employers

GiftCertificates.com, a leadingprovider of incentive solutions, re-cently launched a new robust e-commerce platform, IncentCore.From its simple set up, orderingprocesses and reporting,this customizable on-line platform is anall-in-one solu-tion for the man-agement of anyincentive pro-gram.

Incentive pro-grams can be quite ahandful to manage, butIncentCore can help you pull to-gether all the moving parts andtrack them with ease. IncentCoreprovides program development,web-based platform, online report-ing, data security, and many othercustomizable elements.

The IncentCore IMS function-ality allows you to establish and au-tomate program rules. Set up youremployee nomination process andyour award approval process fromright within the tool. Once theaward is approved, you can identifythe type of awards available to issueand customize the communicationsto the employee. Reporting metricsare easy to track on a real-time basis.You can even choose to operatemultiple incentive programs onone IncentCore platform to easeyour administration needs.

By integrating all of your re-

This customizable online

platform is an

solution for the management of any incentive program

all-in-one


Gift Certificates ad:25 June 23/3/10 14:35 Page 14

The primary objective for an employers’benefits strategy is to control the rapid in-crease in healthcare costs, according to astudy sponsored by HSA Bank in late 2009.In the survey of more than 600 em-ployers, 33 percent ranked con-trolling costs as theirnumber one strategic bene-fits objective. To achievethis benefits objective,many employers are turn-ing to Health SavingsAccount (HSA) compatiblehealth plans. Aon Consulting andthe International Society of CertifiedEmployee Benefit Specialists (ISCEBS) re-leased survey results in late 2009 that statedthat 38 percent of employers offered a con-sumer-directed health plan with the specif-ic intention to control costs.

Employers that control costs throughoffering an HSA plan often pay lower pre-miums and reduce payroll taxes such asFICA, unemployment contributions andworkers’ compensation. Employers cancontrol long-term costs with an HSA planbecause employees are encouraged to re-

duce wasteful spending by eliminating theuse-it-or-lose-it mentality, which reducesclaims expenses that cause health plans toincrease premiums.

Many employers find that addressinghealthcare cost control with an HSA not

only generates savings for thecompany, but also reduces the

cost for employees as well.Industry data indicatesemployers on average re-duce the cost for employ-ee-only coverage by more

than 20 percent as com-pared to all plan types.

Employees pay less too. Data from2009 indicates that employees pay 15 to 30percent less towards their total costs whenthey have an HSA plan opposed to otherplan types.

Could your organization profit fromcontrolling healthcare costs? You can ad-dress healthcare costs and create a benefitthat is highly regarded by your employees.An HSA plan provides a savings vehicle formedical expenses today and into the future,but also serves as a potential retirement re-serve. The time is now to make HSAs a partof your benefits strategy.

FAST FACT

There are now

applicants for everyjob opening in the US

6.3

CONTROLLING COSTS

Discrimination in the workplace reachedits second highest level ever in 2009 asthe number of workplace dis-crimination claims re-ceived by the EqualEmploymentOpportunityCommission(EEOC) to-taled 93,277,down twopercent from2008.

Of thediscriminationallegations filed in2009, 36 percent werebased on race, 36 percent

WORKPLACE DISCRIMINATION

Employees pay

less towards theirtotal costs when theyhave an HSA plan as

opposed to other plan types

15% to 30%

on retaliation and 30 percent on gender. TheEEOC also received 22,772 charges alleging

age-based discrimination, the victims ofwhich were awarded $72 mil-

lion in benefits. Accordingto the EEOC, the total

amount of mone-tary relief ob-

tained byvictims in 2009totaled morethan $376 mil-lion, which is

slightly lowerthan the $376.6

million paid out in2008 – the year in

which the highest num-ber of claims were made.

Wonderlic Inc., a provider ofon-demand employee and stu-dent recruiting, selection andretention solutions, recentlyannounced that the results of itshuman resource research areconsistent with a recent gov-ernment report by the NationalInstitute of Drug Abuse(NIDA). Over 46,000 studentswere surveyed for the report,which found that almost one-third had used marijuana andlevels of use increased from 8thto 10th grade and from 10th to12th grade. The results of thesurvey also indicated that 3.4percent of high school seniorsused cocaine and 10 percent re-ported using Vicodin, the pre-scription painkiller, fornon-medical reasons. The find-ings from NIDA’s report sup-port Wonderlic’s research intohuman resources, which statesthat current job applicantsoften have a recent history ofillegal drug use. TheWonderlic Productivity IndexBackground Check foundthat 23.5 percent of currentemployees and potentialjob applicants had recentlyused marijuana.DR

UGPR

OBLE

MS

UPFRONT20

Source: Bureau of Labor Statistics


HSA Bank ad:25 June 23/3/10 14:37 Page 14

In the last issue of HRM ALAN KAYE, Mattel’s SVP of HR, explained the im-portance of a strong company culture. “There’s a lot of passion in our or-ganization, which is a big part of how we built this culture,” Kaye told us.“When I recruit at a very senior level there are a lot of skill sets we’re look-ing for, but if we can get people into our company who have in their heartsthe desire to put smiles on kids’ faces, we’re starting with the right stuff.”

To read the stories from this issue, head to www.hrmreport.com

UPFRONT22

Employee Transfer Corporation(ETC) unveils a new program thisspring called My FinancialMentor that offers work-ers support servicesand tools thatwill help themrecover or stayon trackthrough theeconomic crisis.The online servicewill assist people withinformation on foreclosure pre-vention, short sales, unsecuredcredit debt, budgeting, newhomebuyer advice and more.

The program is a twist ontraditional Employee AssistancePrograms and focuses on finan-cial problems that Americanworkers are facing during themost difficult economic timessince the Great Depression. Thedepressed housing market, risingforeclosure rates and lack of ac-cess to credit has threatened mid-dle-class workers in epic ways.

“The magnitude of house-hold wealth lost in the GreatRecession and the massive num-ber of people affected is unlikeanything else that employers havehad to deal with in moderntimes,” says Frances MartinezMyers, Senior Vice President of

Employee Transfer Corporation.“Distressed employees that aredistracted by financial hardshipwill be less productive, makingthis an issue that companies must

address. The right combi-nation of EAP solu-

tions can make adifference.”

ETC’s newprogram in-cludes: credit

counseling; finan-cial coaching tools;

links to third-party non-profit resources that help withforeclosure and loan modifica-tions; information about thehome-buying process and federaland municipal grants; real estateservices; moving – self move orvan line services; access to a na-tional foreclosure listing database(that works primarily with first-time homebuyers).

The new suite of solutionswas inspired by the trend of prob-lems that ETC’s clients are en-countering. “Not only are weactively providing custom reloca-tion solutions to our partners, wealso found ourselves collaboratingwith them on ways they couldhelp their workers help them-selves,” adds Martinez-Myers.

To learn more about My FinancialMentor, go towww.employeetransfercorp.com

Due to the rising cost of health-care and retirement plans, olderAmericans are staying in theworkforce for longer, according tothe nonpartisan Employee BenefitResearch Institute (EBRI). Usingthe latest US Census Bureau data,the EBRI analyzed the proportionof older workers in the labor forceand found that the percentage ofthose aged 55 or older increasedfrom 29.4 percent in 1993 to 39.4percent in 2008, an increase of 10percentage points. For those aged65 to 69, the percentage increasedfrom 18.4 percent in 1985 to 30.7percent in 2006, up more than 19

percentage points.However, whilst employees

are remaining in the workforcefor longer, they are increasinglyopting for part-time positions asopposed to full-time. The researchby EBRI notes that workers nowface increasing responsibility forcontributing to retirement plansand retiree health insurance andtherefore need to save more oftheir income for these purposes.Many are therefore opting todelay retirement so that they canpostpone the need to pay for theseexpenses and can continue to ac-cumulate savings.

PART-TIME TREND

NEW EAP SOLUTIONS

employees that are distracted by financialhardship will be lessproductive, an issue

companies must address”

“Distressed

FAST FACT

of workers saythey have dateda co-worker atsome time duringtheir careers

37%

Source: careerbuilder.com


EmployeeTransferCorp ad:25 June 23/3/10 14:33 Page 14

UPFRONT24

There is now and continues to be a real shortageof skilled care. We’re going to have many morepeople who are going to be appropriately accessingthe healthcare systems. And it’s a healthcare sys-tem that’s already facing often long wait times, soit’s just going to exacerbate that problem.

What the current economy has done is actuallygoing to make things worse because it’s a temporaryblip. People who were going to retire have decidedto stay in the field a little bit longer and people whowere part-time have added to their hours. So forright now, we feel like we have a pretty good bal-ance. Our vacancy rates are low. Our turnover ratesare low. But I think that’s temporary.

I’m a real believer in developing your staff inter-nally if you possibly can. The reason for that ismost turnovers occur in the first year and oftenthat’s because of poor fit. It may be fit with the cul-ture, it may be fit with the supervisor; it may be fitwith the particular job. It may be a number ofthings.

It would be physically unsound to continue tospend all this money to train people internallywhen there are great people on the outside to bringin. What you do is just cut back somewhat. But Idon’t think you can stop it. If you stop it all togeth-er then it’s very hard to put back in place. You’resending the wrong message to your staff.

We want someone who not only meets all thecheck boxes of being technically qualified, but wewant somebody who also fits the values and cultureof the organization. That might be a little harder toget, but we’ve trained our managers in what to lookfor. For every employee we have here, 30 percent oftheir job description – which means at least 30 per-cent of their evaluation – is customer service.

The traditional forms of recruitment are going toget less and less important, which means we’regoing to have to learn new skills. Traditionally, yougo to colleges, job fairs or put ads into profession-al magazines; I just think all that stuff is going tobecome passé in time and it’s going to be basedmore on social media.

PAMELA PAULK, VICE PRESIDENTFOR HUMAN RESOURCES,JOHNS HOPKINS HOSPITAL


Researchers at Juju.com recently usedBLS figures to rank 50 US metropolitanareas in order of the number of appli-cants per opening. The ten mostpromising cities for job hunters:

Rank/City/Applicants per opening

TOP 10

32

54

1

87

109

6

Washington, DC (2.0)

Baltimore (2.7)

San Jose (3.1)

Salt Lake City (3.2)

New York City (3.4)

Hartford, Conn. (3.6)

Denver (4.4)

Boston (4.5)

San Antonio (5.0)Austin (5.0)Indianapolis (5.0)

Pittsburgh (5.1)

JOB CUTS

During the last threemonths of 2009, businessesmade 321,569 people redun-dant in mass layoffs dueto financial concerns, orga-nizational changes and adrop in demand for theirproducts. According to thegovernment, a mass layoff isone that involves more than50 employees.

Those areas hit hardestwere the Los Angeles-Orange County region,which suffered 19,000 joblosses, followed by Chicago,New York, the ‘InlandEmpire’ region of Californiaand the San Francisco BayArea. Metropolitan areasare particularly hard hit bythese larger incidents ofdownsizing, because bigcompanies are typically inmajor cities.

However, the rate atwhich large and mid-sized

businesses were laying offworkers through the end of2009 slowed significantly, ac-cording to new employmentdata. For example, 117,000Californians were laid off dur-ing July, August andSeptember, but this figuredropped off to 65,000 fromSeptember to December 2009.This represents an importantturning point, as it was thefirst time in three years thatthe number of layoffsdropped from one quarter tothe next. The nationwide tolldropped by about seven per-cent in the fourth quarter,down from 345,367 in thethird quarter of 2009. In themanufacturing sector 83,700workers lost their jobs, ap-proximately a quarter of thetotal layoffs. Constructionfirms made about 83,000workers redundant. Also26,000 hotel and restaurantemployees and 10,100 retailworkers lost their jobs.

UPFRONT25

MORE MONEY

In January, Capital OneBanking conducted an onlinesurvey into the relationshipAmericans have with theirmoney. The survey results re-vealed that a quarter of all USemployees would forgo vaca-tion and work 365 days a yearif that meant that their salarywould double.

A report published in2007 by the Washington, DC-based Center for Economicand Policy Research referred tothe United States – the only in-dustrialized nation without amandated minimum annualleave for workers – as the ‘No

Vacation Nation’. The find-ings of the report detail howa shocking 28 millionAmericans don’t get any paidvacation and this is particu-larly the case for low-wageand part-time workers, andfor those who work forsmall businesses.

John Schmitt, CEPR se-nior economist and lead au-thor of No-Vacation Nation,believes that the findings arenot necessarily related to thefeelings Americans haveabout vacation, but rathertheir anxiety about money inthese tough economic times.

In a three-way tie for 9th place:

The cities with the highest number ofjob applicants per opening:

BOTTOM 10

4342

4544

4140

4847

5049

46

Orlando (9.0)

Memphis (9.4)

Birmingham, Ala. (9.5)

Providence, R.I. (9.6)Portland, Ore. (9.6)

Sacramento (11.2)

Los Angeles (11.9)

Riverside, Calif. (13.4)

Las Vegas (14.4)

Miami (15.8)

St. Louis (19.9)

Detroit (21.6)

Tied for 43rd place:


UPFRONT26

RECESSION BACKLASHThe effects of the recession are having a detri-mental effect on the nation’s workforce ac-cording to experts at HeartMath, arecognized authority on stress-re-ducing and resilience-buildingsolutions. The economicdownturn forced many com-panies to cut back theirworkforce in order to sur-vive the recession and sincethen cases of stress and absen-teeism have been on the riseamongst the remaining work-force, causing healthcarecosts to increase. Those whomanaged to avoid recession-related layoffs havebeen burdened

with heavier workloads and longer hours, forcingincreasing numbers of employees to turn to em-ployee assistance programs for help. A worldwide

benefits consulting firm surveyed 282large companies and found that 22

percent reported an increase inunplanned absences, and 78percent of employers cited“excessive work hours” as aleading cause of employeestress. Towers Perrin alsoconducted a survey of 321

companies and found that the2009 average annual health-

care cost per employee is$9660 – an increase of

six percent overtheir 2008figures.

According to WorldAtWork’s latest salarybudget survey update, many organizationsare treading carefully this year when itcomes to pay practices and are preferring towait and see how things go. During the re-cession, many companies took the decisionto freeze pay and substantial numbers arenot planning to go back on this decision anytime soon.

Thirteen percent of US employers cutpay in 2009 and 37 percent of those said theywere still in recession and not consideringrestoring the pay in 2010. Only 29 percentplan to restore pay in full and 15 percentsaid pay cuts were permanent.

Some 52 percent of US employers frozepay for some or all employees in 2009 andnearly a quarter of those have decided to pro-long that freeze into 2010 whilst 54 percent ofthem plan to resume normal pay. Many or-ganizations are still considering pay freezesfor 2010.

WAITING GAME

February saw another example of thepower of social media, as adults in the

blogosphere launched a campaignon Twitter and Facebook to con-

vince Mattel that Barbie’s next oc-cupation should be that ofcomputer engineer.

The outcrycame afterMattellaunched

an onlinepoll askinggirls every-where to choosewhether Barbie’s nextoccupation should be sur-

geon, architect, news anchor,environmentalist or computer

engineer. The overwhelmingchoice was news anchor, but due tothe social media campaign Mattelwas forced to relent and go with both

the suggested occupations.The situation has served to high-

light the problems surrounding the issue ofwomen in so-called STEM professions –science, technology, engineering and math.Despite the calls for more women in thesefields, fewer and fewer seem to be taking

up the challenge and the worry is thatthe geek factor is putting many

women off. According tothe National Center forWomen & InformationTechnology, only 17 per-cent of girls take ad-

vanced placement tests incomputer science while in

high school, the lowest level offemales among all such exams.

Similarly, in 2008, only 18 percent of com-puter science degrees were awarded towomen, compared to 37 percent in 1985.

Alicia Abella, Executive Director of theinnovative services research department atAT&T Labs, believes that scientists get a hardtime, especially on TV, where as they areoften depicted in white lab coats with funkyhair like Einstein, or as cartoon characters.

BARBIE BROUHAHA

Only

of girls take advanced placement

tests in computer science while in high

school

17%


UPFRONT27

Companies in this issue are indexed to the first page of the article in which each is mentioned.

Adecco 97Aspire 28, 124Associates for InternationalResearch Inc. 138, 139Association of Pharmacy BenefitManagers 84Baldoni Consulting 124Bank of America 56Bass Pro Shops 55Berkshire Associates 99Ceridian Health & ProductivitySolutions 13, 82, 83ConnectYourCare 42, 45Creative Services 102DCI Incentives 59Dearborn International 61Deutsche Telekom 28Double Star 95Duke Energy 34Employee Transfer Corp 22, 23eni 66, 67Ethics Resource Center 122

Fairmont Hotels & Resorts 11, 38,39Giant Impact 119GiftcCertificates.com 18, 19Global Learning Resources Inc. 98Graebel 51Harlan Evans Inc. 124HAS Bank 20, 21Icims 105Inception Technologies 144, IBCInternational Association for Corporate & Professional Recruitment 94International E-LearningAssociation 116In Tune 72, 76J.P. Morgan 42, 49, OBCKaleidoscope Learning 116 KFC 60Kohl’s 63Long John Silver’s 60

Manhatten Management 133Meet the Boss TV 143MHS Inc. 7, 110, 111McKinsey & Company 28MI Group 135National Association for Female Executives 28National Small BusinessAssociation 68Nike Inc. 40, 41Nokia Siemens Networks 90Norwegian Cruise Lines 2NOVAtime 9, 108, 109Onlife Health IFC, 72Online Rewards 71People Click 101Pitney Bowes 80Pizza Hut 60Recognition ProfessionalsInternational 52, 56, 60Restat 86, 87Root Learning 120, 121

Secova 42, 47Sirva 137Smartbox 65Taco Bell 60Test Country 107The Miller Company 52Total Well-Being 72, 74Transamerica Worksite Marketing 42, 43UMR 4, 50UnitedHealth Group 72, 78, 89University of Connecticut 129University of Tennessee 114, 115Upper Iowa University 125VisionPoint 112, 113WellVentures 72Worldwide ERC 132Yum! Brands 60

UNION MEMBERSHIP BY INDUSTRY, 2009

DESIGNS ON

E-LEARNING

David Guralnick on howe-learning can helpcompanies keep trainingand development costsdown P116

REASSESSING

RECRUITMENT

Kay Kennedy on howrecruitment professionalscan learn from theeconomic downturn P94

DON’T MISS...

COMPANY INDEX Q2 2010

MAKING

CONNECTIONS

Hans-Jürgen Bill on thechallenges of mergingtwo companies P90

PUBLIC SECTOR 7.9 MILLION PRIVATE SECTOR 7.4 MILLION

Local government4,867,000

Other private sector industries 919,000

Leisure and hospitality 349,000

Wholesale and retail trade937,000

Construction958,000

Transportation and utilities1,144,000

Manufacturing1,470,000

Education and health1,655,000

State government2,025,000

Federal government 1,005,000Source: US Bureau of Labor Statistics


The past decade or so has been pretty significant in termsof game changing events and the sheer magnitude ofmany of these episodes has rocked the very foundationsof corporate America. Enron, WorldCom and LehmanBrothers now take pride of place in the financial hall ofshame and as the world still reels from the ef-fects of the worst financial meltdown

since the Great Depression, business has been forced to takea long hard look in the mirror and re-evaluate the way thatit operates. One thing that’s for sure is that the econom-ic crisis has put traditional leadership qualities under fargreater scrutiny as people start to reconsider what itmeans to be a good leader.

A recent leadership report – entitled Tearing Up TheRule Book, A New Generation of Leaders For 2010 – byAspire, a leader in executive coaching, leadership develop-ment, consultancy and research, includes a list of the top 12 leastadmired leaders. The result is a list made up predominantly of male lead-ers, and whilst this is understandable given the fact that most leadership rolesare currently filled by men, the list of the 12 most admired leaders in Aspire’sreport tells a very different story: six of the top 12 are women.

And Aspire are not alone in suggesting that the leadership qualities thatwomen offer are being grossly underestimated and overlooked. Numerous

studies and reports are coming to the same conclusion and based on the re-search that is being carried out on the matter, it would be a grave mistake notto ask the question: Do women make better business leaders?

At a first glance it would be easy to assume that they do not, due to thefact that so few women actually make it up to the heady heights of the c-

suite or the boardroom. However, the action currently taking placein Europe to rectify this situation would seem to suggest there

must be some advantage to having women in leadershiproles over and above the diversity aspects of corporate

responsibility.In 2002, Norway enacted a law requiring that 40

percent of all board members at state-owned and pub-licly listed companies be women by 2008. Since then

political pressure has grown across Europe for compa-nies to increase female representation among their lead-

ership ranks and as a result both Spain and the Netherlandshave passed similar laws. In January this year, the lower house

of France’s parliament approved a new law forcing companies to lift theproportion of women on their boards to 40 percent by 2016. Followingthese examples Belgium, Britain, Germany and Sweden are now all con-sidering legislative measures involving female quotas. In fact, only recent-ly, German company Deutsche Telekom, Europe’s largesttelecommunications company, announced that it would voluntarily intro-

28 www.hrmreport.com

issueSkirting

With anecdotal reports showing that companies with women at the helmare on average 30 to 40 percent more profitable, Stacey Sheppard askswhether corporate America could benefit from a more female touch?

the

Women arecurrently only in

11%of profit &

loss jobs

27 Patricia Woertz Archers Daniels Midland$17.5m

Fortune 500 women

32 Angela Braly Wellpoint $9.8m 41 Lynn Elsenhans

Sunoco $9.8m

COVER STORY

Women&Leadership_17MAR10 29/03/2010 10:31 Page 28


duce a quota aiming to fill 30 percent of upper and middle management jobswith women by the end of 2015.

Whilst the proportion of female leaders is particularly low in Europe –on average 11 percent of board seats in European companies are held bywomen – the situation in the US is only marginally better; roughly 15 percentof the board members of Fortune 500 companies are women. However, formany critics these statistics are far from acceptable and calls are being madeto increase the number of women on boards and in executive roles. There maynot be the same debate here in the US about legal quotas, but concerns are stillbeing voiced loud and clear.

Betty Spence is President of the National Association for FemaleExecutives and part of her role is to collect data on the top companies that fe-male executives can work for. NAFE ruins an annual awards that recognizesthe top 50 companies and the work that they do in promoting the advance-ment of women through the ranks. Spence is clearly perturbed by the distinctlack of women in senior-level management positions, but she is particularlytroubled by the disappointing numbers of women who are in roles where theyare actually running the business.

“Women are currently only in about 11 percent of profit and loss jobs,”says Spence. “As evidence emerges that companies with women at the top aremore profitable than companies without women at the top, the fact thatwomen should still only be in 11 percent of these positions is clearly an erroron the part of companies. To let that talent be within your walls and not beusing it for profit makes absolutely no sense.”

And the figures do seem to support her point. Some of the companies inher top 50 list do indeed have women at the helm and a few of them cer-tainly appear to have outperformed companies with male CEOs.According to NAFE, even Wall Street backs this concept: stocks of the 12Fortune 500 companies with women CEOs rose an average of 50 percentin 2009, compared to the benchmark for US stocks, the S&P 500, whichrose an average of 25 percent.

Spence goes on to explain how a recent report released by Hedge FundResearch Inc. found that between January 2000 and May 2009 hedge fundsrun by women returned nine percent gains compared to 5.8 percent for thoserun by men. “This is clearly a dreadful misuse of talent,” she says. “If you’vegot the women within your organization that can do this, put them to workand have them do it.”

She cites figures from McKinsey & Company that suggest companies runby women are 40 percent more profitable, and similar figures from Catalyst,a non-profit group working to expand opportunities for women in business,that suggest companies run by women are 30 percent more profitable. “Ifcompanies are that much more profitable when they do this, then only a foolwouldn’t follow that advice,” says Spence.


WORLD ECONOMIC FORUM’S CORPORATE GENDER GAP REPORT 2010SOURCE: FIGURES TAKEN FROM 600 COMPANIES ACROSS 16 INDUSTRIES

THE CEO GENDER GAP

40%of the globalworkforce are

women

AGRICULTURE AUTOMOTIVE CHEMICALS ENERGY

ENGINEERING & CONSTRUCTION FINANCIAL SERVICES FOOD & BEVERAGE HEALTH

IT & TELECOM LOGISTICS & TRANSPORT MEDIA & ENTERTAINMENT MINING

PROFESSIONAL SERVICES REAL ESTATE TEXTILE TRAVEL & TOURISM

DESPITE WOMEN MAKING UP ALMOST 40% OF THE GLOBAL WORKFORCE,

PERCENTAGE OF FEMALE AND MALE CEOS BY INDUSTRY

FORTUNE 500 COMPANIES RUN BY WOMEN

THE NUMBER OF FEMALE CEOS ACROSS MOST INDUSTRIES REMAINS LOW.

“When you go back 10, 15, or 20 years whenwomen were aspiring to the board there was avery strong expectation that in order to besuccessful you had to be like a man, but I’m notso sure that expectation is still there”


Clearly, with figures like these being thrown around, the issue merits in-vestigation – particularly as many companies are still struggling with the lega-cy of the economic crisis. Like Spence says, who wouldn’t want to run a moreprofitable company? Employing women in senior-level positions would ap-pear to make sound business sense and if this is indeed the case it’s worth ex-amining what it is exactly that women can bring to the table.

Joanna Barsch is a director at McKinsey & Company, a global manage-ment consulting firm, and the leader of The Centered Leadership Project. Shehas also recently co-authored a book entitled How Remarkable Women Lead:The Breakthrough Model for Work and Life. As far as she is concerned thereare a number of important distinctions between the attributes of women andmen, as well as differences in their leadership style. The main differences thatshe alludes to relate to the five core principles of Centered Leadership.

“There are a couple of things that women do on average that would begood for men to do as leaders. The most important one is anchoring what thecompany does in meaning, in other words, providing a sense of purpose thatis shared within the company,” says Barsh. “Research shows that this tends tobe more important to women than pay and status, which are generally moreimportant to men.”

The second thing that Barsh notes is that women recognize positive emo-tions in the company and use them to mitigate the fears that employees haveand that reduce their will to work. “The positive emotions of joy, happinessand love are very strong and can actually be great strengths for a company. Soa woman leader, recognizing the power of emotion in the workplace, is moreable to lead effectively.”

Barsch goes on to explain the third advantage that women have: instinct.She refers to a theory by psychologist Shelley Taylor called ‘Tend andBefriend’ which states that women tend to build and nurture community andthat makes the company stronger. “I have interviewed a fair number ofwomen at the top, and they talk about their role as a leader very much think-ing about the organization as a family. Anne Mulcahy was a great example ofthat when she was leading Xerox. You have to pay attention to all the peopleand value everybody,” says Barsch.

“Brenda Barnes who leads Sara Lee is another who talks about it thatway,” she says. “Andrea Jung who leads Avon, is a third person who thinksabout family all the time, and recognizes that the individual facing her acrossthe worktable is a person who has a family, who is not just a work unit, but ahuman being. And that humanistic notion is one that I think women who aremoms and family leaders can bring to the workplace.”

The fourth aspect that Barsh highlights is the fact that women tend tolead in a more collaborative manner than men do. “I've seen ample evidenceof women being far more collaborative, gaining far more input from the com-pany, and being able to make decisions that are based on taking a lot more in.It’s not that women are worse at decision-making. They just make decisionsmore collaboratively, which is a different form of decision-making, andmaybe more effective in times when it’s really uncertain and you don’t haveall the answers yourself,” she explains.

www.hrmreport.com 31

LEADERSHIP TRAITS: WOMEN RULE!% saying this trait is more true of...

Honest

Intelligent

Hardworking

Decisive

Ambitious

Compassionate

Outgoing

Creative

Men Women

Note: Traits listed in order of the public’s ranking of their importance to leadership.“Equally true” and “don’t know ” responses are not shown.

52 Indra Nooyi PepsiCo$13.4m 53 Irene Rosenfeld

Kraft Foods $17m 75 Ellen Kullman

DuPont $4.4m

Fortune 500 women

WHY AREN’T THERE MORE WOMEN INTOP EXECUTIVE POSITIONS?

Women who try to rise to thetop get held back by the old

boy network

Doors have not been open longenough for women to make it

to the top

There are few women in high corporate positions to

inspire others

Women are discriminatedagainst in all areas; business is

no exception

Women’s family responsibilitiesdon’t leave time for running

a corporation

Generally speaking, womendon’t make as good bosses

as men

Generally speaking, womenaren’t tough enough for

business

20 50

14 38

28 28

44 33

34 34

5 80

28 47

11 62

49 28

44 34

Major reason Minor reason

38 36

35 32

34 34

16 26

15 26

Note: “Not a reason” and “don’t know ” responses are not shown.

Sour

ce: P

ew R

esea

rch

Cent

er


Spence agrees with Barsh on this matter and cites another study pub-lished by Catalyst in October 2005 entitled Women “Take Care”, Men “TakeCharge”: Stereotyping of US Business Leaders Exposed. Spence says that therehas always been a certain perception that men are much better at making de-cisions and moving forward, but that this isn’t necessarily true.

“Studies are now finding that men may make decisions based on a singlestrategy whereas women have a bigger overall strategy when they’re makingtheir decisions, and they also pull in more view points. So what Catalyst con-cluded in the study is that there were no real differences in skills, only differ-ences in styles of management,” explains Spence.

The final characteristic that Barsh identifies is that women tend to bemore risk averse. She believes that perhaps because women leaders havethis sense of meaning and a strong sense of community and responsibili-ty for everyone in the company, they may act more cautiously.

However, this appears to be a very con-tentious issue, predominantly due to the word-ing of “risk averse.” Spence certainly thinks thatthis is a misconception. She refers back to herearlier comment regarding the Hedge FundResearch. “It’s not that women aren’t risk tak-ers, it’s that they seem to be managing risk awhole heck of a lot better than many men aremanaging risk,” she says.

Samantha Collins, the founder of Aspire,also doesn’t subscribe to the view that womentake less risks; she thinks they have a different ap-proach to risk, which is more closely related toethics. “I think women take a more calculated riskand when it comes to something that goes againststrong value or ethics, they’re not going to do it.So when you think about the whistle blowers inthe last 10 years, like for Enron or WorldCom,they’ve all been women. Now to be a whistle blower, that’s a huge risk. Butthey’re doing it because it went against their values,” she says.

“So am I saying that women are more ethical than men? I’m not sayingthat, but I am saying that when it comes to risk and an attitude towards risk,I think men and women approach it differently and I think that’s a goodthing,” says Collins.

So whilst men and women would appear to have very different ways ofdoing things and contrasting leadership styles, there is nothing really to sug-gest that one style is overtly or definitively better than the other. And if this isthe case, why are women struggling to break through the so-called glass ceil-ing – if indeed one actually exists?

Clearly the fact that women are the child bearers cannot be ignoredhere; taking time out to raise a family would obviously impact the careerof any woman, or man for that matter. Electing to work part-time or taketime off for children means that women often find that they’re not hitting

the milestones at the same rate as the men are hitting them. But Barschalso puts it down to women having a different understanding of leader-ship.

“We define leadership in our book not as being at the top of the compa-ny, but as making your mark in whatever you choose. And because of the im-portance of meaning to women, they have a much richer and broaderdefinition of what it means to make a difference,” says Barsh.

She believes that men view pay and status as the goal and thereforegetting to the top is important to them. However, women look much morefor what is going to make them happy and make their lives worthwhile,she says.

Collins agrees and when asked why there are so few women in senior-level positions she says: “Because a lot of women don’t really want to do it.I don’t think it’s because women can’t do it. I believe that a lot of women,

from Generation X and Generation Y, look at thesenior levels and say ‘You know what, I’m not re-ally sure whether I want to make those sacrificesand I’m not really sure whether that’s the style orthe atmosphere of somewhere that I want towork’”. Combine this with the work-life balanceissue and a style of work that is perceived to bequite aggressive and Collins says that it’s not sur-prising that many women decide not to go downthis route.

When we take a look at successful femaleleaders from the Baby Boomer generation, manyof them succeeded in the only way they could – byimitating men. Authoritarian, direct and control-ling leadership was the hallmark of the 1970s busi-nessman, and women were not exactly welcomedinto the ranks of management.

“Those women who have adopted a more mas-culine style in order to compete with their male peers probably had to workthree times to 10 times as hard to reach that senior level position,” says Collins.“One of the dangers is that the women at that level think they have to be asuper woman and portray this perfect image of somebody who is a brilliantbanker or a brilliant lawyer, a super model, a wonder woman at home, and asex siren. You know, the perfect outfit,” she continues.

Now that these women have made it to the top, Collins believes that theyhave the opportunity to uncover some of these layers and start to show a morehuman, more authentic side to themselves. Particularly in terms of role mod-els, Collins points out that younger women working their way up the rankswant to be able to look up to female role models who are human and whohave strengths and weaknesses. “When you go back 10, 15, or 20 years whenwomen were aspiring to the board there was a very strong expectation that inorder to be successful you had to be like a man, but I’m not so sure that ex-pectation is still there,” says Collins.


100 Mary SammonsRite Aid $5.2m 131 Carol Meyrowitz

TJX$8.6m 147 Anne Mulcahy

Xerox$10.9m

Fortune 500 women

PERCENTAGE OF COMPANIES

BY NUMBER OF WOMEN

EXECUTIVE OFFICERS (2009)...

ZEROWOMEN

ONEWOMEN

TWOWOMEN

THREE OR MOREWOMEN

29.2%31.7%

21.2%17.9%


“Some of the skills that have been more traditionally attributed to womenhave consistently been underrated as soft, fluffy and girly, and I think that’shad its day now. What we’re realizing is that those skills are absolutely need-ed in order to get the best out of people and to really encourage people to wantto enjoy their time at work,” she explains.

So perhaps we are skirting the issue with all this talk of whether corpo-rate America needs more women at the top. Maybe it’s part of a far greaterdiscussion on leadership. This time last year, the New York Times columnistNicholas Kristof reported that some of the most interesting discussions at theWorld Economic Forum in Davos, Switzerland revolved around whether wewould be in the same mess today if Lehman Brothers had been LehmanSisters. The consensus, he wrote, was that the optimal bank would have beenLehman Brothers and Sisters.

Men and women bring vastly different perspectives, skills, mentalitiesand communication styles to business and a company that can capitalize onwhat both have to offer will inevitably benefit in the long run. After all, aboard or executive team that can draw on the different styles of men andwomen will undoubtedly profit – perhaps even in monetary terms – frombetter decision-making.

Whether more women make it to the top or not, what is undeniable is

that a more feminine approach is needed to leadership. The new generationof leaders take jobs in companies they believe in and want make a differenceand be challenged. They are frustrated by hierarchies, work-life balance, anda lack of opportunities to do what they came for.

“Once companies start realizing that this is the case and a whole gen-eration of women, and a lot of men, want something different from senior-level positions, then there is a chance for them to start changing the waythey do things. And I think that might be the wake-up call that’s needed,”says Collins.

In the foreword to Aspire’s report, Tearing Up The Rule Book, A NewGeneration of Leaders For 2010, Collins writes: “This new century needs anew generation of leaders who are more transformational and embracetheir feminine qualities. The old school style of many politicians and cor-porate CEOs is on the way out and transformational leadership behaviorsare on the way in. The time for a new rulebook is here and women andmen who operate with the highest integrity, think beyond short-termprofit, have a vision for the future and are not afraid to prioritize theirfamily and personal life will not only survive but thrive in a new decade.This is a new era for women as leaders.”

I for one would certainly like to believe her. n


199 Brenda BarnesSara Lee $9.3m 255 Andrea Jung

Avon$11.1m 269 Laura Sen

BJ’s Wholesale Club$2.6m

“Studies are now finding that men may makedecisions based on a single strategy whereas womenhave a bigger overall strategy when they’re makingtheir decisions, and they also pull in more view points”


If the fi nancial crisis and subsequent economic down-turn have taught us anything, it is that no one is immune to the potential impacts. Even providers of seemingly essential commodities like power have felt the pinch as individuals and businesses attempt to cut costs by reducing the amount of energy they use. Less demand means less revenue and this has left companies like Duke Energy, which provides gas and electricity to some four million customers in the US, with some

tough choices to make. For Jennifer Weber, Chief Human Resources Offi cer at the energy giant, balancing the needs of her people with those of the organization has been a major professional challenge since she came into her current role in 2008.

Weber is emphatic about one thing when it comes to being a suc-cessful HR professional: it’s all about the business. “One of the things I always tell individuals who are interested in entertaining a career in HR is to make sure that you focus on being a good businessperson fi rst and an HR expert second,” she says. “If you’re going to focus some de-velopmental time, focus it on learning the business, understanding the business drivers, understanding how the company that you’re support-ing makes money, understanding the P&L and the balance sheet.” It’s a lesson that HR has been learning in recent years and something that needs to be taken on board if people specialists are going to retain their seat at the table.

PEOPLE

Jennifer Weber explains how Duke Energy’s employees are driving the energy giant through some dark times.

FEATURE

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focus. We’ve done it through getting together routinely and collaborat-ing on various solutions and challenges that we’re facing.”

But energy can only do so much. Cost saving on any meaning-ful scale inevitably results in headcount cuts, a traumatic reality both

for the employees who leave and those who suc-cessfully dodge the bullet. Nonetheless, Weber insists that the kind of relationship that exists between Duke and its people goes at least some way towards diminishing the pain caused by reductions in staffi ng. “We do engagement sur-veys of our employees every year,” she says. “Th e most recent survey came just aft er we froze merit increases in 2009. So in the summer of 2009 we do our engagement survey, and our engagement levels were higher than they’ve been for many, many years. I think that is a refl ection of em-ployees’ appreciation for having a job, because so many people around them – their neighbors, their family members – have been impacted by this recession and have lost jobs. We had a lot of

write-in comments to that eff ect.”

Skill setsEven in challenging times, an organization cannot neglect prepar-

ing for its future. More than many other industries, power and energy is going through a technological revolution. It is essential that people on the front line keep pace with this development. “One of our fi rst priorities is

Th e trick is to develop the more conventional areas of HR expertise in support of the challenges faced by the organization. “HR facilitates a lot of decisions around things that can save the company money or cost the company a lot of money,” Weber continues. “It also controls things that impact the health and well-being of the organization in terms of employee engagement and in terms of productivity. Understanding what the busi-ness drivers are, how those vary by area, is very important.”

Th e growing realization that a company culture can be a key diff eren-tiator gives HR an opportunity to take the lead. Th is is particularly true for Duke Energy, which has faced the challenge of building a coherent culture at a company largely formed from a series of mergers and acquisitions. Weber explains that having clearly defi ned ideas of what a culture should be and driving that through senior management has been key. In addition, an attitude she describes as ‘take the hill’ is essential in Duke’s work to meet its goals, particularly in our current climate. “When there’s some-thing that we need to get done – such as recently, because of the economic downturn we’ve had a focus on cost management – this company has a way of knowing how to take the hill and how to go get it done,” Weber says. “Th at’s something that really needs to be leveraged in times like this.”

Dark daysTh e impact of these tough times cannot be underestimated. Organi-

zations of all types have had to weather huge challenges, with large-scale job losses becoming an increasingly common feature. In these situations, HR fi nds itself in an unenviable position, squeezed between its commit-ment to preserving the bottom line and loyalty to its people. So what are the qualities that have allowed Weber and her team to work through this rocky period? “I think one of them is tenacity,” she replies. “It’s keeping the energy levels up and making sure of that. It’s also about agility. It is unbelievable how unpredictable our environment is these days. Just when we think volumes in our business are starting to show some signs of recovery, we look out a few more months and we see visible signs that we are going to continue to be below where we’ve performed his-torically in terms of demand for our product.”

Weber tells us of a heavy focus on cost-savings and acknowledges that this can have a big impact on company morale and energy levels. However, she is adamant that the company’s management is leading from the front in maintaining an air of positivity. “We have a very dedicated, very high energy senior team,” Weber explains. “I would say a lot of that comes not just from them. Everybody is wired in a way that they’ve got a very diligent focus on the business and a lot of energy that they put into it. But (CEO) Jim Rogers does as well. If you ever see him in action, he’s got a lot of enthusiasm for this business. He’s been in the business and in the industry almost his entire career.

“He is incredibly high energy, and that inevitably rubs off on all of us. We’re all looking forward to a time when we’ve turned the corner in terms of our economy, and we do start seeing some recovery in terms of the demand for our product and services. But in the meantime, I think that this has gotten the adrenaline going in all of us to not lose our

Jennifer Weber

Out in frontWeber explains the necessity of developing leaders.

I believe that there are attributes of leadership that can certainly be taught. I absolutely believe that, and we actually structure our curriculum around leadership competencies. In our selection process we consider those competencies when we hire and when we move somebody into a key role. We look at those and we say, ‘Is this individual either already exhibiting these attributes, or do we believe that they actually have the potential to learn them?’

So we do invest time and resources in the teaching part of leadership, and I believe that many aspects of leadership can be learned. I do think among some leaders there are certain things that come naturally, so you don’t have to invest as much time and attention. But nobody’s perfect, and everybody can continue to improve in their capabilities and their leadership style. In these times, because they’re so unpredictable and so unprecedented, I think it has become a time that has really challenged leadership.

The people who it’s come naturally to or who have invested in their own self-development and developing their leadership skills, are probably faring better across many companies than those that haven’t made that investment or haven’t been mindful of it.

p

I believe certainly bestructure o

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know how ready are we behind them to backfi ll the skills and leadership they bring into those roles,” Weber says. “So we look at those kinds of met-rics and see how we’re doing, and we identify areas of weakness.”

Plans are put together to work out how to accelerate development of key individuals so they are ready to fi ll new roles in the future, and engage-ment is central to this process. “We look at engagement,” continues Weber. “We can cut that every way under the sun. If there are areas where we see some employee engagement challenges or morale issues, HR works in sup-port of the area to actually put some action plans in place to improve or turn things around.

“We look at retention across areas, where we have had historically high retention in our industry and with our company. Th ose are some of the things that we look at and track and monitor. Th e board is increasingly

interested in this, so every December Jim Rogers and I are in front of the board talking to them about how we’re doing

on all these metrics.”Ultimately though, HR is the business of

people. Metrics and data are vital in their own way, but the human connection at the heart of the function cannot be ignored. “I think we do a very good job of that,” Weber states. “I don’t think we would be viewed as trusted advisors to our businesses if we weren’t fl exible enough

to not be so wedded to the metrics that we can’t manage and accommodate the subjective judg-

ments related to people and their readiness and their growth and their development. By and large,

most of the decisions of how to move people, what their next growth opportunity is, who’s going to take on what

responsibilities, are largely subjective in nature. “We talk about their competencies. We talk about their track record

and performance. But we also talk about some of the soft er intangibles that fi t in chemistry with the team, their ability to develop others and their managerial eff ectiveness. We address all those things. Th is is now my second year of going through this process with the company. I fi nd it very refreshing. At least at the senior table I fi nd that people challenge each other quite a bit.”

So does Weber have any parting words of advice for those seeking to build a successful career, be it in HR or in another area of business? “Always seek out opportunities to challenge yourself,” she replies. “Th at allows you to round out your professional growth. At the point in which you feel like you’ve got it down, you know your job, when you’re feeling really competent, take yourself out of your comfort zone and go learn something new.” In a business environment as unpredictable as today’s, it’s a sentiment that makes a great deal of sense.

to fi gure out ways that we can retool our current employees to meet some of the needs that we’re going to have in the future,” Weber confi rms, citing the developing smart grid as just one area that is going to require a whole new set of skills. “Our employees and our managers know that that’s a fundamental part of our strategy, and I think people appreciate that. Th at being said, we do try to bring in people from the outside where we have strategic needs, so that we’re always getting an infl ux of new talent and new ways of thinking and doing things.”

Continuous learning is another way that Duke ensures its workforce is fi t for the future, and Weber believes it is a key factor in building an organization that is stronger in every respect. “You build a company that thinks in terms of innovation and comes up with innovative ideas,” she says. “You build a culture of diversity and inclusion. I think all of those things are an outgrowth of being a learning environment. We certainly make investments, like a number of companies do, in a learning and de-velopment curriculum for our employees.”

Th is learning environment applies to people at all levels in the organi-zation, ensuring that development goes on from top to bottom. “We have things that are very targeted to new supervisors and managers in terms of helping develop their skills,” says Weber. “We have things targeted at mid-level managers that we designate and determine are high potential; we send them to something we call a strategic leadership pro-gram at UNC, which is customized to Duke Energy. Our executives are actively engaged in partnering with the professor who is delivering the curriculum to make sure that it’s Duke Energy-specifi c.”

Weber also tells us about something called the CEO Challenge. High potential employees are presented with real-world problems facing the business and asked to work on solutions over the course of several months, ultimately presenting their ideas to senior leadership. Another key spoke is the continuous rotation of talent. “Th is is actually a philosophy of Jim Rogers,” Weber explains. “Just when somebody’s starting to feel comfortable in their role, he believes it’s time to move them. I agree with that philosophy, and many of us do and have embraced that. So in multiple levels of leadership you’ll fi nd that we rotate people around pretty routinely so we make sure that they’re constantly stretching, challenging themselves, and growing professionally.”

Making progressA critical component of the HR function at Duke Energy is proac-

tive career progression and succession planning. “We have various job categories, and we routinely track,” says Weber. “We look at these numbers and ask ourselves how we are doing. Every year we look at movement and progression, we look at diversity metrics and we look at readiness. We go through a fairly time-intensive succession planning process with the com-pany every year.” Weber explains that close attention is paid to the talent pipeline, making sure there is capacity to replace any people who may leave unexpectedly. “If somebody were to win the lottery or there was someone we tapped on the shoulder and wanted to move to a new role, we need to

Duke Energy: quick facts

18,680 employees

$57 billion in assets

35,000 megawatts of owned capacity

50,000 square miles of service territory

4.5 million customers

“Th e growing realization that a company culture can be a key diff erentiator gives HR an opportunity to really take the lead”

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family feel gives us the success that we’ve had over the years.”

Fairmont’s Service Plus Memory Maker Recognition Program is designed to reward colleagues in a meaningful, personalized way. Any colleague may nominate a peer for being a Fairmont brand ambassador. ‘Memory Maker’ awards recognize specifi c displays of thought-fulness and creativity.

Fairmont’s popular Destinations and Friends & Family travel programs enable its colleagues and their social circle to stay with Fairmont at a discounted rate. Th is 30,000 strong ‘sales force’ is recognized with Travel, Earn & Win, a promotion that earns col-leagues $10 for every room night consumed through the Friends & Family program. All participants are also entered in a monthly random prize draw. Th e top ‘colleague booker’ every month wins a trip for two anywhere in North America.

“Travel, Earn & Win is an opportunity to reward colleagues for their ongoing eff orts during this diffi cult economic climate, and generate additional revenues for our hotels and communities at the same time,” says Storey. Th e result? Th e program has been very suc-cessful with Fairmont colleagues generating more than $26 million in additional revenue in 2009.

Empowerment, innovation and creativity are fostered at Fairmont with the Ideas Count program. Colleagues share their best practices with other hotels on myfairmont.com, the company’s internal website. Th e best ideas are adopted throughout Fairmont’s portfolio, and their creators are recognized annually with Ideas Count awards.

Fairmont is proud to be among Canada’s Top 100 Employers 2010 for an 8th consecutive year – the only hotel company named to the list. It also earned the prestigious distinction as one of the country’s 10 Most Admired Cor-porate Cultures in 2009 when it was selected from a group of over 400 corporations by Waterstone Human Capital, a leading profes-sional recruitment and human resources con-sulting fi rm.

Our exciting innovations, rewards and recognition programs are just the beginning. With 59 hotels in some of the world’s most un-forgettable destinations, our colleagues work where others only dream of visiting.

results are a function of having satisfi ed guests, and satisfi ed guests can only be the product of satisfi ed, motivated colleagues.”

Th e building blocks of Fairmont Hotels & Resorts culture – teamwork, empowerment, respect, integrity, loyalty, pride, innovation, empathy, philanthropy – are inextricably linked to fulfi lling our mission of turning mo-ments into memories for our guests. We host a number of programs and partners to support our culture and to measure its correlation with both colleague and guest satisfaction.

‘Service Plus’ is Fairmont’s comprehen-sive human resources platform that embodies its philosophy to select the best; lead with the best; train and develop; and recognize and reward. Th e strategy begins with hiring talented colleagues and leaders who, together, create the kind of exceptional workplace that inspires an exceptional guest experience.

“Our colleagues teach each other to be involved in their community, involved with our guests, and to respect their colleagues re-gardless of level or position,” says Storey. “Th e

Turning moments into memories for guests is our mission at Fairmont Hotels & Resorts. It happens when we provide our customers with authentically local ex-

periences in properties with unrivalled pres-ence. But the key – and what sets us apart – is the faces of Fairmont, our 30,000 colleagues around the world who deliver warm, engaging service.

Our colleagues and their charming, dis-tinctive service diff erentiate Fairmont’s guest experience from other luxury hotel companies. An authentic colleague engagement strategy is integral to making our workforce feel valued and motivated – and we do it by turning mo-ments into memories for our colleagues.

“When I get feedback from our guests about what makes Fairmont special, it’s always about our service, it’s always about our col-leagues,” affi rms Tom Storey, the brand’s Pres-ident. “Our colleagues are the heart and soul of our company; strong fi nancial and revenue

Memory makerAt Fairmont Hotels & Resorts it’s not only the guests that are left with lasting memories

ASK THEEXPERT

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challenge a rival organization to foster team morale.

Employees can easily broadcast their fi tness successes on social media platforms

such as Facebook – an-other means to maintain motivation. Consider the value of employees engaged in a company wellness program and actively promoting their employment brand. To link ones Nike+ profi le to popular social media ap-plications, users simply adjust settings to auto-matically send workout status updates to Face-book and Twitter.

To encourage employ-ee engagement, consider outfi tting the most enthu-siastic participants with customized athletic gear. Using NIKEiD.com or the NIKEiD iPhone app, Nike

shoes, bags, hoodies and tees can be custom-ized in company colors and team names or slo-gans. If this type of incentive exceeds budget, try rewarding activity with gift cards that can be applied toward individual purchases.

Nike+ is a sophisticated technology, but fundamentally it is a tool that makes working out more fun, accessible and rewarding. If the goal is to increase employee participation in wellness and fi tness programs, let Nike+ do the heavy lift ing.

working with a personal trainer – and more. Th e system includes workout scheduling, digital coaching, a mapping feature, a social media widget, and an online forum for con-necting with friends and challengers around the world. On iTunes, users can purchase customized work-out mixes to amplify their fi tness regimes. Nike Sport Music selections include original albums by artists De La Soul and Th e Crystal Method, audio workouts, as well as special coaching mixes with music led by athletes such as Alberto Salazar, Lance Armstrong and Serena Williams. Ad-ditionally, employees can participate virtually from anywhere in the world. Nikeplus.com has more than two million members worldwide, who have col-lectively logged more than 175 million miles. With Nike+, employees never have to train alone again.

Th e Nike+ experience is a great team builder. At Nike for example, the footwear and apparel teams challenged each other to see which side could collectively log the most miles in a given timeframe (footwear won!).

Challenges continue to spring up between genders, levels of seniority (this is a great way for executives to interact), departments and countries. Try a companywide competition or

If inspiring employees to make health a priority is part of your employment brand, you may want to take a look at two user-friendly Nike innovations – Nike+ and NIKEiD.

Employees can greatly benefi t from well-ness programs that provide inspiration and boost overall health in the workplace. While budgets may not support on-site sports or wellness centers, it is possible to get employees moving by incorporating a simple, customiz-able wellness program. Nike+ technology and personalized NIKEiD rewards are tools that can easily bring a wellness program to life.

Nike+ makes it easy to boost participation through healthy competition. Slipping a trans-mitter chip into shoes that support Nike+ or plugging into Nike+-enabled workout equip-ment allows runners to track distance, pace, calories and time, as well as the ability to chart workout stats and progress on their iPod Nano, iPod Touch, iPhone, or Nike+ SportBand. Aft er working out, users sync Nike+ to their computers, and workout data is automatically sent to nikeplus.com. Online, users can visu-ally monitor progress, set goals, connect with others, and participate in challenges.

Based on fi rst-hand experience, Nike Well-ness Center Manager Meghan Simmons singles out Nike+ as a good way to boost participation through healthy competition – an important component of wellness-focused activities and events. “Any company can engage their employ-ee population with Nike+ to create challenges and motivate with incentives and rewards at meaningful milestones,” Simmons says.

Nike+ delivers many of the benefi ts of

TECHNOLOGY FOR EMPLOYEE WELLNESSDebbra Palmer explains how the latest innovations from Nike could help

inspire employees to engage in a healthier lifestyle.

NEXT BIG THING

Debbra Palmer is the Employment Branding Director at NIKE, Inc. where she is a member of the Human Resources Organization Effectiveness and Business Planning Center of Excellence.

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Today’s offering of employee benefits can be the biggest source of confusion for many employees. What is the best way of prop-erly communicating voluntary benefits options to employees?Randy Clarkson. Many factors determine the best strategy in com-municating voluntary benefits. Ideally, employees should receive their voluntary benefits information from one source. Equally impor-tant though is the employee’s education prior to, during, and after en-rollment. This is the company’s opportunity to provide value to each employee by continuing to engage and remind them of their benefit

ROUNDTABLE

Benefi ting the workforceCash is no longer enough today to recruit and retain top talent in business. Providing an attractive benefi ts plan is just as important. Three industry experts give HRM an insight into the importance of employee benefi ts.


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ployees in today’s environment. Traditional media continues to be a critical component, so providing compelling print media that is easy to understand and visually appealing is an absolute must.

Implementing supportive enrollment and communication solu-tions that strike a balance between high-tech and high-touch em-ployee support will best reinforce not only the value of a company’s benefit offering, but the value the company places on the employee.

David Josephs. Communicating early and often, and senior manage-ment buy-in are the two keys to communicating any benefit plans to your employee base. A well thought-out communications plan intro-duced over several months before the actual enrollment period gives employees time to understand the benefits offered, get questions an-swered and reduces confusion during the busy enrollment season.

The more employees know about their benefits plans and options the more confident they are when it’s time to choose one. When we engage with an employer, J.P. Morgan offers a wide variety of edu-cational materials; everything from traditional printed brochures to online interactive tools. Meetings, either in person or by webcast, are another great way for employees to learn and to ask questions. And when senior management take an active role, whether by attending employee meetings or sending personalized letters to employees’ homes, it adds a tremendous amount of credibility to the program.

To what extent can the range of employee benefits on offer enable companies to stay competitive in the marketplace in terms of employee engagement and retention?JMP. With so much public scrutiny on healthcare offerings coupled with tougher economic times, employees are looking more and more at their benefits packages. However, many companies find it difficult to offer rich benefits without breaking the bank. Companies that cannot find that fine balance risk losing talent, which compromises long-term viability.

Healthcare accounts and other tax-advantaged accounts, like transportation accounts, offer employees tax savings without impos-ing significant costs on the employer. In fact, since payroll taxes are reduced by the amount of the contributions, these accounts actu-ally end up saving employers and employees money in the long run.

opportunities. Most importantly, the communication should detail the value provided by the employer for all employee benefits, includ-ing voluntary benefits. A company’s competitive edge in terms of employee retention and cultivation is a dynamic position and process. Choice is important, and a complete enrollment and communications plan – one that involves the employee – is paramount.

J. Marc Palmer. Clearly, many employees are confused by their ben-efits offerings and do not understand the significant benefits that healthcare and other tax-advantaged accounts can offer. We feel that this confusion is not the fault of the employees, but is instead due to how these benefits are communicated, which is often based on theory instead of scientific proof.

Contrary to traditional communication methods based on theory and delivery a “one size fits all” message, ConnectYourCare applies scientifically proven methods for better communicating with em-ployees. We deliver a behavior-centric approach to drive enrollment in healthcare accounts and maximize tax savings for both employees and employers. Core to our communications strategy is leveraging groundbreaking Consumerology research conducted by our parent company, Express Scripts, to better understand employees’ behavior and communicate to them in a way that helps them understand the benefits of these accounts.

For example, we weave proven behavioral economics principles into our open enrollment materials, which help deliver our customers enrollment increases of up to 30 percent over their previous adminis-trator and corresponding increases in payroll tax savings.

Joel Carter. Employees face daily difficulties choosing the best ben-efits package in an environment of increasing health care costs and limited support staffing in HR. Offering multi-dimensional commu-nication and enrollment capabilities in a variety of supportive formats serves the best interest of both the employer and the employee.

Employing an online environment that facilitates initial benefit planning based on employee specific data, information and model-ing tools will empower employees to find their own answers to HR questions. A true participant advocacy call center is a critical element and provides supportive information and assistance to the employee throughout the process. Leveraging new communication mediums such as webinars, blogging and twitter should be used to engage em-

J. Marc Palmer serves as the CEO for ConnectYourCare, driving the migration to CDH and preserving the organization’s industry reputation as an account management solutions leader. Additionally, as Vice President of Strategic Planning and Development for Express Scripts, Palmer’s achievements contribute to their overall success and recognition as a Forbes 130 company.

Randy Clarkson is the President of Transamerica Worksite Marketing, a division of AEGON USA. He has been in the insurance industry for 28 years, starting his AEGON career in 1991. During his tenure at TWM, Clarkson has increased sales by opening new distribution channels, building new relationships and expanding product offerings.

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Many employees are recognizing the long-term benefits of Consumer Directed-Healthcare and seeking CDH plans from their employer.

JC. Too often companies neglect or underestimate the true value of their benefit offerings in a down economy. High performers and top candidates still have options in the marketplace and are argu-ably in greater demand as employers look to maximize productivity and boost returns. To attract and retain these individuals, companies must focus on communicating the value and overall positive compen-sation impact of their benefits structure.

According to the Bureau of Labor Statistics, nearly 30 percent of true total compensation is attributed to benefits costs. Unfortunately, most employers neglect to communicate the economic value of these employer contributions to health and welfare, retirement, income protection and work/life plans.

Embracing pre-employment and ongoing total compensation statements as a tool to define and showcase the true value of these benefit offerings has been proven to positively impact employee re-tention and enhance overall employee satisfaction with the benefit plans and structures provided by a company.

DJ. Offering a range of benefits can certainly help employers remain competitive in the marketplace. However, equally important is ensur-ing that the choices on offer are responsive to the needs of employees and their loved ones. In our experience managing HSA Programs, we’ve found that employers who have well-designed programs, including attributes such as differential premiums and employer contributions to HSAs, provide their employees greater control over their healthcare decision-making, something very positive. Employ-ers who take an interest in the wellbeing of their employees over time are demonstrating a long-term commitment to them.

RC. With budgets tightening and workloads increasing, it’s important to retain key people whose experience and institutional knowledge keep their business running smoothly. Savvy employers know a good benefits package does more than just support retention. It is key to productivity as well. And, when a company offers a wide range of vol-untary, often portable, benefits, immediate perception is favorable for the company’s reputation and image. A good benefits package though is only as good as the communication between the employer and ben-efit advisor. Effective discussions between these two should include a review of past plans, missing coverage, and updated employee in-formation. The employer and benefit advisor should strive to know the workforce. Practical and vital voluntary benefits can elevate a company’s reputation, employee perception and increase loyalty.

The healthcare debate has dominated headlines in recent months. How will a potentially changing medical environment affect vol-untary benefit schemes?JC. With the recent shift in the make-up of the Senate, it appears that incremental change to healthcare reform has replaced sweep-ing global change, at least for now. What the actual make-up of this ‘incremental change, will look like will ultimately determine the true

impact on the voluntary benefit landscape. However, many in the industry are predicting a greater emphasis on voluntary benefits as a means to enhance not only base levels of coverage but to provide a broader range of supportive offerings for all employees.

One thing all of us can be certain of is that benefit providers will be enhancing their voluntary product offerings and will be present-ing them aggressively to the marketplace. Companies must carefully analyze whether these offerings will fit into their overall strategy and must be prepared to invest in communication and support mecha-nisms to ensure that the true value of these products are communi-cated to employees.

DJ. With the current uncertainty around healthcare reform it’s diffi-cult to say what impact a changed environment will have on voluntary benefits. However, many voluntary benefits, particularly account-based programs, have been shown to meet the expressed goals of healthcare reform: to improve outcomes by encouraging preventive care and reduce costs by helping people get more engaged with their healthcare decisions.

RC. The voluntary benefits industry has a history of analyzing the marketplace and expanding product offering to fit employer needs. A look at our evolution demonstrates the point. Traditional individual life products are a cornerstone for voluntary benefits. The indus-try is responding to employers’ interest in supplemental products and has expanded to offer more than fifteen ranging from legal to health, vision and dental. Transamerica Worksite Marketing is a f lexible company poised for all healthcare debate outcomes. If the result is broadened benefits for more Americans, there will be an equally increased demand for supplemental benefits to compliment major plans. If there is little or no change after the debate, voluntary benefits will still be viable as employers look to maintain or expand coverage for employees while minimizing cost increases. Regardless of any healthcare reform, any result will cause employers to make decisions they had on pause.

JMP. We think that the changing healthcare environment will not only drive the adoption of consumer-directed healthcare (CDH) ac-counts as a voluntary benefit, but as an overall benefits strategy. In

Joel Carter is Vice President Client Services & Business Development, Secova.He focuses on developing and delivering world-class HR and benefi t administration solutions to Fortune 500 companies and state and local governments. Carter is a frequent speaker at industry events and has authored papers on the proper design of benefi ts administrative processes and outsource initiatives.


Secova ad:25 June 26/3/10 09:25 Page 14


HealthPak, a product package that addresses this situation. Employers can modify existing medical plan designs and then off er supplemental benefi ts like critical illness, accident or life to their employees. HealthPak combines these supplemental benefi ts to help bridge any gaps in coverage. As Newton said, “for every action, there is an equal and opposite reaction.” Reducing employee benefi ts is never a good idea. Voluntary benefi ts still off er the employees the benefi t of choice and fl exibility to design a plan to meet the unique needs of the employee and family.

JMP. Instead of cutting back, employers should look for more economical benefi t plans. A high-deductible health plan coupled with a Health Savings Account (HSA) not only reduces premiums but also delivers signifi cant payroll tax savings. One of our clients, a large national bank, off ers an HSA to its employees and had 6780 employees enroll for the 2010 plan year with an average contribution rate of $2423. Th ese accounts deliver annual em-ployer payroll tax savings of about $1.25 million, and a combined employee tax savings of about $4.9 million. Th is isn’t even counting the millions in premium savings that the bank enjoyed.

Another ConnectYourCare client, Zions Bancorporation, began implementing a CDHP (consumer-directed health plan) in 2005, and since it was fi rst introduced, the company and its employees have saved more than $10 million in healthcare costs. From 2006-2009, the percent increase each year in healthcare costs fell from its prior double digit levels to below 5 percent. Employees understand and appreciate the plan, and, on average, contribute $2200 to their HSAs and $1600 to their FSAs (Flexible Spending Accounts) annually.

JC. Economic realities of today and the need for companies to remain viable during this downturn have driven organizations to aggressively reduce or mitigate increases in all areas of spending; including annual benefi t spends. In an attempt to manage these costs, some companies are increasing employee cost sharing through higher contributions or benefi t plan design changes.

Others invest in more innovative programs aimed at reducing the ultimate driver of employer benefi t costs; namely their annual claims spending. Historically, these initiatives focused on wellness and other pre-ventative measures which, while imminently valuable, have a longer-term payback and don’t satisfy today’s requirement for immediate cost savings. Forward-looking companies are embracing alternative tactics such as De-pendent Eligibility Audits, where participants are required to validate that their enrolled dependents meet the company’s eligibility requirements, to ensure plan rule compliance and achieve signifi cant and immediate cost savings that outperform any plan design or cost share change.

fact, a new study by Towers Watson predicts that a huge percentage of large companies in the US will move to completely replacing their PPO plans with CDH plans in 2010-11.

However, it is critical that companies choose administrators that are poised to handle any regulatory change. Administrators that cannot quickly adjust to changing regulations will have to invest signifi cantly into their infrastructure, oft en drawing resources from other parts of the or-ganization and straining operations. Benefi ts executives should examine their current administrators closely and ask critical questions about their capability to handle possible regulatory changes before renewing contracts for the 2011 plan year.

With the current economic climate being quite tough, many employ-ers have had to consider or even implement cut backs in the benefi ts they can offer employees. Is this a good idea and what are the alter-natives?

DJ. Cutting back on employee benefi ts or worse, eliminating them en-tirely, is certainly not something employers want to do. However, reducing benefi ts is not as detrimental to employee morale as decreasing working hours or eliminating jobs. In a down economy, I think most employees understand the realities of the tough choices and trade-off s employers sometimes have to make to remain in business.

Many companies seeking lower-cost alternatives have adopted a Consumer-Directed Health Plan (CDHP) strategy, which shift s some of the healthcare costs to employees. CDHP products off er tangible cost ben-efi ts while still providing employees with the fl exibility to manage their healthcare needs. From an employer and individual basis, the expense control that you get from a CDHP product, whether it’s an HSA, a Flex-ible Spending Account or a Health Reimbursement Arrangement is very attractive in today’s markets. Premiums tend to be lower and at the same time, they reduce a company’s tax liabilities when employees make pretax contributions.

RC. In the face of the current economic environment, it’s painful to think of a company having to consider or implement a reduction in their ben-efi ts. When faced with that situation, the company must research and weigh its options carefully. Th e objective will always be to lower premiums without lowering coverage for the employee. Transamerica has developed

David Josephs is Managing Director and Head of Consumer-Directed Healthcare, J.P. Morgan. He has worked on J.P. Morgan’s CDH and HSA programs from their inception. Prior to joining the bank he worked directly for health insurers, as well as a management consultant to health plans. He served as a legislative assistant to a member of Congress and US Senator, handling healthcare issues.

“CDHP products off er tangible cost benefi ts while still providing employees with the fl exibility to manage their healthcare needs”


JPMorgan ad 1:25 June 26/3/10 09:07 Page 14


CDH plan designs. For example, many plans include benefi t dollar re-wards for health risk assessment participation and even completion of employer-sponsored biometric testing.

Th irdly, rolling out reward programs for specifi c disease and chronic conditions can help. Th is innovative strategy is designed to motivate members to control their targeted chronic conditions in order to avoid incurring catastrophic claims later on. Th e idea is to provide special monetary funds to assist these members in pursuing and engag-ing in disease prevention education, coaching, wellness and lifestyle programs, and medical care for those managed conditions. To ensure

compliance, the members shouldn’t be allowed to carry these special targeted reward incentives over to the next year. Th is strategy helps alleviate the fear among plan sponsors and members alike of selective choice.

Finally, it is advisable to introduce an addition-al CDH plan option based on a diff erent account type or with a diff erent fi nancial risk threshold. Th is strategy can be as basic as adding a health re-imbursement account (HRA) to an existing fl exible spending account (FSA) or introducing a health savings account (HSA) option to go along with an HRA. HSAs were not as popular as HRAs or FSAs initially, due to the immediate cash fl ow impact and risk they present in allowing full portability and the eventuality dollars leaving the plan upon employee termination.

Or it may be a matter of reconfi guring design strategies such as employer contributions or caps on rollover amounts. Th is practice can discourage savings over time since once a member meets a cap, there is no more incentive to continue to save. Much like a 401(k) retirement account, the long-

term vision of growing assets and fi nancial security from the risk of potential expensive healthcare events is what drives fi scally prudent consumer behavior in the fi rst place.

Taking your CDH strategy toward its potential has to start with really knowing where it is today. Did you come in with an initial strategy that was complex in design? If so, it’s not necessarily too late to explore

ways to simplify your plan off ering whether it is a matter of adjusting the mechanics of your CDH options or maybe limiting some of those options until your population gains a better understand-ing of the program.

Did you set the foundation for consumerism through a strong, expansive education campaign? Helping members ‘do the math’ and understand the substantial personal impact behind pursuing and achieving improved health status is a powerful ap-proach toward generating ground level CDH buy-in.

Do you understand the profi le of your popula-tion as it relates to readiness for change? Setting incremental, progressive CDH strategy depends on this base knowledge. Aft er that, there is a myriad of paths to consider.

Firstly, there is a need to emphasizing preven-tive care. More than likely, you are already paying preventive care at, or close to, 100 percent. If not, you should consider doing so as preventive care can save you and your members signifi cant dollars by heading off more serious health conditions before they can develop. A rich preventive care strategy can drive enrollment in health coaching and disease man-agement programs. It can also help reduce anxiety from employees considering a ‘high deductible’ consumer plan option.

Secondly, it is a good idea to introduce a reward incentive for pursuing specifi c behaviors. Pre- and post-eff ective date incentives continue to play important roles in helping people move toward healthier decisions and improved fi nancial wellness. Members need to have a reason, or better yet, several reasons to embrace con-sumerism, especially when it’s off ered as an option to a traditional PPO plan. Carrot vs. stick continues to be a perennial decision point when thinking through incen-tives. CDH strategies are no diff erent in that respect. In-centives can be as simple as price and the positioning of employee premiums on the CDH option more favorably as it relates to other traditional plans. But traditional events tied to incentive rewards work eff ectively within

IN THE DRIVING SEATBarton Halling explains how to take a basic consumer-driven health (CDH) plan to the next level.

ASK THEEXPERT

Barton Halling is Vice President of Product Management for consumer driven and emerging markets for UMR, the third-party administrator (TPA) unit of UnitedHealthcare. Halling leads efforts to aggressively leverage the unique competitive position of UMR, with core functionality and capabilities at the convergence of the health and wealth industries.

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everybody has a wonderful game and there are no mistakes. Which makes fora very different outlook.”

Miller, who is CEO of The Miller Company, as well as past President ofRecognition Professionals International, counts himself as part of the boomergeneration, who he says don’t always appreciate how lucky they’ve been. “Idon’t think this boomer generation is actually as smart as we think we are. Ithink we got a little bit lucky over the past few decades. When they write thehistory books 100 years from now, this era will be highlighted for technologyand productivity gains and some of the amazing things that we take for grant-ed. When we step back and look at it, we live in a very different work envi-

The American workforce has changed drastically over the pastdecade. In 2000, the term ‘millennial generation’ was coined, andit came to symbolize a group of young people who differ greatlyfrom the generations that went before, as Tom Miller explains:

“Prior to that, there were generational differences, but they were incremen-tal. The boomers weren’t that different from the World War II generation.Their line of thinking about work was: ‘We’ll show up and do great work andkeep our noses to the grindstone, and we’ll be rewarded when we perform.’

“Then these millennials came along – young people who have grown upplaying soccer, where everybody gets a trophy and they don’t keep score, and

The value of reward


Tom Miller tells HRM how the changing demographics of the workforce are affectingthe way companies structure their reward and recognition programs.

RECOGNITION

Miller ED_17MAR10 29/03/2010 10:18 Page 52

ronment and even a social environ-ment than we did 30 or 40 years ago.

“There’s some guilt aroundthings that we did or didn’t do whenwe grew up, and we wanted it to bedifferent for our children. This ishow things like the concept of heli-copter parenting arose. Helicopterparents are parents who hover overtheir children and don’t allow them to grow up. They’re going to job in-terviews with them. They’re going to college admissions interviews with them.

“Translate that to the workplace and what companies are dealing with isa generation coming out of college, probably younger than 30, that has highexpectations of a work experience. They are not willing to work and then berewarded. Instead, they say, ‘Tell me what you’re going to do for me, and I will

determine how hard I want to work for you or if I want to work for you orwhen I want to work.’”

It can be difficult for older, established workers to understand this newoutlook, but Miller says it’s essential for companies to move with the timesand ensure their view of their employees is up to date. “I have come to realizeand appreciate that there’s some real truth in what this generation is trying toget done. You may get people wanting to argue it and push back, but thatwon’t happen. The old days of showing up early, getting there before the bossdoes and leaving after the boss leaves are gone.

“In my company, we’ve gone to the new way of thinking. Nobody punch-es a clock. We don’t even have a vacation policy: you take it when you need it.I had to swallow hard, and sometimes I still do because there are more grayareas now. You have to look and determine what got done as opposed to mea-suring work by time and effort.

“The concept of power in the workplace now is very, very different. Froma generational standpoint, there’s a major amount of change going on withinwork. I was in a meeting yesterday with a client that recognizes that they nowhave two workforces. They’re a unionized organization with a rigid, station-ary recognition/reward system and their older employees are OK with that.But this new workforce they’re trying to build, they need to treat differently.

“These are pretty exciting times for someone who’s going to bring itback to our interest in the reward and recognition, incentive space. It’s

very interesting and engaging, because it’s very much about changinghuman behavior on an individual level and agroup level.”

New recognitionMiller believes a lot more thought now

goes into what is recognition in terms of strate-gy as well as tactics. Where once recognition wasall about time and effort, now companies arebeing very thoughtful about implementing be-havioral-based recognition.

“It’s a concept of observing right behaviorsand right practices and communication,” saysMiller. “Recognition and reward has evolved toinclude much more communication and trainingand cognitive understanding, rather than simplylooking at an outcome and saying, ‘This happenedthe way it was supposed to,’ or ‘It happened,whether it happened the way it was supposed to ornot, so we’re going to recognize you.’

“This new type of recognition fits the millenni-al generation much better, and taking a step backfrom that, it relates to human behavior. What do hu-mans need and what are we looking for out of notonly a work experience, but a life experience?Companies are understanding that and dealing with

that and being honest about that in a much healthier way.”While companies may be changing the way they view their employees’

needs, this has not always been translated into outcomes. People are still ac-cumulating points and redeeming them for merchandise or experiences, orbeing recognized symbolically, or being sent on trips. However, even these


Tom Miller


corporate recognition/reward systems are much more closely aligned nowwith corporate cultures than they were 20 years ago.

The recent financial crisis has led to businesses cutting back in manyareas, including rewards and recognition. Miller points out that whether ornot a company does this depends on whether it views its recognition programas an expense.

“I’ve seen two broad approaches,” he says. “One is that an organizationviews recognition and reward as an overhead and an expense and they cut itback. And the other is that they view it as a communication tool, as a meansto engage employees. I’ve seen companies that work very hard to continue tohave a great recognition and reward system.

“The reality is that every company now is looking at all of their line items.Companies are being smarter about what they spend, and we’re all hating it.Nobody wants to go through it, but I think we will look back and see that therewere some good things obtained out of that and one of those was realizing thevalue of a dollar, what we are getting back for the money we spend.

“One of the big changes I’ve seen over the last couple of years is an effortto determine return on investment. If we’re going to recognize or incentsomeone, we’re going to make sure that it works. If I’m investing $1, I wantto get back at least $1.01.”

AccountabilityThe difficult financial period we’re cur-

rently passing through has also had the effectof driving innovation and accountability inthe recognition space. Miller believes this ishealthy, because it has forced companies tostand on what they say they do, on what theysay they believe, and prove it. “Effectively, ourclients are looking at us and saying, ‘You saythis stuff works. Prove it. Show me why.’”

Companies that don’t have an expenseview of recognition/reward have realized thateven though they’re not going to be giving outbig pay raises or big bonuses, and there are hir-ing freezes or they’re having to lay people off,they still need to recognize those who are pro-ducing and carrying the brand message, areloyal and working hard to help them getthrough the difficult times. That sentimentdoes exist, says Miller, but unfortunately thereare still quite a few companies that don’t buy into that, and still it as expense.

Miller cautions against taking a smug view of your workforce, believingthat because there are fewer jobs available, you don’t have to work to keepyour employees happy. It is true that jobs are few and far between and there’sa lot of fear out there, and fewer people want to change. “The balance of powerhas shifted back a bit and employees aren’t nearly as vocal about their de-mands,” he points out. “In many ways there’s an unspoken, ‘I’m just glad tohave a job’ mentality.”

However, he also emphasizes that: “People are showing up with a gri-mace and putting their time in, but wait until things come back around andthey’ll be leaving the companies that are not treating them well and appreci-ating what they contribute.”

Smart companies know that people’s desires for the things they wantout of life are still the same, that they still want to be recognized for whatthey do. They want to be valued by someone, whether it’s their family orworkplace or friends.

“If you think about Maslow’s hierarchy of needs,” Miller says, “it’s a pyramid,with the base being safety and security needs, and in the middle of it are those ‘tellme why I’m important’ needs. We’ve moved down the pyramid a bit. When we’redoing well and jobs are plentiful and everybody is making money, we are in themiddle of that space where you can get more mileage out of telling people why theymatter. Now people are concerned with safety and security issues, and that’s a poorplace to be focusing a lot of effort on recognition and reward.

“If a company is going through lay-offs, it would be ridiculous for themto focus on recognition and rewards. You’ve got to get through the lay-offs.You’ve got to stabilize and you’ve got to ensure the people that are there, thatthe ship is safe.”

The challenge can be to reassure remaining staff while not making themfeel that money is being spent inappropriately. “It’s very difficult. There ab-solutely is some reality to the group psyche and the pain that is felt whencoworkers are laid off. You can’t recognize in the midst of that. Executive lead-

ers, human resources, the people departments need to be very aware of theheart rate, the cultural emotions that are going on within the company andthen respond accordingly. I’m not aware of any linear scientific way to do that.It’s a bit like a family or a marriage. You know when it’s time to appreciateyour significant other and you know when it’s not.

“In good times and bad there are going to be shifts that have to be made.One of the things you want your recognition and reward system to be is veryflexible, so that it can adjust and adapt to the cultural environment.” n

Tom Miller is President and CEO of The Miller Company. Prior to founding the company in1992, Miller spent six years in the performance improvement and recognition industry. He ispast President of Recognition Professionals International and has served as a board membersince 2005. Miller is a graduate of Baylor University, has studied at Oxford University inEngland and has a Master of Science degree from HEC University in Paris, France.


Self-actualization

Esteem

Love/belonging

Safety

Physiologicalbreathing, food, water, sex, sleep, homeostasis, excretion

morality, creativity,

spontaneity,problem

solving, lack ofprejudice,

acceptance of facts

self-esteem, confidence,achievement, respect of others,

respect by others

friendship, family, sexual intimacy

security of body, employment, resources, morality, the family, health, property

Maslow’s hierarchy of needs


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RECOGNITION

Kevin Cronin knows something about timing. Fol-lowing a 21 year career at Bank of America, where a range of roles eventually resulted in him leading recognition and reward strategies for the company, he left two years ago, just before the wheels fell off the global fi nancial system. During his fi nal decade

at BoA, Cronin was involved with developing new ideas to engage and retain a workforce that was going through some major demographic shift s. Now President of Recognition Professionals International, we caught up with Cronin to get his thoughts on where recognition has been, and where it’s going.

How do you think the changing demographic of the workforce is making a difference to the way that recognition programs are structured and designed?I think one of the greatest impacts is the younger generation. Th e Gen Y and the Millennials are used to instant gratifi cation. If we look at their mindset, they’re known as gamers. Th ey like to be able to play and to get instant reward and instant feedback. It’s not so much they want to be given something tangible, but they want some praise and they want to know that they’re doing a good job. If they’re doing a project that’s going to last 90 days, they’re going to expect probably every two weeks a compliment to let them know that you value what they’re doing. If you don’t give them that compliment, that gratifi cation and feedback,

In a faltering economy, recognition could be viewed as a target for cost cutting. RPI President Kevin Cronin thinks that this would be a mistake.

Debt ofgratitude

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during that 90-day period they’re going to be disengaged and they’re not going to keep focused on the job.

Is that a particularly diffi cult task for people charged with keeping these kinds of workers engaged?I think it makes it challenging as a manager of a diverse team. You’ve got to really know your people. You’ve got to know what really motivates them, what type of recognition they like to receive, because an older generation person will say, “Hey, that person’s getting all the attention. I’ve been doing this job for 25 years.” You’ve really got to be able to bal-ance that out so you give the right amount of feedback to each of those groups and really keep them engaged and keep them cohesive.

It’s also making sure that when you onboard someone into your company that you’re, one, hiring the right people; but two, you’re really getting them to understand your culture too, so they will learn how your company works and how they can fi t into that and have that un-derstanding from day one.

Does the presence of two very different demographic groups like Baby Boomers and Millenials in the workplace lead to any friction?

I actually see it as a great benefi t, because you’ve got people with great skill sets on either side. Th e younger workforce is incredible at multi-tasking and at their technology skills, where oft entimes, the older workforce is not as technology-enabled. So I think there are great things to learn from each other. Th ey can learn and work together and be a very cohesive team if things are structured the right way.

Times have been tough of late. What role does recognition have to play in motivating people during these diffi cult periods?In the purest sense, recognition is a great lever for a manager to be able to leverage their team. People come to work concerned about if they’re going to have a job, maybe concerned if their wife or partner is going to have a job, how they are going to make their mortgage payment, and support children if they’re in school and college. Th ere are a lot of worries. I think if managers were to stay in their offi ce, shut their door and not go out and be involved with their team, they’re not going to have a sense of what’s on their mind. Th at’s going to distract from what happens or doesn’t happen at work and productivity is going to drop immensely. But recognition allows managers to be actually involved in coaching their employees, developing them, giving them praise and feedback, and letting them know that what they do is important. It keeps them focused on the vision, mission, and the goals of that com-pany, so that people are more productive. If we’re not out there giving

“Th e younger workforce is incredible at multi-tasking and at their technology skills, where oft entimes, the older workforce is not as technology-enabled”



praise and saying thank you and letting people know they’re good at their job and that their work does make a diff erence, all these other concerns that are happening outside of work are going to eat away at their productivity.

I think a lot of companies that have actually turned off all the recognition reward programs because of fi nancial concerns are seeing about six months down the line that they don’t have the tools they once had. As a result a lot of companies will see other programs and other spend creep up and all of a sudden people will start ‘padding’ their offi ce supply account to go out and buy the rewards that previ-ously they used to be able to get through the company.

So you’d say that making recognition a target for cost cutting could lead to further expenditure down the line?You are going to pay eventually in the retention of your employees if you want to keep your key talent. Otherwise your engagement will drop. And then your customer satisfaction and ul-timately your profi ts are going to drop, because your employees aren’t feeling valued, they’re not feeling like you want them there. While everybody may understand that bonuses or raises may be cut, pure recognition, such as sending an e-card, costs nothing. Th ere are a lot of companies that have realized they went too far and turned off everything, when they should’ve kept the pure recognition element, because those are simply what managers should be taught and trained to do in engaging and involving their workforce.

One of the challenges with recognition programs is that it can be diffi cult to effectively gauge ROI. Are there any ways that it can be measured so that it makes more sense to the balance sheet?I certainly think there are ways you can measure a program, and those measurements oft en need to be built in the forefront of designing that program. Th ere may be some hard measures and there could also be some soft measures in any type of program you do. Most companies today do employee engagement surveys or associate satisfaction sur-veys. Th at’s one very good measurement of their direct manager; do they receive enough feedback and recognition for doing a good job, are they valued? If you were to design a sales incentive program that’s tied to productivity, you can measure either new product sales or listed revenue based on the same period in time from last year given histori-cal data of the company. I think there’s a lot of measurement you can do there.

I also think companies that are very smart are realizing that if you really look at the measurement and activity that’s happening from a recognition rewards standpoint with a manager that’s very good at it, and then maybe those that don’t do a good job at leveraging programs, and you start to peel back that data, you can fi nd that managers that use the programs more oft en have high retention and oft en have higher customer satisfaction scores. Th ose things defi nitely tie into what that work team is giving out. Th ey see that their manager values them, and then the customers that they take care of on a daily, weekly or monthly

basis are more engaged with buying from that company. Th eir satis-faction levels are higher, and certainly those customers then become walking brand ambassadors for your company, because if someone were to ask, “Hey, I need this service, where should I go?” they’ll say, “Oh, well call Mike” or “Call Pete or Jane over here at XYZ Company, because they do a great job of taking care of me.”

In the light of the economic climate, can comparatively cheap rec-ognition and reward schemes take up the slack normally handled

by bonuses or raises? Companies have got to have the right base salary and

right package of benefi ts to attract someone to come work there and be competitive in the marketplace.

Now assuming that a company has that and they say, “All right, for the next year we can’t give a raise,” I think certainly recognition reward can play into how you help compensate someone for the raise you can’t give them, how you help

keep them engaged and valued. People will understand the challenges of

the economy going on at hand, but then compa-nies need to do a better job of talking about their

vision of that. But I think to engage them throughout the year with the recognition reward program certainly

yields a lot more results than a company that chooses to do nothing.

You’ve been in the business for quite a while. What are the biggest changes you’ve seen in the way recognition is handled?Technology is one of the biggest enhancements that can work for rec-ognition reward programs, but it can also work against it. With the younger workforce being so technology-enabled, its important for a company to make sure they keep up the investment of building out a technology solution that has a robust social networking element as a

part of that program. It might include e-cards that employees can send to each other, possibly not even for recognition, but maybe for some-body’s birthday, maybe someone’s anniversary, maybe for someone get-ting married, or having a child. It’s vital to keep evolving that program so that it’s a great way for people to go to that recognition reward portal to really be interactive in helping recognition of each other.

I think that’s one of the greatest enhancements but all recognition shouldn’t be electronic. It still needs to have a face-to-face element. You still need to have the verbal praise, it may be one-on-one and it may be in a group meeting, and getting managers to understand the right balance of what’s needed with that is always a challenge.

Managers that use the programs more

oft en have high retention and oft en

have higher customer satisfaction scores

“Th ere may be some hard measures and there could also be some soft measures in any type of program you do”


DCI ad:25 June 23/3/10 14:31 Page 14


truly appreciated? Aft er all research shows that one of the top behaviors of successful leaders is the ability to recognize the contribution of others. Given that many businesses wouldn’t be where they are today if it weren’t for the contribution of their employees, a little recognition doesn’t seem like a lot to ask.

Th is idea is nothing new of course, even Voltaire, the 18th century French writer and philosopher, could see the benefi ts of appreciation and is oft en quoted as having said: “Appreciation is a wonderful thing: It makes what is excellent in others belong to us as well.” Companies and HR professionals alike would do well to take note of this sentiment. It’s all very well to say that people are your greatest asset, but how many companies in reality actually live their values and treat their workforce as such?

Since 1995, the fi rst Friday of March has been set aside as Employee Appreciation Day. Created by a founding board member of Recognition Professionals International, this dedicated day is a way of focusing the attention of all em-ployers, in all industries on employee recognition.

Recognizing the achievements of employees is more than just a nice thing to do for them. It is also a communication tool and a powerful motivator that can help to enhance employee engagement, performance and retention – something that has become more impor-tant than ever since the economy took a turn for the worse.

And whilst a day dedicated to employee appreciation is a step in the right direction, surely the people who work for us deserve to have their achievements recognized far more than once a year if they are to feel

In an interview with our sister media channel MeetTheBoss TV, KFC’s Misty Reich explains the importance of building employee recognition into the company culture.

RECOGNITION

The power of recognition

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defi nes what it feels like to work here?” Th e number one response was appar-

ently “friendly”, closely followed by “supportive”. “Th ey talk

about it feeling like a family, with the added element of high levels of accountabil-ity. We believe in peoples’ capabilities and we trust in their positive inten-tions and their ability to get things done, so that’s why it feels quite sup-

portive,” explains Reich.Yum! is well aware that

its people don’t just play a role in its success – they are

the reason for its success. Con-sequently, the corporate values of

Yum! – otherwise known as the ‘How We Win Together Principles’ – are built

around a “People Capability First” philoso-phy in which recognition features highly. “As you go

around the world, the recognition element exists everywhere in Yum! globally, but the magnitude, the amplifi cation and how it comes across is diff erent,” says Reich.

But generally, the culture is already well defi ned and has eff ectively cascaded throughout the company so for Reich it’s not really a case of adapting it or changing it and she describes her role at KFC more as ‘keeper of the culture’. With this in mind, her top three priorities as far as HR goes are: great recruitment; great people development; and building a culture that makes people want to work for KFC and want to stay.

And things seem to be moving forward smoothly for Reich, although she did face some tough challenges when she fi rst came to the UK business. “In 2007 we didn’t recruit as a business, we had outsourced to recruitment agencies. We were using 23 agencies and were spending a lot of money. When you’re in a growth business, as an HR director, one of the things that you have to be able to do reliably and very well is recruit great talent and we weren’t doing that well,” says Reich ruefully.

“So one of the things that I did, and it was a big challenge, was start to shift the mindset of the business around what the HR team is meant to be focused on. Although we outsourced our recruitment at that time to agencies, we did all of the employee relations for our restaurants in-house, and what I wanted to do was turn that around. What we want to be famous for is great recruitment and people development. We need to do employee relations well, but we don’t need to be famous for that,” she asserts.

Reich explains that part of the challenge was to convince her HR team that they could be great recruiters and that recruitment could be brought in-house. Most of the team were employee relations specialists so what Reich was asking them to do represented a big shift . But she was convinced that nobody should be able to recruit for them better than their own HR team.

“One of the things that has to be true and has to be in place for you to

One company that certainly does is Yum! Brands, one of the world’s largest restaurant companies with more than 37,000 restaurants in over 110 countries and territo-ries. Amongst its well-known restaurant brands are KFC, Pizza Hut, Taco Bell and Long John Silver’s and its successful retail operations mean it is now ranked 239 on the Fortune 500 list.

Misty Reich is Vice President of Human Re-sources UK and Ireland for KFC and she says that a strong corporate culture is the foundation of Yum! Brands. “It impacts your performance day-to-day, it impacts whether you want to stay there, it impacts how you feel about the company and whether you want to invite other people to come to work there,” she says.

“In times like this, when you might be tightening the belt around pay, around rewards and benefi ts, or even training, for some companies, you would hope that you have a culture that’s sticky enough, that makes people want to stay and has them engaged. We like to talk about people falling in love with our company, and it takes a special cul-ture for people to stick with it when times get tough,” explains Reich.

To ensure that Yum! Brands could benefi t from this special culture, the company’s Chairman, David Novak, appointed himself the architect of company culture and built it from scratch. “When we spun out of Pep-siCo David Novak took eight or nine months out and actually went and met with what he thought were the best companies and took bits of the culture from each one of them to build ours,” explains Reich proudly.

And luckily for Yum! Novak didn’t forget the importance of recogni-tion. “Now our employees tell us that recognition is one of the highlights of our culture,” says Reich. “We believe that everybody – no matter what country they live in or how senior they are – likes to be recognized. And here at Yum! we do fun, silly, crazy recognition. Every leader in our company has a personal recognition award that represents something that they hold as a truth. So recognition is a hallmark that people would defi nitely mention,” she says assertively.

She goes on to talk about a recent poll that was conducted in which employees were asked “What are the one or two words that you feel best

"Given that many businesses wouldn’t be where they are today if it weren’t for the contribution of their employees, a little

recognition doesn’t seem like a lot to ask."

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got a 90-day plan to teach and help them to integrate into the culture and into the business,” says Reich.

She goes on to explain why KFC has adopted this strategy: “Firstly, because that makes them more successful once they come through that on-boarding process. And secondly, it teaches them how important it is to us that we be an organization that values learning, so much so that even the most senior executives in our business are going to pause for 90 days when they fi rst join and just focus on learning.”

So as far as Reich is concerned this is an integral part of her role. “It is very important to create an environment and a culture that values learning, that makes it safe to not know the answers, and recognizes and rewards people who are know-how gatherers and know-how builders.”

For those looking to move into more senior HR roles Reich has some valuable advice: “Know the business. To be a business leader you need to understand what is it that the business is trying to accomplish. From that point start talking about how the people resources in that business can drive towards that.”

But she also recommends any potential HR managers to avoid the bureaucracy of HR. “As HR professionals we get caught up in our jargon and focused on the policies and procedures. It’s important that you’re most focused on the business and being a business leader.”

recruit well from inside is that you have to have people recruiting for you who absolutely love your business,” says Reich. However, she does admit that there are some niche roles out there that her team will never be good at recruiting for as they do it so seldomly. In those cases it is important to have great partners in place that have been strategically selected and who share the passion and excitement about the business.

In order to facilitate this transition from outsourced recruitment to in-house recruitment, Reich had to spend a lot of time talking to the HR team and helping them to see that the end result was actually some-thing tangible. She also brought in specialist help to support what she was trying to achieve. “I brought the best recruiter from my recruitment team in the US business here for an eight-month assignment, and her only job was to teach my team how to recruit,” says Reich.

And it clearly worked as today KFC have a successful recruitment team and have brought recruitment in-house. Just over two years later Reich sees it as a signature diff erentiator. “We’re not perfect, but we see ourselves as great recruiters and people developers, and I think that’s been a big shift ,” she says.

People development, and obviously leadership development is some-thing that falls under the umbrella of responsibilities that Reich holds in her position as VP of Human Resources. To a certain extent, Reich believes that leadership is something that can be taught. “I learn every day as a leader. If I look back over the last six months, or over the last year at where I was as a leader and how I coach my team and the role that I play for them, I have changed dramatically, hopefully for the better,” she says.

“In our business we value know-how building as it’s one of our cul-tural principles and I think leaders can learn to be better leaders. One of the things that we believe is that in our company we all have to be focused on leading, developing and coaching leaders to be stronger.”

On the other hand, however, Reich says that although leadership can be taught, not everybody is cut out to be a leader. “In my experience people who don’t have self-awareness probably can’t develop beyond where they are,” she says. True leaders need to be capable of recognizing where their strengths lie, what their weaknesses are and be ready to learn and develop in those areas where they are lacking.

For Reich, recognizing employees with leadership potential and en-suring that they are given the opportunities to progress requires strong succession planning. “From an HR standpoint there’s a framework and infrastructure that helps us to identify people who are developing as leaders, gage how far along they are on that journey and identify where we think they can go,” says Reich.

One of the ways that KFC helps to develop its leadership talent is a thorough on-boarding process. “Executives are used to stepping in day one, trying to make an impact and demonstrate their value. But we’ve

"We’re not perfect, but we see ourselves as great recruiters and people developers,

and I think that’s been a big shift ,"

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More than 85 percent of all employees participated in the program to some extent, with more than 75 percent completing all three of the mini-mum requirements. Th e results demonstrate an exceptional response compared with typical corporate wellness programs that can generally expect to involve no more than 30 percent of their population with tra-ditional wellness off erings.

In addition to the great participation rates, the company was also able to accumulate aggregate data on specifi c risk areas for their popula-tion at large. Furthermore, eni was able to identify modifi able risk factors that most aff ected employees and focus programming to target topics that were of greatest concern.

Th e company also experienced an unexpected result from the con-centrated focus on a wellness program: a marked increase in EAP partici-

pation. Th e wellness program increased employees’ awareness of their existing personal assistant and clinical care management benefi ts, which eni also provides. Th ese services help to round out the well-ness benefi t. Engaging these off erings helps to de-crease work/life-balance-related stress and promotes emotional wellbeing – important aspects that fall under the umbrella of a holistic wellness approach.

Th e keys to the success of this program were highly individualized service, excellent promo-tion and a high level of management involvement. Th roughout the year, there was extensive promo-tion to make the program very visible to the em-ployees and encourage their involvement. Wellness Coordinators were readily available to assist with questions, via both phone and email, and HR representatives and frontline managers became in-formed and supportive advocates of the program.Employee response was overwhelming; positive feedback poured in from all over the country from employees who were excited about the new wellness initiative. Th ere was a wide range of positive feed-back with many expressing appreciation that their

employer was concerned about their health and wellbeing. Others noted that the program stimulated an awareness of previously unidentifi ed health risks that they will now be able to address.

PROJECTFOCUS

In January 2008, eni launched an in-depth wellness program designed to suit the needs of large business clients. Th e fl ag-ship program included a Fortune 500 leading provider of payroll and human resource services with more than 12,000 employees in more than 120 branch loca-tions across the nation.

By designing a customized, highly interactive wellness program, eni helped their client achieve amazing results. Participation levels exceeded 85 percent, a stellar fi gure compared to the average of 30 percent participation for wellness programs na-tionally. And while employees benefi ted personally from a successful wellness program, the company received relevant, actionable data to help reduce the costs of healthcare, absenteeism and other modifi -able factors.

Th e program began with a close collaboration between the eni team and members of their client’s staff to develop a program that would meet specifi c corporate goals while energizing and engaging em-ployees as individuals.

An incentive program spurred participation with genuinely valuable rewards, such as eligibility for lower healthcare deductibles and a points system that involved monetary rewards for higher-level participation.

Th e minimum requirement for participation was the completion of three steps: a blood screening event, an online Health Risk Assessment questionnaire, and a commitment to being a non-smoker or to signing up for a smoking cessation program sponsored by the company.

Th e program placed priority on helping each individual become more aware and active in pursuing a healthier way of life. All participants could access lessons, articles and resources through their individualized web portal, as well as receive live assistance from health professionals, including their health coaches and personal wellness coordinators.

Th e points tracker system was a key element that put employees in control of their own personal wellness programs. By logging on to a password-protected, personalized wellness homepage, participants were able to track their health related eff orts and to earn points throughout the year. Th ey earned points for a wide variety of activities, from staying up to date with appropriate medical screenings and attending health and well-ness seminars to working out on their own and meeting other fi tness goals. Employees earned monetary rewards based on their level of participation.

Gene Raymondi is the founder and Chief Executive Offi cer of eni. Over the past 25 years, Raymondi earned his reputation as an innovative leader and active pioneer in behavioral health delivery systems. He continues to create dynamic EAP, Wellness and work/life solutions that maximize employee engagement, wellbeing and productivity within large organizations across the nation.

WORKING OUTGene Raymondi on a wellness initiative that improved the health of both a company and its employees.

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HEALTHCAREREFORM


LOOKING AFTER THE LITTLE GUY

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Small businesses play an integral role in the US economy and have traditionally been a strong driver of job growth and innovation. However, they are at a distinct disadvantage when compared to larger companies due to the current US healthcare system, which imposes a heavy tax on small businesses and their employees.

Molly Brogan is VP of Public Aff airs at the National Small Business Association and knows all too well how the current healthcare system aff ects small business. In a survey conducted by NSBA recently, 69 per-cent of small businesses stated that they would like to be able to off er health insurance to their employees, but only 38 percent were actually in a position to do so.

Th e main obstacle that small businesses are faced with when trying to off er health insurance is of course cost. “It’s just so expensive, espe-cially for small businesses and it also changes on a very volatile basis,” says Brogan. “From one year to the next the average health insurance premium increase can be as much as 25 percent and this is simply not a cost that an employer is able to budget for as it changes so much de-pending on employee characteristics.”

She explains that the cost of health insurance can vary depending on the age of employees, the state of their health and, in some states, whether they are male or female. “Just trying to navigate and under-stand all of the complexities is very diffi cult, but fi rst and foremost, cost is the number one reason why small business can’t off er health insurance,” explains Brogan.

Th e reasons smaller companies fi nd it harder to off er health in-surance are manifold but amongst the most important are high broker fees, fi xed administrative costs and adverse selection. On average, small businesses pay up to 18 percent more per worker than large fi rms for the same health insurance policy, making them less likely to provide health insurance for their workers.

“Most large companies self-insure,” says Brogan. “Essentially what that means is that they carry any kind of expected risk on their own books. So in essence they are their own fi nancial backstop if some-body gets very sick. For small businesses, most of them have to go to an insurance company that provides that fi nancial backstop and when you’re using a third-party provider it’s typically more expensive.”

According to a report published in July 2009 by the President’s Council of Economic Advisors (CEA) entitled Th e Economic Eff ects of Healthcare Reform on Small Businesses and their Employees, only 49 percent of fi rms with three to nine workers and 78 percent of fi rms with 10 to 24 workers off ered any type of health insurance to their employees in 2008. In contrast, 99 percent of fi rms with more than 200 workers off ered health insurance.

Th e report also highlights the disparity between the numbers of employees at smaller and larger companies who have no health insur-

Molly Brogan of the NSBA explains how small businesses are affected by the current healthcare system and how healthcare reform could impact the workers they employ.

ance. It states that 29 percent of non-elderly adult workers at fi rms with fewer than 25 employees were uninsured in 2007, whilst just 10 percent of workers in fi rms with 500 or more employees were uninsured.

Brogan blames this on the fact that smaller companies face far greater volatility than their larger counterparts. “When you are a large company you have many more people to balance out the risk,” says Brogan. “So if you hire one person who is 60 years old and in poor health, it’s not going to impact your overall pool that much because you have, for example, 10,000 people in your pool. If you only have 10 in your pool, as a small company may, and you hire one person who’s 65 with poor health, that will cause the premiums for everybody to go up signifi cantly because there aren’t enough young, healthy workers in your pool to off set that older, less healthy worker.”

Problems like these have left unacceptable numbers of employees unable to access healthcare in this country. Statistics show that of the approximate 47 million uninsured people, roughly 20 million are small-business owners or employees. Furthermore, new analysis by the CEA shows that the current situation of rising costs and declining coverage is unsustainable for small business given that healthcare is currently cost-ing small businesses $1 billion in lost profi ts annually.

So faced with these circumstances, what can small fi rms do to ensure that they can off er health insurance to their employees? Well, as Brogan points out, many employers are now moving towards high- deductible health plans in conjunction with a health savings account. Th is means that both employers and employees can contribute to the savings account pre-tax. Th e limit for 2010 on how much can be saved is $5950, and all healthcare costs are paid out-of-pocket and then reim-bursed from the savings account.

Programs like these are becoming a popular option as they are typically cheaper for employers and allow them to shift more of the cost on to employees. Whilst this is helpful for employers, it does mean that employees must take greater responsibility for their own health-care. Th is is not always met with the greatest enthusiasm, considering that over the past decade, average annual family premiums for workers at small fi rms have increased by 123 percent, from $5700 in 1999 to $12700 in 2009.

Small business in the US More than half of people in the US private workforce – 70 million people – work for or run a small business, according to data from the US Small Business Administration Offi ce of Advocacy and the US Census Bureau. Since 1989, small business has created 93.5 percent of all net new jobs, totaling 21.9 million new jobs in the past 19 years – or 4000 jobs per day. Small businesses – those with less than 500 employees – comprise 99.7 percent of all US private employers, or 29.6 million businesses, and create more than half of US gross domestic product.



In many circumstances though, the employee taking responsibility for their own healthcare is certainly more appealing than the alter-native – reductions in headcounts, which is something that employ-ers are increasingly being forced to consider. “We do an economic report twice a year and we just published our 2009 year-end economic report in which we asked, ‘How have you coped with the rising cost of healthcare?’. When we asked the same question back in July of 2009, 15 percent said that they reduced their workforce. When we asked in December 2009, just six months later, that jumped up to 20 percent. So one in every fi ve small companies is having to lay workers off because of the cost of health insurance, which is startling,” says Brogan.

Although healthcare reform is nothing particularly new, Obama’s reform has the potential to dramatically improve the situation of small business in the US.

“I think it stands to have a signifi cant and positive impact, if they do it the right way,” says Brogan. “Some of the bills that we’ve seen most recently – the Senate bill and especially the House bill – don’t do any-thing to really reduce or contain costs for small businesses. Premiums will still be increasing. If there are decreases for a handful of businesses it’s going to be a very modest decrease, no more than three percent, the Congressional Budget Offi ce has estimated.”

Furthermore, not all of the proposals off er attractive solutions to the NSBA. For one, it has declared itself opposed to any mandated pay-or-play provisions that would encourage more employers to off er coverage and penalize those that do not by requiring them to pay into a pool to help subsidize the cost of coverage for the uninsured.

“First of all, we think it’s not a good policy idea. Th e whole con-cept of tying health insurance to your work was started back in the 1920s when that was seen as a good way to off er better compensation, without having to actually give cash out. As times have changed and as

Healthcare challenges

Sixty-nine percent of small businesses surveyed in 2008 said they want to offer health insurance, however only 38 percent were able to do so – down from 67 percent in 1995. According to a recent NSBA survey, 97 percent of small businesses have been subject to increased premiums since 2005. The ability to offer health insurance is creating a signifi cant competitive disadvantage for small fi rms, as 99 percent of large businesses offered health insurance in 2008.

Of the 47 million uninsured people in the US, roughly half are small-business owners or employees.

The cost of health insurance premiums has increased by 119 percent since 2001, far outpacing infl ation, which increased 29 percent. Since 2001, the very smallest companies, those with three to 24 employees, have experienced the highest premium increases of all US fi rms – often two to four percentage points higher than large businesses.

Due to a discrepancy in the tax code, self-employed individuals are prohibited from fully deducting their health insurance premiums, resulting in an additional 15.3 percent tax that no other individual is forced to pay. US families currently spend 26 percent of their annual family household income on health insurance, and projections show it will jump to 46 percent in 2016. Since 2005, more than one-fi fth of small businesses reported annual premium increases in excess of 20 percent. In 2008, 28 percent reported an increase in excess of 20 percent. The US spends roughly $2.4 trillion annually on healthcare, with employers dedicating 13 percent of their payroll to health insurance. In Japan, less than four percent of payroll is dedicated to health insurance. Fifty-eight percent of small businesses that reported premium rate increases were unable to provide employees with salary increases and 39 percent held off on hiring a new employee.

healthcare has become more and more expensive, it’s become a huge competitive disadvantage for small companies,” explains Brogan.

“What that basically means is that if you work for a big company then you’re getting a better benefi ts package, and more compensation. And that’s not really fair. Our organization believes ideologically that health insurance is something that ought to be driven by individuals and by consumers and not necessarily via employers,” she continues.

Th is represents the foundation of the reforms that Brogan and the NSBA would like to see introduced. “One of the key proposals that we’ve been talking about for the last six years is individual mandate. If you have everybody in the system – including younger, healthier people who are opting out because they don’t think that they are going to need any kind of major healthcare – then that balances all the diff erent risks of people of diff erent ages and diff erent health statuses.”

However, the NBSA is also a proponent of improved quality in the healthcare arena and supports more direct pay-for-performance plans. “We think the best way to pay for it is not through tax on Cadillac plans or a tax on the wealthy, but through limiting the deduction that people get on their health insurance,” says Brogan.

In addition, she would like to see the federal government playing a greater role in creating fair and reasonable rating rules as well as develop-ing a basic minimum plan that covers preventative care and hospitals.

Even though President Obama’s health reforms have now been signed into law, a number of questions remain. And as die-hard op-ponents against change continue to delay and obfuscate, the fi ght isn’t over yet. What is certain is that we are at least taking steps in the right direction. A US where healthcare was not reformed would be home to as many as 72 million uninsured people by 2040. While debate rumbles on about what this new bill could eventually cost, could we truly aff ord not to make changes?

Source: NSBA


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HRM readers submit their wellness questions to our panel of experts.

WELLNESSWORKSHOP

Michael Burcham, Onlife’s Executive Director,has over 25 years of experience in healthcare.In addition to a bachelor’s degree and MBA,Burcham has a doctoral degree in healthadministration from the Medical University ofSouth Carolina. He teaches HealthcareInnovation and Entrepreneurship in the OwenGraduate School of Management atVanderbilt University.

Adrian Stewart has two decades ofexperience in the healthcare and wellnessarenas. With his partner Travis Haws, hefounded WellVentures LLC in 1999 as apioneering strategy company in populationwellness and lifestyle change. He is thearchitect and designer of InTune, a highlyinnovative incentive wellness solution forlarge and small employers.

Dr. David Ellis is National Medical Directorfor UnitedHealthcare’s Customer Analysisand Solutions. Prior to this, he was SeniorMedical Director for North Texas andOklahoma, and before that practiced PrimaryCare Medicine in Texas. He studied at theUniversity of Toronto and completedresidency at Queen’s University. Dr. Ellis haspracticed in both the Canadian andAmerican healthcare systems.

Colleen Reilly is the President and Founder ofTotal Well-Being, a leading provider ofcomprehensive and turn-key corporatewellness program solutions. As a passionatelifestyle change advocate, Reilly has becomea sought-after expert, speaker andconsultant for organizations looking to turna wellness and benefit program into a first-class operation.

THE PANEL

Healthy debate

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Arlin K. Pauler, President, High Point Consulting asks: How do you choosethe right wellness program for your company? And why is company cul-ture important?Adrian Stewart. Wellness these days can mean anything from a pedometerto free flu shots. With HR resources already stretched most companies areturning to third party companies to help them.

The first step is to ensure you have a complete strategy, not one or twocomponents packaged as a comprehensive offering. It should have a full com-munications campaign to attract employees, make sure the lifestyle interven-tions being offered are action-based healthy living programs not just passiveinformation. Incentives fulfillment should be easy and built in. It should havecomprehensive measurement and reporting. Without these essential compo-nents already in place you will be challenged to get real outcomes.

The second step is to choose an approach that has some risk for theprovider on your employees’ participation. Make sure the deal is not neutralabout participation or even worse the provider has a built-in business incen-tive for people not to use their services.

Thirdly consider what sort of support your HR team is looking for in de-ploying and operating the program. Wellness is not an off-the-shelf strategy.It depends on reiteration and adapting to the information you find out aboutyour particular employee population. Evaluate how much resource yourprovider is willing to commit after the product is launched; will they workwith you on refining the strategy? You want a wellness partner who is goingto stick with you after launch.

Culture is important but it can also be an outcome of a successful well-ness strategy that the employees perceive as beneficial to their own lives andhealth. The right wellness strategy will enhance and build on existing cultur-al values of the company and represents an opportunity for the company tomake a strong statement to employees about what it values. The two go handin hand.

Colleen Reilly. While it’s important to have healthy, happy and engaged em-ployees to improve productivity and lower healthcare costs, it’s not that easyto do. But organizations that make wellness a part of their business philoso-phy are the ones that will see the returns. Below are some key elements to bet-ter understanding and building a culture of wellness.

Understand the dynamics of change. A key factor in implementing awellness program is the ability to enact change within an organization. Leadersat the organization need to view this change as necessary to succeed.

Plan a systematic approach for change. To implement an effective wellnessprogram, organizations must determine their employees’ readiness levels, ex-amine the population’s cultural elements, and communicate openly with em-ployees about the changes that will happen as a result of the new programs.

Create motivational tools. Nudging your employees to embrace a wellnessculture can be a challenge. However, if you have a white-collar industry with peo-ple on the move, a high-tech solution will be a better cultural fit, whereas a man-ufacturing environment may be better served with an on-site wellness program.

Incorporate team support into your program. Social relationships andteam-based support are integral in building a culture of wellness. For long-term benefits, all workplace wellness programs need to incorporate elementsthat focus on having individuals motivate and encourage one another.

Continue to make wellness a priority. Once a wellness program is im-plemented, examine its successes and areas for improvement and then adjustprogram components accordingly.

While helping to establish wellness programs for multiple companies invarious lines of business, I’ve learned that in one form or another, all of theseelements are essential to motivating an organization to effectively build well-ness into its culture and achieve positive change.

Michael Burcham. Choosing the right wellness program is essential to hav-ing both a healthy, engaged workforce and being able to reduce the trend ofescalating healthcare costs. But identifying the right program for your com-pany is no simple task. To provide a framework for this decision, use of theFOCUS model – Find, Organize, Clarify, Understand and Select – can helpclarify the process.

Find senior management support to set the vision and support the re-sources from which action plans flow. Genuine backing from senior person-nel also brings credibility to the wellness initiative. Organize the team todevelop and execute your program. Success is only achieved with internalchampions who work collaboratively with industry experts to keep your well-ness initiatives vibrant, meaningful to the participants and producing results.Clarify the data available. Begin with a structured health risk assessment andbiometric screenings for the staff, an assessment of the company culture tosupport wellness and a thorough evaluation of the workforce (remote, white-collar, factory, education levels, cultural biases). Understand the options thatare most likely to engage your employees. Through interest surveys, deter-mine which types of programs support the needs identified in ‘C’ that will pro-

duce results and be fun! Avoid ‘cookie-cutter’ programs. Offer variety: webtools, coaches, challenges, education and interaction. Select the partner andthe program elements that will best help you help your employees. Measureand monitor your progress. Take every opportunity to support the programboth in words and actions.

Unquestionably, poor health habits and chronic diseases rob individualsand families of their health and quality of life. They also represent major coststo employers in the form of healthcare and disability costs, lost productivity

“Take the time to thoughtfully designyour wellness initiative to ensure realengagement and real results”

Michael Burcham

“Employees who make healthylifestyle choices (big or small) can beon the road to healthier living whichmay result in fewer health claims”

David Ellis


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Emily Ernst, Lead Benefits Analyst, CACI, Inc. asks: Is there a place for so-cial networking in wellness? How can a support group of peers motivateand inspire people to participate? Colleen Reilly. Social networking is more than keeping in touch withfriends on Facebook or Twitter. It’s a great way to keep people motivated,online or off.

“People are connected, and so their health is connected,” says NicholasChristakis, MD, one of the leading medical researchers in the country. In astudy Dr. Christakis conducted with James H. Fowler, PhD, the researchersfound that an individual’s risk of becoming obese was much higher when aperson in his/her social network becomes obese. When a spouse is obese, theperson’s risk of becoming obese increases 37 percent. With an obese sibling,the person’s risk increases 40 percent, and with a mutual friend who is obese,the risk factor increases by 171 percent, according to the study entitled ‘TheSpread of Obesity in a Large Social Network Over 32 years’ published in theNew England Journal of Medicine.

Clearly, your social group can have a significant impact on yourhealth. But it doesn’t have to be a negative one. You can unleash the powerof social influence to change behavior, especially in workplace wellnessprograms where people spend 30 or more hours together each week.

Support groups and social networking can inspire participation in ac-tivities that lead to good health. ‘Walking Wednesdays’ is a wellness ini-tiative where employees are encouraged to stay active throughout theworkday by taking a walk outside during breaks. One rainy Wednesday,one of the walking team members sent out an email, encouraging thegroup to walk inside the building that day. The rain may have made iteasier to ignore their commitment that day, but the long train of walkerswinding through the office was infectious, encouraging all they passed tojoin in.

and absenteeism. Take the time to thoughtfully design your wellness initia-tive to ensure real engagement and real results.

David Ellis. Many organizations are turning to wellness programs to addressthe rising cost of healthcare; however, choosing the right one requiresmuch thought, planning and strategy. It’s important that a companychooses wellness programs that are culturally relevant and based on theirfive-to-10-year goals.

The first step is to understand your population’s health status and risks.An aggregate health assessment, a comprehensive review of claims data and

worksite wellness screenings can be key sources for evaluating risks and es-tablishing a baseline of your employee’s health.

Develop and implement a flexible multi-year worksite strategic plan thatis relevant to your company culture and risks. If your company is focused onmeasuring medical ROI, consider an outcome-based program that rewardsemployees for normal weight, blood pressure, cholesterol, etc. If your goal isretention and recruitment, rewards for participation may be a better fit.

Employees who make healthy lifestyle choices (big or small) can be onthe road to healthier living, which may result in fewer health claims.

“You can unleash the power of socialinfluence to change behavior,especially in workplace wellnessprograms” Colleen Reilly


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Creating healthy behavior isn’t easy, but if you utilize peer support andsocial networking, it isn’t impossible either.

Sheila McCarrey, HR, Amway asks: How do you overcome cultural resis-tance to wellness programs? David Ellis. There will be no return on investment if your employees don’tparticipate in your wellness program. Helping individuals become aware oftheir modifiable health risks and engaged in their personal health can be agreat way to affect change.

Visible support and participation from senior leadership is an important as-pect for building buy-in with employees as well as creating a cohesive wellnessteam within your employee population. Compelling communications early andoften are critical to success. It’s important to select interventions that are appro-priate for the workplace culture and set expectations for employee activation.

Incentives for participation can help engage and activate your employees toadopt the behaviors that may have the greatest impact on individual health. Andlastly, be sure to evaluate, measure, fine-tune the plan and celebrate successes.

Adrian Stewart. Studies bear out that cultural resistance stems from a num-ber of factors including poor communication, lack of resource commitment,and the ever popular ‘do what we say not what we do’ management approach,all of which undermine positive organizational objectives. Overcoming cultur-al resistance to a wellness program or any other initiative not only requireschanging or improving the factors above, but understanding that cultural re-sistance is a corporate fact of life and one to be acknowledged and embracedrather than ignored.

Some leaders embrace mandating employee participation in wellness inorder to remain eligible for health benefits. This approach does work, but thequestion to ask is whether this approach will produce more or less resistance, re-sentment and cultural divide. You may drive a high percentage of employees inthe direction you want, but research shows that there will be a cost. The most ob-vious penalty will be a significant participation decline in subsequent years. Yourdata may be less reliable because employees who feel imposed upon will see lowerintrinsic value of the information for themselves.

Principally, human beings respond much better to carrots than sticks.Inspiring rather than requiring participation will not only bear long-term pro-gram results, but will over time, help to remove cultural skepticism and an-

tagonism as employees become convinced of the organization’s commitmentand positive support.

If you have the right program and your leadership is committed to it per-sonally and professionally, then the single most important factor for overcom-ing cultural conflict will be simply staying the course! By remaining committed,serious and undeviating in your course, those forces working against you will re-lent as the naysayers eventually convert into champions. n


“Human beings respond much betterto carrots than sticks” Adrian Stewart


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United Health Care (DSP) ad:25 June 23/3/10 14:58 Page 15


Prevention is better than cure. Th ough such a senti-ment may appear to be self evident, it has taken quite a while for business to catch on. However, spurred by the

rising costs of healthcare, organizations are now starting to take notice. Once looked upon as little more than an insignifi cant element of a traditional treatment-focused healthcare of-fering, wellness programs are steadily gaining prominence. Even President Obama is exam-

Pitney Bowes’ Johnna

Torsone tells HRM that the company’s approach to employee wellbeing could offer a solution to the nation’s big healthcare questions.

WELLNESS

ining how wellness can be used to address the nation’s mounting healthcare woes.

But for Pitney Bowes’ EVP and Chief HR Offi cer Johnna Torsone, the benefi ts that well-ness can bring come as no surprise. For nearly a decade, the company has been refi ning its approach to employee healthcare, with every step taking it further from the old reactive model. Th e results show that a more proactive approach can reap big benefi ts. “Th at was the big thing that Pitney Bowes discovered,” says Torsone. “Now it’s everybody. Th ere are more

The best medicine

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of healthcare. Th ere’s only so much that those of us that are subsidizing healthcare can do to bring the cost down if individuals don’t cooper-ate with us. Th ere are things you can do to help make that happen, but ultimately there’s a joint responsibility here.”

Torsone is hopeful that the elevated profi le of the healthcare debate will have a big impact on the perception of wellness both inside and outside business. “It requires us to begin to educate our populace on a substantial scale about the kinds of things I’m talking about and really build their willingness to take part in that agenda,” she says. “Over time, our employees have learned this. As we bring new employees in, they come into this culture of health; and we hope that these are principles that will be embedded in them whether they stay at Pitney Bowes or they leave. We think that ultimately these principles have to be embedded in other parts of the system. Oth-erwise unless you keep people here for the long term, you don’t get the benefi t of it. Th at’s why we’re so evangelical about this. Because if they come into our workforce not having

been in similar struc-tures, then we’re start-ing from ground zero with them.”However, Torsone is strong in her conviction that the wellness-based approach to healthcare being pioneered by companies like Pitney Bowes off ers a viable model for a new national strategy. “I hope that any program, whether it’s public or private, should be following some of the principles that we’ve laid out,” she says. “In some of the cases where we have some very high cost

healthcare plans, which are not effi ciently designed nor structured to the type of incen-tives we’re talking about, they need to change because I don’t think they’re sustainable. I don’t think we can continue to not have the kind of effi cient focus that we do on health. If we don’t do it, whatever system it is, I don’t see it being sustainable.”

such as smoking cessation, weight reduction or even just promising to wear a seatbelt when driving. Perhaps most importantly, all this self-improvement is supported by a monetary incentive. You might think that being helped towards better health would be reward enough for participants, but Torsone argues that eff ec-tively changing ingrained attitudes requires a great deal of persuasion. “Th ere are some com-panies that have built penalties into their pro-

gram, for failure to do some of these things,” she says. “Up to now we’ve taken a diff erent approach to that. We’ve made it much more of a carrot as opposed to a stick.” But even with these incentives, making the shift to wellness is a slow process.

“None of these things, by the way, are things that work in a very short period of time,” she continues. “It takes time to build up to what we call a culture of health. It’s a relationship with employees over a period of time where they come to recognize that what you’re doing is designed to help them, not just the company. We’ve seen that in those instances where people have engaged in this and seen the results of it, the connection to the company is just astound-ing.”

Building this sense of connection is vital. Moving away from the old ‘take a pill and feel better’ ap-proach requires employees to understand the role they have to play. “Up until now we’ve believed that educa-tion, incentive and legitimate cost sharing is the best way to go,” says Torsone. “When employees can understand what things actually cost they can take responsibility for making sure they get the most effi cient use out of the system, not just us. We’re asking them to be a partner with us in this, and I think that’s the most important ele-ment of what is missing in the public discussion

and more companies that have recognized that. Th at was the ‘aha moment’ that Pitney Bowes came to in the early part of the century; we recognized that we needed to educate people. We needed to design our plans so that people would engage and be incentivized to engage in the healthy maintenance of those chronic diseases and undertake behaviors that would help them not get into those chronic diseases in the fi rst place.”

At the heart of Pitney Bowes’ plan is a targeted response to the most commonly oc-curring, and therefore most costly, illnesses that aff ect the workforce. “One of the chronic diseases that drove our cost was diabetes,” continues Torsone. “We knew that if people maintain themselves appropriately then the cost at the back end from complications of failing to keep their insulin levels at the re-quired amount would be signifi cantly higher. What we’ve done is we’ve tried to remove the barriers around cost to drugs and from pro-cedures that help them maintain themselves on chronic diseases like diabetes, asthma and high blood pressure. We’ve made it easier for them to stay on the appropriate medication to do that. As a result of that we’ve seen our cost for emergency room visits and signifi cant complications from those diseases go down.”

Key to making wellness pay is bringing the workforce on board. Employees need to know what value these programs can bring. “I would say it’s a combination of education, plan design, actual provision of services and subsidizing things like wellness visits, vac-cinations and screenings,” says Torsone. “We keep designing our plans to help discover problems before they become major issues so that employees can take responsibility for trying to stay healthier and trying to remove barriers around the utilization of tools and medications that will keep them productive and well as opposed to allowing it to get much more severe.”

Torsone tells us about Healthcare Uni-versity, a branded program designed to steer people down the path to better health. Employ-ees agree to focus on four or fi ve key points,

"It takes time to build up to what we call a culture of health"

Johnna Torsone is Executive VicePresident and Chief Human ResourcesOffi cer at Pitney Bowes Inc.

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TROUBLESHOOTER

Zachary Meyer says: It’s great that your districtrecognizes the importance of wellness pro-grams. Studies show that most Americans willget some form of chronic disease such as cancer,diabetes or cardiovascular disease in their lifetimeand most are caused by unhealthy, modifiable be-haviors. While changing behavior isn’t easy, it’sexactly where worksite wellness programs canmake a difference. Working with a vendor likeCeridian can enrich your existing program andimprove utilization and results.

For your school district or any business,illness prevention can be a significant cost-sav-ing strategy. And for employees, it’s a conve-nient way to stay healthy, happy and working.

It sounds like your greatest challenge isthat your home-grown wellness groups are lim-ited in reach and there’s not an effective way tomeasure success. You also have no way of as-sessing employee health risk factors.

There are, however, a lot of positive oppor-tunities in your situation too. Your administra-tion appears to be committed to funding andsupporting an employee health and wellness pro-

gram. Commitment by an organization’s leader-ship is critical to a program’s success. Further,employee interest in wellness appears to be high.

Partner with an organization like Ceridian tobuild a program that meshes your existing well-ness groups with programs that will better assessthe health of your employee population and ad-dress behavioral issues with health coaching.

The first step would be identifying aresource to be focused on the program

and accountable to the success. Yourschool district may even be able to

fund and hire an onsite wellness co-ordinator. Dedicating an employeeresource to manage the programwould further demonstrate thatthe administra-

tion is committed to creatinga culture of wellness.

The wellness coordinatorwould partner with a Ceridianaccount representative tochoose the right blend of pro-grams for your employee popu-lation. Having a dedicatedemployee with the sole respon-sibility of managing wellnessprograms is a huge step towardimplementing a program builtfor success.

The following Ceridianwellness program elementsare examples of what may beselected and implemented bythe school district:

Health risk assessment (HRA): The HRAidentifies overall strengths and weakness of theemployee population. You may want to offerthis a couple of time periods each year to en-sure everyone has a chance to participate. Afterreviewing the assessments, you may find thatyour district has a low incidence of employeeswith stress and who use tobacco, but a higher

incidence of challenges with weight manage-ment issues.

Outreach and engagement: HRA data is analyzedand the top 25 percent of employees with at-risk be-haviors are identified. Ceridian health coaches con-tact employees and ask them to enroll in a healthcoaching program. The identity of at-risk employeeswould be kept confidential from the school district.

Health coaching: Based on the assessment, you maywant to offer weight management, tobacco cessa-tion, stress management and cardiovascular healthcoaching programs.

Incentives program: Offering a generous incen-tive, such as cutting the annu-al health insurance premiumin half for employees who en-roll in, and complete, a healthcoaching program, can behighly effective. Incentives areanother critical component tobuilding a successful programand need to be built aroundyour goals and budget.

Measurement: Working withCeridian, you may determinethat you want to conduct a par-ticular number of biometricscreenings and health risk assess-ments as well as achieve a certainenrollment rate in the healthcoaching programs within the

first year after the program is launched. The key isdeveloping realistic goals upfront so that you knowwhat to measure and when.

The power of partnership: When partnering withCeridian, you can count on an effective working re-lationship with the power of our know-how on yourside. Together, we can tailor a program to help youcultivate a healthier, more productive workforce. ■

Kick-starting a wellness programHow do you orchestrate and enhance your existing wellness initiatives tobe more effective? Zachary Meyer tackles your questions.


Zachary Meyer is the ExecutiveVice President and GeneralManager of Ceridian Health &Productivity Solutions.

Ann from Illinois writes: “Our public school

district has about 1000 employees – mostly

women – who work in 15 schools that offer

full-year school programs and activities

from elementary through high school. We

have a couple of smaller programs already

(Fruit and Vegetables Club and a Biggest

Loser weight contest) but I don’t feel

like we’re reaching everyone. I’m also not

sure if we’re addressing the greatest

needs of our employees. How can we build a

better program, and how can I demon-

strate that the program is successful?”

Ceridian_TroubleShooter_17MAR10 29/03/2010 10:12 Page 82

Ceridian ad:25 June 23/3/10 14:30 Page 14


President and CEO of Th e Association for Pharmacy Benefi t Managers, has a clear perspective of the industry and how its evolution into the technological age is having an impact across the board.

“It’s extremely important to how we bring down costs,” Merrit asserts in relation to the rapid development of business technology. With the accelerated invention of technology in

the past decade, pharmacy benefi t managers (PBMs) have had to adapt both their market and methods to ensure they continue to deliver the results expected by their clients. Mark Merrit,

Mark Merrit maps the potential routes business technology could take in the name of PBM advancement.

PHARMACYBENEFITS

Real world changes

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“Chronic diseases need to be managed at the pharmacy level diff er-ent than acute situations. Most of the drug spending in America is on chronic medications relating to blood pressure and depression. Th ese are drugs that people are going to be taking for the rest of their lives. Many times they could get it much cheaper in a 90-day supply via mail coming to their home directly, as opposed to having to go to the drugstore every month to pick up their fi ll.

“Many employers are starting to think, ‘Why don’t we manage chronic and acute drugs diff erently and simply start people with home delivery for chronic medications and let them choose to opt out and go to a drugstore if they want to?’

“Another issue which is more of a physician issue is electronic pre-scribing, as I mentioned previously. It’s a great innovation; everybody

recognizes it, but only about 10 percent of physi-cians use it. Th ey’re much more comfortable simply hand-writing a script. It’s easier for doctors but it’s bad for patients and doctors, because the doctor never knows if the script got fi lled.”

With an estimate of about 30 percent of all prescriptions written by doctors never getting fi lled, the problem becomes exacerbated by the knock-on eff ect of doctors and physicians then not knowing how the patient is getting on. To combat this, the use of electronic prescribing not only tracks the pa-tient’s movement’s post-script, but aff ords doctors the knowledge of whether the patient collected their

prescription. However, the economic crisis over the past 12-18 months has had an impact on the PBM space.

“On the negative side, if there are fewer people with health benefi ts because they no longer have jobs, just on a business level that’s not help-ful to anybody, including us. On the other hand, as economic problems mount, companies are more likely to aggressively use the tools that we off er, such as mail service pharmacy, more generic utilization and so forth.

“Certainly policy-makers and politicians have been wanting newer ways to save money in all aspects of healthcare, including pharmacy. One of the challenges is oft en they look to political or ideological solutions as opposed to just fi nding out what works in the marketplace and using more of it. Our hope in programs like FEHBP, the Federal Employees Program, is that policy-makers will look at it as they have for years – it’s one of the best programs in America; very high consumer satisfaction among federal employees; no evidence that it is wasteful in any way and no evidence that it needs to be ‘fi xed’.”

Merrit’s hopes for the future remain simple yet true to the cause: “I hope that policy-makers would look at things that are broken, fi nd solutions that have already worked in the real world and try to imple-ment them more as opposed to meddling in ways that could be harmful in some programs that are working very well already.” It becomes clear that reform is an open issue; change is an open issue. But the bottom line remains: change will only be fully accepted if it is based on applied knowledge from the ‘real world’.

Mark Merrit is President and CEO of The Association for Pharmacy Benefi t Managers.

“Particularly with technologies like electronic prescribing. Th is enables patients and doctors to have medical records where all the diff erent drugs that they have been prescribed and all their many diff erent doctors are in one place. Th at allows massive safety improvements because then doctors can see if duplicate drugs have been administered or if unsafe drugs have been prescribed which are dangerous when in interaction with other drugs that some other doctor has prescribed.”

Indeed, there are huge cost savings available with electronic pre-scribing, as it reduces waste and duplication, and also helps doctors and the pharmacist the PBMs work with to observe when more generics are available. Moreover, the attraction of a 90-day supply or home delivery service provides further cost-saving tools. However, this doesn’t equate to an easier time for PBM providers.

“Some of the challenges are actually in the public policy arena. For instance, there is going to be geometrically greater use of expensive biotech medi-cines, which is going to transform the face of what America sees as pharmacy right now. Th ey won’t just be pills, they’ll be things taken intravenously through injection and other ways. Th e challenge is that these are very good, but very expensive prod-ucts; currently you’re not allowed to make generics of these.

“So, that literally costs hundreds of billions of dollars because you can’t drive any competi-tion for these drugs and the drug companies can charge whatever they feel like without any fear of being undercut by a competitor. So we do need what we’re calling biogenerics leg-islation, or legislation to allow generic biologies to be approved by the FDA.

“Th e broader challenge is that as the American population ages and as more medicine is focused not on invasive procedures but preventative procedures, the utilization is going up tremendously and there’s more reliance and more spending on drugs.”

Th us, the key to success will come from an ability to make sure that spending is undertaken in the most eff ective and effi cient way possible as the healthcare system continues to transform into more of a preventative model given the ongoing healthcare debate. But to what extent will this impact the PBM sector?

“Generally speaking, if there are more covered lives that’s good for PBMs because we can’t help people who don’t have insurance coverage,” Merrit continues. “Another thing is that there’s a mindset among human resources managers, CFOs and CEOs of companies where they have to get more modern about how to save money.

“In other words, a lot of people may want to get medications through home delivery, but many companies don’t pursue it that much; or they don’t realize the cost savings that are available; or they just take a passive approach to those kind of innovations because they’re not familiar with how rapidly things are changing in the pharmacy space.”

As such, human resources leaders are pushing for original think-ing to look at ways of utilizing cutting-edge technology tools; tools that are already available but not used as widely or eff ectively as they should be.

"there are huge cost savings available

with electronic prescribing, as it

reduces waste and duplication"

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EXECUTIVEINTERVIEW

What impact is the current debate about PBMpricing transparency having on providers? David Kwasny. RESTAT is taking transparency toits logical end point – cost plus. Pharmacies arevery excited about working with an independentPBM that will not compete with retailers by mi-grating prescriptions into a mail service ownedby the PBM. Pharmacies welcome the oppor-tunity to provide discounts that will actuallybenefit the payer/client as opposed to the PBM.They also relish the occasion to have the payerand member gain visibility to the price retailersmake available in order to effectively and openlycompete for business.

RESTAT’s model passes discounts to payersand frees the pharmacies to openly compete forbusiness based on the value proposition offeredby the pharmacy, beginning primarily on price.RESTAT is promoting ‘cost clarity’, where amember and a payer can clearly see that pharma-cies can differ on price and levels of service/con-venience, however being assumed that the patientoutcome is never in question.

Is it the responsibility of government or of pri-vate business to resolve issues surroundingpricing transparency?DK. RESTAT believes the free marketplace bearsresponsibility for resolving this issue but otherPBMs may require legislation to provide pricingtransparency. A new PBM pricing philosophy isrequired to address this issue and RESTAT is per-fectly positioned to execute this new strategy. RE-STAT is the only PBM in the country with theindependence and experience to deliver this pric-ing change and new reality. RESTAT is privatelyheld. We are not burdened with the legacy costsof a dispensing infrastructure (inventory, tech-nology, personnel). Lastly and most importantly,we’re independent. We have the trust of theproviders, which allows for sharing of sensitivepricing information without fear of reprisal oreconomic security.

price, value, convenience, etc. The pricing offeredis based on acquisition cost plus a profit marginand a dispensing fee. Pharmacies of varied set-tings and retail philosophies will compete by pric-ing their value proposition to the consumerclearly and appropriately. Our goal is to fostercompetition openly based on the merits of theconsumer experience. A member can choose a24-hour pharmacy, a pharmacy conveniently lo-cated, a pharmacy with a drive-through window,a pharmacy with a walk-in clinic, one with a gro-cery, or in a discount setting. The choice made bythe member will be made based on their need andtheir desire to invest their time and co-pay dollarsappropriately and in an equitable exchange forvalue. The member/consumer will make thisvalue election, not unlike any other consumerpurchase. It is RESTAT’s goal to furnish the con-sumer with all relevant information to make aninformed empowered economic decision. n

Crystal clear costDavid Kwasny discusses the need for greater PBM pricing transparencyand the benefits that this can bring.


David Kwasny RPh, was promoted to President of RESTAT in 2009 after having served as VP of Sales since 1997.Prior to joining RESTAT, Kwasny worked for ProVantage, Script Card and Health Care Pharmacy Providers and forthe Kmart Corporation’s AmeriKind Pharmacy Network. He graduated from Temple University School ofPharmacy in Philadelphia, PA, and was inducted into the school’s Gallery of Success in 2007.

What benefit can businesses and their peopleexperience when they opt for a PBM optionwith a more collaborative approach?DK. The client’s needs and the needs of theirmembers, coupled with the needs of the pharma-cies providers, become aligned so that everyonebenefits. Cost clarity is provided along with thepositive outcomes that are assured from pharma-ceuticals. Previously, only the outcome was as-sured. Now a member can access cost plustransparent pricing to go along with their highquality prescription medication, whether it isfilled at the Mayo Clinic or Wal-Mart. Everyonebenefits with the Align model.

Can users expect to get the same quality ofservices from plans such as this?DK. Absolutely. Employers and members can se-lect and determine the experience they prefer.Pharmacies are given a chance to compete on

Restat_ExecInt_17MAR10 29/03/2010 10:20 Page 86

Restat ad:25 June 23/3/10 14:48 Page 14

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Human Resources ManagementIf people are a company’s biggest asset, then it is essential to know how best to deal with them. Crafting an effective workforce fi t for today’s ever-shifting business environment requires knowledge of everything from recognition, benefi ts and health coverage, to technology and personal development. With news, opinion and analysis from top executives and experts, HR Management is a vital source of information for people professionals at all levels.

Next Generation PharmaceuticalApproximately 50 percent of new drug development fails in the late stages of phase ||| – while the cost of getting a drug to market continues to rise. NGP features interviews with pharmaceutical experts from the discovery, technology, business, outsourcing and manufacturing sectors. It is committed to providing information for every step of the pharmaceutical development path.Available for: US, EU

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cataloguepage.indd 88cataloguepage.indd 88 29/3/10 10:20:4129/3/10 10:20:41


ASK THEEXPERT

Escalating healthcare costs are outpac-ing inflation at an alarming rate.Obesity and diabetes trends in the USand a related lack of patient awareness

and engagement will continue to fuel cost in-creases and ultimately bankrupt our healthcaresystem. More than a third of Americans are obeseand nearly 57 million individuals are pre-diabet-ic. The cost of care for these conditions representsa significant financial burden to individuals, fam-ilies, and businesses.

To curb long-term medical costs, a growingnumber of organizations have begun to adoptwellness programs. In 2008, 77 percent of em-ployers offered some form of a health and well-ness program to their employees. The wellnessstrategy spectrum is broad but the common ob-jective is to encourage personal recognition ofhealth risks and personal responsibility for be-havior to improve an individual’s health statusand reduce long-term expenses.

Wellness programs come in many formsfrom simple models that offer health assessments,biometric screening opportunities and wellnessbenefits to more advanced models that bifurcatepopulations based on health status and personalbehavior and offer financial incentives for follow-ing evidence-based care standards and clinicaloutcomes.

The health reform legislation recently passedby Congress recognizes the potential benefits ofactive investment in wellness and takes steps topromote advanced wellness initiatives. Both the

Senate and House bills provide grants to em-ployers for the establishment and adoption ofwellness programs. Likewise, both bills createcommunity task forces that would identify anddisseminate evidence-based recommendations onthe use of clinical and community prevention ser-vices. Once implemented, this legislation will im-prove the delivery of preventive healthcare andsecure greater participation from Americans na-tionwide. Healthcare consumers have alreadydemonstrated widespread support for wellness ini-tiatives – among those em-ployed full or part time, 82percent report feeling positiveabout employer-sponsoredwellness programs.

In designing an effectivewellness program, employersmust carefully consider theprogram’s target populationand incentives. Program cre-ators should determine whobenefits most from a wellnessinitiative, whether that be alleligible individuals, or high-cost populations – those withthe greatest immediate re-turns.

Additionally, wellnessinitiatives should be struc-tured such that employeesare inclined to assume re-sponsibility for their person-al health and wellbeing. Insome cases incentives maynot be necessary; in othersthey may be part of a yearly plan, or included asan outside reward. It’s important to note that suc-cessful wellness programs do not yield instantgratification. It takes time to change behavior.Implementation requires as much thought, plan-ning and strategy as any other organizational ini-tiative. To that end, UnitedHealth Group has

identified a series of best practices that help orga-nizations build, expand and grow a successfulwellness program.

Firstly, it is important to assess your popula-tion and design plans that cater to its specifichealth risks, status and readiness to change. Next,it is necessary to secure leadership commitment,support and participation for the program andvisibly invest in wellness initiatives at the highestlevel of an organization.

Building a program that focuses on behav-ior change across the health-care continuum will allow youto engage all participants inbehavior change, regardless ofhealth status. You should alsoleverage data to proactivelyidentify health risks and per-sonalize programs. This datacan be used for analysis to de-velop personalized actionplans that address all factorsthat influence behavior.

It is also necessary to devel-op compelling communicationsand incentives and to create in-centives that are appropriateand effective. Furthermore, it isimportant to create a culture ofhealth in which health and well-being are promoted through avariety of channels; use healthportals to keep members en-gaged and aware. Finally, youneed to openly track and evalu-ate results and progress in order

to motivate participants.Wellness programs are a critical component

of a modernized healthcare system. These pro-grams manage costs while helping employees livehealthier, happier lives. Over time, expanding of-ferings and incentives will give way to a work-place culture of true wellness. n

Wellness worksTom Beauregard explains how wellness programs can play a

meaningful role in health reform and help lower costs.

Tom Beauregard is an ExecutiveVice President of UnitedHealthGroup and the Executive Directorof the UnitedHealth Center forHealth Reform & Modernization.

Prior to UnitedHealth Group,Beauregard was the NationalPractice Leader for HewittAssociates. He has over 20 yearsof healthcare leadershipexperience and is one of theindustry’s leading experts on theforefront of dramatic change.

“Wellness initiatives should bestructured such that employees areinclined to assume responsibilityfor their personal health andwellbeing. In some cases incentivesmay not be necessary”

UnitedHealthcare_ATE_17MAR10 29/03/2010 10:22 Page 89


Hans-Jürgen Bill tells HRM about the human implications of turning two companies into one and why job titles just aren’t that important.

When Nokia Networks and Siemens Communications joined together to form Nokia Siemens Networks in 2007 the company instantly became one of the largest communication organizations in the world. Not only

that, it also required that two workforces numbering tens of thousands of people in more than a hundred countries had to somehow form a seam-less whole. Th ough some of this work had been done by the time Hans-

Jürgen Bill became Head of Human Resources in 2009, there remained plenty of work to do. It’s a task that would have been daunting for even the most seasoned people professional. For Bill, the test was even greater. Despite a long and distinguished career in the communications industry, this is Bill’s fi rst HR role.

One of the biggest challenges of this new role is the continuing integration of workforces from two very diff erent organizations, on a

Making connections

FEATURE

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worldwide scale. Adrian McLean, a consultant hired by the new company to help facilitate cul-tural change, likened the merging organizations to a shoal of fi sh and super tanker. “In Nokia the dominant image was of a shoal of fi sh,” McLean said. “What this represented was the values-driven, self-organizing capacity inside Nokia. A lot of people had a sense of having freedom, but the coordination occurs through adherence to some strongly felt and shared values.” Th e driving force within Nokia was teamwork, with far less emphasis on the individual. By contrast Siemens, with its more rigid and hierarchical structure, represented the tanker, moving forward with power and momentum and possessed of numer-ous fl oors and levels.

According to Bill, the new organization is es-sentially a blend of its two parents. “It has more fl exibility than the super tanker, but a little bit more order than the shoal of fi sh,” he states. “But we are moving into some new fi elds. We are de-veloping as a known company, with a heritage of two fi ne companies. We have our own values and our own company setup and our own company understanding.”

Merging these two entities into an eff ec-tive whole was a process that involved a certain amount of pain. Layoff s were unavoidable, with around 10,000 existing staff leaving Nokia Sie-mens Networks since its 2007 foundation. On the fl ip side, 15,000 new people have since joined the organization. Th ough this process has undoubt-edly caused a great deal of upheaval, Bill believes that there have been upsides. “I even think it is rather positive that you have this kind of ex-

change of people, so that you get new ideas in,” he says. “When you look where we have hired people, specifi cally in the areas where our markets are still growing, like India, China, the US and some other parts of the world like South America, that has been an advantage.

“We also have to change the business, in that we are transforming from more a system and equipment led business, into a soft ware and ser-vices led business, which obviously also requires diff erent skill sets and diff erent capabilities and competencies of people.”

Nonetheless, for those employees who weren’t new recruits, the obstacles of instilling an entirely new culture remained. Bill seems largely unfazed by what looks like a major challenge, instead viewing it as simply another component of business development. “I believe that cultural change or mindset change is an ongoing task for each and every company, specifi cally in the fast changing environment that we are in as Nokia Siemens Networks.

“Of course, when you do an integration kind of merger there are some specifi c topics you need to look at. But generally, you need to con-tinue with that. Th e market is changing. Th e environment is changing. You need to adapt your capabilities, your competencies, the specifi c topics you’re looking at in the company, your focus area. From this point of view, transformation is an ongoing topic. I’m quite sure that it never ends. And the environment we are in today is defi nitely diff erent from

Hans-Jürgen Bill was appointed Head of Human Resources, Nokia Siemens Networks, on 20 April 2009. Prior to this role Bill was Head of West South Europe region for the company. In that role, he led the company’s operations and activities in a diverse market comprising of 30 countries, working with many of the world’s largest global operators. He held this position since the formation of Nokia Siemens Networks in April 2007, building a strong team and organization for the region.

Prior to Nokia Siemens Networks, Bill held a range of diverse roles at Siemens which he joined in 1983. From 1994, he was Head of Siemens Mobile Networks in Indonesia. In 1998, he became Head of Region Central-East and North Europe for Siemens Mobile Networks and then served as Head of Operations and later as Head of Asia Pacifi c for Siemens Mobile Networks.

“I believe that cultural change or mindset change is an ongoing task for each and every company”Hans-Jürgen Bill



a huge impact on the overall strategy,” he says. “We are part of the strategy and we are part of the business. We are support-ing the business. With the right talent interaction and retention, with the right values, with the right leadership, I think there is a huge impact on the overall company strategy. Th at is what we are doing daily. We obviously have kind of a people agenda, which is a base for and also, part of the overall Nokia Siemens Networks strategy. It’s a very important cornerstone.”

Bill’s view of business and HR being inextricably linked comes as no surprise. With a degree in telecommunications and economics and numerous previous management roles at NSN and Siemens, he is an HR executive with an unusually strong grounding in the corporate world. “HR should be part of the business and HR should support the business,” says Bill. “One of the preconditions for that is that you understand the business you are in. We think that here, it’s an advantage, that somebody coming from the business and understanding the business is also driving the human resources part of the

company, and would contribute more to the success of the company.” But could there be disadvantages to someone without specifi c people

experience being in a role like this? “Somebody not coming from an HR function is not very knowledgable about all the HR processes, all the HR needs,” concedes Bill. “At the beginning, that is something somebody ob-viously needs to learn. But we have a lot of HR professionals within Nokia Siemens Networks who are defi nitely covering all these topics as well.”

the environment that was there when we made the decision to go into this merger.”

Bill identifi es the move into this new busi-ness environment as a far bigger hurdle than simple cultural alignment. Th e requirement to eff ectively balance immediate and future goals is central to being prepared for what-ever lies further down the road. “At the end of the day, you need to fi nd the right balance between short-term and long-term measures and short-term and long-term success,” he explains. “Each company needs to survive in the short-term as well, and that is what we are trying to balance out with diff erent incentive systems we have on the short-term and long-term view.

“But what is even more important, from my point of view, is that we’re also balancing the ‘what’ part and the ‘how’ part in our per-formance evaluation for our leaders within the company. So we have, on one side, a focus on the ‘what’ part. Th at’s the numbers, the mile-stones, the revenues, whatever you’re judging there. Th e ‘how’ part is the behavior of the leaders. And the behavior is, of course, some-thing that needs to be very sustainable, at the end of the day. What we’re doing is to balance that out. So that means if somebody is good at the ‘what’ part, but not good at the ‘how’ part, he is not going to be successful within this company in the long-term.”

People powerA constant question asked of HR leaders is how much their work

truly aff ects the wider actions of the business. Bill is adamant that he has a major part to play. “I think the human resources department has

NOKIA SIEMENS NETWORKS – BIG NUMBERS

Global network, local approach

How Nokia Siemens Networks handles its worldwide workforce, accoding to Hans-Jürgen Bill

“The challenge is that on one side, you need a global set of values, a global set of measures for the entire workforce that you have throughout the company. But you also need to be regionally relevant. So, of course, you can’t compare people in China with people in the UK, for example.

“A different setup is needed there, different requirements in terms of developing the people in a different environment, and in a more or less competitive environment. We try to get a balance between our global and regional requirements and needs.

“For example, we don’t have global research. These kinds of things we do on a very regional level. So we have different regions within the country, and we try to adapt to the needs of the local workforce.”

Serves 600 communication service providers globally

1.5 billion people connect

through the company’s

networks

More than 60,000

employees in 150 countries



A top priority for Bill’s HR organization is foster-ing talent and ensuring that the Nokia Siemens Net-works’ internal population mirrors that of the many territories in which the company operates. “One of the major topics is defi nitely leadership,” he says. “We think that it’s going to change a company, and that it’s defi nitely needed to transform a company into the new areas where you are active. Th e second point is talent, which also takes in diversity. We’re investing more in gender diversity. And though we aren’t perfect on national diversity, we are doing quite well in that area. Looking into our executive board, for example, we have six diff erent nationalities within this executive board. We are also investing in youth. So getting new people on board, having close cooperation with uni-versities in diff erent countries of the world. It’s also an investment being active in this. At the end of the day, I think what is necessary is that you have a balanced workforce with experienced people and with younger people who have more drive. And that is what makes a company succesful in the medium and long-term.”

Despite this interest in fi nding and supporting the next generation of workers, Bill believes that de-mographic issues are not the most important when it comes to having a cohesive and eff ective workforce. “From my point of view, it’s very much based on the values we have as a company,” he says. “Th at is inde-pendent of whether somebody has been in the com-pany for a couple of years already, or is just joining new. We feel that people appreciate that this company has values, and that we live the values as much as we can. And it’s also a bit dependent on the growth areas we see in the diff erent regions of the world. Th at also means that we’re shift ing workforce into the areas where we’re doing more business, where there is more growth. Specifi c to the growing service business is that it’s a very regional, a very local business, so service people need to be close to our customers. I wouldn’t say that it’s really an age issue, in terms of that. It’s rather an issue of where your business is located or where your growth areas are.”

What’s in a name?One of the more unusual features of Nokia Siemens Networks’ orga-

nizational structure is the way it has done away with much of the hierar-chy of job titles that has come to characterize the corporate environment in so many companies. In its place is a far more streamlined set of roles that apply across the entire business. While this process was largely wel-comed, it did run into resistance in certain areas, notably the US where attachment to the tangled network of SVPs, EVPs, Presidents and Chair-men was more profound. “It was an issue,” Bill explains. “If you do such a major cultural change, you will inevitably fi nd some resistance. Th ere were some areas and some regions in the world where people were very

To outsource or not to outsource – that is the question

“It’s a huge word “outsourcing.” HR plays a very important role in drivingthe strategy of a company, so I wouldn’t outsource that generally. But thereare specifi c fi elds where outsourcing could make sense and that we’relooking at. For example, it isn’t essential to have your payrolladministration within the company. We’re looking into other fi elds where itmakes economic sense for the company. “But there are some areas where, from my point of view, it simply doesn’tmake sense, so HR needs to understand the business. If you want to selectthe right people and promote the right leadership skills for your company,then you should know the company and the requirements of the business andthe customers.”

much used to these kinds of titles. We had quite a clear line on it at the beginning, though we were also making certain exceptions.”

Ultimately though, time was invaluable in people settling into this new structural culture. “Time really helped us very much here,” Bill continues. “People just developed into it. What really counts is the com-petency of your business partner – and not the title. Our customers got used to it. Our sales – which are equally important – got used to handling this no title policy. Th ere might be still some areas in the world where we have the odd exception. But I think with 90 percent of the company, we are defi nitely handling that, as it fi ts to our culture. And at the end of the day, it’s not so important what’s on your business card, but what you can deliver, and what your contribution is to your customers’ success.”

In or out?


REASSESSING RECRUITMENT


Kay Kennedy, President ofIACPR, offers her advice on howrecruitment professionals canlearn from the economicdownturn and how they shouldbe approaching the recovery.

STAFFING

In what ways has the economic downturn affected the professional re-cruitment industry and what lessons have recruitment professionalslearned from this experience?Kay Kennedy. Corporate recruitment professionals have learned that a soundperformance measurement process is critical, whatever the economic situa-tion. Yes, a strong, tested system is essential when looking at promotions andraises – but it is even more valuable when a corporation is considering lay offs.Good performance measurement – applied consistently by knowledgeablemanagers – can help support better and fairer decision-making.

Retained search professionals have had it forcefully brought home that youcan’t neglect marketing efforts when times are good, no matter how busy youare, and that you need to have a diverse client base so that you’re not overly de-pendent on any one client for work. Many firms have also been using the slow-er business environment to take a hard look at their quality control processes andoperations – a chance to improve how they go to market and execute.

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The past year or so has been very difficult for recruitment professionalseverywhere as many companies have been forced to downsize. In whatways have recruitment professionals been able to help ease this transition?KK. For corporate recruitment professionals, the challenge has been how to helpdownsized executives move forward when company budgets are very con-strained, so that formal outplacement services or termination packages are keptto the minimum. In many cases, companies have turned to long-term retainedsearch partners and asked them to help these executives make the next move.From candidates, corporations and search firms, I am hearing about close col-laboration – and a real sense that right now we all need to help each other.

When downsizing occurs, the remaining employees are often expectedto maintain levels of productivity with fewer resources. How importantis it in this situation to ensure employee engagement?KK. There is research that shows that productivity in a severely downsized de-partment suffers more from low morale than lack of resources, even threemonths after the downsizing. It does a company no good to tell half-truths orignore the pressing issues. The message to those leaving, to those remaining,to shareholders and vendors, and to the community at large must be sincere,based on the truth, forward-looking and repeated often. What can be expect-ed in the next weeks and months? What is the company doing to support past,current and future employees? How will the company be moving on? Sugarcoating is not the answer – and simply feeds damaging rumors.

During the economic downturn, many employers chose to scale back theirgraduate recruitment plans in order to create short-term cost savings. Whatimpact will this have on those companies as we emerge from recession?KK. Whether it’s bringing in new talent or supporting those executives alreadyin place, companies can’t lose sight of the long term. It’s easy to get boggeddown in day-to-day problems and immediate solutions – but developing greatleaders and implementing strong talent practices are still essential to organi-zational success, in up times or down. Firms that don’t have a strategic visionfor how they will be building exceptional leadership, today and down the road,will seriously lag behind their competitors.

Recent research by PricewaterhouseCoopers has revealed that manyonce-powerful employer brands may be unable to attract top talent in

the next decade due to the eroded bonds of trust that the economicdownturn created between them and their employees. Do you think thisis the case? KK. I don’t think companies will feel the impact immediately – too many peo-ple are still out of work. But as disgruntled employees leave and strong talentat the executive level is more at a premium, an eroded employment brand willbe an issue. Those companies that have treated their employees with dignityand respect – whether it’s helping ease a transition or making sure those whostay are fully engaged and their concerns heard – won’t feel the heat. Thosecorporations that have been less than candid in their dealings with employ-ees at all levels need to act now to “right the wrongs.” But you don’t becomea “most admired” company with a few quick fixes – there needs to be a con-sistent commitment to your employees.

What considerations should a downsized organization engage in beforere-staffing in response to improved economic conditions?KK. Many companies are hiring on a temporary basis – part-time employeesor hourly consultants – before making a commitment to full-time positions.This helps ease the current burden of what can be overwhelming workloads– and also allows corporations to see how an executive might fit long-termwith a corporation’s goals. I am hearing of more and more of these “interim”employees moving into full-time positions.

How has the development and evolution of Web 2.0 and social mediaaffected the professional recruitment arena?KK. LinkedIn, Twitter, YouTube, Facebook and all the rest have tens of millionsof participants. And, as companies and employees are populating the new socialmedia in droves, search firms and corporations alike are turning to these sameplatforms to help identify and provide background on potential candidates.However, firms need to have best practices in place for engaging with thesemedia and institute formulized policies that could hold up to legal scrutiny,whether you are using the media to promote your firm or to source candidates.

We face major shifts in demographics over the next few years and estimatessuggest that within a decade or so there will be up to four different genera-tions in the workforce. How will recruitment professionals have to adapt theirpractices in order to best communicate with these different groups?KK. I think most firms are already reaching out to younger candidates in newways – like through social media – to identify potential candidates and mar-ket new positions. But nothing can replace in-depth interviewing skills, strongassessment techniques and thorough background checks – these are the foun-dations of any successful search. n

“It’s easy to get bogged down in day-to-dayproblems – but developing great leadersand implementing strong talent practicesare still essential to organizational success”

The International Association for Corporate & Professional Recruitment (IACPR) is aprofessional organization bringing together the corporate recruitment and retainedsearch communities to share best practices in an environment of trust and confidentiality.

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adecco ad:25 June 23/3/10 14:20 Page 14

However, what Wheeler refers to is the corporate model of an ATS; it neglects to take into consideration the relationships and intangible traits of people. Th is means that there is usually no way to gather and retrieve information about people who have not expressed an interest in a specifi c job. “Th ere are a few systems, however,” continues Wheeler, “that are based on another and more useful philosophy that people and relationships are central to recruiting.

“Th e agency world has been using tools that are more aligned to the relationship philosophy for some time now. Th ey use Applicant Track-ing Systems that are designed to facilitate relationships, store contact

information and regularly communicate with candidates. Historically, HR and corporate recruiting has little interest in relationships of ‘sell-ing’ jobs or people, and more interest in process and the ability to meet legal challenges.

“Th e agency world, on the other hand, has been built on relation-ship development and candidate communication. Th ey oft en do not

RECRUITMENT

People are the primary asset to any organization. Granted that may seem like an overly obvious statement to make, yet many companies oft en begin to blur those boundaries when recruiting. People can become words on a resume, dissected to the ‘n-th’ degree, which is understandable

considering the potential investment an employer is about to make. How-ever, what has become clear to many recruiters throughout the years of interviewing and placing candidates is that the ‘perfect candidate’ does not exist. Th ere are too many comparable factors to include: a balancing act of strengths versus weaknesses; a recruiter’s wish-list that will never be fulfi lled; and of course the sheer volume of applicants that is too time-consuming to look through.

With the acceleration of business technology and management sys-tems in the past decade, the search for that elusive candidate is back on track – but now with more realistic parameters. Welcome to the world of the Applicant Tracking System (ATS).

Now, one could wonder why a recruiter would want a soft ware system to track an applicant as opposed to purely fi nding the right person for the job? But the name is refl ective of what these tools are de-signed to do. Kevin Wheeler, President and Founder of Global Learning Resources Inc., explains: “Th eir primary purpose is to store resumes, retrieve them through search engines based on keywords and track a candidate’s progress through telephone screens, interviews, and either an off er or a rejection. In fact, all the most popular Applicant Tracking Systems are designed around the philosophy that the resume is central to recruiting. Th ese systems enable the resume to be stored, retrieved and matched against a requisition.”

Back on trackA look at the two main philosophies prevalent in the world of Applicant Tracking Systems.

“All the most popular Applicant Tracking Systems are designed around the philosophy that the resume is central to recruiting. Th ese systems enable the resume to be stored, retrieved and matched against a requisition”


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bother with resume storage, and instead keep track of potential candidates’ contact information and a few notes about the candidates to help in their communica-tion and to jog their memory about them. When the need arises, they search through their notes and past communications to potential candidates and, when they fi nd a potential fi t, they re-establish contact and request a resume.”

Fortunately, this is slowly becoming the model corporate recruiters are using. Th is is fortunate for two main reasons. Th e fi rst is that the agency model can obtain candidates far quicker, and do so based on ‘talent pools’ and understanding the needs of the business. Secondly, matching humans to jobs requires a certain amount of fl exibility – something databases are not equipped to provide. Furthermore, corpo-rate recruiters oft en spend vast amounts of time looking at resumes they will never use, and then storing them in their ATS. Whilst this is done more for legal com-pliance than anything else, it still causes unnecessary time-costs and ineffi ciencies within the process.

Conversely, agencies rarely search resume databases or try to match requi-sitions to resumes. “Th is is a futile eff ort for the most part,” asserts Wheeler, “because hiring managers are never sure of exactly what they want and expect to be infl uenced by candidates and recruiters. A well-executed recruiting model assumes that matches

are inexact and that candidates who meet the critical requirements but lack other requirements maybe the preferred choice.”

Th us, we return to the idea of the new ‘perfect candidate’. Someone who fulfi ls the general competencies whilst maybe lacking in other desirables will become more of an asset to an employer in the long-term as they still have space to grow, learn and progress. More importantly, this oft en fosters a new-found loyalty for an employer – one who has nurtured ability, developed strengths and helped to shake off prior weaknesses. Th is is certainly a principle that a sound recruiter will understand when utilizing the advantages of an ATS.

As such, instead of looking for that ‘perfect candidate’ who fi ts a precise need, recruiters will store information on a wide variety of people who may be a fi t for future positions. As needs arise, they can scan their contacts list, make phone calls and are led to an appropriate candidate very quickly. Moreover, by using their per-suasive powers, they also infl uence hiring managers to consider candidates who would otherwise have been passed over be-cause they were not exact matches to a req-uisition. In relation to this, Wheeler states: “Tools that provide fl exibility in data entry,

allow networking and candidate communication and allow recruiters to make ‘fuzzy’ matches to candidates will emerge as the winners in the overcrowded ATS marketplace.”

Top fi ve things to look for in an Applicant Tracking System

1. Flexibility: An ATS should be confi gurable to work within your established process rather than force you to make compromises. Your needs should dictate the type of data captured.

2. Functionality: A good ATS will allow you to quickly and easily unlock its potential. The best ones will integrate candidate assessment tools and direct job board posting and can even predict which job boards will be most effective.

3. Affordability: An ATS should pay for itself, reducing both time-to-hire and cost-per-hire. Subscription-based pricing will enable you to prove the effectiveness of the ATS without committing signifi cant funding.

4. Reliability: Take a good look at the vendor. Are they recognized as a leader in talent acquisition management, with a list of satisfi ed customers to prove it? Can they deliver 24/7/365? If not, look elsewhere.

5. Integration: Can the ATS be integrated with back-end systems and other third-party applications? If so, you’ll extend its effectiveness and simplify the lives of everyone involved in personnel matters.

Source: www.taleo.com

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BACKGROUNDSCREENING

Is your background screening program effective? By Kellie O’Shea

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(CRA) and you may not hire the applicant based on the information in the report provided, you are required under the Federal Fair Credit Reporting Act (FCRA) to give the consumer opportunity to dispute the information contained in his or her report. Conversely, ignoring poten-tially adverse information and hiring the candidate without verifying it sets up a potentially dangerous liability under negligent hiring. Negli-gent hiring is when an employer can be held liable for the acts of their employees when they knew or should have known that the employee was unfi t for a particular position. Th e Bureau of Labor Statistics reported that employers lose 79 percent of negligent hiring lawsuits and the av-erage jury award in employment-related lawsuits exceeds $1.6 million. According to the Workplace Violence Research Institute, the average out-of-court settlement is $500,000.

Criminal searches at the county court level are public record and the best source for up-to-date criminal record information. Unfortunately, this information is generally limited to records in a single county juris-diction and will not surface information from other jurisdictions. Some states may require additional criminal record searches at the district, municipal and/or lower court level. Criminal searches conducted at the court level, although not instant, provide the most accurate information for matching identifi ers, uncovering active warrants and disposition information and detail.

Many states off er comprehensive statewide criminal record reposi-tories that are accessible and generally provide compiled criminal record information from across the state. It is imperative that a statewide data-base be tested against court level searches to ensure accuracy before an employer and/or screening vendor utilizes a statewide criminal record database in lieu of court level searches. Either way, court level searches should always supplement any statewide criminal record surfaced.

Statewide criminal record repositories vary by state and employers must be aware of any statutory requirements or regulations to utilize a specifi c statewide repository, such as criminal searches on candidates that will work with vulnerable populations, or any requirement or in-terpretation of regulation to employ only court level criminal record searches. In some cases, specialized, release forms and/or notarization may be required before a state will process a statewide criminal record search. Some states will require an employer and the screening vendor agent (if applicable) to undergo an in-depth certifi cation process before criminal record information will be released. Th ese states are typically referred to as ‘close record states’.

An assessment of each state’s source and process must be evalu-ated before an employer can reasonably defend or promote a screening program’s methodologies. If an employer or screening vendor will or will not off er statewide criminal record searches in specifi c states, this should be addressed at the outset to avoid potential problems that may arise because of it.

Another level of criminal record searches to consider is at the federal level. Th is is a search of the US District Courts either by onsite record searches or electronic access. Electronic searches (for federal convictions only) can be conducted nationally, by state or per US District Court. Fed-eral searches generally require additional research as they contain lim-ited identifi er information so broadening the search scope to a national search can add layers of research to fi nd and match identifi ers. Federal

It’s 3:07 pm on a Friday aft ernoon before a holiday week-end. Just as you allow yourself to consider the forecast for the long weekend ahead, the phone rings. Before you can even say your name, you hear the heavy breaths of panic on the other end of the line. Th ere has been an incident with one of your employees and he has just been taken out of the building in handcuff s.

In the following hour you learn that the incident involved your employee raping a female client. Your mind races as you wonder, who is this guy? Didn’t we do a background check on him? How did we miss this one?

Th e answers begin to become clear as your research reveals that the employees background check report shows no criminal record was found or listed.

At 5:25 pm your phone rings again. Th is time, it’s a local television reporter asking about the incident at your location and if you have any comment about the history of the convicted felon and registered sex of-fender working for your company.

Your next call is to your background screening vendor to fi nd out how and why this could have happened. Why do you conduct back-ground checks if they aren’t going to protect your employees and your company against these situations?

Th e short answer is there is nothing you can do to surface every, or even any, criminal record conviction a potential employee may have. Despite what you see on television, a criminal history search involves complex layers of pre-determined methodologies and resources in order to apply the best techniques to yield the best results for each search.

Buyer bewareIn the age of technology, it is tempting to search electronic databases

that provide inexpensive and instant results. Products that are marketed as ‘comprehensive national criminal check’ and ‘access to over 300 mil-lion criminal record for less than $20’ are alluring to employers that are looking to cut costs. Used properly, national criminal searches are a good supplement to employment screening programs, however, these databases can also come with potential pitfalls.

Unless you are conducting a criminal record check through the Federal Bureau of Investigations (FBI), National Crime Information Center (NCIC), Criminal Justice Information Systems (CJIS) or some au-thorized agency to perform a national criminal record search generally conducted using fi ngerprints, there is no government endorsed national criminal check that is easily accessible online and off ered to employers and the general public. Th ere are, however, privately owned criminal record database searches available through wholesalers or resellers of such information. Be careful to distinguish between the two.

Privately owned criminal record database searches typically search by name only and can surface a number of potential matches. When you receive these reports, it is imperative that you research whether the name listed is your applicant or not. Why? You fi rst want to know if this is your applicant before you take any adverse action. According to a 2007 Special Report published by the Bureau of Justice Statistics, 6.4 million US households reported one or more types of identity theft . Additionally, if you are outsourcing your screening to a Consumer Reporting Agency



that the Social Security Trace does not integrate with or search any master fi le list of Social Security Administration (SSA). Th e Social Secu-rity Trace/Address Verifi cation is an intelligence tool sourced through database and/or Credit Bureau information that identifi es alias names and/or previous addresses associated with the provided Social Security Number (SSN). It is used to identify possible names or addresses that should be searched as part of the criminal record search. Employers should fully understand the procedure their vendor (if applicable) uses as it relates to the Social Security Trace.

The look back periodTh e next step is to defi ne the look back period of the criminal search.

How far back should your criminal search extend? Are you searching for criminal records using the current address of the potential candidate?

Th is search scope works if the candidate has resided at this address for some length of time but consider that your

candidate just moved to this address six months ago. How comfortable are you trusting that this candidate has no incidents in jurisdictions in which they pre-viously resided? Extending searches to previous ad-dresses is a critical element in conducting criminal record searches. Ideally, your search should extend

as much as necessary to surface any patterns of be-havior or underlying conduct. Th e industry standard

is seven years, however this can vary in regulated indus-tries or by statute. Some regulated industries require that the

search scope extend back to the age of adulthood.

searches can also include the US Court of Appeals. It is important that employers understand and agree with the type and source used in a fed-eral criminal record search.

Sex off ender registry searches should always be included as part of the criminal record search when a candidate will care for, potentially interact with or even have access to a vulnerable population. In-home workers, contractors and sub-contractors should also be checked against the sex off ender registry. According to a 2006 CBS Report, Mississippi offi cials estimate that 2000 sex off enders relocated across the country in the wake of Hurricane Katrina. Many of them have failed to register in the states in which they now live. Be aware that sex off enders can be listed on a registry with no criminal history indicated on a background check. Employers should consult state laws on utilizing sex off ender registry information. Some cities and states have passed legislation to limit the use of sex off ender searches for employment purposes unless the candidate will work with an at-risk population.

Check and balance How do you know that the names and ad-

dresses provided by the applicant are correct? Aft er all, those are the names you’ll be searching in the jurisdictions they provided as their address. Sup-pose the applicant did not fully disclose all of his or her addresses and/or names suspecting that you might actually fi nd the criminal record they are trying to hide. Most screening vendors will use a Social Security Trace or Address Verifi cation search as part of the criminal record search. Note

Employers lose 79% of negligent

hiring lawsuits


iCims ad:25 June 29/3/10 10:59 Page 14


Employers will want to ensure the search methodologies and scope are consistent for each applicant at least across job function. If you’re conducting a criminal record search at the county and/or statewide level, federal level and a sex off ender registry search in all jurisdictions where the applicant has resided for the past seven years searching all names provided

and surfaced through the Social Security Trace, this methodology and scope should be applied for all candidates within this job function.

SummaryTh e US Bureau of Labor Sta-

tistics reports that there were more than 7000 occupational homicides nationwide during the relatively stable economic period of 1997-2007. Statistics will refl ect the eff ect of our current economic climate during the next measured report. With this in mind, many employ-ers will experience the unfortunate reality of workplace violence. Just as there is no way to guarantee a candidate has no criminal record, employers cannot control every aspect of every employee’s ac-tions. Even background checks cannot eliminate the chance of some unforeseen and unfortunate incidents. However, with the right safeguards in place, employers can considerably reduce the risk.

It is ultimately an employer’s responsibility to understand their screening program’s sources, search methodologies and scope to reduce risk. Conducting back-ground checks supported by the due diligence of the screening program’s methodologies can signifi cantly help employers in defending liability claims and respond positively with best busi-ness practices to the court of public opinion. Understanding vulnerabilities in a criminal his-tory screening program can help employers drastically reduce their exposure but only if they know

where and what they are. It is best to address these questions well in advance of the startling phone call on Friday at 3:00 pm.

Kellie O’Shea, PHR, represents Creative Services, a Boston-based background investigation company.

Th e look back period is the timeframe used to identify all addresses in which the candidate, at a minimum, has resided, for example, in the past seven years. All levels of the criminal record search should be conducted in accordance with the established look back period includ-ing county, statewide (if available), federal, sex off ender searches and national criminal database (if ap-plicable). Each court, state database and federal search maintains crimi-nal record information for varying lengths of time. A criminal record search can yield criminal conviction information that is much older than seven years.

At a minimum, criminal record searches should search the jurisdic-tions where the candidate has resided for the look back period, however, many employers extend the scope to include employment jurisdictions as well as addresses where the candidate has attended school. Broadening the search to include additional jurisdic-tions can help to identify criminal records where the applicant has es-tablished a nexus.

A key element in a background screening program is searching alias names. Alias names can include maiden names, previous names or names your applicant may other-wise be known as. At a minimum, screening programs should search the current provided name of a can-didate, however, it is important to note that failing to search maiden, alias or other surfaced names cre-ates a major gap in surfacing crimi-nal record information. In some cases, the candidate will disclose an additional name on an employment application or release form but the employer or screening vendor does not conduct a criminal record search on the provided name because the methodology is to search current names only. Th is protocol must be addressed in every program. Some questions to apply to your own program include: Does the criminal record search automatically search every alias name surfaced on the Social Security Trace or must a separate request be made? How many names does the criminal record search allow? Are there additional costs for running alias names? If so, aft er how many?

Back to realityThe scenario presented at the outset of this piece is unfortunately not fi ction. When an employee was hired to work as an unsupervised sitter in a private assisted living facility in Colleyville, Texas, he lasted just weeks before he allegedly raped a 77-year old Alzheimer patient. It wasn’t long before the company learned that this employee had a history of violence and sexual assault. The stunning revelation was followed by a negligence lawsuit.

Applying the protocols we’ve identifi ed above, there were a number of issues that occurred during this background check:

Q: What sources were used as part of the criminal record search?A: The company used a privately owned criminal database search only.

Q: Was a Social Security Trace used as part of the criminal record search to identify possible alias names and/or previous addresses associated with the provided SSN?A: Yes. The company did run a Social Security Trace. This employee had an alias name that surfaced on the background check report.

Q: Was there a comprehensive statewide criminal record repository available but not used?A: Yes. Texas does offer a criminal history conviction search of public records through the Department of Public Safety’s Computerized Criminal History System (CHS) but the company conducted a privately owned database search only. It is recommended in Texas that county court searches also be conducted to supplement CHS. County court search in this case could have revealed that this employee (under an alias name) spent 11 years in prison following a conviction of aggravated sexual assault of a female child.

Q: Did the criminal record search look-back period extend to previous addresses?A: No. The company used a criminal database search only.

Q: Did the criminal record search include a direct sex offender registry search that also extended a look-back period to include previous addresses?A: No. Had the company checked the Texas Department of Public Safety Sex Offender Registry, they would have seen their employee listed as a registered sex offender.

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INDUSTRYINSIGHT

Today’s demanding business require-ments, and the thin line between suc-cess and struggling to survive intoday’s landscape, highlight the rea-

son why time and attendance, or workforce man-agement solutions, have become an importanttool for businesses of all sizes. Not only do eco-nomic factors drive labor decisions, but compli-ance factors are becoming more and more of abusiness driver in managing workforces. Accessto real-time data and the ability to effectively ma-nipulate this data for labor costing and reportingsolidifies the role of time and attendance in thebusiness world today.

Businesses are often slow to adapt to some ofthese challenges and grasp technology that is ableto address these issues. Companies often feel thereis no need to address legacy systems that ‘just work’and therefore do not take advantage of the automa-tion, savings, and compliance tools made availablein today’s workforce management solutions. Ascompanies do begin to undertake the process of im-plementing, or replacing a time and attendance so-lution, there are many variables that make thedecision-making process complicated.

One major issue facing the time and atten-dance industry today is quality of solutions and

the consolidation of providers. While there are anumber of providers in the industry, many ofthe current solutions have been built on agingand proprietary platforms. To further compli-cate the time and attendance landscape,providers are consolidating with each otherthereby reducing the available choices totoday’s businesses. It’s important that the re-maining players in this industry continue toupdate their solutions in terms of technology,functionality and usability to be able to meetthe business requirements of today and those ofthe future. Continued consolidation of solu-tions and solution developers threatens the on-going advancement and evolution of workforcemanagement solutions.

Technology is also very important in thetime and attendance industry, and thoseproviders that are embracing technology and de-veloping on standard platforms are separatingthemselves from other solutions because of theirability to easily integrate with third-party prod-ucts and solutions. Many companies have invest-ed heavily in enterprise systems to address ERP,accounting, scheduling, and business intelligencerequirements. Because of this, today’s time andattendance vendors must be able to interface with

these critical, costly systems. The use of current,as well as emerging, technology must be incorpo-rated to provide real-time interfaces to these sys-tems to move data in and out. Furthermore, thosevendors focusing on technology are able to scaleand add solutions to meet evolving business re-quirements.

The development of open standard inter-faces, transports, and solutions will help timeand attendance solutions become more strate-gic in the overall suite of enterprise applications.Companies may not realize the goldmine of in-formation that is contained within a time andattendance solution. Most often, these work-force management solutions are consideredpart of the payroll process when, in reality, timeand attendance is the foundation of labor cost-ing and effective cost management. To increaseaccess and the usability of this labor costingdata, vendors continue to develop software andtools. An increased collaboration between ven-dors of workforce management solutions andenterprise application providers will help busi-ness maximize the potential of the data storedwithin time and attendance.

The other major discussion point in the timeand attendance industry is compliance.Companies have seen the governments’ focusshift from compliance support to compliancepenalties. In addition to the increased scrutinyfrom enforcement agencies, companies must alsoobserve the possibility of employee claims. Theability to automate policy and report on viola-tions provides proactive tools for workforce man-agement thus minimizing liability.

While time and attendance solutions havedeveloped significantly over the past decade, frommanual punch solutions to complex systems,the next five years will redefine the industry.Biometrics provided the last significant contri-bution to cost savings, process updates and newsolutions; however, new technologies such asweb services, standardized interfaces, trans-ports and open platforms will differentiate ven-dors and be the foundation of strategicsolutions for years to come. n


Time and attendance solutions are becomingincreasingly important business tools for workforcemanagement, says Brian Harris of NOVAtime.

Brian Harris serves as the Director ofProfessional Services for NOVAtime,overseeing all customer-facing activity

from pre-sales to support. Harrisfocuses on the alignment of processand technology with today’s everchanging business-critical issues.

Clocking in

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Selecting and retaining the right people in the right roles is among the most challeng-ing responsibilities of all HR managers. Each year in the US, billions of dollars are invested in shaping and

evaluating human capital strategies and in implementing and measuring selection and development initiatives. Trying to discover just the right combination of systems and cri-teria for your organization can seem like seek-ing the Holy Grail of sustainable success.

Part of the challenge is making the best of limited information. When hiring, HR managers oft en feel as though they are miss-ing a piece of the puzzle – and they oft en are. Traditional selection criteria, such as techni-cal credentials and professional experience, provide little indication of how candidates will contribute to organizational culture, interact with colleagues or tolerate stress. Th ough these emotional and social abilities are a vital determinant of professional success, they are oft en deemed unquantifi able and left out of selection initiatives.

Th ey needn’t be. Standardized measures of emotional intelligence, or EI, off er a sci-entifi cally validated means of predicting and improving the emotional and social skills that are critical to workplace performance. By using assessments of emotional intelligence to diff erentiate between individuals who excel in a particular job function and those who do not, numerous businesses and government agencies have transformed the effi cacy of their selection and development processes.

For example, Th e US Air Force (USAF) worked with Multi-Health Systems (MHS), a global leader in psychological publishing and testing, to assess the emotional intelligence of 1500 USAF recruiters. Using the Emotional

Quotient Inventory (EQ-i), MHS identifi ed fi ve attributes that separated successful recruit-ers (those who achieved at least 100 percent of quota) from unsuccessful ones (those who achieved less than 70 percent of quota). MHS’ analyses indicated that the most successful re-cruiters were alike in their high levels of asser-tiveness, optimism, fl exibility, self-direction, and stress-tolerance. MHS assigned relative weights to these key attributes and used them

as the basis of a new formula for recruiter se-lection. Th e implementation of this formula resulted in a 92 percent reduction in turnover; factoring in the costs of hiring, training and settling a new hire into place; this translated into a $2.7 million saving for the USAF.

Similarly, one of the largest debt collec-tors in the United States worked with MHS to improve the productivity of its workforce. Using the same process, MHS compared the EQ-i scores of the comapny’s star collection of-fi cers (those who collected at least 100 percent of quota) against the low performers (those who collected up to 47 percent) to determine the specifi c factors that contribute to high per-formance. Th ese profi les greatly enriched the selection criteria for new hires, as well as the creation of development programs for collec-

tion offi cers. New recruits who were hired on the basis of their emotional skills, and partici-pated in targeted EI-based training, collected 163 percent of quota over 3 months.

In order to successfully realize the full potential of emotional intelligence initiatives, EI expert Dr. Cary Cherniss suggests infusing emotional intelligence into the organization in a variety of ways. “Multiple infusion helps to normalize and generalize the concept,”

Cherniss says in his Guidelines for Securing Organizational Support for Emotional Intelli-gence Eff orts. “It also creates a culture in which people are repeatedly reminded of what they have learned and thus are more likely to apply it on the job.”

A systemic approach means considering not only the organization’s selection system, but also how they develop and reward their employees. As a human capital strategy, emo-tional intelligence can be worked into a multi-system solution, aligning initiatives such as succession planning, hiring, coaching and leadership development with business goals.

Measuring emotional intelligence is a scientifi cally valid way to predict and improve the emotional and social skills that are critical to workforce performance, says Diana Durek.

Diana Durek, Senior Advisor at MHS, is an expert in the area of emotional intelligence and its bottom-line impact on selection, development and leadership initiatives.

Emotional intelligence

PROJECTFOCUS

“Traditional selection criteria, such as technical credentials and professional experience, provide little indication of how candidates will contribute to organizational culture, interact with colleagues or tolerate stress”

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What are the most signifi cant trends cur-rently affecting the learning business?Laura Bernstein. In a nutshell, continual advances in technology and the extension of the global world have had the most impact. Th e most exciting trend I see is the value now being placed on training.

In what ways is technology having an impact on the training industry? LB. For years the training profession has found itself somewhat at odds, locked in a central debate regarding the most eff ective use of technology and how best to blend vari-ous training modalities to achieve the greatest impact on learning. We hear a lot about e-

learning, m-learning, wikis and podcasts, and who knows what tomorrow will bring? What is important today is understanding that it’s no longer merely about seamless integration of training methodologies; it’s about instant accessibility, fl exibility and portability of con-tent and the aff ordability ratio.

Can you tell us more about portability?LB. Although there are variations in defi nition, typically this refers to having training content that can exist in a variety of platforms without losing context and learning value. Th is be-comes extremely important when deploying training to dispersed employee audiences.

What are the challenges with reaching geographically dispersed work teams?

LB. Contrary to what we talk about the most, the biggest challenge has nothing to do with location. Mostly, it has to do with an organi-zation’s ability to provide consistent training across the company, while maintaining the fl exibility needed for local implementation. Learning professionals are tasked with pro-viding the right blend of content in a variety of formats to meet multiple delivery needs. While it may seem simple on the surface, being able to design and deliver training that yields similar outcomes is a greater challenge when the methods of delivery can seem inher-ently at odds with one another; for example, training in a facilitated classroom and self-study e-learning.

In what ways has widespread globalization of business required organizations to ap-proach learning and training in new ways?LB. First, globalization isn’t just about location and language translation; it’s about building a global mindset and working eff ectively across multicultural boundaries. Training and development professionals must now develop expertise in designing and deliver-ing training, which emphasizes cultural and intercultural competency and also develops diversity maturity. High-performing leaders must be able to foster respect among a mul-tigenerational workforce, lead a global team, mediate cultural confl ict and eff ectively ad-dress micro-inequities in the workplace. Is it helpful to be bilingual or multilingual? Sure, but it’s secondary.

How has the perception of training changed over the last couple of years?LB. As is typical in a down economy, some organizations slashed training budgets and stopped investing in the development of their greatest asset – their people. However, many companies seized the opportunity to view training as a key business strategy – one that would retain top talent while they weathered the economic storm. Employers expect certain technical competency and many are willing to pay for continuous education. However, the focus for training in 2010 is much more ex-tensive than technical capability. Dollars and time spent on the needs of emerging leaders, company-wide inclusion initiatives and regu-latory compliance eff orts are on the rise.

The evolving landscapeLaura Bernstein outlines the top trends currently impacting today’s training and

development practitioners.

“Success in today’s business climate demands that training be viewed as the new business imperative”

EXECUTIVEINTERVIEW

Laura Bernstein, President and CEO, VisionPoint, is an acknowledged master trainer and innovative business executive. She has been an active contributor to the training industry throughout her career, developing award-winning training programs and leading diverse teams.

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crucial importance of practicing the prin-ciples of ‘every-day leadership’.

For example, during a crisis, leaders oft en ask their teams to make a leap of faith: “I know times are tough, but we can get through this!” If the leaders haven’t talked straight and de-livered with team members in the past, there’s little chance that team members are going to line up behind the leaders and follow them into the unknown. Everyday Leadership Lesson: establish credibility and trust with your team.

During a crisis, leaders oft en ask their teams to make sacrifi ces for the company: “We’ll need to cut way back on all non-essen-tial expenses, like travel.” If the leaders haven’t already demonstrated genuine concern for team members and built up some relationship credit, there’s little chance that team members will get excited about enduring personal pain for the sake of the company. Everyday Lead-ership Lesson: Express your respect for and commitment to your team.

time to fi gure out who you are or what you stand for – or to communicate that to your team. For better or worse, your credibility as a leader has already been established in the minds of your team members. Th e lead-ers who will be eff ective during and aft er any crisis are the ones who have demonstrated their leadership ability well before the storm arrives. In fact, the tough tasks leaders oft en face in the midst of a crisis underscore the

How to survive a crisis: Lead before the storm hitsMichael McIntyre explains the need for leaders to demonstrate their leadership ability every day if they hope to successfully lead their team through a crisis.

The age-old saying, “Adver-sity doesn’t build character – it reveals it” has an im-portant leadership corol-lary: Lead before the crisis hits. In the midst of the

current economic crisis, many executives are learning this lesson the hard way: once the waters surge, the winds wail and the ground shift s beneath your feet, there is not enough

INDUSTRYINSIGHT

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tencies, team members will have a tough time distinguishing and giving up non-value-added activities. Everyday Leadership Lesson: Iden-tify and communicate the core competencies of the organization.

During a crisis, leaders oft en ask team members to base critical decisions on core values: “If we say customers are important, then let’s do what’s right for customers.” If the leader has been unclear, inconsistent, or quiet about the organization’s core values, then team mem-bers will struggle to fi gure out the right thing to do. Everyday Leadership Lesson: Clarify the core values of the organization.

Eff ective leaders don’t wait until crisis hits to defi ne themselves – they do that every day.

our own maintenance, rather than outsourcing it.” If the leaders historically have discouraged change and innovation, team members are not likely to embrace change during a crisis. Every-day Leadership Lesson: Create a culture of fl ex-ibility and innovation.

During a crisis, leaders oft en ask team members to get back to basics and focus on core competencies: “Focus on what we do best, and stop doing peripheral activities.” If the leader has allowed the company to spread itself too thin and lose sight of its core compe-

During a crisis, leaders oft en ask individu-als to make sacrifi ces for their teammates: “If we each take a 10 percent pay cut, we won’t have to lay anybody off .” If the leaders have created an independent, competitive culture, there’s little chance that team members will start making

the wellbeing of their co-workers a high pri-ority. Every-day Leadership Lesson: Create a culture of teamwork and collaboration.

During a crisis, leaders oft en ask team members to do things diff erently or do things they’ve never done: “We’ll need to start doing

Michael McIntyre, PhD, is the Director of the Professional MBA program at the University of Tennessee College of Business Administration and a leadership development coach in all of the college’s executive-level MBA and leadership programs. He is an industrial-organizational psychologist with expertise as a corporate trainer, management consultant and executive coach; his focus is on internal strategic planning to help organizations reach their performance goals.

“Eff ective leaders don’t wait until crisis hits to defi ne themselves – they do that every day”

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TRAINING


David Guralnick explains how e-learning can help companies keep training and development

costs down if it is well designed to meet employee needs.

Designs

David Guraln

help companicosts down

employee

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Limitations on people’s time, a more geographi-cally dispersed workforce and budget constraints means that bringing people from across an or-ganization together for face-to-face training can be a near on impossible task. However, this does not negate the need for organizations to invest in training and development. In fact, quite the oppo-site is true as training and development is increas-

ingly seen as a key factor in employee motivation and retention. As challenges have arisen making traditional methods of learning

more problematic, employers have had to seek alternative methods of educating their workforce to ensure both their performance and their progression. Technology has started to play a greater role in overcoming the challenges of time, budget and resources and e-learning is increas-ingly touted as a way of fi lling this gap.

David Guralnick is President of the International e-learning As-sociation and President of Kaleidoscope Learning. He specializes in the use of technology to improve job performance and he designed what is considered to be the fi rst ever learn-by-doing simulation for corporate use in 1991. He believes that the defi nition of what actually constitutes e-learning has broadened over the years.

“I look at corporate e-learning as meaning the use of technology to improve job performance,” says Guralnick. “I tend to think that e-learn-ing is oft en focused too much on training and not enough on just-in-time performance support, which is something that can really change the way people do their jobs and make it easier for them. But both of these things come under the umbrella of e-learning.”

In the past e-learning has come under fi re somewhat as research has shown that although attitudes vary greatly between companies in dif-ferent sectors and with diff erent forms of work organization, there is a wide-spread fear that e-learning can lead to social isolation.

One possible reason for this is a fear of lack of teacher support, or a lack of peer group interaction. “I think it is a legitimate perception as people have diff erent preferences,” says Guralnick.

“Th e defi nition of social isolation is a funny one though because what it means to be social has changed so much in today’s world. If your defi nition of social requires something to be done in person then this could be a valid concern. But I do believe there is plenty of room for social interaction and this is something that Web 2.0 technologies are giving us: a way to communicate and bond fairly well with people you don’t necessarily see in person.”

Th e advent of Web 2.0 and social media has lead to a movement away from up-front training, which Guralnick is happy to see, as he believes that many companies tend to over-train to a certain extent. Now that

companies are adopting less of a top down approach to training it pro-vides employees with more ways to communicate with one another.

On the other hand though he is also wary of this technology and says it has promoted a movement towards unstructured information only. “It is certainly is useful for some things, but it doesn’t replace exper-tise entirely, and it doesn’t replace people with years of experience who have expertise in structuring information in the right ways – ways that people can really use it and apply it on the job,” says Guralnick. “Th ere’s a tendency for people to go overboard with new technologies and I am concerned about that going forward.”

Perhaps another major concern around e-learning is that those people who wish to engage in it require certain special skills in order to make the most of it, in particular the ability to use all the new technology on off er. “Generally this shouldn’t be the case, but sometimes it is,” says Guralnick. “Technology oft en leads the way rather than good design and thinking about what’s right for the end user. If you design an e-learning product well – keeping the goals, the audience and what you are trying to teach them in mind – then it really shouldn’t be too diffi cult to use,” he explains.

Something that Guralnick has noticed is that a lot of technology is being thrust out into the market very quickly, which causes problems as people get confused by the off ering, especially if it doesn’t meet their

needs. “Th is can give e-learning a bad name and I think it has suff ered because of that. I don’t think it’s the technology itself that makes it dif-fi cult for people engage in e-learning, but I do think there is a group of people who struggle with some of the things on off er,” says Guralnick.

Generally speaking, all sectors of the corporate world could fi nd potential in e-learning. Clearly there will be some sectors that are better suited to using it than others, but in most cases it can bring benefi ts for any role in which the use of technology can make the job easier, more effi cient and more enjoyable. An example that Guralnick cites is fi ber optics technicians, a group that you wouldn’t necessarily think had that much to gain from e-learning as they oft en work out in the fi eld.

“What we were able to do for them was create a just-in-time reference system for their cell phones, which could access information about the

“What we were able to do for them was create a just-in-time reference system for their cell phones, which could access information about the kinds of parts that they need”




a good return on investment is of paramount im-portance especially when budgets are still tight. And if done correctly e-learning and m-learning can help companies keep training and develop-ment costs down.

“Th e main thing really is to spend your money wisely. Generally, if you only spend a couple thou-

sand dollars, you’re going to get pretty much zero return on that,” says Guralnick. “So I think you are better

off , even when budgets are tight, trying to select those areas that are going to have the most impact on your organization. You need

to get the right people to design and build something that will actually aff ect performance – then there could be huge savings.”

One particular client that Guralnick worked with has calculated that over approximately fi ve years they have managed to save over $150 million in improved performance. He stresses that this kind of return cannot be gained by simply spending $1000 but it can be done by spend-ing $500,000, which for many large enterprises isn’t that big an invest-ment yet it provides worthwhile returns.

“When money is tight I would advise trying to pick the hitters rather than trying to cover everything in a very minimal way as this just ends up with you wasting small amounts of money in lots of places rather than making an impact from one or two larger projects,” explains Guralnick.

However, with the wealth of new devices hitting the market – partic-ularly Apple’s new multi-media iPad – new opportunities will certainly arise in the e-learning arena. But as Guralnick points out, it will probably take time for the corporate world to adopt new devices and decide to spend money on them . “New devices are going to provide new ways to help employees work better, faster and more comfortably. In particular, more mobile devices means better performance-support opportunities, which I’m always in favor of.

“Ideally it’s going to drive more new thinking and hopefully we won’t see people trying to translate simple e-learning and just putting it on a new device. As time goes by, we will not only see the iPad but all sorts of diff erent, smaller more advanced devices and all of that should get better and better over time,” says Guralnick.

He is certainly excited about the raft of possibilities that new tech-nologies off er to e-learning. One thing in particular that interests him and that he has been experimenting with is more advanced simulation technology. “It’s a little bit too new for corporations at this point, but we have been experimenting with technology and brainwave sets,” concedes Guralnick. “Th ese are headsets that can supposedly tell a computer ex-actly what a person is thinking. Th ey can be used to teach something as simple as customer service as this little headset can detect whether you are starting to feel anger towards a customer, which is something that perhaps you wouldn’t acknowledge otherwise.”

Whilst Guralnick admits that this does start to get into the realms of Big Brother slightly, he is also very excited by the prospects that this kind of simulation technology could off er to training and development and e-learning in particular. So perhaps one day soon we’ll all be taking part in training courses in virtual worlds similar to Second Life. It may sound incongruous, but Guralnick tells us that as more advanced programming is developed this kind of thing could become a reality.

kinds of parts that they need. Th ey are oft en faced with a thousand diff erent parts and even the most experienced technicians were having to call back to the offi ce for more information and guidance,” says Guralnick. “Generally, in today’s world, E-technology is in everything and if it’s well designed it can play a role in everything.”

As ever technology continues to evolve at break-neck speed and in recent years e-learning has been accompanied by a parallel movement towards what has become known as M-learning. Th e two have also started to converge somewhat with the development of more sophisticated mobile devices.

“As a general mobile devices, particularly the smaller ones, usually work best for short, just-in-time learning and for performance support – for something that’s going to help you do your job rather than for some-thing that’s part of your training,” says Guralnick.

For times when more upfront training is required Guralnick sug-gests doing that online, on a computer, where you have more of a screen real estate, as he puts it, and can sit and concentrate for longer periods of time. But he emphasizes that mobile devices are incredibly useful, par-ticularly since the iPhone and other smartphones have become so widely used. Even netbooks can now be used for m-learning when a slightly bigger screen is required.

Th e main benefi t of both e-learning and m-learning for employers is obviously being able to save money by improving job performance. For Guralnick, improving performance is not just about people doing their jobs better but also about happier, more engaged employees who feel that the company is doing something to make their lives easier. “If you design things to support the workfl ow that people have and thereby help them to improve it and do things in a more comfortable way, you’re going to do pretty well,” says Guralnick.

Conversely, he says, if you create products – whether they’re on mobile devices or on computers – that your employees fi nd more aggra-vating than anything else, such as page-turning e-learning or things that really don’t seem to apply well to the job, and they feel forced into doing it, educational research shows that you will not improve job performance, but you are more than likely going to alienate your employees.

“It really comes down to designing the right products for the situ-ation,” says Guralnick. “If you employ the right kind of design strategy, you can do pretty well at improving your returns both fi nancially and by improving the overall employee culture.”

One of the main obstacles that many employers come across with e-learning and m-learning however is how to measure any improvements in job performance. Th ere are things that can be done, says Guralnick, but measuring improvements will always be diffi cult unless you can isolate what you are trying to measure from other things that might be taking place within the company that may impact performance.

“You have to defi ne the metrics and ask what it means to be good at a certain job. Are employees being effi cient? Are they being accurate? Th at does take some thought but I do think it is well worth it in terms of evaluating if what you are doing is working,” explains Guralnick.

For most companies, especially in this diffi cult economic climate, making sure that any investments in training and development deliver

One client has saved over

$150 million in improved performance


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EXECUTIVEINTERVIEW

What was the relevance of e-learning when itcame onto the scene?Jim Hauden. The early value proposition wascost efficiency and speed. It allowed people tolearn without being in the same classroom, and itwas sustainable in terms of materials. Digitallearning was a way to more efficiently share andstore information. Unfortunately, it was boringand ineffective.

But recently, people are seeing learners ascustomers. People can explore information intheir own time at their own pace. Businesses likee-learning’s ability to create “motion in learning”through scenarios and feedback, and it’s muchmore compelling.

Root is a proponent of blended solutions –paper and digital. Why not one or the other?JH. We create with what works with users. Attimes, e-learning is best; sometimes, a live, smallgroup is the answer. We’re always conscious ofthe learner, of the mix of learning experiences thatprovide the optimal outcome for the business.

The best learning comes from combining fa-cilitated learning, social learning, and individuallearning. The ability to think, learn, and applyknowledge with others and then practice beforetaking a risk is how most of us learn. Using tech-nology in combining all these learning formsmakes quality e-learning an effective part of anoverall learning solution.

Root approaches learning as a system. How dosystems relate to learning?JH. We often use an example of trying to assem-ble a 1000-piece puzzle without seeing the boxtop. People need to see the big picture – the sys-tem – before the individual parts make any senseat all. When we frame the whole so people can seethat entire system, they’re curious about theirconnection to it. Learning has the most value incomplex issues that are the greatest inhibitors tosignificant improvement. If we want people to act

differently, they have to understand the com-plex systems of our businesses. Within any sys-tem, components are constantly in motion, sopeople need to see the direction – where it’smoving and how.

What are the best practices for making learn-ing ‘engaging’?JH. Our book, The Art of Engagement, tells how tocapture people’s discretionary effort to create re-sults using storytelling, visualization, and othercreative ways. It’s ‘engaging’when every learn-er says, ‘I get it! This is exciting! I see how I fit,and I know how to make a difference!’ Thiswon’t happen if we just ‘tell the learner what tolearn.’ Involving, inviting, and exploring in-

formation with the learner makes it relevant.

What’s the potential promise for e-learning?JH. It’s the ability to understand how to makecause-and-effect more transparent within oursystems. We don’t often get to see the conse-quences of what we do. Technology lets us re-hearse the causes and see the effects immediately.If technology can help us to quickly understandhow actions lead to outcomes, we can unques-tionably create better results.

Technology allows us to instantly find what-ever we need to know. The promise of e-learningis putting learners in the driver’s seat, to focus onaccessing, assimilating, and compiling informa-tion that is most important to find. We’re in trou-ble as long as e-learning is defined by the creatorof the method rather than by the desires of theend user. The best e-learning really isn’t designedto help people perform better in the workplace;it’s a tool for enabling extended conversations.

How does Root determine the best solution toa learning need?

JH. Our process starts from the genuine curiosityof ‘what it’s like not to know.’ We ask good ques-tions and uncover the right approach for that au-dience. We engage clients in what’s possible.Then we use our 20 years of experience to build,deploy, and sustain relevant learning. We excel atgroup and individual e-learning, simulations,gaming, and scenarios. We also have the consult-ing capability to help clients with the entire spec-trum of learning needs. n

In the mixJim Hauden details the benefits of a blended learning approach.


For over 20 years, Jim Haudan, CEO and Chairmanof Root Learning, has helped organizationsunleash hidden potential by engaging people intheir work. He partners with leaders of majorcompanies worldwide to build creative ways toexecute strategy.

“The best learning comes from combining facilitatedlearning, social learning, and individual learning”

Root Learning ed_17MAR10 29/03/2010 10:21 Page 120

Rootlearning ad:25 June 23/3/10 14:49 Page 14


ETHICS

PATRICIA HARNED:17MAR10 29/3/10 09:37 Page 122


Have you seen many changes in trends in the yearsyou have been working with the Ethics ResourceCentre (ERC)? Patricia Harned. Yes and no. Some things never change. Ithink that the field itself has become quite complex. Thenumber of regulations that apply to businesses with respectto ethics and compliance has grown exponentially in thetime that I’ve been here. But some ofthe basic things that companies strug-gle to figure out how to prioritize –ethics, scandals, conduct – those havenot really changed a whole lot.

The National Business EthicsSurvey is conducted every two years –with the one preceding the 2009 reportobviously being the 2007 report. Since that time, with therecession and the economic crisis, industries have beenturned on their heads in many ways.

What impact would you have expected the recessionto have had on work like that?PH. We fully expected when we were fielding that surveythat the findings would be terrible, that in the recessionpeople would be driven to cut corners, to sacrifice the stan-dards of the organization just to be able to stay in business.And when people tighten their belts and they’re operatingout of a sense of fear, you would think that all the rulesdon’t apply anymore, you just need to survive. In fact what

High principles

Now in her fifth year as President of The Ethics ResourceCentre, Patricia Harned talks to HRM about the current state

of American business ethics.

we found was the opposite – the impact of the recession hasbeen that ethics are good. People are being more careful andmore mindful of company standards and they’re more will-ing to report misconduct when they see it.

Why do you think that is?PH. I think it’s probably two things. One, the people that

are most likely to really engage inwrongdoing are probably laying low,they want to keep their jobs at the mo-ment. But also, some of the difficultieswe’ve seen in the financial services in-dustry have led business leaders to talkto their employees about how they’regoing to do their business and how

they’re going to survive in a way that employees have in-terpreted as being very ethical in what they’re doing. So, Ithink ethics has become much more of a daily part of dis-cussions during this timeframe.

Just after the release of the 2009 survey, you werequoted as saying: “Research suggests that the im-provement in ethical conduct will be temporary.” Whatdo you think the focus should be for those companiesthat are trying to instill an ethical sensibility into theirworkplace culture?PH. I think the first step is to do some kind of assessment oftheir organization right now, to be sure that the findings

“When ethics is a performance

goal, people takeit more seriously”


from this research are applicable to their own organization. It is very like-ly that with most companies, their cultures are stronger right now.Employees are feeling better about ethics, but they need to make sure thatthat’s the case. If it is, then the second step is to try to figure out, ‘what is itthat we’re doing differently right now that we need to maintain whenthings are better?’ There’s something about the way people are supervisingemployees, the way they’re talking to their employees, that if they can con-tinue that kind of an effort, misconduct won’t go back up. It’s just thatwhen it goes back to business as usual, I think we change our priorities andour focus. And that’s why it rises and falls.

How easy do you think it wouldbe for business leaders to main-tain the sorts of practices they’vedeveloped in these tough times?PH. I don’t think it’s terribly difficultto do and I think a reason for that isthat right now it’s just a daily part ofbusiness. What’s difficult is trying tomake sure that you recognize theethics element to everyday businessdecisions and that you point it outand make it known. That’s not a dif-ficult thing to do, but it is difficult toremember that it’s important.

Returning to the subject of the re-cession and the impact that’s hadon not just the most recent survey,but comparisons between the 2007to 2009 survey and the 2000 to2003 survey also covering periodsof recession. What sort of trends doyou see between the two?PH. The first trend was that duringthose time frames, we saw a signifi-cant rise – or an improvement – inoverall company ethics. That positivetrend went away after the recessionand government scrutiny of businessreceded. But the other thing that wesaw within that data was also that em-ployees’ perceptions of their businessleaders were much more positiveduring those two timeframes than they were when it’s business as usual. Andagain, I think that goes back to the fact that when there’s not a recession,when we’re experiencing good productivity and business success, businessleaders focus on the bottom line in the way they talk and what they prioritizeand how they go about doing their work in a way that employees lose confi-dence that they’re ethical leaders.

So, would you say that it’s a fair assumption to say that open, infor-mative channels are more important in time of recession or when

things are going right? Moreover, are people more inclined to reportmisconduct in times of recession or is it the case that they wouldrather protect themselves and their job position?PH. I think that they’re always important. I actually think that they’re moreimportant during times when things are going right. And that’s becausethose are the times when we see more problems taking place. But it’s alwaysimportant that employees feel that they have a way to report wrongdoingwhen they observe it. I do think that there’s a stronger sense of not wanti-ng to stir trouble because you don’t want to lose your job. That said, I alsothink that employees, when they work in organizations where they think

ethics is a priority, they’re very willingto raise these concerns when theyhave them. It’s mostly driven by theculture of the organization. If theyfear that they’re going to experienceretaliation for reporting, they won’traise the concern. But if they thinkthey’ll be supported, they will, be-cause they do care about the overalllong-term interest of the company.

Looking forward into the comingmonths and years, as the economyshows signs of stabilizing, whatcan leaders really do to ensure thatethics remains at the forefront ofworkers’ minds and is an integralpart of business culture?PH. Well I think there are a couple ofthings they can do. The first is to en-courage their boards to put someoneon the board committee that has anexpertise in ethics so that at the veryhighest level of the organization,ethics is a priority. The second is toidentify some behaviors that are char-acteristic of ethics being a priorityand make them performance goals.When ethics is a performance goal,people take it more seriously. Andthen the third thing is to help super-visors understand that they have acritical role and one of the things thatthey need to do is to help employees

really feel supported in raising issues when they encounter them.

Okay. So, to bring things back to the present – what’s been happen-ing over the first few months of 2010 with the ERC?PH. We are actually just about to release a supplemental report pertainingto more specific research on topics. The first report will be more about mis-conduct in the recession; the next report coming out after that will be look-ing at employee engagement and the impact of ethics on their overallengagement with the company. �


National Surveys: ERC conducts biennial surveys of ethics pro-grams, issues and culture using a national sample of employees inbusiness and government. Results are compared to data from pre-vious years and to national norms. ERC’s data is widely used inbusiness, government and academia.

Proprietary Surveys: ERC conducts confidential workforce sur-veys for corporations and industries and assesses programs andethical culture for municipal and federal government agencies.Results are analyzed and benchmarked, allowing the ERC to rec-ommend improvements.

The ERC Fellows Program: Chief ethics and compliance officersfrom business and government meet twice yearly to address ethicsissues in the workplace and form working groups for further ex-ploration and discussion.

ERC ACTIVITIES


Upper Iowa University ad:25 June 26/3/10 09:38 Page 14


With regards to the impact of the economic crisis, do you think it has put considerably more pressure on leaders in all industries?Toni Chinoy. Absolutely, and there’s a trend that I’m seeing, which is interesting because I predicted that it would happen, though I didn’t realize that it would happen this fast. And it’s happening around and to some of my clients. One of the things I see happening is that we have been over infl ating leadership titles for people in order to keep good people in organizations.

In several of the organizations I work with they are going to people and they’re downgrading their position. So a Vice President in today’s world would look like a silly child next to a Vice President from 20 years ago in terms of experience, sophistication, savvy and business acumen.

Th is recognition is occurring as a result of the crisis, they’re going through some of the organizations I work with and doing adjustments of both title and compensation. It’s necessary because I think we’d overinfl ated it. Because it was too easy for people to move on in a booming economy, companies were trying to fi gure out how to keep them. So you have young un-savvy 40 year olds with Vice President titles who had been out placed by this economy and they’re having a lot of trouble fi nding jobs that they think are worthy of their positional status.

I keep trying to caution them and say, “You’re not where you think you were. You need to go back.” So that’s the big one from my perspective.

LESSONSIN LEADERSHIP

HRM asks Toni Chinoy and John Baldoni about the challenges of developing an effective 21st century leaders, and the role HR has to play in the process.

WHO’S BOSS

THE

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John Baldoni. I think there’s always pressure on business leaders to perform, and in times of recession, absolutely. You are challenged to do more with less, but that’s a continual thing. But when times are tough, the pressure to perform and to at least keep your head above water is always there, and so within a challenged economic environment leader-ship comes to the fore. And what do I mean by leadership? Essentially a working defi nition for me is doing what the organization needs doing, and it means making those tough, hard decisions that only leaders can do. I do believe in distributed leadership decision making, but when it’s the signifi cant, tough questions, those will get kicked upstairs and that’s when you need leaders of good character to make those hard decisions.

If you want to move up the ladder you’re going to be faced with challenges. Th ere’s a diff erence between management and leadership. Management is the taking care of systems, getting things done on time and on budget. Leadership, anyone can do at any time at any level in an organization. It’s a way of doing what’s right for the organization as well as for yourself, and it also involves decision making. Can leadership be

taught? Without question, but does it make a leader to take a course in leadership? No. Th at’s a conscious decision to say, “I want to be in

charge. I want to have autonomy. I want to be responsible. I want to be accountable.” Th ose are the aspects of leadership.

HR often likes to focus on the positives, but in the kind of business climate we have been facing over the

past few years, that just hasn’t been possible. Do you think leaders are prepared enough to do

the nasty jobs as well as the pleasant ones?TC. Just from my experience base, my sense

is that HR leaders are generally fairly well

prepared technically to handle things like compensation issues. But they aren’t tough enough, they don’t know how to have the tough discussions, whether the discussion be something emotional like a layoff or even taking on bad behavior in the organization in an eff ective way, particu-larly at the higher levels.

I think the biggest thing that I’d say to HR people is; “You have to learn not to be naïve and that some of your leaders are doing things that are damaging to both the organization and individuals in the organiza-tion and you have to be prepared to stop it and to take it on.”

But what generally happens is they can have somebody come to them and say, “Th is person is abusing their power.” And the HR people step back from it and say, “Oh, I’m sure you’re mistaken.” And they can’t realistically look at the evidence and see that a lot of these behav-iors are deliberate and they are a refl ection of the competitiveness of a tight economic situation.

HR leaders need to be prepared to face off against the disruptive behaviors of this tight competition within the organization to keep the jobs and to keep moving up.

JB. When times are good, doing what the organization needs doing can be fun because we may start a new business, we may hire new people, may open a new facility. All of those are good things, but in challenging times you do have to lay off people. You do have to cut expenditures, and those are painful decisions. Th e challenge of doing what’s good for the organization ironically it’s not always good for individuals, but if the organization does have to downsize or right size, you have to make that decision and you have to do it cleanly and quickly and with dignity.

A truly inspirational leader can be a tremendous boon for an orga-nization, but can leave a major hole if they are suddenly out of the picture. For example, Steve Jobs decision to take a step back for a period last year had big implications for Apple. How can companies deal with situations like this?JB. It’s all about good succession planning. You should develop who’s next at every level, and that starts at the frontline management all the way to senior level management. Th is is something that General Elec-

tric has done well. It’s when you groom your next leaders, especially those at the top, it’s not that you’re grooming the leader for the

challenges he or she facing today, but that you’re grooming the leader for the challenges he or she will

face in the future.Most organizations don’t

do that, but that is the great challenge because nothing stays the same. We are always



presented with new and diff erent challenges. You need leaders of capability, but you also need leaders of vision who can see around the corner and take that organization to meet those challenges when they arise. Now, that does not mean that every new leader needs to fundamentally change the organization. But they need to be prepared for when new oppor-tunities, as well as new challenges, arise. Th ose men or women must have the wherewithal to deal with that challenge, be it a crisis or an op-portunity.

Looking at GE, one of the things that Jack Welch did when he handed off to the next gen-eration, was the same thing he did in his own career. When he replaced Reg Jones in 1981, he decided he was going to run a very diff erent GE than Reg Jones did, and likewise he expected his successor, Jeff Immelt, to run GE in a very diff erent way. Every senior leader needs to let go. You’re no longer in charge, but can that person handle the next big challenge, the next big crisis? Th at’s what you’re looking for in your next level senior leadership.

TC. If we can step back and look at it as a change issue, as opposed to just a vital per-sonality leaving, the fi rst thing you do is you celebrate. Th ere has to be a celebration of what they contributed, and then there has to be a re-visioning of where we’re going from here, and it doesn’t have to be about that personal-

An MBA certainly makes you a managerial candidate and perhaps might even get you labeled as a high potential.

However there’s an old saying in HR that IQ gets you hired but it’s EQ, your emotional quotient, that gets your promoted. Part of your emotional quotient is, of course, your ability to relate to others. Leadership is all about relating to others, but it’s also that willingness to exert autonomy, responsibil-ity, and live with consequence. If you’re an accountable person, if you get your work done on time and you prove your credibil-ity, that’s step one.

Th en your challenge is to become a person of infl uence. It’s about how you eff ect change in your own organization, how you make things happen for the good of the or-ganization. Are you a positive force? Th at’s

part of the leadership equation and that is what you do over time.

How you bring people together around a common cause, that’s your leadership quo-tient. Th at is what brings you to the fore. It’s interesting how you measure this. Th ere was a gentleman that I once did a keynote speech for who spoke to me about how he hires, and it was very much about how he looks for team players. When he interviews he looks for how many times they use the word ‘we’ and how the candidate talks about collaboration.

So that’s the kind of person you want to identify and gradually give more and more responsibilities to. Leadership is not a solo act. It’s about bringing others together for common cause. To eff ect good for the organization you need that ability. So a good leader needs that EQ, the ability to relate to others.

SWEET EMOTIONJohn Baldoni explains that business success isn’t just about an MBA.

Toni Lynn Chinoy has written multiple texts on leadership, bullies, power games and more. She is the founder of Harlan-Evans, Inc., a consulting fi rm specializing in effective organizational change and coaches senior leaders on how to respond to crisis. Her book, Handling Critical Moments with Grace takes the reader through many examples of how to handle critical, life-defi ning moments with grace.


University of Connecticut ad:25 June 23/3/10 14:59 Page 14


ity anymore. It means looking at the basis of what’s been created because of this personality as jumping off point and building the future from that jumping off point with a lot of gratitude towards what has already occurred because of this personality.

As opposed to thinking of it as a downhill or a negative or a diminishment of the organi-zation, it’s an organization that has been read-ied by Steve Jobs to go to the next step. Have we got a vision for what that next step looks like and do we know where we’re going? And it’s regrouping around what the organization is as opposed to what the person is.

Who’s responsible for that? Th at’s the fun-damental thing about what we’re talking about here. Leadership belongs to every single person in the organization. I don’t care if they’re hourly, I don’t care if they’re on the janitor

crew, every single person owns that one, and it is a belief system that has to be instilled.

Can HR play an infl uential hand in that? Of course, they’re in the perfect position to do so. But they have to recognize that it’s not their job. It is the job of everyone there. All they have to do is frame it as a way of thinking about the job for those that need to pick up the machete and start swinging it.

When it comes to HR professionals also being effective business leaders and part-ners, do you see evidence of this happen-ing? What sort of qualities do HR people need and can these types of skills really be taught? TC. It’s both a skill set and it’s a competence and clarity about what they’re dealing with. Are people even close to being prepared for

If the culture is punitive to people that reach out and speak out or raise concerns, you’ve got to help – and this is an interesting distinction. Normally what people will say is you’ve got to fi x

the culture so that leadership can blossom. I’m saying something very diff erent. I’m saying you have to go to the individual and teach them how to cope with the culture as it is in order to be a leader.

In doing that they will actually shift the culture. Th e culture will not shift until it’s been fi xed at the indi-vidual level. Th is means helping people to revamp their belief systems about security, about what their responsi-bility as a leader is, and giving them skill sets for taking on adversity and obstacles to being a strong leader.

Th e strong leaders that I know are getting beaten to pieces right now, and they are oft en getting beaten by HR people, to be very blunt about it. With some of the cultural issues that we’re confronting with HR and 360’s and performance feedback, some of the strongest leaders we have are getting beaten up because they make people uncomfortable or they make people feel bad. We have to stop that. Yes they need skills and they need to be more adept at fi nesse, but you cannot take away their right to lead, and that’s what we’re at risk of doing.

THE RIGHT TO LEADToni Chinoy suggests that an infl exible idea of culture can cause problems

John Baldoni is an internationally recognized leadership consultant, coach, author and speaker. His newest book, Lead Your Boss, The Subtle Art of Managing Up, was selected as a notable leadership book for fall 2009. In 2010 for the second consecutive year, John was named one of the world's top 25 leadership experts by Top Leadership Gurus International.

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this now? Not in my world. I don’t see them getting training in it, and I certainly don’t see them skilled at it.

It is a skill set, and some people are better prepared because they’re more born to it than others. It has a lot to do with a person’s ability to be very logical about what is actually occur-ring as opposed to couching it in all sorts of belief systems that may or may not apply.

JB. HR has earned a seat at the table. It is now a strategic partner because as the organiza-tions grow and develop they need to know what their people can do, what can they not do, who do they need to hire, what do they need to train and develop for. HR should take the lead, and does take the lead, in that. With-out question there are two big things going on right now. One is that there’s going to be a wave of retirements from the baby boom generation; so now is HR’s time to prove itself in talent management, to groom that next generation.

My newest book Lead Your Boss is all about how to lead from the middle, how to lead your boss, how to infl uence change, how to make things happen. HR is in that role. Th ey are leading from the middle. Th ey are the voice of employees. Th ey need to exert it. Th ey need to provide opportunities to groom and develop their people, and I think the good HR departments are doing that. But I think they need to be a little more assertive and use their infl uence, use their understand-ing of employment trends, economic trends, market trends.

Th ere’s a strong movement within HR in the corporate world of being an employer of choice. I think every company should strive to become an employer of choice. What does that mean for me in HR? What kind of people do we have to hire? How do we develop them? How do we compensate them? How do we grow them? How do we become a high performing organiza-tion? Th ose are the questions that senior management looks to HR to help answer, and when HR has answers to those or can help formulate answers, they position themselves as a strategic leader, which is fi tting for their role.

Top 12 least admired leaders

12

11

10

9

8

7

6

5

4

3

2

1

Peter Mandelson

Vladimir Putin

Rush Limbaugh

Fred Goodwin

Robert Mugabe

Silvio Berlusconi

David Cameron

Tony Blair

Bankers

George W. Bush

Politicians in general

Gordon Brown

Source: Aspire/Customer Interpreter

Top 12Most admired leaders

Barack Obama

Richard Branson

Nelson Mandela

Hillary Clinton

Angela Merckel

Someone in my family

Oprah Winfrey

Vince Cable

David Cameron

Michelle Obama

Dalai Lama

Margaret Thatcher

1

2

3

4

5

6

7

8

9

10

11

12

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There was a time when relocation packages were seen as recruitment tools by companies who were seeking to attract the best talent in a competitive market. Relocation programs routinely included benefi ts such as company home purchase options, allowances for temporary housing, help paying for childcare and

the transportation of house contents. However, since the economy took a turn for the worse and took the employment and housing markets with it, many of these benefi ts have been curtailed as companies have looked to relocation as a way to cut costs.

Michael Washbourn, President of Worldwide ERC, explains the effect that the recession has had on mobility programs and how relocation service providers can help ensure the success of international assignments as we head for economic recovery.

RELOCATION

MOVING ON

One man who knows this story all too well is Michael Washbourn, President of Worldwide ERC, the professional workforce mobility asso-ciation. Both the recession and the stagnant housing market in the US have had a dramatic impact on the domestic and global mobility pro-grams of most companies.

“On the US side, companies are more closely scrutinizing the need to move employees before extending a job off er that will require relocation, as nearly 50 percent of employees are homeowners, and home sale costs in this economy can be signifi cant,” says Washbourn.

For this reason there is currently a discussion regarding the revision of home sale programs so that they can better meet the needs of em-ployers and employees in this turbulent market. “Tighter funds, closer scrutiny of mortgage qualifi cations and a sluggish housing market slows the entire relocation process, from the home sale through various reloca-tion services from the old location to the new one. Lower home values have also prompted some employees to refuse a relocation altogether,” says Washbourn.

On a more global scale he notes that the economic downturn is having a far greater aff ect than the US housing market. In many markets, he says, the traditional three to fi ve year expat has been replaced with project and shorter-term assignees. Europe has seen a particular down-turn in mobility and in some cases Washbourn says that some companies have even sent assignees home. Asia has been less aff ected by the down-turn and there has been a reported increase in mobility to Africa.

“But across the board, companies are concerned with cost and are becoming more sophisticated and targeted in their policies and programs to support mobility,” says Washbourn. “We believe that the number of people being moved outside the US remains somewhat static, but the less expensive, short-term assignee has in many cases replaced the highly expensive longer-term full package expatriate”.

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T: 212-967-7013E: [email protected]

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GLOBAL RELOCATION TRENDS

In its 2009 Global Relocation Survey Brookfi eld Global Relocation Services quizzed 180 respondents from companies representing a total worldwide employees population of 9.8 million.

The survey results refl ect the following trends in relocation:

• China was named as the top international assignment destination, but was also named as the top emerging destination, the country representing the greatest challenge for expatriates, the country representing the greatest challenge for program managers and the location with the highest rate of assignment failure.

• 68% of respondents indicated that their companies were responding to economic conditions by reducing assignment expenses.

• When asked how their companies planned to reduce the cost of assignments the two most common measures cited were reductions in policy offerings or amounts (32%) and increased reliance on local hiring (21%).

• Respondents reported that 53% of revenue was generated outside the headquarters country.

• The top two methods of preparing for global expansion were evaluating programs to ensure that needs were met (81%) and aligning objectives and needs (78%).

• Critical relocation challenges included assignment cost (46%), fi nding suitable candidates (39%), controlling policy exceptions (33%), career management (30%), retention of expatriates (29%), and inability to use experience after repatriation (22%).

• 33% of respondents reported that expatriates were promoted more quickly, and 35% reported that they obtained new positions in the company more easily. But 35% also reported having left the company within one year of returning.

• 42% of all survey respondents increased their reliance on outsourcing since the 2008 report – a record high percentage.

• 29% of US respondents indicated that they currently outsource their international assignment program.

For more information visit www.brookfi eldgrs.com

Worldwide ERC.indd Sec2:134Worldwide ERC.indd Sec2:134 29/3/10 10:21:0029/3/10 10:21:00

The MI Group ad:25 June 23/3/10 14:53 Page 14


HR departments have found themselves faced with the need to economize during the recession and consequently they have had to revise their relocation policies in order to achieve the necessary savings. “In the US, approximately 70 percent of organizations have made changes to their policies in the last year – most of which address challenges created by the housing market,” explains Washbourn.

Some companies, he says, have had to tighten marketing restric-tions to reduce the time it takes to sell homes and some have even had to adopt more tiered approach to policies where diff erent levels of assistance are off ered based on longevity and or experience. Others have had to increase the number of days of temporary living that they provide to homeowners.

Th ere have been some interesting tactics employed by HR departments looking to revise their policies. Some examples of this are adding or enhancing a home sale bonus for incentive for employees who fi nd buyers for their homes; adding a requirement to the home sale program that requires employees to list their homes within a certain percent of the buyout off er in order to qualify for home sale assistance; and modifying policy to provide loss-on-sale assistance to more employees.

“Globally, eff orts to reduce costs and locate work into more cost-effi cient areas have prompted more outsourcing, backrooming and off -shoring of manufacturing, processing and call centers,” says Washbourn. “Th ere has been a steady decline in traditional expatriate packages to help control costs, localization is more prevalent and short-term assign-ments are used more frequently.”

Th e need to change policies regarding relocation has not only aff ect-ed HR departments, but has also fundamentally changed the way that relocation providers conduct business. Th e tightening of requirements for credit and loans during the recession means that they have had to become far more fl exible in their approach.

Washbourn explains that in many cases staff levels have been re-duced and operations responsibilities have been spread across a smaller workforce, requiring more multitasking. Services and products have also been examined to ensure that they focus on the most eff ective and valu-able areas. Incorporating hard budget caps and streamlining budgets and projections are also essential actions that continue to be employed by relocation providers.

“More companies are taking advantage of technology for team meet-ings and professional development to reduce travel, accommodation and

continuing education expenses,” says Washbourn. “Th e recession has increased the consultative relationship of the relocation service provid-ers and their clients. In fact, many corporations rely on their partnership to help them review and right-size their workforce mobility policies to fi t the current environment. Solid relationships and close monitoring of the relocation process between the client and service provider results in a well-managed, cost effi cient move,” he continues.

Given the particularly volatile environment workforce mobility professionals have been faced with, the need for

more innovative solutions and programs has increased greatly. One of the solutions that Washbourn al-

ludes to is the so-called ‘incent to rent’ program, which is designed to make renting in a new lo-cation more attractive than purchasing. He says that these programs not only save company costs for closing costs in the new location and resale

costs on a future move, but the employee can likely retain their homeowner benefi ts for a later move.

Another solution that is increasingly being con-sidered is the employment of locals as opposed to relocat-

ing staff . Washbourn also explains that there has been more awareness of the need to build skills in crisis management; talent mobil-ity and assessment tools; career counseling, coaching and outplacement; online marketing and professional networking; and managing people and teams from a distance.

Incorporating green initiatives into workforce mobility programs is also gaining traction, and there is interest in developing hyper-local data, which Washbourn explains as explicit and “fi ne-grained” information about locales being delivered via technology from blogs to satellites.

However, it would appear that the worst of the economic turmoil is now behind us and as we start to emerge from recession companies will inevitably be looking once again at expanding as a way to maximize rev-enues and capitalize on new opportunities. In which case international assignments will become increasingly important. Outsourcing to relo-cation providers is one way that companies can ensure that expansion plans run smoothly.

“International assignees face an imperative to comply with tax, labor and immigration laws. Outsourcing of tax, immigration and employment law functions enables companies to get this highly specialized and techni-cal help, which helps manage risk for both the employee and the company. Similarly, expertise in security, as well as research on cost of living and housing data oft en lies with outside specialty providers,” says Washbourn.“Many companies also outsource various other facets of mobility man-agement. Destination and home fi nding expertise in the host location, counseling the transferee and family, and processing and tracking of ex-penses are all functions that some companies elect to have done by out-side service partners. Th ere is no fi nal answer here, as some companies prefer to have in-house staff perform some of these functions, and some companies believe it is more effi cient from a cost and process perspective to keep these functions off staff . Regardless of the approach, companies are recognizing that international mobility requires special training and skills,” explains Washbourn. Mike Washbourn SCRP, GMS, Pfi zer, Inc. is the 2010 Worldwide ERC President.

“In the US, approximately 70 percent of organizations have made changes to their policies in the last year – most of which address challenges created by the housing market”

China is the world’s most

popular international assignmentdestination

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EXECUTIVEINTERVIEW

We are experiencing the worst economic envi-ronment in memory, yet international busi-ness is still crucial for companies based in theUS and elsewhere. How has this environmentaffected international mobility at these com-panies? Are companies implementing costcutting measures? Mary Ellen Myhr. Not all companies and eco-nomic sectors have been affected by the downturnin the same way. Companies in heavy manufactur-ing and shipping, for instance, continue to strugglewith severe financial conditions, while pharmaceu-tical companies have done well. European-basedcompanies have not been affected as much as theirUS-based counterparts. Also, international busi-ness is more important to some companies thanto others.

Thus cost cutting, while common, is not apriority for everyone and companies have re-sponded to the downturn in different ways. Also,the manner in which costs are trimmed dependson the company, the industry and the markets inwhich the company operates. Cutting costs mayactually harm some companies by reducing theirability to recruit needed talent.

For those companies where cutting costs is apriority, what are the easiest ways to do it? MEM. The quickest way to reduce the costs of aninternational assignments program is to reducethe number of assignees by repatriating them tothe home location. In many cases, localizing as-signees can also be less costly.

The quickest way to reduce the cost of exist-ing assignments is to reduce allowances tied to ex-ternal market factors. For example, many rentalmarkets have declined in the last two years.Reducing assignee rental guidelines allows com-panies to save on new assignments, but in somecases companies can also reduce the cost of exist-ing assignments by negotiating leases down. Thesame is true for Cost of Living Allowances(COLA); companies are sometimes hesitant to re-

duce allowances even when exchange ratechanges suggest that they should.

While these measures may seem obvious tothose experienced in mobility, many companiesmiss such opportunities.

What are some other ways to reduce coststhat may generate benefits in the long run?MEM. Some companies are reducing subsidieswithin the framework of existing policies and elim-inating some entitlements altogether. Companiesthat had already trimmed packages are reviewingelements previously left off the table, such as lower-ing housing budgets, reducing or eliminating in-centives, adjusting hardship allowances fortransfers within a region, and switching to a moreconservative COLA methodology.

Finally, some companies are developing al-ternative packages that offer the flexibility to

maintain high levels of subsidy for strategic as-signments while reducing costs for developmen-tal assignments.

However, even for companies facing dire fi-nancial constraints it is crucial to review proposedcost cutting measures carefully in light of thebusiness needs driving each assignment. Cuttingtoo deeply or eliminating the wrong types of sup-port can jeopardize business goals if the right tal-ent cannot be recruited to the necessary location,or the assignee and family do not sufficiently ad-just after arrival. The focus needs to be on value,not just on cost.

How does a company maximize the value itreceives from its mobility program?MEM. Costs must be in alignment with the busi-ness needs driving mobility. Some companieshave relatively simple and straightforward needs– one type of assignment to a small number of sim-ilar locations where assignees return to the home lo-cation upon completion; business units in similarindustries with similar financial constraints. Here,a relatively simple and straightforward policy andadministrative infrastructure may be sufficient.

Other companies have complex needs – multi-ple assignment types to a large number of dissimilarlocations where assignees may go on to subsequentassignments; business units engaged in multiple in-dustries. Complex needs may require complex de-livery, such as flexibility within one policy or multiplepolicies for different assignment types.

Simple needs – simple delivery. Complex needs– complex delivery. Aligning delivery (cost) withneeds leads to value. n

Smart moveMary Ellen Myhr explains how to optimize your global mobility

program by aligning costs with business needs.


Mary Ellen Myhr is Senior Manager at Associatesfor International Research, Inc. (AIRINC). She isresponsible for mobility program strategy andpolicy consulting; and developing new products,service offerings, and new client relationships.She has over 20 years of experience in mobility,developing and supporting strategic andoperational solutions for global companies.

“Cutting too deeply oreliminating the wrong typesof support can jeopardizebusiness goals”

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IN THE BACK140

THE EVOLUTION OF THE JOB MARKET

In as little as 20 years time, the landscape of the job market is likely to have changed beyond all recognition. But while new jobs are likely to be created, some are likely to fall by the wayside; lost forever as a distant memory of years of employment gone by.

While advances in technology and mobility will create roles that otherwise sound like something out of a science fi ction movie, jobs that are – by their very defi nition – more ‘hands on’ are re-portedly at risk of become obsolete by, say, 2020, at least according to job market analysts. Heading for extinction

So just what are the jobs that are likely to be swallowed up thanks to technological advancements, machines and a distinctly less human approach...?

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IN THE BACK141

As society and technology evolve, what jobs are likely to come into being to serve our future society…

Nano-medicNanotechnology has the potential to revolutionize healthcare for

the next generation, particularly in the areas of diagnosis, prevention and treatment. Th e healthcare industry is hoping to harness the quali-ties of nanotechnology in order to provide healthcare, which operates purely from a preventative state, identifying and stopping potential sources of disease/illness in the body before they even get started. A new range of nano-medicine specialists will obviously be required to administer these treatments.

Body part makerDue to huge advances in bio-tissues, robotics and plastics, the

creation of body parts – from organs to limbs – will soon be pos-sible requiring body part makers, body part stores and body part repair shops.

Old age wellness managers / consultants / specialistsDrawing on a range of medical, pharmaceutical, prosthetic, psychi-

atric, natural and fi tness solutions to help manage the various health and personal needs of the aging population.

Avatar manager / devotees / virtual teachersAvatars could be used to support or even replace teachers in the

elementary classroom, i.e. computer personas that serve as personal interactive guides. Th e Devotee is the human that makes sure that the Avatar and the student are properly matched and engaged.

Social ‘networking’ workerTh ere may soon be the need for a new breed of social workers who

help those in some way traumatized or marginalized by social network-ing. Young people today are increasingly hanging out on the internet and social workers will need to be where their clients are.

THE NEW ORDER Store assistantTh e concern here is really two-fold. First is the fact that job

security in this fi eld is likely to decline as the online shopping arena goes stratospheric, and analysts believe that in-store assistants will become surplus to requirements as existing stores install self-service scanners and robotic shelf stackers.

What’s more, analysts also believe that all jobs that center on dealing with cash handling and paper money – including bank tell-ers and toll booth operators – could easily become obsolete as con-sumers rely more and more on credit and digital forms of money.

SoldierAnalysts believe that, with time, the need to send army men

and women to war will begin to wane as machines become more and more capable of going into battle alone. Already develop-ments in the use of unmanned combat aircraft vehicles (ACAVs) suggest that the role of the fi ghter pilot may well be the fi rst to fall foul of machinery.

Construction workerAccording to futurist Joel Barker, while much construction

work continues to be done by hand, 3D printing may change that. Barker believes that, instead of printing one layer of ink on paper, stereo lithographic printers – capable of printing multiple layer of material to make three-dimensional structures – may become the norm. He believes that such structures could then be used to con-struct houses on a mass scale – in a matter of hours.

CD store managerIt’s offi cial: the music world is going digital. And while die-hard

afi cionados of the compact disc aren’t likely to go down without a fi ght, for the average music fan, the days of trawling through Tower Records to fi nd a limited edition Pink Floyd record are long gone.

Th e fact is that, over time, as music producers go digital, retail-ers have to do the same. What’s more, for even the most hardened CD collector, compact discs simply don’t have the same fl air as vinyl records: as such CDs also miss out on laying claim to that classic ‘vintage’ label as well.

Union manager

Th e concern here is that there already seems to be a growing trend of unions with depleting numbers. Analysts believe that unless unions address this trend over the next few years, union organizers will become obsolete.

According to futurist Alvin Toffl er, union leaders have already been too slow and “may soon disappear” because they have failed to “show any sign of wanting to reverse their 20-year membership decline.” Toffl er also notes that the “labor movement has not come to terms with the knowledge economy at all,” and instead warns that union leaders should adapt to the needs of workers in knowl-edge, science and technology sectors.

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Hot off the pressHRM takes a quick look at the some of the books currently clamouring for space on your shelf.

The Future of WorkBy Richard Donkin

Th e Future of Work presents a cohesive argument for a fundamental change in attitudes to work – one that could create a healthier society capable of meeting the expectations and concerns of a developing economy. By looking at the forces shaping the future of employment, this book concentrates on seven signifi cant themes underpinning change in the modern workplace: demographics, talent, measurement, networks, health, age and leadership.

HRM SAYS: Separating popular myths from truly transformational trends, Donkin has produced a fas-cinating read for anyone with responsibility for people at work. An essential guide for using technology to intelligently manage your staff .

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Coaching Skills for Leaders in the WorkplaceBy Jackie Arnold

Acting as a mentor or coach for staff is something that is oft en required of senor managers and executives. Th is book provides valuable advice for anyone looking to set up a successful coaching program that will help to motivate and retain staff .

HRM SAYS: A must read for anyone looking to move into a coaching role within a business, this book is full of useful tools and exercises to facilitate that transition.

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How Remarkable Women Lead: The Breakthrough Model for Work and LifeBy Joanna Barsh, Susie Cranston, Geoffrey Lewis

Full of unique ideas about successful leadership, this book is based on fi ve years of proprietary research on Centered Leadership and raises provocative issues such as whether feminine leadership traits are better suited for our fast-changing, hyper-competitive and increasingly complex world.

HRM SAYS: Th rough lessons and insights based on the stories of successful leaders, this book provides a practical plan for breaking through at both work and in life.

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IN REVIEW142

Book reviews.indd 142Book reviews.indd 142 29/3/10 10:19:5329/3/10 10:19:53

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FINAL WORD144

With the new economy, all organizations are being forced to look at new ways to get the same amount of work done with fewer resources.

Technology is everywhere. It is amazing how many ways technol-ogy touches our daily lives. From our cellular phones we can read our email, browse the internet, set them to remind us about meetings, and oh yeah… they make telephone calls too. Th e cellular phone is a perfect example of merging technologies that were once separate, however when working together allow us to be much more effi cient. Technology is also merging in the human resources industry. How the human resources professional harnesses this technology is what allows them to be highly effi cient and cost eff ective.

Human resource information systems (HRIS) are a necessity in the current business climate. Th e modern HRIS is becoming centralized. Th ey are either hosted on a private network or on the internet. Th ey are accessed

with an internet browser like Internet Ex-plorer, Safari, or Firefox. Th is centralization allows the system to be accessed by diff erent levels of the organizations. Th e modern HIRIS allows access by employees, supervisors and managers alike. Th is allows each level of the organization to enter data, run reports and disseminate information across levels and back to the human resources department.

In addition to merging the internet and human resources data, the modern HRIS should also use other technologies that we use in our everyday lives. Social networking tools such as Twitter, Facebook and LinkedIn should be used as a communication method

between the HRIS and the rest of the organization. Other technologies such as text messaging, email and the telephone should also be incorpo-rated to provide maximum access to necessary information and to send information to the human resources department.

In addition to the merging of technologies, the modern HRIS must merge business functions in the organization. A complete system should include the ability to use social networking, manage timecards, calculate gross wages, schedule, interface to accounting/payroll sys-tems, and much more. Th e modern HRIS should be a merging of all of this information in to a complete record of information about the employee and the organization.

A modern HRIS is one of the few business expenses that can pay for itself with a quick return on investment. By eliminating duplicated functions, merging useful technologies, and centralizing information, the human resources professional needs to use technology to provide a better workplace and cut costs to help the company survive in these diffi cult times.

Fred Schmitthammer is the President and CEO of Inception Technologies and is the chief architect of Inception’s Infi niTime Labor Management System. He has used his extensive background in biometrics, application development and database design to develop in-novative business applications for the business community for 25 years.

The business world has undergone metamorphic changes over the last two years. Communities were subject to business failures, downsizing, layoff s, budget cuts and benefi t reductions. Th is has made the human resources fi eld very challenging.

Employees and managers are feeling the stress of more work with fewer resources. Th ere is a level of fear because employees and manag-ers do not know how to work under these conditions. All aspects of the organization need to restructure to work in this new environment. Technology is the way for the HR professional to manage a higher workload with fewer resources, distribute information, and provide communication channels beyond email and telephone.

Th is generation has never experienced unemployment rates in the double digits. Th e United States has not experienced double digit unemployment since 1983. Because of this long period of prosperity, human resources management teams today do not have experi-ence to manage such a downturn. Most have not experienced the massive layoff s, budget cuts and benefi t reductions that have occurred in the last few years.

Decisions on how to make the human resources organization effi cient will need to be made carefully and deliberately. It is amazing how most organizations spend such little time and money to improve the effi ciency of the human resources department. Th e single biggest expense for a business is their labor cost. However, they stay with legacy management systems and manual processes to manage this very expensive resource.

SURVIVAL OF THE FITTESTFred Schmitthammer explains how HR professionals should be using technology to ensure they survive diffi cult economic times.

“Technology is the way for the HR professional to manage

a higher workload with fewer resources distribute information, and provide communication channels

beyond email and telephone”

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