INVESTMENT MANAGEMENT CAREER PATHS INPRIVATE FOUNDATIONS/EDUCATIONAL ENDOWMENTS

JANUARY 28, 2015

Anna OrgeraIlene Siscovick

MERCER WEBCAST

MERCER WEBCAST

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Today’s Speakers

CLICK HERE

Anna OrgeraPartnerMercer+1 212 345 5041anna.orgera@mercer.com

Ilene SiscovickPartnerMercer+1 212 345 4760Ilene.siscovick@mercer.com

QUESTIONS?

Please type your question inthe Q&A section of thetoolbar and we will do ourbest to answer it.

While in full-screen mode,simply use the Q&A buttonon the bottom right-handside of your screen.

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QUESTIONS?

Please type your question inthe Q&A section of thetoolbar and we will do ourbest to answer it.

While in full-screen mode,simply use the Q&A buttonon the bottom right-handside of your screen.

While in half-screen mode,use the Q&A panel on thebottom right-hand side ofyour screen.

MERCER WEBCAST 2January 28, 2015

• Overview of talent challenges facing the sector

• Context: Mercer research on performance management and careers

• Career path design areas and examples

• Sample process for developing career paths

• Career pathing as focal point for talent and reward programs

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AgendaWhat we’ll cover today

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Key Talent Challenges Facing Investment Managementin Private Foundations and Educational Endowments

• Impact of 2008 financial crisis on investment management roleexpectations

• Compensation programs alone are ineffective

• Private foundation/higher education work environment presents anopportunity, but also a challenge

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ContextMercer research on performance management

AreaArea Critical Drivers of SuccessCritical Drivers of Success

Source: Mercer’s 2013 Global Performance Survey Report (n = 1,056 organizations)

Manager Skills • Elements having most impact– Having candid dialog– Linking performance to development planning– Setting “smart” goals

Executives Leading by Example • Holding one-on-one performance discussions• Having formal performance planning discussions• Holding team accountable• Providing regular coaching/feedback• Regularly talking about performance management as

a core business process

Calibration • Calibrating all employees

Technology • Providing access to information; supporting a comprehensive/timelyprocess

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ContextMercer research on career frameworks

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Source: Mercer 2012 Career Framework Survey. 297 US and Canadian organizations

1/3companies have acareer framework

68%companies plan to

implement one

9%

26%

65%

Plan to implement a new framework (9%)

Do not plan any modifications (26%)

Plan to modify their existing career framework, includinglinking additional talent management or rewards programs(65%)

68%

32%Plan to implement a career framework

Do not plan any modifications (32%)

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Career Path Design AreasProgram objectives

• Provide employees with a map to own their careers– What career opportunities exist?– Vertical and lateral progression

• Manage employee expectations– What experiences/skills are required for success in the role and to progress?– Career opportunities reflect organizational need and employee capabilities– Discourage entitlement mentality

• Provide managers with a tool to be effective coaches

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WHAT is expected of me?

WHERE ELSE CAN I GO IN THISORGANIZATION? WHAT OTHER

FUNCTIONS EXIST?

WHAT ARE THEROLE EXPECTATIONS?

HOW can I get there?

JOB FAMILIES/SUB-FAMILIES

Generally recognized majorprofessional area, often requiringa unique set of skills

Most career development occurswithin a job family.

ROLE

A specific point in a careerjourney, characterized by acombination of career level,career stream, and sub-family.

Each role has a unique blend ofcompetencies and technicalcapabilities.

HOW MANY RUNGS ARETHERE IN THE CAREER

LADDER HERE?

CAREER LEVELS

The hierarchical position ofa job within a career stream.

Recognizes incrementalchanges in job scope andresponsibilities.

Consistent across job families.

DO I HAVE A CHOICE BETWEEN ATECHNICAL CAREER OR A

MANAGEMENT CAREER ATSOME POINT?

CAREER STREAMS

Career type within theorganization,characterized byunique responsibilities.

Career ArchitectureDetermining the right career architecture is the blueprint to a strongfoundation enabling individual growth and better business performance

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FUTUREOPPORTUNITIES

CURRENTROLE

Career Path Design AreasVertical and lateral progression

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ROLEPROFILE

Group A Group B Group C Group D Group E Group F Group G

ROLEPROFILE

ROLEPROFILE

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Career Path Design AreasCareer path design building blocks

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Career Path Guides

Career Tracks

Role Architecture

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Career Path Design AreasDual career track illustration for investment management roles

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Investment Officer

Senior InvestmentOfficer

Chief InvestmentOfficer

Investment Director

Investment Manager

Senior InvestmentAssociate

Investment Associate

Investment Analyst

Individual Contributor People Manager

Investment Management Team

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Career Path Design AreasCareer path guides: content areas for each role

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Job RelatedInformation

Career PathGuidance

Major responsibilities

Job family specific experiences, e.g., investment management

Broadening experiences

Typical feeder roles (within and outside the organization)

Potential next roles (within and outside the organization)

Core competencies/skills

Technical competencies/skills

Career Path Guides

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Career Path Design AreasMajor responsibilities

• 3 to 8 major responsibilities

• Provide a picture of what’s critical

• Not every task or duty

• Show progression from role to role

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Career Path Design AreasMajor responsibilities: simplified Investment Officer illustration

Investment Officer Major Responsibilities

• Assists in determining portfolio allocation• Conducts new manager searches• Presents business case for investment manager selection to Chief Investment Officer and President• Monitors designated funds, including conducting due diligence, making on-site visits and both tracking

and analyzing investment performance• Prepares and presents reports evaluating performance of designated external investment managers• Manages projects, including developing plans, assigning work, and ensuring that work is completed

according to performance standards• Assists in developing analyst staff by reviewing their work and providing on-the job training opportunities• Leads cross functional teams, e.g., consisting of Investment Management, Finance and Operations

representatives

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Career Path Design AreasMajor responsibilities: simplified progression illustration

Role Major Responsibilities Illustration

Senior InvestmentAssociate

• Performs most complex quantitative analyses with limited supervision• Prepares reports for internal and external stakeholders• Assists in presenting recommendations to Chief Investment Officer and

President• Reviews all work prepared by Investment Associates and Analysts• Serves on cross functional team to identify key information for financial

reporting

Investment Associate • Under general supervision, performs specialized quantitative analyses,including financial modeling and research, for specialty area

• Contributes to report development for internal and external stakeholders• Reviews programming developed by Investment Analyst to track data

Investment Analyst • Under close supervision, conducts market research and analysis in support ofthe selection, evaluation and monitoring of external investment managers fora specialty area

• Develops programs to track investment and risk management data

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Career Path Design AreasExperiences

Types of Experiences Examples

InvestmentManagementSpecific

• Demonstrated knowledge of assigned asset class and trends/developmentsin related areas

• Understanding of basic principles of risk management• Ability to interpret investment financial reports and apply data for decision-

making

Broadening • Project management• Financial analysis, statistical or econometrics• Experience working outside of home country

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Career Path Design AreasCareer pathways: consider experiences and competencies/skills required

Career Pathway Area Examples

Feeder Roles:sources of talent withinand outside theorganization

• Within: finance and risk/compliance roles• Outside: MBA, foundations/educational endowments/pension funds, financial

services industry, consulting

Next Moves:within or outside theorganization

• Within: most typically vertical, but finance, risk/compliance, communicationsand advancement/development could be options

• Outside: Non-profits per above, financial services, consulting

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Career Path Design AreasCore and technical competencies (may pertain to behaviors orknowledge/skills)

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COMPETENCY/SKILL TYPE PROFICIENCY LEVEL (EXAMPLE)

• Applies to specific jobfamilies, e.g., specificto investmentmanagement

TechnicalTechnical

Demonstrates beginner awareness andunderstanding

Applies intermediate understanding in ownwork and may guide others

Leverages advanced understanding in ownwork and may act as a coach

Leverages expert understanding and acts asa role model, organizational coach andchampion

• Applies to all jobs andjob families

CoreCoreLEARNINGLEARNING

FULLYPROFICIENT

FULLYPROFICIENT

ADVANCEDADVANCED

EXPERTEXPERT

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Competency Model Assumptions

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Competency FrameworkCompetency Framework

Level 1 Level 2 Level 3C

OM

PETE

NC

IES

Technical Competencies

Core Competencies

SAMPLE CAREER LEVEL

Relationship and Application

COMPETENCIES Core Competenciesthat apply to all jobsregardless ofgeography or function

Specific skills andknowledge that arecritical for functionspecific jobs

CoreCompetencies

TechCompetencies

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Career Path Design AreasCompetencies

Sample Behavioral Sample Knowledge/Skills

• Leadership• Personal influence• Teamwork/collaboration• Flexibility

• Communications• Quantitative analysis• Subject matter expertise• Business acumen• Risk management

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Key CareerFramework Components

Building Blocks: CompetenciesDefined company-wide competencies (leadership, employee) to driveperformance management and career development

WHAT

HOW

EXPERIENCE/PROGRESSIONGUIDELINES

Key behaviors,skills andknowledge

Job scope andresponsibilities/accountabilities

Education andexperienceguidelines

US bank

Illustrative

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Definition: Has the ability to convey and communicate ideas in a way that is simple and enhances understanding, collaboration and engagement.

Learning Fully Proficient Advanced Expert

Investment Analyst/Associate Sr. Investment Associate/Investment Officer Senior Investment Officer Chief Investment Officer

Impactful communication

• Exhibits effective oral, written andnon-verbal communications anddelivers high quality work

l Listens attentively and askseffective questions to clarifyunderstanding

• Understands verbal and non-verbal nuances while deliveringmessages to create simple andhigh impact outcomes

• Leverages knowledge of a myriadof communication styles andadapts own approach to conveycomplex concepts in a simple wayto manage sensitive and diverseaudiences

Internal and external relationships

• Exhibits awareness of differentstakeholders (e.g. banks,investment managers, regulatorybodies, etc.) recognizing theirimpact on XYZ

• Leverages knowledge of differentstakeholders and seeksopportunities to engage them indifferent ways that can havepositive outcomes

• Understands priorities and deeperneeds of different stakeholdergroups while strategically utilizingthem for the organization

• Is an expert in managing multiplevaried stakeholder perspectivesand objectives while providing riskadvice with an impact on the widerindustry

Developing self

• Shows eagerness to learn newbusiness knowledge, technologies,tools or systems and makes apoint to offer ideas/solutions

• In times of change, applies variouslearning experiences to proactivelyanticipate problems, createefficient solutions and avoids“over-analysis”

• Drives, anticipates and embracesthe change process by quicklylearning new concepts andtechniques and helping others todo so as well

• Keeps abreast of innovativeindustry practices and externalperspectives and sharesdata/reports that can improveXYZ’s position

Personal Influence

Career Path Design AreasCore competency/skill example

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Career Path Design AreasCareer path guide simplified illustration for Senior Investment Associate

Area Senior Investment Associate

Major Responsibilities • Performs most complex quantitative analyses with limited supervision• Prepares reports for internal and external stakeholders• Assists in presenting recommendations to Chief Investment Officer and President• Reviews all work prepared by Investment Analysts and Associates• Serves on cross functional team to identify key information for financial reporting

Investment ManagementExperiences

• Advanced understanding of assigned asset class and trends/developments in relatedareas

• Demonstrated understanding of investment quality standards, including performance inthe context of risk management and managing liquidity

• Advanced understanding of how to apply financial/statistical modeling to investmentanalyses

Broadening Experiences • Project management• Demonstrated ability to present recommendations to senior management

Required Core / TechnicalCompetency Level

• Fully proficient

Feeder Roles • MBA, foundations/educational endowments/pension funds, financial services industry,consulting

Next Moves • Within Investment Management, Investment Officer or Manager• Within organization, finance, risk/compliance, communications• Outside organization, foundations/educational endowments/pension funds, financial

services industry, consulting

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Building Blocks: Career JourneysDefined critical experiences and skills that enable specific career journeys

Illustrative

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Professional

Individuals may switch betweenprofessional and people managementroles as appropriate

People manager

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Building Blocks: Role ProfilesA single document for each role that would bring all the pieces together.This would drive market pricing and employee development

Each job standard profilerepresents a global level inthe career ladder

• Job Scope - Each grade is defined usingorganization-wide criteria such as scope/impact,complexity, span of control, etc.

• Responsibilities - Key areas of responsibilities aredeveloped and assigned by career stream for eachgrade

• Technical capabilities – Key skills, knowledge andbehaviors that are articulated by sub-department foreach grade. The types of competences include:

• Core (generic): across the organization for allemployees

• Department-specific: Some specific capabilitiescan be identified for sub-departments

• Guidelines on key qualifications and experiencesare developed and assigned by global job level

Illustrative

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Key CareerFramework

Components

WHAT

HOW

EXPERIENCE/PROGRESSIONGUIDELINES

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Sample Training and Development ToolDevelopment Actions

Competency models can include the identification of specific on-the-job actions to strengthen capabilitiesand facilitate employee development.

Sample Development ActionsTechnical Competency: Effective Communication

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Illustrative

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Sample Competency Assessment Tool

§ Receives coaching from executive peerswhen developing the next generation ofmarketing skills, analysis, planning, andknowledge requirements that deliver bottom-line results which take more time thancolleagues at the Fully Proficient level

§ Draws upon a foundation of broad knowledgeto develop the next generation of marketingskills, analysis, planning, and knowledgerequirements that deliver bottom-line results

§Draws upon a foundation of broad knowledgeand drives others to learn how to developthe next generation of marketing skills,analysis, planning, and knowledgerequirements that deliver bottom-line results

§ Develops successful market plans thatdeliver on revenue projections and profittargets through the direction of seniorcolleagues/managers

§ Develops successful market plans that deliveron revenue projections and profit targets

§ Develops and drives others to championmarket plans that deliver on revenueprojections and profit targets

§ Identifies sources of competitive advantagein market and company capabilities todevelop market plans that reflect customerand market requirements with the guidanceof senior colleagues/ manager

§ Promotes delivery of integrated customer solutionsby translating information into actionable items forothers

§Coaches others to identify sources ofcompetitive advantage in market andcompany capabilities to develop market plansthat reflect customer and market requirements

§ Produces positive results using marketanalysis to make strategic decisions thatpositively impact the brand most of the timeafter reviewing a clear example

§ Produces positive results using marketanalysis to make strategic decisions thatpositively impact the brand

§Drives positive results through othersusing market analysis to make strategicdecisions that positively impact the brand

Based on where the majority of your ratings fall, choose an overall rating for the Market Analysis and Planning competency:

Supporting evidence (support your overall rating with specific work-related examples and results):

Developing Fully Proficient Role Model

Developing Fully Proficient Role Model

Mercer strongly supports baseline talent review and development through an assessment process.The assessment also helps socialize the competency model.

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Sample assessment page withfree form comments boxes

Sample assessment pagesIllustrative

Sample administrator page

Section 1

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Sample Competency Assessment Results:Individual Report and Talent Heat Map

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Individual Report:Discrepancy profileshows largestdiscrepancies betweenown ratings and the ratingsof others

Individual Report: Overallprofile provides an overview ofresults

Talent Heat Mapprovides an overview of

aggregate results

Illustrative

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Sample Process for Developing Career Paths

• Gather information on current roles– Organization charts– Existing position descriptions

• Consider market practice

• Establish design principles around– Desired degree of change from current state– Career tracks and alignment with organization-wide role architecture

• Involve employees and managers in building content, e.g.,– Steering Committee– Design Team– Broader employees

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Key Learnings About Process for Broader Applications

Start careerpathing with theright job family

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Think carefullyabout projectteam structure

And so isexecutivesponsorship

Projectmomentum iscritical

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Career Pathing as Focal Point for Talent and Reward Programs

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Today’s Speakers

CLICK HERE

Anna OrgeraPartnerMercer+1 212 345 5041anna.orgera@mercer.com

Ilene SiscovickPartnerMercer+1 212 345 4760Ilene.siscovick@mercer.com

QUESTIONS?

Please type your question inthe Q&A section of thetoolbar and we will do ourbest to answer it.

While in full-screen mode,simply use the Q&A buttonon the bottom right-handside of your screen.

While in half-screen mode,use the Q&A panel on thebottom right-hand side ofyour screen.

QUESTIONS?

Please type your question inthe Q&A section of thetoolbar and we will do ourbest to answer it.

While in full-screen mode,simply use the Q&A buttonon the bottom right-handside of your screen.

While in half-screen mode,use the Q&A panel on thebottom right-hand side ofyour screen.