Tuesday, May 31, 2011
Last week we discussed starting with organizational strategy when creating HR metrics that matter to your organization. That blog received the most feedback, I have ever received since writing Profitability Through Human Capital.
I had many requests for a larger version of the strategy map and many questions about definitions that we use when mapping strategy.
So, I thought I would do a follow up due to all the feedback.
First, I would like to clear up a few definitions we use:
1) Strategic Goals-An organizational statement that communicates where your organization is going. It is directional. It can be called different names.
2) Business Results-These are clear directions & measures of success in achieving the strategic goals.
3) Performance Objectives-Think of these as business KPI’s or what needs to be done to achieve the business results. People begin to see what needs to be done & how they can fit in.
4) Performance Metrics-Metrics are designed solely to drive improvement & track progress for the Performance Objectives. They are specific & quantifiable goals.
5) Performance Outcomes-These are definitions of your desired outcomes that force the organization to be clear about what will improve. Also helps people plan specific actions & projects to achieve the goals.
6) Actions-These are the "what" you need to do to execute on the strategy.
Let's try and walk through an example.
Strategic Goal: Your organization wants to grow sales in 2011
Business Results: Increase sales to new customers by 5% and Increase sales to existing customers by 10%
Performance Objectives: Increase speaking events by 20% and increase sales calls by 15%
Performance Metrics: % sales increased new customers and Customer sat scores existing customers
Performance Outcomes: Increase sales skills and increase customer service skills
Actions: (potential) Provide training to sales staff on selling skills and customer service, provide rewards and recognition program geared at increasing customer sat and closing new business
This is a very simplified example to show a process. If this was a "real time" mapping exercise we would have all functions i.e. sales, ,marketing, HR, finance, operations, etc. present to walk through the strategy to make sure:
1) All scenarios are accounted for and identified.
2) Everyone is on the same page and understands the interdependencies between departments.
3) Serves as a communication devise to each department so they understand how what they do fits into the overall organizational strategy,
4) Serves as a strategy execution tool as each department has uncovered what they need to do to move the strategy forward.
5) Uncovers all actions that should be considered and ANALYZED to determine which are the BEST alternatives depending on budgets and AHA's found from data analysis process.
This process is critical for strategic execution and it is a perfect exercise for HR to own and manage. HR has been screaming for strategic work....here is your opportunity!
Monday, May 23, 2011
So, you have decided you need HR metrics. You know it's important. You know your CEO is craving data to see how the investment in people is paying off.
You then begin to develop metrics. What is your first step?
So many times I hear the following answers to the above question:
1) I start with turnover and cost per hire
2) I google "HR Metrics" and pick some that look good
3) I ask another HR colleague
4) I go to a conference
5) I just measure anything and everything
"NOT!" to all of the above. The key to determining your HR Metrics that matter to your organization is to start with your organization's strategy. A company that is in growth mode has very different metrics than a company that is in survival mode. The growth oriented company is going to focus on goal attainment and revenue growth and the company trying to survive is going to be more cost conscience.
So the proper game plan would be: READY, SET, MAP YOUR STRATEGY and then MEASURE.
A strategy map is an invaluable tool that enables you to understand your business results, your performance outcomes, your performance measures, and the actions needed to execute the strategy. Then and only then are you ready to create metrics.
The cool thing about a strategy map is that it gives every department a visual communications tool to understand how the organizational strategy comes to life. Think about your organizational strategy, when it was announced. Did it hit like a thud or did everyone stay energized and focused because they knew what to do and how they would be measured?
What an opportunity for HR to be strategic...you can assist with strategy execution AND develop HR metrics that really mean something to the organization. Brilliant...
Saturday, May 14, 2011
Recently, I went to the Performance Conference in Chicago, where I had many interesting discussions regarding HIPO's. In HR slang HIPO's are defined as an organization's high performers. But as I delivered a presentation with my colleague Sue Bond from Halogen Software, it became crystal clear that high performers and high potentials are two very different types of employees. I am a fan of segmenting employee populations just like we do consumers as I think you can really gain insights on employee behavior and employee needs by analyzing segments versus all employees.
So what about high performers and high potentials?
According to me, (for what it's worth) a high performer has a track record of delivering results to the organization.
A high potential has the ABILITY to deliver results (at a future date) to the organization minus the track record. The high potential just needs to gain more experience and possibly skills to become a high performer.
So, how do we move a high potential to a high performer? Good question. I think this is both an art and a science as the tipping point, is motivation. Motivation is a tricky thing as it has many drivers. In my experience you can move a potential to a performer in the following ways:
1) Make sure the potential employee has a clear set of expectations for his current role.
2) Make sure rewards and recognition are given in a timely fashion.
3) Make sure the manager understands this person has potential. The manager is the key in this transition from potential performer to high performer. The manager is the coach in this relationship.
4) Sometimes the high potential employee doesn't recognize his own potential. See #3 above. Manager needs to communicate the traits that he sees that will make the employee a high performer.
5) Make sure the high potential employee knows what you are planning for him. If he is on a succession plan, make that explicit to the employee.
Can you have a high potential that is not performing? YES, I see that combination all of the time.
What can you do about that high potential that is not performing? To me, this is the trickiest scenario and a common one at that. Remember you need motivation for a person to perform. And sometimes, no matter what we do as managers we can't drive the employee to perform. It could be a matter of personal issues or just a bad job fit. This situation is also one of the most frustrating as managers often feel responsible for the non-performance.
So, let me hear from you, what have you done in a similar situation? Please comment below and give me your scenario and advice!
Thursday, May 5, 2011
I am sitting here at a Performance Conference hosted by ASMI and I can't help but to think about performance and the importance it plays in our organizations. After all, after the Great Recession isn't performance on top of everyone's list? CEO's want to outperform their competition. Managers want their departments to out perform other departments. And HR? Well...what is HR's relationship with performance?
Isn't performance the desired outcome of everything we do in HR? Compensation is designed to motivate higher performance. Our performance management systems are designed to measure, track and develop performance. Training programs are designed to increase skills thus increasing performance. So why in the world do I hear a statement like the following from several attendees at this conference: (I have not ran into 1 HR person yet, FYI)
"Our HR department won't share their performance metrics with the rest of the organization. I can't get performance data from HR, they guard it like it were gold."
Those comments make me cringe. How in the heck are we supposed to optimize our workforce and get the most we can out of our people if HR is not in the game? I don't get it.
By the way, the individuals I heard the comments above from were from large well known companies. Are you kidding me?
Yesterday, I picked up the latest edition (April 2011) of HR Magazine and found an interesting article on Integration and Talent Management. (membership required to view). I agree with Adrienne Fox it is critical to integrate compensation, recruiting, succession planning, performance management, compensation and learning. Here is why:
- All 5 components have to be linked to strategy for optimal outcomes (i.e. performance)
- All 5 have data that we NEED for analytics to understand where we are weak and strong.
- You can't impact performance with siloed programs, it just doesn't work. You can have a compensation strategy that you think is world class, but if it does not reflect the goals and objectives of your organization then it is useless.
Organizations with integrated talent management systems can shift to accommodate changing business strategies more seamlessly. These organizations experience a return on equity that is, on the average 38% higher per year during a five year period than those without an integrated system, according to the researchers.
What are your thoughts, is performance where HR should focus? Should HR systems be integrated? Please comment and keep the conversation going!
Monday, May 2, 2011
I had the pleasure of attending HRevolution this weekend in Atlanta. It was the third time the "unconference" took place and my first time to attend. "I will be back." I attend many conferences every year, and they are basically the same. There is a Keynote, then workshops, with PowerPoints. I feel very thrown up on when I leave. I am guilty as I usually am doing some of the throwing up.
I didn't feel that way late Saturday when I left HRevolution. I felt like I was a part of the conference. I did not attend workshops. I attended live discussions on interesting topics. Here is a sample of the discussions I participated in:
1) Pop Culture, Politics, and HR – Laurie Ruettimann and Matt Stollak-We discussed if bringing a discussion of pop culture and politics into the work environment is a positive or negative. We also talked about "that guy" that is the top seller but is a huge asshole. What do you do with that guy? And to finish up the chat, we discussed organizational values vs. opinions. As you can see interesting and stimulating. To see more, check out the twitter hashtag #pophr.
2) Connecting in a Non-creepy Way – Shauna Moerke, and Dwane Lay-Shauna and Dwane discussed the different online personals a person can have online including a lurker, a social butterfly, a pimp, a robot and others. Understanding what makes an interaction "feel creepy" was also discussed by the individuals in the room. Again, interesting and relevant. Check out the twitter hashtag #noncreepy
3) The HR Slam – Mary Ellen Slayter and Charlie Judy-This session was very interesting. The attendees in the room actually got to solve a real live HR problem. We were given a scenario from a real company and acted as a team of consultants to come up with the best solution. Yes, there were prizes for the winning team. There were some heated moments...all good though. Check out hashtag #hrslam on twitter.
Besides the content examples above, you should attend because:
1) Be a part of the evolution of HR...have a voice
2) Connect with other individuals who are passionate about #1 and also have influence. (Another great discussion on influence was lead by China Gorman and Paul Smith)
3) It makes you THINK...
4) You can understand what is NEXT in HR, not just what is RIGHT NOW
5) It is fun and you can say swear words if you want to!
6) There is an emphasis on bacon; from chocolate cupcakes with bacon to prizes including bacon
Hope to see you at the next one! I hear it is in Vegas baby...how appropriate!