Towers Watson Manager Redefined: Unleash the potential of your organization’s managers

© 2011 Towers Watson. All rights reserved.

Manager RedefinedUnleash the potential of your organization’s managers

Tom DavenportStephen HardingFebruary 24, 2011

© 2011 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.towerswatson.com 2

Today’s discussion

“Kill” the manager?

Redefining the manager

The manager performance model

Seven elements of success

Q&A


“First, kill all the managers”

Employees are smart and demanding

We have ambivalent feelings about leadership and followership

We really don’t like being told what to do

Managers behave badly

Middle management has become a euphemism for meddling, ineffectual supervision and frustrating career coma


Who wants to be a manager?

Do you want to be a manager?% of employees

49%51%YesNo

Source: “Managers of Tomorrow: Setting a New Standard.” 2009 World of Work Topic Report, Randstad 2009. Study of 2,199 employees and 833 U.S. managers conducted in March and April 2009.


Why don’t people want the job?

Of those employees who don’t want to be a manager Strongly agree/agree

82%74%

63% 63%

Increased level ofstress

Handlingdisgruntledemployees

Increasedpaperwork

Having to terminateor lay off employees

Source: “Managers of Tomorrow: Setting a New Standard.” 2009 World of Work Topic Report, Randstad 2009. Study of 2,199 employees and 833 U.S. managers conducted in March and April 2009.


Organizations have placed fairly low priority on improving manager performance

3%45%52%Senior leadership assessment

2%47%51%Succession management

3%40%57%Senior leadership development

4%41%56%Employee learning and development

0%46%54%Performance management

DecreasedStayed

the sameIncreasedTalent management activities

Change in emphasisHigh-performing companies

Source: Towers Watson, Talent Management and Rewards study

12345

1%56%43%Manager performance8


Overstressed managers, frustrated

employees, higher

turnover, lower productivity

Many companies have allowed the manager’s job to become a death spiral

You’re our best producer, sowe’re promoting you to manager

But keep producing —after all, you’re the best

And we’re expanding your span of control,

to save money

True, you haven’t shown any leadership ability

But unfortunately, we no longer offer training

for new managers

And don’t forget to master manager self-service so you can reduce

HR’s burden


Effective managers get much higher scores than ineffective ones

Source: 2010 Towers Watson Global Workforce study

11%66%Makes fair decisions about how my performance links to pay decisions

15%66%Has enough time to handle the people aspects of the job

17%72%Provides me with opportunities to develop my skills

12%74%Helps remove obstacles to doing my job well

16%75%Explains how our work supports execution of team goals

14%76%Is a trusted source of information about what is going on in the organization

18%78%Provides clear goals for the work of the team

13%80%Acts with honesty and fairness

Percent who agree with survey item and who also:

58%

Agree that manager is effectiveMy immediate manager:

10%Helps me with career planning and decisions

Disagree that manager is effective


Don’t kill them — redefine them

With this approach, they will:

Use our five-part performance model to define what managers need to do well

Organizations often:

Define manager competencies by using existing or historic models and emphasizing process, not people





Define the manager role to: Increase employee engagement Achieve specific economic goals Contribute to achieving and

sustaining competitive advantage



Construct manager roles to fail, by: Ignoring the implications of

reporting spans Making managers divide their time

among too many activities Promoting for the wrong reasons





Define the manager role to: Increase employee engagement Achieve specific economic goals Contribute to achieving and

sustaining competitive advantage

Have a more realistic sense of success requirements and come to better make/buy decisions



Construct manager roles to fail, by: Ignoring the implications of

reporting spans Making managers divide their time

among too many activities Promoting for the wrong reasons

Place too much faith in training and development to create competency or rehabilitate poor performers

In our model, the best managers work offstage


In this context, a key theme

“To lead people, walk behind them.”Lao-Tzu


The current environment calls for an offstage manager who excels in five categories

Authenticity and Trust

Developing People

ExecutingTasks

Delivering the Deal

Energizing Change


Let’s start with the first requirement: ensuring effective execution of tasks


Developing People

ExecutingTasks

Delivering the Deal

Energizing Change


EXECUTING TASKS

This means balancing job resources and challenges, and reducing hindrance demands

Hindrance demands Resource shortfalls Role conflict and overload Politics Unclear leadership

Engagement

Burnout

Job resources: Autonomy Feedback Development Rewards and

recognition

Job challenges: Range of

responsibility Workload Urgency


Defining alternative manager roles: technical expert

Time allocation

Direct production

People focus

Work process oversight

External contact

Administration

Span of control

Manager competency balance

0% 20% 40%

Limited Broad

0 10

Employee roles and competencies

Technical Relational

EXECUTING TASKS


Defining alternative manager roles: power multiplier

40%0% 20%

Limited Broad

0

Technical Relational

10

Time allocation

Direct production

People focus

Work process oversight

External contact

Administration

Span of control

Manager competency balance

Employee roles and competencies

EXECUTING TASKS


What’s different about this way of looking at managers?

• Understands subtle differences in individuals’ engagement drivers• Treats employees equally well

Configures work to build engagementGets jobs done

• Involves employees in crafting customized jobs• Assigns work fairly

• Involves employees in planning• Challenges own assumptions• Uses planning tools effectively

In our model, a strong manager also:In the typical model, a good manager:

EXECUTING TASKS


The second area, developing people, is a key global engagement driver


Developing People

ExecutingTasks

Delivering the Deal

Energizing Change


Why performance management systems fall short —look to the manager

Performance management challenges% of respondents

Source: Reward Challenges and Changes — Top-Line Results, Towers Perrin, 2007, p. 41.

Significant challenge Not a challengeSome challenge

Managers unwilling to take the timeto thoroughly evaluate employees

Lack of funds to reward high performers

Inadequate manager training on howto be an effective coach

Insufficient rewards for managers inmanaging performance

Employee mistrust of performance ratings

1827 55

3827 36

1925 56

3120 49

2820 52

1827 55

3827 36

1925 56

3120 49

2820 52

DEVELOPING PEOPLE


Strong managers do more than set SMART* goals

Matched with the cadence of workControllable

Task-focused, not person-focusedMastery-buildingError-tolerantIncremental

Action-oriented

Individual, not comparativeAligned individually and organizationally

Fairly determinedFew in number and focused

FITEMA feedback:FAMIC goal setting:

*Specific, Measurable, Agreed-upon (or Attainable), Realistic and Time-bound

DEVELOPING PEOPLE



• Coaches, teaches, counsels to reinforce autonomy and self-efficacy• Coaches employees

• Works with employees to define FAMIC goals• Sets SMART goals

• Makes FITEMA feedback/dialogue a constant part of the job flow• Gives frequent feedback

Turbo-charges engagement by creating and recognizing mastery Helps people develop

• Creates network of internal/external learning contacts• Connects people with training


DEVELOPING PEOPLE


Delivering the deal requires a partnership between managers and HR


Developing People

ExecutingTasks

Delivering the Deal

Energizing Change


Which picture doesn’t fit?

DELIVERING THE DEAL


People are not assets — they are investors

DELIVERING THE DEAL


How two personalized deals might work

• Cubicle (eventually office) with a window• Flexible schedule/work locationBenefits

• Goals and incentives emphasizing project success

• Goals and incentives emphasizing marketable contributions

Rewards

• Project success acknowledged, leadership potential reinforced

• Technical contributions acknowledgedRecognition

• Career-development plan focused on achieving executive rank

• Leadership responsibility for increasingly larger and more important projects over time

• Career-development plan focused on achievement of high status as a technical contributor

• Contact with network of senior experts in the discipline

Growth

• Growing responsibility for team or project leadership

• Challenges reflecting both team and relationships, and project operations

• Stimulating projects to work on• Membership on teams with smart

people• Challenges reflecting technical issues

and questions

Work design

Future executiveStar contributorElements

DELIVERING THE DEAL



Knows that:• Pay doesn’t always reinforce performance• Ownership behavior does not follow

financial ownership

• Adheres to the organization’s pay-for-performance philosophy

• Administers systems effectively

• Uses FAMIC goal setting and FITEMA feedback

• Enables poor performers to improve or find better options

• Deals with poor performers quickly and fairly

• Designs customized deals• Applies reward systems equitably

Goes beyond HR programs — creates an intrinsically rewarding portfolio of

elements

Implements HR’s pay schemesconsistently and efficiently


DELIVERING THE DEAL


Change never stops — managers must consistently build change capability


Developing People

ExecutingTasks

Delivering the Deal

Energizing Change


Faced with culture change, managers need to focus on sustaining engagement

Highest employee performance

Well-being

Individual physical, social and emotional

health at work

Engagement

Employees’“attachment” to the organization (think, feel, act)

Performance support

Facilitation of employees’ efforts in the

immediate work unit

ENERGIZING CHANGE


Performance support in practice

Nearly one in three think there are substantial obstacles to doing their job well, and that conditions in their job are not conducive to achieving exceptional performance

Feelings of frustration are widespread in the workplace

60%

38%

46%

63%

21%

32%

22%

22%

19%

31%

32%

16%

There are no substantial obstacles at work to doing my job well

My team/local work group is able to meet our work challenges effectively

Conditions in my job help me achieve exceptional performance

DisagreeDon’t knowAgree

Over the past month, I have often experienced feelings of frustration at work

Source: Towers Watson 2010 Global Workforce study

ENERGIZING CHANGE



Provides performance support

Ensures employee well-being

Makes change a contributor to employee strength and organizational successManages change

Builds employee resilienceHelps people accept and respond to (difficult) change

Builds employee adaptabilityEncourages and supports innovation


ENERGIZING CHANGE


Authenticity and trust form the foundation of the manager performance model


Developing People

ExecutingTasks

Delivering the Deal

Energizing Change



Don’t take yourself too seriously

Consistently adheres to principles of fairness

Follows the platinum rule: Treat others the way they want to be treatedDemonstrates company values

Develops and conveys a personal style based on authenticityActs with integrity

Sees every part of the performance model as an opportunity (indeed, a requirement)

to demonstrate authenticity and build trust

Is honest and consistent

Understands and achieves the economic advantages associated with trust


AUTHENTICITY AND TRUST


Incorporating the model into practice

The Seven Elements of Success

Measure Manager

Performance

Redefine Manager

Role

Make ChangeHappen

Align Rewards

Define Critical

Competencies

DevelopManager

Capability

DiagnoseManager

Performance

Measure Manager

Performance

Redefine Manager

Role

Make ChangeHappen

Align Rewards

Define Critical

Competencies

DevelopManager

Capability

DiagnoseManager

Performance


A final thought

“As for the best leaders, the people do not notice their existence. The next best, the people honor and praise. The next, the people fear, and the next, the people hate. When the best leader’s work is done, the people say, ‘We did it ourselves.’”

Lao-Tzu

Make this the guiding theme for the managers in your organizations

Contacts

towerswatson.com 36© 2011 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Tom [email protected]

Stephen [email protected]

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