Managing Finance Talenthosteddocs.ittoolbox.com/finance-talent.pdf · 2013-11-13 · Toolbox for...
Transcript of Managing Finance Talenthosteddocs.ittoolbox.com/finance-talent.pdf · 2013-11-13 · Toolbox for...
Managing Finance Talent
Presented by Avi Alpert
Toolbox for Finance: An Online Knowledge Sharing Community
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2
COPIES AND COPYRIGHT
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LEGAL CAVEAT
The Controllers’ Leadership Roundtable has worked to ensure the accuracy of the information it provides to its members. This report relies upon data obtained from many sources, however, and the Controllers’ Leadership Roundtable cannot guarantee the accuracy of the information or its analysis in all cases. Furthermore, the Controllers’ Leadership Roundtable is not engaged in rendering legal, accounting, or other professional services. Its reports should not be construed as professional advice on any particular set of facts or circumstances. Members requiring such services are advised to consult an appropriate professional. Neither The Corporate Executive Board Company nor its programs are responsible for any claims or losses that may arise from a) any errors or omissions in their reports, whether caused by the Controllers’ Leadership Roundtable or its sources, or b) reliance upon any recommendation made by the Controllers’ Leadership Roundtable.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
4
KEY TALENT CHALLENGES IN THE ECONOMIC DOWNTURN
1 Employee Performance Is Declining
The number of employees exhibiting high levels of discretionary effort has decreased by 70% since 2005.
2 The Disengaged Are Staying
The disengaged are 45% less likely to quit in 2010 than in 2006.
3 High-Potential Employees Are More Likely to Quit
One out of four high-potential employees (HIPO) plans on quitting in the next 12 months.
Source: Corporate Leadership Council research; Controllers’ Leadership Roundtable research.
5
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
ROAD MAP FOR THE PRESENTATION
Role for ManagersEmployee Engagement
Managing Performance
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
6
EMPLOYEE DISENGAGEMENT IS INCREASING
Source: 2009 Manager Quality Survey; Corporate Leadership Council research.
Disengagement is increasing, leading to falling levels of discretionary effort.
■■ The number of highly disengaged employees has increased from 1:10 to 1:5 since the first half of 2007.
■■ The number of employees putting forth high levels of discretionary effort has dropped by half.
Percentage of Employees Who Are Highly Disengaged
Percentage of Employees Displaying High Levels of Discretionary Effort
0%
12%
24%
0%
12%
24%
8%
15%
22% 22%
0%
6%
12%
18%
24%
0%
6%
12%
18%
24%
TimeTime
1H 2007 1H 2007
1H 2008
2H 2009
Q1 2010
1H 2008 1H 2009 Q1 2010
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
7
DECLINE IN EFFORT IS MOSTLY PROACTIVE EFFORT
Percentage of Employees Voluntarily Expending Extra EffortQ1 2008–Q1 2009
Almost half of all employees say they will put in effort if needed, but aren’t volunteering like they did.
“Our company is going through serious organizational change.
We’ve laid people off, and now we are changing job requirements. A lot of our employees are disengaged and unhappy with the company, and they don’t know what they should be doing. People are just not putting in as much effort as they used to.”Senior Vice PresidentHuman Resources
Professional Services Company
0%
35%
70%
0%
35%
70%
29%
20%
40%
31%
41%
27%
56%
48%
I Often Volunteer for Additional Duties
I’m Constantly Looking for Ways
to Do My Job Better
I Frequently Try to Help Others
with Heavy Workloads
When Needed, I Am Willing to
Put in the Extra Effort to Get the Job Done
Effort Driver
Δ (31%)
Δ (22%) Δ (34%)
Δ (11%)
Proactive Effort (Looking for Opportunities to Help)
Reactive Effort (Responding to
Requests for Help)P
erce
ntag
e o
f R
esp
ond
ents
Str
ong
ly A
gre
eing
Q1 2008
Q1 2009
Source: Employee Survey and Analysis Tool; Corporate Leadership Council research.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
8
THE DISENGAGED ARE STAYING
Percentage of Disengaged Employees Who Are Actively Seeking a Job
While performance is suffering across the organization, the highly disengaged are not turning over at the same rate as in the past.
■■ Disengaged employees are 46% less likely to quit now than in 2006.
Source: Engagement Survey and Analysis Tool; Corporate Leadership Council research.
2008 Q1 201020060%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
46%
29%
25%
Δ = 24%
Δ = 6%
n = 4,990 n = 24,529 n = 5,949
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
9
ONE-IN-FOUR HIPOS PLANS ON QUITTING
Percentage of HIPOs Expecting to Quit Over the Next 12 Months
High-potential employees are 10% more likely to leave than the general population.
■■ Most employees are less likely to leave the organization because of fewer external labor market opportunities.
Source: Engagement Survey and Analysis Tool; Corporate Leadership Council research.
Note: HIPO status is determined by the organization participating in ESAT.
75% Not Expecting to Quit
25% Expecting to Quit
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
10
COMMITMENT DRIVES EFFORT AND PERFORMANCEOrganizations that improve commitment will see significant returns in discretionary effort and higher performance across the workforce.
■■ Moving employees from strong non-commitment to strong commitment can result in a 57% increase in discretionary effort.
■■ Moving from low- to high-effort levels can move an employee’s performance rating up to 20 percentile points.
Maximum Impact of Commitment on Discretionary Effort1
Maximum Impact of Discretionary Effort on Performance Percentile1
Cha
nge
in D
iscr
etio
nary
Eff
ort
Num
ber
of
Em
plo
yees
Strongly Non-
Committed
50th Percentile
Strongly Committed
70th Percentile
1.00
1.57
Source: Corporate Leadership Council 2004 Employee Engagement Framework and Survey; Corporate Leadership Council research.
1 The analysis above presents a statistical estimate of the maximum total impact on discretionary effort and performance emotional commitment will produce. The maximum total impact is calculated by comparing two statistical estimates: the predicted discretionary effort or performance rank for an employee who scores “high” in emotional commitment, and the predicted discretionary effort or performance rank for an employee who scores “low” in emotional commitment.
The “10:6:2” Rule
■■ Every 10% improvement in commitment can increase an employee’s effort level by 6%.
■■ Every 6% improvement in effort can improve an employee’s performance by two percentile points.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
11
WHAT A DIFFERENCE ENGAGEMENT MAKESThe much higher level of engagement at Organization A relative to Organization B results in 10 times the level of discretionary effort and five times the level of intent to stay across the workforce.
Employee Engagement Discretionary Effort Intent to Stay
22.9%
4.9%
23.5%
2.5%
42.9%
8.7%
Organization A Organization A Organization AOrganization B Organization B Organization B
Per
cent
age
of
Wo
rkfo
rce
Stro
ngly
Eng
aged
Per
cent
age
of
Wo
rkfo
rce
in H
ighe
st
Cat
ego
ry o
f D
iscr
etio
nary
Eff
ort
Per
cent
age
of
Wo
rkfo
rce
in H
ighe
st
Cat
ego
ry o
f In
tent
to
Sta
y
Source: Corporate Leadership Council research.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
12
THE ROUNDTABLE MODEL OF EMPLOYEE ENGAGEMENT
Two Commitment "Types" Four Focal Points of Commitment
Perfo
rmance
Retentio
n
The Outputs of CommitmentDiscretionary Effort and Intent to Leave
Rational CommitmentThe extent to which employees believe that managers, teams, or organizations have their self-interest in mind (financial, developmental, or professional).
Emotional CommitmentThe extent to which employees value, enjoy, and believe in their jobs, managers, teams, and organizations.
Day-to-Day Work
Team
Direct Manager
Organization
Source: Corporate Leadership Council research.
The two types of employee commitment act through four focal points which impact the level of discretionary effort and intent to stay and can translate to increased performance and retention.
■■ Employee engagement is defined as the extent to which employees commit to something or someone in their organization, how hard they work, and how long they stay as a result of that commitment.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
Discretionary EffortEmployee willingness to go "above and beyond" the call of duty, such as helping others with heavy workloads, volunteering for additional duties, and looking for ways to perform the job more effectively.
Intent to StayThe extent to which employees value, enjoy, and believe in their jobs, managers, teams, and organizations.
13
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
SOLVING FOR ENGAGEMENT
Role for ManagersEmployee Engagement
Managing Performance
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
14
EMOTIONAL COMMITMENT STILL SUPREME
Change in Impact of Employee Commitment on Discretionary EffortComparing Global Sample of Employees from 2004 to 2009
The four most important drivers of discretionary effort are based on emotional commitment, with emotional connection to the job being the most important component.
■■ Employees are now more likely to provide effort due to their enjoyment and belief in their organization and colleagues.
■■ Rational commitment to the organization is now more important than other rational commitment variables.
56% 56%
51%
43% 44%
39%
32%34%
22%
18%
11%
14%
9% 8%
Emotional— Job
Emotional— Organization
Emotional— Team
Emotional— Manager
Rational— Organization
Rational— Team
Rational— Manager
2009
2004
Note: The maximum total impact is calculated by comparing two statistical estimates: the predicted discretionary effort level for an employee who scores “high” on the focal point and the predicted discretionary effort level for an employee who scores “low” on the focal point.
Source: Engagement Survey and Analysis Tool; 2008 Multigenerational Workforce Survey; Corporate Leadership Council research.
Average Impact of Emotional Commitment 2009 = 46%, 2004 = 43%
Average Impact of Rational Commitment 2009 = 14%, 2004 = 13%
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
15
TEN IMPERATIVES TO MAXIMIZE PERFORMANCE AND RETENTION
Imperatives for Maximizing Employee Performance and Retention
Managers obtain greater employee performance and retention through both directly managing employee performance and managing the employee’s relationship with the broader organization. Role #1:
Managing Employee Work and Performance
Managers must first center their day-to-day employee interactions on activities with the highest impacts on performance and engagement.
Role #2:Managing the Employee's Relationship with the Organization
To ensure maximum performance and retention, managers must build employee engagement with the broader organization, thereby increasing employee discretionary effort and intent to stay.
1. Provide Fair and Accurate Informal Feedback2. Emphasize Employee Strengths in
Performance Reviews 3. Clarify Performance Expectations 4. Leverage Employee “Fit” 5. Provide Solutions to Day-to-Day Challenges1. Provide Fair and Accurate Informal Feedback2. Emphasize Employee Strengths in
Performance Reviews 3. Clarify Performance Expectations 4. Leverage Employee “Fit” 5. Provide Solutions to Day-to-Day Challenges6. Amplify the Good, Contextualize the Bad 7. Connect Employees with the Organization
and Its Success 8. Instill a Performance Culture: Communication,
Flexibility, and Innovation and Risk Taking9. Connect Employees with Talented Coworkers
10. Demonstrate a “Credible Commitment” to Employee Development
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
16
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
SOLVING FOR ENGAGEMENT
Role for ManagersEmployee Engagement
Managing Performance
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
17
OVERINVEST IN HIGH-POTENTIAL TALENT STRATEGIES
Two HIPO Imperatives
Organizations have two imperatives to improve HIPO retention and their own supply of HIPOs.
Average Percentage of HIPOs Satisfied with Delivery of Top HIPO Retention Drivers1
Imperative 1: Deliver on Key HIPO Retention Drivers Imperative 2: Offer Key Attraction Drivers to Attract HIPOs from Talent Competitors
Top Drivers of HIPO Retention
Impact on Intent-to-Stay
1. Meritocracy 39%
2. Future Career Opportunities
32%
3. People Management
31%
Top Attraction Drivers of HIPOs
Percentage of HIPOs Choosing
1. Compensation 56%
2. Future Career Opportunities
42%
3. Work–Life Balance
40%
4. Development Opportunities
35%
5. Job–Interest Alignment
23%
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
68% Neutral or Disagree
32% Satisfied
Source: Women in Science and Technology (WIST) Survey; Corporate Leadership Council research.
1 Satisfaction is measured as the top two on a seven-point satisfaction scale for each attribute.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
18
FOCUS RETENTION INVESTMENTS ON KEY TALENT
Evaluating Position and Individual Risk
Detailed employee segmentation provides greater potential for creating customized, targeted solutions to retention issues.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
Position Risk Criteria Individual Risk Criteria
The level of risk that an organization would be exposed to from the loss of any employee holding a given position
The level of risk that an organization would be exposed to from the loss of a specific, named employee
Factors to consider:■■ Critical to maintaining external relationships and partnerships
■■ Critical to product development■■ Critical to revenue generation■■ Critical to strategy development and execution
■■ Difficulty of quickly hiring an external replacement
■■ Difficulty of identifying an appropriate internal successor
■■ Seniority of job level within organization
Factors to consider:
One or more of the following…■■ Individual is considered a high potential or high performer
■■ Individual is a named successor on the succession plan
■■ Individual is heavily networked in organization and serves as a critical conduit for information and knowledge
■■ Individual possesses a particularly high degree of valuable institutional knowledge or functional expertise
…plus one or more of the following:■■ Compensation package not equitable with internal peers or external market
■■ Lack of access to development opportunities■■ Long period of time since last promotion■■ Dissatisfaction with most recent performance review
■■ Poor relationship with direct manager■■ Known personal risks (e.g., long commute, health factors, family-related factors)
■■ Noticeable decline in performance or engagement levels
Source: Corporate Leadership Council research.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
19
IDENTIFY AND TARGET CRITICAL POSITIONS AND CRITICAL TALENT
Duke’s Web-Based Retention-Criticality Matrix
Duke Energy evaluates retention risk for selected individuals and positions and develops targeted retention plans for high-risk talent.
■■ The matrix identifies five individuals as having a low retention outlook and occupying a high criticality position.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
Source: Corporate Leadership Council, High-Impact Succession Management, 2005; Corporate Leadership Council research.
Retention Outlook
Low Medium High
Criticality
High 5 91 237
Medium 12 70 103
Low 3 15 4
Step 2: Assess Retention Outlook for Individuals in Critical Positions
Duke Energy uses the following criteria to identify individuals who present the greatest retention challenge:
■■ Total compensation versus market compensation
■■ Future career opportunities within and outside of Duke Energy
■■ Exposure to senior managers and the degree to which that exposure has been favorable
Step 1: Assess Position Criticality
■■ Duke Energy assesses the criticality of positions within the organization, using the following criteria:
■■ High experience or competence requirements
■■ Degree to which critical business processes would be interrupted if a position were left vacant
■■ Barriers of entry to position, stemming from specialization or educational requirements
■■ Position’s impact on customers, revenue, or productivity
Step 3: Create Targeted Retention Plan
By clicking on the number in the box, executives can view the profiles of at risk individuals and prepare customized retention and succession plans.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
20
PRESERVE PAY FOR PERFORMANCECompensation is not a top 50 driver of engagement, but its impact on retention is still significant and tying pay to performance has the greatest impact on discretionary effort.
■■ Employee satisfaction with compensation has a greater impact on intent to stay than on employee effort.
■■ Although compensation has a limited impact on effort, connecting pay to performance will maximize its impact.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
Source: Corporate Leadership Council, Driving Employee Performance and Retention Through Engagement, 2004; Corporate Leadership Council research.
Maximum Impact on Discretionary Effort and Retention Due to Satisfaction with Base Pay1
Maximum Impact of Individual Compensation Levers on Discretionary Effort
7.6%
19.0%
Change in Discretionary Effort
Improvement in Intent to Stay
Cha
nge
in D
iscr
etio
nary
Eff
ort
an
d Im
pro
vem
ent
in In
tent
to
Sta
y
Cha
nge
in D
iscr
etio
nary
Eff
ort
11%
10%9%
8%7%
6% 5%
Co
nn
ecti
on
Bet
wee
n
Per
form
ance
an
d R
aise
Co
nn
ecti
on
Bet
wee
n
Per
form
ance
an
d B
on
us
Tota
l Co
mp
ensa
tio
n S
atis
fact
ion
Bas
e P
ay S
atis
fact
ion
Pro
fit-
Sh
arin
g S
atis
fact
ion
Sto
ck B
on
us
Sat
isfa
ctio
n
Cas
h B
on
us
Sat
isfa
ctio
n
1 Each bar represents a statistical estimate of the maximum total impact on discretionary effort or intent to stay each lever will produce through its impact on rational and emotional commitment. The maximum total impact is calculated by comparing two statistical estimates: the predicted discretionary effort or intent to stay for an employee who scores “high” on the lever and the predicted discretionary effort or intent to stay for an employee who scores “low” on the lever. The impact of each lever is modeled separately.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
21
MANAGING THE DISENGAGED
Process for Managing the Disengaged
Business leaders often are unable to manage out the disengaged without disrupting other employees.
■■ According to Senior Leaders, 63% of managers are ineffective at managing the disengaged.
■■ Managers need tools and resources to effectively manage disengaged employees.
Source: Corporate Leadership Council, “2008 Talent Champions Survey;” Corporate Leadership Council research.
Rebuild Engagement
■■ Build an engagement plan.
■■ Improve managers’ capabilities to re-engage employees.
Manage Out Poor Performers While Keeping Survivor Engagement High
■■ Plan layoffs.
■■ Build effective internal communications around layoffs.
Identify Roles of Employees That Are Disengaged
Identify which employee segments are most at risk.
Develop Strategy
Develop a workforce strategy to determine where to allocate the most resources to improve employee engagement.
1
2
3 4
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
22
THE IDEAL CANDIDATE
Stryker Top Performer Behavior AssessmentsIllustrative
Stryker’s Controller analyzes the common characteristics of top performers to create a job posting designed to attract candidates with similar traits.
Source: Stryker Corporation.
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
Nick Bourgeois Behaviors Assessment
Mas
tery
Ser
vice
Co
mm
itm
ent
Res
po
nsi
bili
ty
Dis
cip
line
Co
ura
ge
An
alyt
ical
Ski
lls
Gallup® Top Performer Behavior Compilation
■■ Service Commitment
■■ Responsibility
■■ Discipline
■■ Mastery
■■ Analytical Skills
■■ Courage
Stryker’s top 20 finance performers exhibit similar behaviors, which the Controller seeks to replicate in new staff.
■■ Recruits for overall skill level instead of job-specific capabilities
■■ Eliminates time-to-fill pressure of recruiting for an existing open job
■■ Attracts candidates with the skills to perform outside the limits of a specific role
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
23
22% Agree
EMPLOYEE ENGAGEMENT
ROLE FOR MANAGERS
MANAGING PERFORMANCE
COMMITMENT THROUGH DEVELOPMENT OPPORTUNITIES AND ORGANIZATIONAL CONNECTIONS
“I Will Be Rewarded for My Loyalty to My Organization”2009
Leading organizations are reconnecting employees rationally through experiential development and emotionally by using managers to reinforce organizational values.
■■ Monetary incentives may no longer be viable to connect employees rationally.
"Organizations Have the Best Interest of Their Employees in Mind"2009
78% Neutral or Disagree
81% Neutral or Disagree
16% Agree
Tactics to Improve Rational Commitment to the Organization
1. Create career paths that include experiential development for all employees, not just high-potential employees.
2. Unlock solid performer contributions through challenging roles and projects aligned with strengths.
3. Ensure rewards and recognition programs apply to a large number of employees, even as the organization invests more in high performers.
Tactics to Improve Emotional Commitment to the Organization
1. Ensure CEO and line leader communications specify how employees can contribute to business goals.
2. Reinforce organizational values and messages through managers, not just centralized initiatives.
3. Create opportunities for two-way exchanges between business leaders and employees.
n = 13,110
Source: 2008 Multigenerational Workforce Survey; Corporate Leadership Council research.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
24
Leading Finance departments use a number of innovative development opportunities to drive engagement.
LOW-RESOURCE DEVELOPMENT OPPORTUNITIES
CREATE HYBRID POSITIONS
Allow lawyers to split time between legal and non-legal roles, creating new challenges and developing additional skill sets.
PEER CONSULTING COHORTSOrganize cross-company business networks for emerging leaders to provide targeted job support and leadership development opportunities.
EXPERIENTIAL LEARNINGHelp team members fully leverage developmental opportunities within their work rather than waiting for “big” experiences which may be limited.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
25Source: Cummins, Inc.; General Counsel Roundtable research.
Splitting time between core and non-core roles has created exciting learning opportunities for Cummins staff to expand their knowledge of business functions.
■■ “Hybrid Positions” at Cummins have served to:
– provide career “stretch” for capable staff,
– further integrate functions with the rest of the business,
– keep headcount and the company’s costs to a minimum, and
– provide staff with varied experiences without forcing them to leave.
LEVERAGING TALENT AT CUMMINS
Hybrid Profiles
Name Background Legal Position
Legal Reporting
Nonlegal Position
Nonlegal Reporting
Current Work Split
Paul Malone Worked at a law firm and with the Indiana Attorney General’s Office for a total of six years. Joined Cummins in 1999.
Corporate Counsel
General Counsel
Director of Government Affairs
VP, Business Services
70% Legal,30% Nonlegal
John Rubino Worked as a pilot at Cummins before obtaining MBA. Worked in a business role at Cummins until obtaining J.D. Has been a Cummins attorney for the past 10 years.
Corporate Counsel
General Counsel
Director of Environmental Affairs
VP, Environmental Affairs
80% Legal,20% Nonlegal
David Wright Worked in-house at another company. Has been a Cummins attorney for more than 15 years.
Corporate Counsel
General Counsel
Director of Benefits Design and Strategy
VP, Human Resources
90% Legal,10% Nonlegal
Marya Rose Worked at a law firm and with the Indiana Governor’s Office for a total of seven years. Joined Cummins in 1998.
Corporate Counsel
General Counsel
Director of Public Relations
General Counsel
30% Legal,70% Nonlegal
In-Depth Profile—Marya Rose
■■ Exposure: “I have the grand fortune of interacting at a very high level with the Chairman, the President, the CFO, and all the executive officers. As a result, I know that my career has probably progressed faster because of the PR position than it would have if I had only been a lawyer.”
■■ Integration: “There is no sentiment that once you become a lawyer at Cummins…your only value is to give legal advice.”
■■ Stretch: “I am glad I have this public relations role, because I see a slice of corporate life that is so different from my role as a corporate lawyer.”
■■ Compensation and Workload: “I did receive a raise when I took on this other position, but my workload increased exponentially.”
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
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Bombardier creates a forum for managers to (re)build cross-business networks designed to provide targeted job support.
■■ CLC1 research shows that high quality job-focused peer networks have a powerful impact on leadership development.
■■ Many organizations fall short on helping employees to activate and maintain networks beyond the immediate team.
■■ Bombardier created line manager peer consulting cohorts; with minimal time and budget investment from HR and the line, managers can benefit from ongoing guidance and support from their peers.
BOMBARDIER’S PEER CONSULTING COHORTS
Bombardier Aerospace’s Peer Consulting CohortsFor Supervisors and Managers from Diverse Functions
Success Factors For Reestablishing Disrupted Networks Using Peer Cohorts
Optimize Network Quality■■ Cross-functional participation builds networks beyond the immediate team that are valuable for obtaining knowledge and resources
■■ Connecting managers with peers at a similar stage in the careers with similar challenges fosters empathy and relationship building
Optimize Network Interaction■■ Clearly defined roles and agenda help set expectations and ensure constructive, solutions-oriented discussion
■■ A “report-back” element at the start of each session enables reflection on what worked or did not and contributes to learning
Optimize Network Maintenance ■■ The eight-month duration provides sufficient time for networks to be developed and consolidated
■■ The focus on job-specific challenges drives relevance of the network for participants
Source: Learning and Development Roundtable, ‘Bombardier’s Peer Consulting Cohorts’ 2007; Corporate Leadership Council research.
CONSULTING COHORT MECHANICS■■ Bombardier convenes groups of seven managers from different business units monthly for eight months to advise each other on leadership and management challenges.
■■ Each manager plays the role of the “client” at least once across the eight-month time period; otherwise they are “consultants.”
■■ The client presents a management challenge and directs the type of consulting he or she wants from the group.
■■ Consultants contribute based on the objective and approach set by the client.
■■ A learning facilitator ensures that the client and consultants adhere to a pre-defined contract.
Managers take turns playing the role of “consultants”
Managers also take turns playing the role of the “client”
Learning Facilitator
1 Corporate Leadership Council.
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
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State Farm’s L&D function helps leaders to identify sources of development in their work and to create specific opportunities for addressing development needs supplemented by a robust inventory of competency-aligned experiences.
■■ Through this framework, the L&D function encourages leaders to mine their work for existing developmental opportunities rather than searching for “big” experiences such as work rotations or regional assignments that are scarce, expensive, and difficult to execute.
HELPING LEADERS HELP THEMSELVES
State Farm’s Learning Experience Continuum
Source: State Farm Insurance Co.; Learning and Development Roundtable research.
Case in Point: Constructing Development Opportunities in WorkIllustrative
New Job
Current Job
New Role
New Task
Current Task
New Project
Current Project
SituationKathy needs to improve her oral communication skills.
AssessmentRoot-cause analysis reveals that Kathy’s main challenge is influencing and persuading others in small group settings.
Development ActionsStep 1: Kathy provides a five-minute presentation to her direct manager every week to discuss the progress of one of her major projects.
(Feedback and Addition of Stretch)Step 2: Kathy provides the same five-minute presentation to her peers, who are not as familiar with her formal presentation.
(Feedback and Addition of Stretch)Step 3: Kathy provides the same five-minute presentation to managers and peers in other teams.
Examples from State Farm’s Experience Library Skills Addressed
Senior Executives■■ Serve as an adjunct professor for a local university■■ Volunteer as a professional facilitator outside State Farm■■ Participate in an internal leadership forum
■■ Passion■■ Relationship Building■■ Communication
■■ Influencing■■ Learning■■ Vision
Functional Leaders■■ Engage in formal dialogue with 10 industry peers on a
non-competitive topic■■ Serve as a board member for a local community group
■■ Self-Awareness■■ Coaching■■ Teamwork
Middle Managers
■■ Have leaders, peers, and direct reports assess your performance in externally administered 360-degree feedback
■■ Participate as a small group teacher to State Farm associates
■■ Self-Awareness■■ Learning■■ Relationship Building
First-Line Managers
■■ Organize a small networking group of first-line managers to discuss challenges
■■ Shadow a middle manager experienced in coaching and performance feedback
From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
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State Farm’s Debrief Question InventoryInitial Leader Reaction “Doing Things Differently” Skills and Behaviors
What surprised me about this experience? What would I do differently if I were going to do this experience over again?
What skills and behaviors did I display most effectively during the experience?
What met my expectations? What did not meet my expectations?
What would I have done, what would I have read, and who would I have met with to better prepare myself before the experience?
What skills do I wish I had demonstrated more effectively in completing the experience? How can I gain these skills?
How did I feel before, during, and after the experience?
What would I have done, what would I have read, and who would I have met with to better prepare myself during the experience?
What did I learn that I can apply to my current and future work responsibilities?
INCREASING LEADERS’ “ACTION-TO-REFLECTION” RATIOS
State Farm’s L&D function provides leaders with a list of debrief questions to facilitate (constructive) reflection on key lessons learned from developmental experiences.
■■ By providing a structured means for thinking about and synthesizing experiences, State Farm hopes that leaders will be more intentional in their approach and execute against what they have learned from development in work, especially critical given that 90% of leaders come from inside the organization.
Source: State Farm Insurance Co.; Learning and Development Roundtable research.
1 1 1
2 2 2
3 3 3
Individual Leaders
Reflect on key lessons learned during and after developmental experiences
Development Advisors
Provide advice and support tools to leaders to help synthesize key lessons learned
Direct Managers
Help leaders understand performance differences before and after developmental experiences
Potential Debrief Participants
Mentors
Share tips and lessons learned for effectively reflecting on developmental experiences
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From the CONTROLLERS’ LEADERSHIP ROUNDTABLE®of the FINANCE AND STRATEGY PRACTICEwww.ctlr.executiveboard.com
© 2010 The Corporate Executive Board Company. All Rights Reserved. CTLR6104010SYN
KEY TAKEAWAYS
1 Focus on Employee Commitment
Focus on improving employee commitment (both rational and emotional commitment) through day-to-day employee interactions on activities with the highest impacts on performance and engagement and building employee engagement with the broader organization to significantly increase staff discretionary effort.
2 Explicitly Address the Impact of Resource Reductions
Prioritize everyone’s workload, including your own, and establish clear objectives, measure them frequently, and provide positive, corrective feedback as necessary. Reinforce a culture of small productivity wins, e.g., time-saving adjustments, cost savings, removal of roadblocks, etc.
3 Create Space for Employees to Discuss the Downturn
Even if there are no major cuts in the department budget, the economy’s continued weakness creates a level of concern about the company’s health and potential for cutbacks. Allowing employees to raise concerns as well as providing them with ongoing updates about the company’s financial stability is critical to maintaining morale and focusing staff efforts.
4 Build Employee Engagement with the Company
To ensure maximum performance and retention, build employee engagement with the broader organization through increased CEO, line leader and manager communication, experiential development opportunities for all employees, and appropriate rewards and recognition to a large number of employees, thereby increasing employee discretionary effort and intent to stay.
5 Overinvest in High-Potential Talent Strategies
Aggressively manage performance to create “headroom” for emerging Tax leaders and budget room for new hires.
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