I stumbled upon an old article by Professor Gary Hamel, where he talks about “The Hole in the Soul of Business.” In his compelling style, he asks us to re-think the language of business. Here are some excerpts:

Here’s an experiment for you. Pull together your company’s latest annual report, its mission statement, and your CEOs last few blog posts. Read through these documents and note the key phrases. Make a list of oft-repeated words. Now do a little content analysis. What are the goals and ideas that get a lot of airtime in your company? It’s probably notions like superiority, advantage, leadership, differentiation, value, focus, discipline, accountability, and efficiency. Nothing wrong with this, but do these goals quicken your pulse? Do they speak to your heart? Are they “good” in any cosmic sense?

Now think about Michelangelo, Galileo, Jefferson, Gandhi, William Wilberforce. Martin Luther King and Mother Theresa. What were the ideals that inspired these individuals to acts of greatness? Was it anything on your list of commercial values? Probably not. Remarkable contributions are typically spawned by a passionate commitment to transcendent values such as beauty, truth, wisdom, justice, charity, fidelity, joy, courage and honor.

I talk to a lot of CEOs, and every one professes a commitment to building a “high performance” organization—but is this really possible if the core values of the corporation are venal rather than venerable? I think not. And that’s why humanizing the language and practice of management is a business imperative (as well as a moral duty).

Again, there’s nothing wrong with utilitarian values like profit, advantage and efficiency, but they lack nobility. Reflect for a moment on the avarice and irresponsibility that produced the recent banking crisis, and wreaked havoc at Enron, WorldCom, Adelphia and a host of other scandal-plagued companies. If corporate leaders and their acolytes are not slaves to some meritorious social purpose, they run the risk of being enslaved by their own ignoble appetites. An uplifting sense of purpose is more than an impetus for individual accomplishment, it is also a necessary insurance policy against expediency and impropriety.

Every organization is “values-driven.” The only question is, what values are in the driver’s seat?

There was a time when Disney was in the joy business. Animators, theme park employees and executives were united in their quest to wring gasps of wonderment and delight from children across the globe. Today, Apple is in the beauty business. It uses its prodigious software and design talents to produce products and services that are aesthetic stand-outs. There are many within Google who believe their company is in the wisdom business, who talk about raising the world’s IQ, democratizing knowledge and empowering people with information. Sadly, though, this kind of dedication to big-hearted goals and high-minded ideals is all too rare in business. Nevertheless, I believe that long-lasting success, both personal and corporate, stems from an allegiance to the sublime and the majestic.

Now, more than ever, companies and leaders need to build a greater sense of purpose to create great workplaces and produce sustainable results. After all, “meaning” is the new money. Oh! Let me stop writing now before I, inadvertently, start using my own frequently-used-terms!

So, how are you changing the language you use at work? What questions & answers are you rephrasing?

In terms of ensuring that employees are business literate and have a good view of organizational performance, there seems to be little variation across the geographical regions. Even so, Asia-Pacific sits at the bottom of the pack on these important issues related to providing clarity and building a sense of connection.

The second issue I spotted was related to Employee Value Proposition (EVP). Given the nature of the talent race in Asia, I think it’s quite a hot issues these days. And interestingly, a higher percentage of Asia-Pacific companies report that they have a clearly defined EVP. However, when it comes to having a segmented EVP approach (e.g. for high performers, high potentials etc.), these companies fare a bit badly. Also, the bigger question is how effectively is the EVP winning mind-share in the talent market.

And as social media powers the new world of communications, there is a fair distance that companies in Asia-Pacific have to go. Only about 30% of the organizations report that they have a documented social media policy in place, the corresponding number for the USA is 77%! Moreover, only a handful of Asia-Pacific companies report that they have the right tools to measure the effectiveness of social media. So, first there is an adoption issue and then, if measurement is not effective, then establishing a clear business case for social media will be a challenge for companies. As for me, I am more interested in finding out how Asia Pacific companies are leveraging these channels for building an open, transparent and collaborative workplace.

All graphs and data credits to Towers Watson

Tom Peters talked a lot about bias for action in his book “In Search of Excellence”. He also shared some slides on this on his website. I just loved the quote on the second slide:

“We have a strategic plan. It’s called doing things.” ~ Herb Kelleher

 So, stop staring indefinitely at the employee survey results. Make things happen.

So, when I got a copy of the book Transformative HR, I was thrilled. Transformative HR has been written by John Boudreau and Ravin Jesuthasan. Ravin is a senior colleague of mine and is the Global Practice Leader for Talent Management at Towers Watson. I hungrily read the book and I think it is one of the best I have read so far. The key takeaway is that HR professionals and leaders need to make informed human capital decisions to keep their organisations competitive. ‘Informed’ is a key word here and the book outlines an evidence-based approach to human capital decisions. They outline 5 basic principles of evidence-based change:

1) Logic-driven Analytics: How often do we HR professionals have an overload of information and metrics? Do we just have numbers or can we tell a powerful story? In a transformative HR future state, the authors share how we can use frameworks & mental models to go behind the metrics, understand the real picture and produce insights which are in high demand by other organisational stakeholders. After all, getting the numbers right is just the beginning. The real value-add comes from using a multi-dimensional approach by synthesizing business strategies, business metrics and talent metrics to produce real insights that help in achieving those business objectives.

2) Segmentation: Conceptually, most of us agree that one size doesn’t fit all and we need to segment our workforce. But, how? John and Ravin propose 3 fundamental questions:

• What are our vital talent segments?
• Which employment elements induce the desired responses at optimum cost (supply-side talent segmentation)?
• What do we need employees to do (demand-side talent segmentation)?

I think this is a powerful way to think through key talent investment decisions, as it helps to understand how to customize the employment deal to create the highest payoff in terms of business outcomes, at the optimum costs.

3) Risk Leverage: I feel that Human Capital Risks are often under-reported and worst, not well-understood. Now, all organisations face HR-related risks, but instead of just mitigating risks, the focus should be on optimizing risks. The book presents a number of systematic approaches to optimize risks and develop sustainable advantages. Again, the approaches are rooted in management tools that business leaders are used to – tolerance analysis, portfolio theory, stochastic simulations, probability matrices etc. In two words: cutting-edge and powerful!

4) Integration & Synergy: Often, HR processes operate in silos which prevents us from getting the “1+1=3″ effect. This principle talks about how to integrate various HR sub-functions as well as integrating HR with other organisational units. The live example about the Talent Management Game at Shanda (one of China’s largest online gaming company) is just fascinating!

5) Optimization: The principle of optimization follows from segmentation. It is all about identifying where & how the payoff of certain HR investments will lead to exponential returns. It is all about identifying the mix of investments that will have the most desired business outcomes. So, instead of spreading HR investments across the board equally, the focus should be on understanding & positioning ‘fairness’ to mean strategically differentiated treatment.

The book is full of great examples and brilliant case-studies from leading global organisations such as IBM, Coca-Cola, Royal Bank of Scotland, Deutsche Telekom, Ameriprise, Royal Bank of Canada, Khazanah Nasional Berhad etc. Overall, it’s a compelling read. It is for anyone who wants to bring rigorous thinking, informed decision-making and sustainable impactful change in their organisation. Did I say that you just can’t miss this book!

Filed under: Business, Human Resources, Leadership, Management Tagged: Business, Change Management, Deutsche Telekom, HCM, HR, HRM, Human capital, Human Capital Management, Human Resource, Human Resources, IBM, Leadership, Management, Performance Management, Royal Bank of Scotland, Talent Management, Transformation, Workplace ]]> http://abhishekmittal.com/2011/09/23/transformative-hr-book-review/feed/ 0 1.352083 103.819836 1.352083 103.819836 Abhishek Transformative_HR_art copy http://abhishekmittal.com/2011/08/24/how-can-hr-use-engagement-surveys-to-drive-business-performance/ http://abhishekmittal.com/2011/08/24/how-can-hr-use-engagement-surveys-to-drive-business-performance/#comments Wed, 24 Aug 2011 09:15:37 +0000 Abhishek http://abhishekmittal.com/?p=1266 ]]> Several companies invest thousands of dollars in running Employee Engagement surveys. Typically, they use the survey results to benchmark workplace experiences with other organizations,  determine enterprise-level priorities, drive key HR programs, set engagement-related KPIs, involve managers in the action planning process etc. But one of the key elements missing is how do we use these insights from the survey, fortify them and use them to really drive business performance. I often find that we miss connecting those critical dots. If HR has to ‘get a seat at the table’, then all it’s initiatives should link back to business performance, including employee engagement.

I could think of one potential approach, and it may be suitable to larger size organizations with a decent number of “units of analysis” i.e. bank branches, retail stores, production sites etc. If we have sufficient number of units to study, the first step would be to start linking the employee engagement survey data to business metrics. Think sales, profitability, productivity, employee attrition, customer survey scores, safety incidents, customer waiting time etc. Then you would need some analytical wizardry to examine how these metrics link to employee survey data. Do highly engaged bank branches have higher loan growth and higher net interest margin? Or do low engagement manufacturing plants showlow productivity as well? Or worse, the linkage is not meaningful or not strong enough (in which case you really need to go back to the drawing board to design a good survey). Such linkages help to establish the validity of your employee research frameworks and help create buy-in among the senior leadership team.

The next step is really to take it a notch further up. Based on the above linkage analysis, you would have identified your high / average / low performing units. Now, the way HR can really add value and improve business performance is by replicating the high performing units. How do you do that? Well, you try to examine what differentiates these high performing units from others. You could look at a range of variables for employees in these groups – age, tenure, experience, competencies, managerial practices – anything that can hypothetically differentiate performance. And yes, you could also connect it all back to the employee survey and see what issues are these “high engagement – high performance” units particularly satisfied on as compared to other units. Again, we are just looking for factors which can differentiate or even predict engagement and performance

Only when you have insights of this depth, then you could work out a plan for replicating such high-performance. Such insights can provide inputs into recruitment plans, talent management, rewards, training & development, career progression etc.  And all this will potentially have much more credibility since you have validated these against business outcomes.

What do you think? How are you using employee survey data to improve business performance? Drop in a line if you would like to discuss this in details.

Enjoy the infographic! And do share your best ideas on gamification.

Employee Value Proposition (EVP) can also be understood in a similar way. It is the sum-total of benefits and experiences a company promises an employee in return for the employee’s time and efforts. The EVP can include compensation, benefits, learning & development opportunities and the overall workplace experience. Usually, companies would define their EVP through some combination of these. So, that’s the promise. But, the crucial challenge for HR, leaders and managers is to deliver on the EVP.

Many a times, I see HR professionals in a rush to define the EVP and communicate it to the world. We want to create a message, come up with great tag-lines, brand the communications and throw it out. Advertisements, posters, billboards, social media – you can do it all and still achieve nothing. A badly execution EVP strategy can never solve talent attraction and retention problems. To be effective in the EVP initiative, it is equally or more important to think about whether existing systems, policies, culture, management style and processes support the delivery of the EVP. If not, then we need to think about what changes are required. Your Employer Brand could fail miserably if the brand doesn’t deliver on the promises. And in this day and age, sentiments are often vented quite openly on public channels.

So, if your EVP promises “a culture that thrives on teamwork, leveraging collaboration to solve X challenges”, but employees join the organisation only to find silos, then its a failure. Or if you promise “performance based pay and best-in-class benefits”, but pay is driven by tenure and benefits are just about average when compared to other organizations, employees will feel disenchanted. The list of examples can be endless.

So, the first step is to look within, not outside. Look within and ensure that the delivery mechanisms are in place. If you get it right, you will just end up creating engaged employees, who also act as advocates for the Employer Brand. It’s as much about the delivery, as it is about the those feel-good, slick communications.

• Jon Ingham is one of my favourite bloggers. He feels that there is a need for a differentiated unique proposition for people management. Sticking to the theme of “talent race”, he shares how Haier (a consumer electronics MNC that started off in China) established race tracks for a unique way of managing their talent base.

• Laura Schroeder wonders where has all the talent gone. She analyzes reports from the Economist Intelligence Unit and Bersin & Associates to come up with strategies to bridge the talent gap.

• Talent retention is on top of the agenda for most HR professionals. Derek Irvine from GloboForce outlines some Tips to Keep Headhunters Away from your Top Employees.

• Tanmay Vora writes at the QAspire blog and shares with us some Core Lessons in Leading & Managing People. He says that “working with people, guiding a team and helping them in their quest for peak potential is one of the noblest things we can do as leaders. It is an opportunity and an obligation as well.

• As HR professionals, we are often heard advising employees to “take charge of your own development”. But do most employees really know how to do this? In this post, Dan McCarthy, from Great Leadership, offers a free step-by-step self-study guide to developing leadership skills. Best of all, it’s free to use and/or share, as a way to engage and retain valuable employees who are willing to learn on their own but need a little structure”.

• Yes, programs are needed. Benefits have to be appropriate. Salary right. But no matter what the industry, the killer app in retention is the personal involvement of management with employees, says Marsha Keeffer.

• Heard about the “HR Hairball”? Find out in this excellent post by Mark Stelzner.

• Ian Welsh writes in from Canada and says that “If we need talent for the future, we need to belong to the future we visualize”. Simply “buying” talent is not the panacea.

• It might be important to hire employees for their skills, but hiring for culture-fit is really important as well. Wally Bock shares his views on Hiring Well. One of my favourite lines from the blog post – “Performance and growth are often situational”.

• Amy Wilson writes about transforming existing performance models into one that is more work-centric and embedded in the natural flow of business to get the best work done.

• Robin Schooling has a different take on Talent Management – Family Style.

• A strong learning & development platform is critical for organization looking at managing their talent base effectively and driving sustained business performance. Linda Fisher Thornton from Leading in Context shares 11 Learning & Development Reports. Informative!

• Anita Lettink feels that “best practices” may not always work for you because you have your own unique context. Instead, she shares some guidelines for winning the Talent Race.

• Finally, to add more of an Asian touch to the Carnival, here is one of my posts about Change Management and Leadership in Asia 2.0

The top challenges highlighted for Asia are – limited supply of candidates with the right skills, competitors poaching talent, global talent deployment and inflexibility of talented people. As the Asia growth machine turns faster, companies are definitely feeling a talent squeeze. But are too many companies simply “buying” talent, rather than investing to “build, deploy, grow, retain” talent? Also, interestingly, “providing attractive career paths” is cited as less of a challenge by CEOs in Asia. I am not entirely sure how to read this because most of my experiences seems to suggest that this is a continual challenge for companies here. Is there a potential disconnect between what leaders and employees think?

The report also states that over 80% of the CEOs globally are seeking a rethink of their people strategy. When asked about what changes they anticipate in their people strategy over the next year, the response are as follows:

Use of non-financial rewards to motivate staff is right at the top of the list. (“Meaning” is the new money?) Leaders in Asia are also looking at deploying more employees on global assignments as they expand. There is lesser focus on incentivizing younger employees differently, which makes me again wonder if focusing on age-groups is useful or should we really focus on “life-stages” of employees. In Asia-Pacific, there is the same level of focus on attracting and retaining women in the workforce as the global levels, but the focus on recruiting / retaining older workers is higher in Asia-Pacific.

Of course, these are just some of the insights from the study. Tell me what else you found interesting!

The idea of the book is to apply commonly used business analysis tools to HR / Talent Management problems. It does not disregard existing HR systems, frameworks and approaches, but focuses on articulating and solving such problems in a way that leaders and managers readily understand because of their familiarity with these business tools. For instance, it applies “portfolio diversification” techniques from Finance to scenario planning for talent management. It borrows from Marketing Research to identify hot talent groups and optimize talent supply strategies. My favourite was the application of “Conjoint Analysis” to design Total Rewards for Microsoft. Here, employees’ preferred Rewards packages were determined and the data was analyzed to find out the expected costs / pay-offs of each Reward scenario. The books is full of such real-life examples. I am soon to start work on a new project on Human Capital Risk Management and I think this book will be a great resource for me.

I strongly recommend the book for anyone who wants to bring strong analytics, clarity, logic and structure to the way HR & Talent Management is approached in his/her company. In fact, I feel this book will be a great addition to “recommended readings” for business school students as well.