Jack SmalleyDirector, HR Learning and Development Express Employment Professionals
June 19, 2013
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
Old Economy Stable– Large company kept competitors at bay
New Economy is Competition– Ability to anticipate, respond and adapt to threats– Eliminate bureaucratic structures– Prepare for organizational change in a minute’s
notice– Or become EXTINCT!– Old business model vs. progressive business
model
Jack Smalley / June 19
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The #1 Movie of 1967Live in a Different World
– 75% of U.S. lives online - autos/farmers– From industrial revolution to data knowledge
revolution– If you understand it, it’s obsolete– Social media
Jack Smalley / June 19
There is a big shift to a Digital Economy
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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“The topple rate” at which companies lose their leadership
positions has more thandoubled.
Jack Smalley / June 19
From: “The BIG eats the Small”To: “The Fast Eats the Slow”
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
Getting suppliers to move fast
Source: Jason Jennings and Laurence Haughton, “It’s Not the Big that Eats the Small … It’s the Fast that Eats the Slow”
SustainingSpeed
FastThinking
FastDecision-
Making
Fast toMarket
Letting the best idea win
Forecasting & roadmapping
Establishing guiding principles
Constantly reassessing
Owning competitive advantageInstitutionalizing
innovation
Financial flexibility
Adaptability
Business process management system
Engine of Innovation
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Microsoft executives were asked how they would break down the
$450 billion market capitalization value of their
company.
“The stuff in people’s heads.”
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Threat 1:
Inability to Innovate
Jack Smalley / June 19
• If you do not have the best talent, you will not survive today.
• HR must lead the organization to attract and retain the best talent.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Where’s your weakest link?
Jack Smalley / June 19
80% of surveyed respondents who are currently employed “would consider leaving their current job if presented with other opportunities.”40% will succeed
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Cyber ProwlersNot only is your competition watching your corporate actions on social networks, they
are stalking your talent.
Jack Smalley / June 19
Of the 2,600 North American hiring managers surveyed, 45% use social-networking sites to research job candidates . Not a war for people/war for talent 12/10 more quit vs. laid off
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Beware of Hiring in HasteJack Smalley / June 19
31%
only of average firms feel they selected their best pick.
Look before you leap.
46% of resumes are falsified
• Halo Effect• One candidate – multiple
resumes• Was it a great hire or a
polished applicant? • To easy to focus on wrong
thing• Arrow vs. Indian
Don’t be distracted by the school colors. Schools attended are not a guarantee.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Threat 2:Losing Your Competitive Advantage
Jack Smalley / June 19
HR must lead to increase employee engagement.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Do you have an army of sleepwalkers?
Jack Smalley / June 19
The Opposite of Employee Engagement
Employees who don’t leave – the under-performing and disengaged
The “quit-and- stay” phenomenonThere are 9-to-5er’s who show up to work everyday but who have “checked out” mentally.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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$300
Jack Smalley / June 19
Employee disengagement costs businesses
billion in lost productivity every year.
Are your profits melting away, employee after employee?
Over 13 million employees & over 32,000 business units surveyed show
of employees in most companies are not engaged in their work.
Customer retention vs. employee retention
67%
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Many companies underestimate the importance of their front line.
Jack Smalley / June 19
60%
Approximately
50% of the workforce
are hourly employees.
leave before they have been on
Engaged plan to stay for what they GIVE!Disengaged stay for what they GET…
the job for six months. Script the first 90 days.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Threat 3:High Costs of Reckless Hiring
•HR must allow supervisors to participate in the hiring process then hold them accountable for retention.
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Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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• Managers are not experts in hiring– It is not essential to the job function– Halo vs. Devil effect
• Biggest failure– Lack of preparation– Experience over “fit”
Jack Smalley / June 19
80% of turnover cost is related to bad hiring.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Ask yourself:How much can we afford to lose?Most conservative estimates of turnover show costs anywhere from 50% to 150% times annual salary. For a professional making $50,000
How many $75,000mistakes can you afford?
Jack Smalley / June 19
Departure Costs• 85% of salary not
uncommon
Hiring Costs• 7-20% of salary
New Hire Training Costs • 13% of salary
New Hire Productivity• 32% base salary
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Jack Smalley / June 19
Beware of turnover fever
• It leads to job sniffing• To close the back door
Why am I staying?I’m leaving!
Maybe I should start looking…
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Threat 4:Poor Leadership &
Communication
• HR’s greatest contribution to organizational success
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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The organizations that exit the recession early and stronger.
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To the employee, the Leader is the company
The messenger is as important as the message.
Relationships –Trust-Information-Success
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
Pre-recessionEmployers not loyal
Post-recessionEmployees not loyal
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What’s on your dashboard?
Jack Smalley / June 19
“I quit!”.
One in two employees is looking to leave or has checked out on the job.
Worker satisfaction is at its lowest level since The Conference Board began measuring it in 1987.
Only 45% satisfied Two-thirds
of companies are more concerned about retention now than they were before the economic crisis.
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Toxic Work Environment
Jack Smalley / June 19
Just because you have talent in your field doesn’t mean you’re a great leader.
Do you know what it’s like to work for you?
1.Do you know how to push without being rude or obnoxious?
2.After someone talks to you, do they feel like they have more or less energy?
3.Do employees feel like you have their backs?
Ask yourself these three questions:
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Leadership is the #1 reason talent leaves
Jack Smalley / June 19
Managers and Leaders influence each…
32% Need for
advancement
22% Pay and Benefits
20% Lack of job fit
17% Mismanagement
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Continuous Learning Is Crucial to Maintaining and Managing Talent
Jack Smalley / June 19
….according to Jim Collins
The mismanagement of human resources is one of the main reasons many “Good” companies never become “Great.”
of organizations surveyed feel
their executives have a gap of leadership level
skills.
50% from the samesurveyed
organizations feel the skills of their current workforce
do not match today’s market challenges.
51%
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Jack Smalley / June 19
Remember!
Employees don’t quit companies,
They quit bosses!
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Threat 5:Regulatory Nightmares
• HR must lead through the regulating minefield
Jack Smalley / June 19
This country has come to feel the same when Congress is in session as when the baby gets hold of a hammer.”
~ Will Rogers
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Top Business Risk
Jack Smalley / June 19
The total cost of federal regulations to employers has increased over $1.75 trillion.
Growth of economy is small businesses– Fear of growing
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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What’s keeping you up at night?
Jack Smalley / June 19
Federal, state, and local restrictions
Background checks Hiring, firing,
and employment regulations NLRB’s self-imposed muscle Social media protections Healthcare Reform Legalization and medical use
of marijuana Class Actions
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Department of Labor (DOL) 2011
– 26,815 charges– Lawyers predicting $1B annually in near
future– 91% class action lawsuits involve wage/hour
claims– Doubled number of investigators– Guilty until proven innocent
•Willful violators
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Department of Labor (DOL) cont.
– Website instructs on filing claims– iPhone app tracking hours worked– Going after misclassified exempts– Volunteer work– Independent contractors
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Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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EEOCDiscrimination and retaliation cases at highest level since Title VII became law in 1965
– 99,947 charges– Less employees– Retaliation charges new #1– $455.6M paid by employers– Record number of million dollar
settlements
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Light at the End
of the Tunnel?
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Why are the Best CEO's turning to HR to solve the Top 5 Threats?
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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Jack F. Smalley, SPHRDirector, HR Learning and Development
Jack Smalley / June 19
Why CEOs are turning to HR to Lead the Organization Through Today’s Top 5 Threats
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