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HR’s Role in Business Growth
Accelerator or Speed Bump ?!?!
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Raising HR’s Strategic Contribution
1. Understand what strategy is and isn’t;
and why so many fail.
2. Sharpen the ELT’s strategic focus and related capabilities.
3. Redefine HR’s value proposition and role in the enterprise.
4. Create and illustrate the connection between HR and business processes.
5. Design and follow an HR Plan that drives growth plans and execution.
Five Critical Success Factors
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Strategy –
a framework of choices that determine the nature and direction of an organization.
Source: The Art and Discipline of Strategic Leadership
by Mike Freedman & Benjamin Tregoe
First…What It Is
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Lack of clear ownership and accountability
Lack of rigor and challenge in
planning phase
Out of touch with the market
and/or the business
Inconsistent focus and
prioritization
Inadequate attention to process and implementation
Culture, leadership, people or skills can’t support it
Design (Customers)
Implementation (Capability)
Why Strategies Fail
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
SWOT Analysis
Gap Analysis
Needed Organization and Capabilities
Strategic or Operating Plan
Monitoring and Continuous
Improvement
HR Plan for Closing the Gaps
HR’s Strategic Context
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Know the Vision
Know the Business
Know the Options
Decide and Do
What do we want to be known for or achieve?
How will it affect financial performance?
New markets, capabilities, or relationships?
How will we prioritize and implement?
Basic Strategy Framework
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
Defining HR’s Strategic Contribution
1. Understand what strategy is and isn’t;
and why so many fail.
2. Sharpen the ELT’s strategic focus and related capabilities.
3. Redefine HR’s value proposition and role in the enterprise.
4. Create and illustrate the connection between HR and business processes.
5. Design and follow an HR Plan that drives growth plans and execution.
Five Critical Success Factors
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Sharpen the Strategic Focus & Capability
• Help shape their vision & aspirations
• Add clarity by asking the tough questions
• Help align & equip the broader organization
Influence & Support the ELT
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Company’s Capabilities
Customers’ Needs
Competitors’ Offerings
Strategic Hot Spot *
Sharpen and Challenge Their Aspirations
Know the Vision…Know the Business…Know the Options…Decide and Do
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
* Harvard Business Review – April 2008
Add Clarity By Asking Tough Questions
Questions about our talent
demands and supply of talent
Questions about our mission, vision or strategic direction
Questions about our organization structure and effectiveness
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Defining HR’s Strategic Contribution
1. Understand what strategy is and isn’t;
and why so many fail.
2. Sharpen the ELT’s strategic focus and related capabilities.
3. Redefine HR’s value proposition and role in the enterprise.
4. Create and illustrate the connection between HR and business processes.
5. Design and follow an HR Plan that drives growth plans and execution.
Five Critical Success Factors
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
FACT #1:
Non-financial (intangible)
considerations constitute 35%
of investor decisions.
FACT #3:
60 – 80% of a typical company’s
Opex is tied up in workforce
costs. FACT #2:
For every $6 of market value, only $1 occurs on the balance sheet. The other $5 are based
on intangibles.
Understanding “Intangible” Value
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
TRADITIONAL VALUE – ADD
Expenses Process Performance Value Drivers
Payroll as a % of revenue
Acceptance rates or time to fill
Profit Before Tax per employee
Quality of hires
Benefit costs as % of payroll costs
Absenteeism or Safety Results
Call Center Performance
Revenue per sales-maker
Cost per hire Promotion and transfer activity
C-SAT or customer loyalty ratings
Employee Engagement
HR – related legal costs
Formal complaints Succession Plan Ready Replacements
Customer Engagement
HR headcount to total headcount
Turnover rates or exit interview data
Completed Performance Reviews
Process cycle time
Per – capita training costs
Reasons given in exit interviews
Completed Individual Development Plans
New products or services launched
Shifting HR’s Focus
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
The ultimate purpose of strategy is to create, optimize and sustain stakeholder value.
Top and Bottom Line Impact
HR’s Strategic Role Is To:
• Ensure the organization has the people it needs to execute its strategy • Continually evaluate, build and strengthen its capability to execute • Help protect and ensure the value- creating potential of its talent
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Defining HR’s Strategic Contribution
1. Understand what strategy is and isn’t;
and why so many fail.
2. Sharpen the ELT’s strategic focus and related capabilities.
3. Redefine HR’s value proposition and role in the enterprise.
4. Create and illustrate the connection between HR and business processes.
5. Design and follow an HR Plan that drives growth plans and execution.
Five Critical Success Factors
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Your Employees
Your Customers
Your Business
•Talent Value Proposition
• Employee Segmentation
• Employee Engagement
• Employment Brand
• Internal Performance
• Customer Value Proposition
• Customer Segmentation
• Customer Engagement
• Product/Service Brand Promise
• Marketplace Performance
Enterprise value is created at the customer – employee interface
Aligning HR and Business Processes
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
Defining HR’s Strategic Contribution
1. Understand what strategy is and isn’t;
and why so many fail.
2. Sharpen the ELT’s strategic focus and related capabilities.
3. Redefine HR’s value proposition and role in the enterprise.
4. Create and illustrate the connection between HR and business processes.
5. Design and follow an HR Plan that drives growth plans and execution.
Five Critical Success Factors
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Organizational Plan
Human Resource Plan
Deployment
Development
Retention Alignment
Acquisition
BUSINESSSTRATEGY
METRICS
METRICS
MET
RIC
S METR
ICS
Integrated HR Strategy
Competencies: the common link
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Technology & Risk Mgmt
Applied Throughout
Q & A
Wrap Up
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Appendix
1. Are key leaders aligned to and accountable for our vision or purpose?
2. Which initiatives drive most of our strategy’s
value? (80-20 Rule)
5. Do we have action plans that drive everyone’s effort
and outcomes?
Questions About Our Direction
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
3. Do our top initiatives have clear goals and
milestones?
4. Are those goals translated to the individual level?
1. Do we have non-core or non-value add processes or functions?
2. Can we gain economies or efficiencies by
centralizing?
3. Can we get closer to our markets by expanding
or decentralizing?
5. Are we victims of our own silos?
6. Do we have too many
layers and filters?
Questions About Our Organization
4. Where are our process disconnects
and bottlenecks?
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
Demand • Business strategy’s capability and talent implications • S/T planned & L/T anticipated • What talent do we need? • What are we missing? • What trends (business & people) concern us? • Which roles are critical? • Which critical roles are at risk or sub-optimized? • Which needs can we build or fill internally? • Which ones must we acquire?
Supply • What talent do we have? • What does our skill/competency inventory look like? • Which people are critical? • Who is a successor for what role? • Who is placed in a talent pool? • Who is at risk? • How do we segment, evaluate, calibrate and deploy? • What does our external talent pool look like? • Which skills/roles are no longer needed?
Questions About Our Talent
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
The 80 – 20 Rule Can Be Applied to Your Talent Base
Talent Segments
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
The 80 – 20 Rule Applies to Your Customer Base Too!
Customer Segments
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Brand Advocates
Loyal Customers
Price Buyers Convenience Buyers Value Buyers
High Cost Customers
See Strategy Alignment Tool for more information and examples
BRAND PROMISE
COMMERCIAL
EMPLOYER
Creating solutions for business and
home
Providing products that
lead in innovation and design
Legendary customer
service…and a lot of fun
Relationships drive success
Providing an innovative workplace
Legendary opportunity…a
fun place to work
Creating a world of
possibilities and
opportunities for a
meaningful life
We turn relationship
specialists into industry experts
Aligning Your External and Internal Brands
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Seizing All Opportunities to Differentiate
See Strategy Alignment Tool for more information and examples
SUPPLY
Multiple Sources of Prospects
Applicants
Phone Screens
F2F Interviews
In-depth Interviews
Offers
Acceptances
HR Process
DEMAND
776
97
63
47
40
194
Cold Calls
Appointments
Actual Visits
Proposals / Bids
Negotiations
T & C’s
Sales Process
Customer and Talent Acquisition
Both Assets Require Similar Processes and Levers
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
Aligned Comp and Pricing Approach
Parties Pay More for Receiving More Value
PAY PRICE
PREMIUM
BASE (Fixed)
(Variable)
PAY
Compensation paid for
employee meeting
expectations
Compensation paid for
employee adding value
Customer views and pays for standard
value
Customer views and pays more for extra
value
PRICE
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
See Strategy Alignment Tool for more information and examples
About the presenter: Bill Thomas has over 30 years of experience in HR/OD, Customer Experience Management, TQM and Operations management. Prior to joining Centric, he held national and global management roles with PricewaterhouseCoopers and Dell Computers, respectively. He was the co-architect of PWC’s Service Excellence initiative, and helped design and launch Dell’s Customer Experience effort. He co-authored the recent book “Anticipate: Knowing What Customers Need Before They Do,” and his work has been featured in CEO magazine, Human Resource Executive magazine, Quality Progress, HR Advisory and others. He can be reached at 866.302.9099 or via email at [email protected].
About the company: Centric Performance works with organizations of various types and sizes to help them accelerate growth and improve results – at the enterprise, business unit, function, team or individual level. We do this by identifying, evaluating and improving their efforts and performance in four areas proven to create stakeholder value:
• Strategy, Leadership and Organization Effectiveness • Optimizing the Customer Experience
• Human Resource Practices and Processes • Business Transition Planning and Implementation
Further information is available at www.centricperformance.com.
© Copyright 2001 – 2013 Centric Performance, LLC – All Rights Reserved
Accelerating Growth…Improving Results