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Do You Know the Quality of Your Widgets But Not Your Recruits?

Wed, 25 Aug 2010 13:11:00 GMT

Go ahead, be a picky recruiter. It's a buyer's market for most jobs these days so your company can afford to bide its time and hire the right person. But here's the rub: It's unlikely that, once you've made your new hires, you'll honestly be able to tell how good they are.

That's because most companies do not measure quality of hire to any great extent. They may have six sigma programs that reduce defects to 3.4 parts per million but when it comes to their hiring, they're often flying blind.

The performance gap here is huge. Our recent study on Talent Management Measurement found that a paltry 16% of respondents said their organizations measure quality of hire to a high or very high extent. But that's not because these professionals don't know any better - fully three quarters believe that their organizations should be measuring quality of hire to a high or very high extent.

So, why is there an enormous disparity between what organizations know they should do versus what's actually being done?

As part of a larger initiative, i4cp's Talent Management Accelerator, a research working group made up of 15 member companies, has looked into this challenge and found seven major barriers that frustrate organizational efforts to measure quality of hire.

Metrics vary by position

i4cp research shows that quality of hire differs based on the nature of the position. For some roles, quality may be about longevity in the role, while in others it's about the time it takes to come up the learning curve or productivity output levels. It's rare that one quality metric is universal across an organization.

Quality is subjective

Different functions view quality differently, even if it's for the same position. Those who focus on leadership development will see quality of hire as being all about long-term promotability, while first-line managers will care more about the ability to learn and produce quickly. Meanwhile, operations or finance may value longevity in the role to increase the return on investment for the hire. In short, quality is not an absolute concept.

Hiring philosophy and strategy affects the metric

Philosophy and strategy will affect quality metric outcomes. An organization that succeeds by being a low-cost competitor, for example, will focus on keeping labor costs down, productivity up, learning curves short and efficiency fine-tuned. An organization that competes based on design and innovation will likely focus more on qualities such as creativity, teamwork and customer relationships.

There are no clear external quality-of-hire benchmarks

When it comes to product components and manufacturing processes, there are often industry-wide specifications and quality metrics. When it comes to people, however, there are few benchmarks and standards. Companies might have an idea of compensation ranges and educational prerequisites for certain positions, but qualifications say little about quality of hire. Therefore, it's hard for Company A to know how much it's gaining (or suffering) in comparison with Company B in this critical area.

Quality of hire is a viewed solely as a staffing metric

As yet unpublished i4cp research on the integration of talent management components clearly shows that the recruitment and selection function is typically the odd man out. That is, it's the least likely to be seen as integrated with other primary components of talent management. This is a huge problem when it comes to quality of hire because the ultimate success or failure of a recruit is dependent on many other organizational factors, including leadership, training and development, and performance management. The whole talent management system bears responsibility for ensuring quality of hire.

The measure requires additional data collection

When measuring widgets, organizations have full quality assurance programs and protocols that include additional inspections to ensure quality. When it comes to new hires, organizations resist additional data collection processes, which may include surveys of managers and employees to gather real-time feedback. Additional data collection is often met with resistance because the organization doesn't understand the value. Yet without this valuable, real-time information, there are limits to the robustness of a quality-of-hire measure.

Jay Jamrog, i4cp's Senior VP of Research, notes that other metrics can help support quality of hire. For example, data such as promotion rates, internal placement rates, regrettable termination rates and time to full productivity may all play a role in determining quality of hire. But tracking and integrating such data in a useful way can be difficult unless the proper systems and organizational values are in place.

Unclear purpose or rationale

Measuring quality of hire is not a goal for its own sake and it has various purposes that should be made clear. Of course, organizations want to make sure their staffing processes are efficient (keeping down costs per hire) and effective (ensuring new hires are the right ones) but this is not solely the responsibility of recruiting professionals. Often, the recruitment function resists quality-of-hire measures because it seems to unfairly place the burden of good selection, on-boarding and training on their shoulders. Quality of hire can be diagnostic in nature in order to create accountability, improve performance or evaluate the validity or effectiveness of a process or tool. The larger goal, however, is to ensure that the organization has the most talented and productive workforce in the industry, one that leads to top performance.

i4cp's 4-part recommendation:

Identify critical roles - Start by focusing quality-of-hire efforts on critical positions. Critical positions should be defined as roles that will drive growth and the strategic plan over the next 3-5 years or as roles where the organization is currently suffering pain, such as ones where there is a high first-year termination rate.
Create a measurement strategy - Once critical roles are identified, create a measurement strategy and project plan to address the needs of the organization. The strategy should clearly articulate why the role is being measured, the issues to be addressed, the measurement criteria and a detailed timetable. The timetable should include the data collection period, data analysis intervals and management review timing. This strategy will become the basis of a communication effort.
Secure buy-in from management and HR constituents - Based on the goals of the measurement strategy, identify and communicate with relevant stakeholders. Stakeholders need to understand the benefits of measurement, the effort and resources required, and the timing of the initiative. Ideally, the stakeholders will define the success criteria. If management or HR does not buy into the strategy, then the strategy should be postponed until the organization is ready. Organizations have done more harm than good when proceeding with a workforce measurement strategy the stakeholders do not believe is necessary.
Enlist support of all employees - Management and the staffing function are not the only parties responsible for the successful recruiting, selection and on-boarding of new staff. Provide employees with the opportunity (and reward) for referring former colleagues and friends. Often this is the best source for quality hires. Use broad-based teams to interview and weigh in on selection decisions. Whole Foods Markets, for example, relies on team members to select new associates. Evaluate hiring and non-hiring managers' recommendations in order to determine which employees have a knack for identifying talented employees who can be successful in the organization.

For many more i4cp insights on implementing quality-of-hire metrics, look to our Measuring Human Capital and Recruitment and Selection Knowledge Centers.

Social Media Goes to Work

Wed, 11 Aug 2010 14:07:00 GMT

With Facebook, Twitter, YouTube and other social media technologies virtually omnipresent lately, it's not surprising that many managers are wondering how to leverage these tools. Sales and marketing were the first to exploit these technologies, which present new ways of reaching customers. But the real trick is finding ways to improve productivity, collaboration, communication and learning within organizations using tools that increasingly look like mainstays rather than fads.

It turns out that not many companies have figured out this trick yet. According to The Rise of Social Media, a report that the American Society for Training & Development commissioned from i4cp, less than 20% of employees are using social networks, wikis, blogs, podcasts or shared media for work-related learning often or all the time. Fewer than 10% are using micro-blogs (Twitter, Yammer, etc.), virtual worlds or augmented realities to the same extent.

Okay, so most people aren't using social media for learning often or all the time. So what? Why should an organization be interested in any of this in the first place? A big reason is the influx of the Millennial generation (those born after 1981) into the workforce. This is a generation that would rather send a text to someone down the hall rather than speak in person, or even by phone for that matter. They cut their teeth on MySpace and soon graduated to Facebook, and if there isn't video of something available one YouTube, they're not convinced it actually happened.

The technology-aided social interactions these workers have grown up with represent a type of informal learning - one they are going to expect to find at their place of work. More than 80% of the Millenials in the study have used Facebook in their personal lives, and close to 60% have used YouTube. About 45% of Millenials said they interact with social media for learning at work for anywhere from 30 minutes to more than an hour per day. Only about a third of Baby Boomers said the same thing. Employees of all generations know these tools are going to become more important, as 83% percent of respondents say social media use for learning will increase over the next three years.

Another reason organizations should consider adopting these tools more widely is that it appears they work. The study showed that higher performing organizations are more likely to encourage the use of these tools than lower performers. Workers who use these tools for work use them for specific reasons, and many of these uses are correlated with higher market performance, including:

Finding resources more easily
Improving knowledge sharing
Fostering learning
Improving communications
Increasing participation in learning

While employers may not yet see the value in these tools for learning, employees do. More than three-quarters of employees said they found podcasts at least somewhat valuable for work-related learning and slightly fewer said the same about wikis. Blogs, shared media and social networks were considered valuable by around two-thirds of employees.

Understandably, though, many organizations don't wish to jump in to the social media fray without serious consideration. Besides not wanting to get caught up in a fad that may become obsolete, there are security concerns as well. More than two-thirds of study participants said they believe social media tools have the potential to create security or privacy issues at work. There are also concerns that user-generated content will not be accurate and may actually impair the learning process.

According to Elliott Masie, CEO of the Masie Center, "Companies still have some fear around social media, but employees know better. They know the ‘wisdom of the crowd' will quickly correct any misinformation. The company-employee disconnect on adoption happens with every new technology, and social media is following this same predictable pattern."

Others agree that the time has come to more fully exploit these new technologies. According to Tony Bingham, CEO of ASTD and co-author of the book The New Social Learning: A Guide to Transforming Organizations Through Social Media, "Historically, the learning community has stayed away from informal learning and social learning, and that is where the majority of learning is taking place. We now have the tools, and the catalyst, to engage them with that kind of learning."

i4cp's 4-Part Recommendation:

Implement a formal policy governing social media use. A well developed and executed social media policy can go a long way to mitigating many of the risks associated with social media technologies. Only 44% of Study participants have a formal policy in place. The policy should define the goals and purposes of using social media in the organization's day-to-day business.
Market the concepts to employees to boost adoption. According to Justin Mass, senior learning technologist for Adobe Systems, an i4cp member company, "finding early adopters who can showcase the benefits of these tools to other in the organization helps immensely with adoption." However, adoption cannot be achieved from the bottom up alone. There needs to be buy-in from senior leadership, as well as role modeling. Many executives are currently having success communicating with employees via blogs and podcasts.
Start from the beginning. Expose employees to social media tools from the get-go. Some companies use social networks as part of the on-boarding process. This way they are able to provide information about the company and give new employees a feel for the culture even before they set foot in the door on their first day. It also sets the expectation for the use of these tools throughout the employee life cycle.
Run pilot projects. Arguably the best way to foster use of social media technologies is to simply start using them. Find small targeted projects that can benefit from these tools, and use these experiences as success stories to gain both buy-in from leadership and adoption from employees.

For many more i4cp insights on implementing and managing social media in the workplace, look to our Internal Communication, Workforce Technology and Training and Development Knowledge Centers.

Getting the Most Out of International Assignments

Wed, 28 Jul 2010 11:36:00 GMT

Yes, we're still on a global economic roller coaster (who said the world is flat?), with good and bad news from the U.S., Europe and Asia causing markets to shoot up and down weekly or even daily. But, at the end of the ride, it still looks like we'll all be doing much more rather than less global business.

Case in point: For i4cp's recent member-driven Global Mobility Practices study, we asked if companies are anticipating more or fewer international assignments over the next 18 months. Almost 9 out of 10 said they expected more (46%) or about the same number (43%) of international assignments.

So much for the idea that the age of the expatriate is dead. Some observers predicted that as global companies hired more locals to fill positions, there would be a subsequent decrease in the number of international assignments. After all, expats tend to be expensive to compensate and are sometimes tricky to manage.

But, even in an age of increasingly effective teleconferencing and other virtual meeting technologies, there's no substitute for working and living abroad. It's very hard to understand another culture unless you've lived there, and that understanding is crucial to business success in a global society. That's one of the main reasons - aside from financial constraints - that respondents from high market performing organizations are so much more likely than those from low-performing ones to forecast more international assignments.

And if an organization is going to keep feet on the ground outside its home region, it had better do it right. For higher-performing organizations, that means formalizing the process and measuring the results.

Larry Looker, Manager of Global Leadership Development at Amway, states, "This whole process, as you know, is extremely expensive. When you think of what it cost for one person to have an international assignment - even in just dollars, taxes and expenses - it's a little bit shocking to me that more of us aren't asking ‘how are we doing?' ‘how well did it work?' ‘how did it work for the person, the family, the receiver and the business need?' How can we not ask those questions to those different groups?"

Looker says that Amway increasingly views international assignments as targeted learning experiences and as strategic opportunities to gain global experience and to fill specific, short-term needs. They are currently in the process of formalizing their global assignment processes and integrating them with various talent management and other broader organizational strategies. Measurement and stakeholder feedback are going into the design as an integral part of the process.

Of course, managing international assignees well involves a series of decisions and actions. There are many steps involved, including, but not limited to:

Determining the purposes of assignments
Assessing potential assignees and their families
Selecting assignees
Preparing assignees, their families and their managers
Developing policies and guidelines to govern assignments
Keeping track of information about expats and reasons they're on assignment
Deciding on success criteria
Evaluating stakeholder satisfaction levels
Retaining and properly utilizing expats once they return home

And this list doesn't even go into details of the actual relocation.

So how do higher-performers deal with the actions on our list? First, our study shows that they tend to be better at aligning their international assignments with other processes. In fact, they're twice as likely to report that "our mobility program supports talent management efforts," 51% compared to 26% for lower performers. They're also more likely to use international assignments for leadership (53%) and employee (39%) development.

Respondents from high-performing companies are also more likely to assess candidates and their families to see if they're suitable for international assignments and to provide cultural training in the host country for employees and their families.

Our survey also indicates that training about the host countries' cultures shouldn't be limited to pre-assignment, home-country courses. Cultural training in the host country for both the assignees and their families can be another differentiator for high performers. After all, multiple studies have established a link between international assignment failures and spouse/family concerns.

Finally, higher performers are more likely to measure what they consider important, to include all stakeholders in the measurement process and to follow through by applying what they've learned. International assignments, like any business initiatives, are about achieving goals and delivering results. If those goals include learning and development, then those skills should be used for the benefit of the organization. Not having a proper outlet for those skills and a plan for repatriated employees squanders a long-term investment.

International assignments are a potentially valuable investment that should be integrated with other talent management processes, measured thoroughly and managed carefully. According to Looker, "Because this is a project with such potential for gain and/or loss, it makes a lot of sense for us to take this time to formalize the process. In my opinion, we could reap some pretty big rewards, not only on the savings side, but also on the return side of the equation."

i4cp's 4-Part Recommendation:

Implement a formal policy governing international assignments. Creating and following a comprehensive policy provides more certainty in the ultimate cost of the assignment - which in turn helps organizations assess the value proposition. A formal policy also protects the organization from creating unintended precedents and ensures fair dealings with all employees. The policy may also serve as a recruiting tool when employees are deciding whether to accept an international assignment.
International assignments should begin with an assessment of the employee's suitability, which should include the employee's family if they are relocating as part of the assignment. A new job is stressful. Moving is stressful. Relocating to a foreign country and taking on a new role in an unfamiliar culture while using a language you're not proficient in can be more than some will be capable of. Add to that an unhappy spouse and children torn away from friends and stability and it's no wonder there is a high failure rate for international assignments. Higher performers consider all of these factors before making assignment decisions.
Continue cultural acclimation in the host country. There's nothing like complete immersion when it comes to learning, and there's no better way to learn a culture than from a native. Many organizations arrange for local partners to continue cultural training and create a touchstone or mentor for the assignee. This small additional investment helps to ease the transition and speed the employee's time to productivity in their new role.
Align the goals for international assignments with other strategic processes and measure the results. Getting needed skills in place is the primary reason for most international assignments, but leadership and employee development are also important. High-performance organizations put appropriate resources toward processes they consider important and always measure the results. As this is an expensive process, it's good to gain broad stakeholder estimations of success.

Inclusion Measurement - Tracking the Intangible

Wed, 14 Jul 2010 12:49:00 GMT

Diversity and inclusion are, in some ways, like peanut butter and jelly. They're not the same but are often combined, making up a whole that's more than the sum of its parts. So when i4cp - on behalf of its members-only Diversity Accelerator group - decided to look at inclusion metrics, we first had to carefully define, identify, and separate the two concepts.

In our Inclusion Measurement Survey, we started by finding out whether or not companies had inclusion initiatives and if initiatives were considered separately or in combination with diversity. Two-thirds of study participants reported inclusion as part of their people-management strategy, either in combination with diversity (47%) or as a separate talent-management initiative (19%). These numbers crept up only slightly among higher market performers. With this established, we asked them to focus specifically on inclusion, the more difficult to measure of the two.

Diversity is about variations and differences and, more often than not, refers to traits that are measurable. Sometimes diversity refers to a traditional compliance point-of-view that looks primarily at EEOC protected classes. Other times, it incorporates a broader definition that accounts for factors such as diverse experience, education and backgrounds. Either way, seeing how one individual differs from another and tracking those differences is, while challenging in practice, intellectually clear cut. Inclusion, however, is a much more amorphous affair.

Inclusion is what ties varied individuals together into a cohesive and productive whole. By far the most commonly cited definition for inclusion among our study participants was from the 2002 Frederick Miller and Judith Katz book, The Inclusion Breakthrough. This definition - "Inclusion is about creating an environment in which employees share a sense of belonging, mutual respect, being valued for who they are, and supportive energy and commitment from others so that they can do their best work" - was selected from among six possibilities by over half of our study group.

But does anything about that definition lend itself to measurement? Can one say that a company produced 5% more "supportive energy" this year than last? While other definitions had more concrete wording, such as "avoiding tokenism," organizations seem inclined toward a definition that is more aspirational and values-based. This kind of definition may explain why only a fifth of respondents say their organizations attempt to quantify the effects of inclusion strategies to a high or very high extent.

Corporate Practices

Through a series of interviews tied to our Diversity Accelerator, we investigated how some organizations incorporate inclusion as a key value. These companies are both more successful at inclusion and more capable at measuring the success of their efforts. The key factors that make this possible are a definition that includes measurables and driving goals that are strategically aligned and quantifiable.

With inclusion ingrained as a core corporate value, organizations can measure success in this area through several channels, including indirect routes such as quality assurance reports that provide a view of inclusion from the customer perspective. These organizations can also directly tap their employees for guidance to provide feedback and ensure that they are truly living their corporate values.

Other practices that boost inclusion proficiency include inclusion-specific competencies as part of the managerial review process. Linking those competencies to both salary and promotability further emphasize the company's commitment to inclusion as a core value. It's an important step for inclusion to be seen as a competency that is closely tied to success in those managerial positions.

One top company we talked with, WellPoint Inc. - the largest health plan company in the Blue Cross and Blue Shield Association - uses their definition of inclusion to help define the metrics they track to determine success.

"Our definition of inclusion is really all about engagement, be it associate (employee) engagement or member (customer) engagement," said Linda Jimenez, Chief Diversity Officer and Staff VP - Diversity & Inclusion for WellPoint. "Inclusion is the important component that weaves that thread of diversity throughout our organization. One level of inclusion is how individuals feel connected, respected, valued, but - most importantly - engaged in working alongside one another."

WellPoint's use of annual employee engagement surveys to track inclusion is therefore a clear, if indirect, metric. In fact, employee engagement surveys were the most utilized measurement method cited in our inclusion study (47%), followed by analysis of new hire data (36%) and promotion/movement data (33%). WellPoint also closely tracks diversity representation metrics and movement among varied groups at multiple tiers of the organization. Inclusive of about a quarter of our survey respondents, WellPoint includes diversity-specific questions in its engagement surveys.

In addition, WellPoint looks at manager evaluations, which have questions specifically geared toward inclusion competencies, and they participate in various third-party evaluations from employer-of-choice awards that provide an external standard to measure progress. Such awards were a less frequently used metric overall (used by about a fifth of i4cp respondent organizations) but, along with productivity data, were the metrics with the largest usage gap between high and low performers.

WellPoint was included on The DiversityInc 2010 Top 50 List, and also participate in a select group of other employer-of-choice recognition awards. According to Jimenez, "There's a wealth of information in terms of benchmarking that we've received and the opportunity to listen to and share best practices with similar organizations that are considered leaders in diversity management. They're definitely an internal motivation and I think it's a great metric for us to be able to see where we stand against ourselves and where we stand against our peers."

In a similar vein, through our Diversity Accelerator program, i4cp has found that group discussions - in which practitioners are able to describe challenges, share best practices, and brainstorm on future-looking strategies - are useful ways of improving performance in the areas of diversity and inclusion.

The Bottom Line

Inclusion is, as we've shown, a hard nut to crack from a metrics perspective. It's simply easier for an organization to tell if diversity representation has increased at certain tiers of the organization, if the employee base has reached parity with the customer base, or if complaints against management have gone down. These metrics don't tell you how inclusive the culture of the organization is, but, much like gravity shifts indicating the presence of otherwise imperceptible astronomical objects, they do show the presence of something and give us an indication of size and movement.

Our study shows that these indirect measurements - paired with accountability, top-down support for inclusion-related values and employee surveys - are how many organizations are gauging inclusion success.

i4cp's 4-Part Recommendation:

Review your organization's definition of inclusion, if it has one, to determine if it lends itself to measurement. A definition that is more utilitarian - that is more prescriptive rather than aspirational - is more useful in guiding measurement and goal setting. Debate the content of your definition. A definition that lacks debatable content probably lacks the significance or concreteness that will make it measurable.
Ensure a common understanding of what inclusion means to your organization and make certain it aligns to the organization's mission. A good definition will go beyond employees to include suppliers, customers and the community at large. To form a common understanding of what inclusion means, consider what is driving your organization toward this goal. The i4cp study found that high-performing organizations are more likely to be driven by factors such as talent acquisition, retention, employment brand, and increased productivity and engagement.
To measure inclusion, start by identifying the business area where you expect to see movement. For WellPoint, that metric is engagement. For other organizations, it may be profit per store, better customer ratings, reduction in shrinkage (theft), improved company reputation or brand, etc. Again, the measurement should align with the organization mission.
Create accountability at the executive, manager and employee level. Creating an inclusive work environment starts at the top of the organization, but it must be practiced at every level to permeate a culture. Accountability at the employee level means articulating expected behavior and rewarding employees that exemplify that conduct. It also means working to change behaviors of employees who do not. At the manager level, accountability should be part of the performance management process and is most effective when linked to performance appraisal competencies and promotional opportunities.

Beyond Efficiency: The Keys to Future HR Success

Wed, 30 Jun 2010 11:27:00 GMT

Maybe you're proud of the sheer productivity of your HR department. Your ratio of HR pros to employees is lower than the industry average, most transactional HR activities are delivered via self-service, and you have a finely tuned shared-services center. Generally speaking, your HR function is a lean, mean efficiency machine.

Good for you. There's just one problem. By itself, it's not nearly enough.

This is one of the findings from the Future of HR study conducted by i4cp in partnership with the Center for Effective Organizations (CEO) at USC's Marshall School of Business. We found, for example, that having a low HR-to-employee ratio is not in itself a great predictor of market performance, though that story changes for very large, commercial entities. So, while it's smart to benchmark such ratios to gauge efficiency, they seem a lot less critical than some other HR characteristics, at least for organizations with 1,000 or more employees.

"Efficiency is a given in today's world," says Jay Jamrog, i4cp's Senior VP of Research. "Maybe it gets you a seat at the table, like table stakes in a poker game. But your HR department had better have some other qualities in addition to that if you want to become a real player at that table."

Like what? Think about what your organization needs most from its leaders. One of those critical competencies, as another recent i4cp study shows, is the ability to manage change well. Our new study suggests HR should be able to support leadership in this area.

Here's one piece of evidence: Respondents from high-market performing organizations were about 30% more likely than their counterparts from lower-performing companies to report that HR "drives change management" to a great or very great extent. We also found a significant positive correlation between corporate market performance and HR's role in this area.

But the ability to drive change is just part of the equation. HR must also provide the kind of HR data required to support change management.

"There's often a lot of attention to measurement in HR that's about getting the data, running the right analysis and producing the right reports. But if you want to effect strategic change, you also need to have the right logic and the right processes. Not only do we want to tell a well-analyzed and well-measured story, but it needs to be a story that matters and it needs to be logically connected to the mission of the organization. No matter how good you are at this measurement stuff, if there isn't a connection to moving the organization, you run the risk of nothing happening," said CEO's Prof. John Boudreau, who co-presented an i4cp webinar on the subject.

A third characteristic of HR functions in high-performance organizations is that they tend to formulate a human capital strategy that's well integrated with the larger business strategy. This may seem like a no-brainer but the study shows that only a quarter of all respondents said this is true to a great or very great extent in their organizations.

"You want to perform better in HR?" asks Jamrog. "You need to get integrated and aligned. When we look at respondents who say HR is full partner in strategy development and implement, over half say such integration is strong in their companies. They bring a lot to the table."

Actually setting up the table rather than merely being present should be the ultimate goal for HR, says CEO's Prof. Ed Lawler. He describes this as coming in with ideas and input that shape strategy rather than being the reactive implementer. This is particularly true of organizations with a management style that relies on human capital for competitive advantage, Lawler says.

HR metrics are another key to success. Jamrog notes that there aren't significant differences between high and low-market performers in terms of the financial efficiency of HR operations, but high performers are considerably more likely to measure the business impact of HR programs and processes.

"Maybe you're never going to have perfect information on the business impact," says Jamrog. "It's impossible to be certain of cause and effect in a dynamic business system. But I think just making a serious effort to make these connections is a best practice."

i4cp's 4-Part Recommendation:

Collect the kind of data needed to manage change well. Much of this data should be regularly collected as a normal part of workforce planning. Another recent i4cp analysis found that - for strategic workforce planning - companies need more than just data on headcount, budgets, hires, terminations, retirements, etc. They should conduct SWOT (strengths, weaknesses, opportunities, and threats) analyses, determine key roles, and make headcount growth assumptions. They should also create a profile of the agility and resilience of their employees, their teams and their organization as a whole. This means having gauges of characteristics such as openness to change, persistence, ability to function under pressure, optimism, and technological skills.
Then help manage change. Where the data shows deficits, help build strengths. Johnson & Johnson, for example, has a change-management framework that includes creating a compelling vision, building stakeholder and leadership alignment, delivering communication, establishing measures of success, aligning systems to reinforce change, and enabling employees to learning new skills that they can apply at work.
Integrate HR strategies with larger business strategies. HR needs to have a firm grasp of the organization's principle business strategies and ensure that HR strategies complement them. If, for example, a major business strategy is to move into more global markets, then HR should have a strategic initiative for helping leaders develop a set of competencies to operate successfully at a global level. Likewise, they have a clear understanding of best practices in the areas of global staffing, global training, and global information systems.
Measure the business impact of HR programs and processes. It's fine to track data such as the efficiency of your recruitment function, gaining an idea of how many interviews it takes to make a hire, etc. But, ultimately, this type of metric isn't establishing a strong linkage to business success. It's more important to measure factors such as the ability to retain the key personnel who add to the bottom line or the degree of alignment between key business strategies and key HR strategies.

Four Key Practices for Developing Global Leaders

Wed, 16 Jun 2010 11:52:00 GMT

I never thought I'd see this day. One of my colleagues is taking the week off to - get this - watch the World Cup. Now, if you live in Europe or Asia, this is expected behavior, but I live in the U.S., where the World Cup has historically been about as popular as a case of the croup.

This got me thinking not only about what the U.S. media is calling "World Cup fever" but about how today's businesses are increasingly required to take on a World Cup mindset. That is, they must see the world as a global field with global talent playing to global audiences and markets, a field on which they want to place good leaders who have a firm grasp of the global competitive scene.

Some organizations are working harder than others to adapt to the global playing field. A new i4cp study, commissioned by the American Management Association, found that - among companies with 1,000 or more employees and some degree of multinational presence - only about half have implemented one or more global leadership development programs.

As expected, we found that organizations with global leadership programs are more likely to report higher market performance. That's not a big surprise since globally expanding organizations are more likely to require such programs in the first place. But we also found that, even among companies with such initiatives, there's still a lot of progress to be made. Only about two-fifths of respondents strongly or very strongly agreed with the statement that their "leadership development program is highly effective."

Given these circumstances, what can organizations do to improve their global leadership development programs?

First, they should think about which competencies they wish to instill in their global leaders. Critical thinking and problem-solving competencies are important and commonly taught, according to the study. But perhaps even more important, the research shows, are teaching global leaders how to stay agile and adaptable, how to manage innovation well, and how to expand the organization's brand in local and global commerce.

Maria Van Parys, Director of Leadership Education and Talent Management at i4cp-member-company Boston Scientific, notes that her organization's global leadership development initiatives focus specifically on competencies such as adaptability, agility and innovation - competencies that she states become "more important the higher up you go in organizations." She also notes that Boston Scientific is increasingly focused on developing stronger global competencies in the areas of resourcefulness, perseverance, accountability, and team building.

Another potential area of improvement lies in the involvement of senior business leaders. Our study found that when the senior executive team is involved, regardless of the specific role they play, both program success and market performance tend to be higher. Senior executive teams are most often involved in communicating about their organization's leadership development program and in establishing the needed business results from the program. The good news is that simply having your senior leaders communicate more often about the global leadership development program - a relatively easy practice to implement - is associated with success. If an organization doesn't already engage in any of these practices, getting improved communication from senior executives is a good place to start.

But there are many other levels at which executives can become involved. At Boston Scientific, for example, the executive team is not only engaged in shaping the competencies covered by its global leadership development program but in the evaluation, selection and development of program participants. Members of the executive committee also engage in mentoring and coaching, and they sometimes teach other elements of the program as well, recounting their own experiences in managing change and driving success.

A third key finding of the study is that metrics matter. There are strong statistical relationships between the degree to which companies evaluate these programs and their reported success. Especially interesting is the fact that "the amount of learning achieved from the initiative" is the one metric significantly correlated with market performance and has the highest correlation with global leadership development program success. Companies should use this metric even as they examine other metrics such as business results and behavioral changes.

Boston Scientific covers basic metrics such as number of courses and participants, but it also looks at what Van Parys calls the "ultimate outcome" of bench-strength readiness. This refers to the number of high performing managers who are prepared to move into senior leadership roles. Between 2008 and 2009, the Boston Scientific program was able to move the mark from 20% to 42%.

A fourth key finding is that, while most respondents say their organizations use outside vendors or other external experts to help in the creation or implementation of their global leadership programs, they might not be using the best selection criteria. We found that organizations are most commonly looking for subject matter experts as well as a proven track record demonstrating an ability to execute. Less popular expectations for outside suppliers are the ability to handle multiple language requirements and wide geographic representation. Our study found, however, that the ability to handle multiple language requirements is actually well correlated with the global leadership development success index, and using vendors based on their ability to represent each geographic region was the only variable associated with significant improvements in both market performance and global leadership development success.

But it's also clear from our interviews that flexibility, adaptability and creativity can be key requirements. Van Parys notes that at Boston Scientific, external providers become "extensions of ourselves" and so must be flexible enough to accommodate the organization's specific needs. For example, her company requires all its vendors to follow the same processes so that the program can be provided in a unified, seamless way.

Flexibility is also one of the key criteria that SGS - a global provider of inspection, verification, testing and certification services - looks for in a vendor. Vice President of HR Dominique Ben Dhaou notes that her organization requires external providers to listen well in order to understand the unique needs of SGS. External partners not only need to be flexible but also creative and highly responsive.

i4cp's 4-Part Recommendation:

Decide which competencies are most critical for the success of global leaders in your organization. Query senior leaders, external experts and key business partners about what they view as key competencies. Although every organization will have unique needs, keep in mind that in today's shifting global environment, global leaders must often stay agile and adaptable, know how to manage innovation well in a highly diverse workforce, and have a good idea of how to expand the organization's brand in a global marketplace.
Involve your senior leaders. At the very least, ensure they play a key role in communicating the value of the global leadership development initiative to participants and high potentials in your organization. But also consider having them become more deeply involved in the process of establishing the business results you want from the initiative, shaping program content, selecting key participants, and even helping teach courses or engaging in coaching.
Measure the impact. Of course, it makes sense to track the basics, such as number of participants and courses and satisfaction with the programs. But also try to track the business results derived from particular development opportunities, changes in leadership behaviors, the amount of learning achieved and the impact on the bench strength of your leadership pool.
Choose your external providers wisely. Start by making a list of the characteristics you want in a provider. Subject matter expertise and a proven track record are key, but so are other criteria, such as flexibility, agility and responsiveness. Make sure that vendors are listening carefully to your organizations' specific needs. Also, keep in mind that for organizations with a broad global scope, criteria such as geographic representation and the ability to handle multiple languages can gain prominence as selection factors.

The Crummy State of Talent Management Metrics (and What to Do About It)

Wed, 02 Jun 2010 10:50:00 GMT

I know he stole it from the great Peter Drucker, but for years now I've heard this constant refrain from my boss: "What gets measured, gets managed." I always want to respond, "Stop already! I get it! I got it the first thousand times, too!"

The crazy part is that sometimes I still ignore that advice. Managing people is, after all, about much more than metrics, and you can't reliably measure everything that's important. What's more, you don't want to become one of those soulless, number-crunching automatons for whom numbers are all that matter. At the same time, I also believe that managers responsible for talent who ignore all metrics do so at their own (and their organization's) peril. And now I, appropriately enough, have the numbers to prove it.

First, let's state what most enlightened managers already know and what various previous i4cp studies have demonstrated: Companies that are higher market performers are also more likely to say they're good at managing talent. That is, good talent management seems to pay. Our newest study, Talent Management Measurement, corroborates this.

But is metrics a critical piece of the puzzle? To find out, we asked about firms' "workforce measurement strategies," which we defined as "disciplined and cohesive efforts - as opposed to ad hoc efforts - to gather and use employee-related metrics in the organization." Sure enough, higher-performing organizations are more likely than lower performers to have metrics strategies, and those that excel at talent management are nearly twice as likely to use workforce metrics strategies to a high or very high extent.

So, yes, our study supports the notion that what gets measured (in this case, your workplace talent) gets managed more effectively.

The bad news is that, although Drucker's wisdom has become a management truism by now, the vast majority of firms are still mediocre or worse at workforce measurement. In fact, a paltry one fifth of all our study participants said that their organizations have such a strategy to a high or very high extent. (Perhaps we should all take a moment to envision Peter Drucker sadly shaking his head at the state of talent management circa 2010.)

Bottom line: most organizations have a problem with measuring their talent, and we have some ideas for solutions to this problem. These ideas are still percolating amid the corporate practitioners participating in i4cp's Talent Management Accelerator, which is studying best practices around this issue. i4cp's Human Capital Management Practice Leader, Mary Ann Downey, states, "Talent management measurement isn't exactly uncharted territory, but it hasn't been executed very well, either. Practitioners still have an awful lot to learn from one another about what works in the real world."

i4cp's study of this subject is far from complete but, so far, there are some tantalizing clues about what distinguishes firms that use metrics well from their not-so-competent counterparts. One characteristic of higher performers - in terms of talent management prowess - are that they tend to focus on certain outcomes more than others, especially these four:

Leadership success
Robustness of talent pipeline
Overall employee engagement
Management satisfaction with the talent management process

Of these four outcomes, the most important is leadership success. That outcome, via a regression analysis, is linked with both talent management success and market-performance success. In other words, the more that organizations use the measurement of leadership success to gauge the quality of their talent management practices, the more likely they are to say they're good at talent management and to have higher market performance.

We also asked participants about more specific types of workforce metrics; everything from internal placement rates to new hire separation rates. Virtually all respondents said their firms should be using these metrics to a higher extent than they actually do. There's no mystery there, given the earlier finding that so few businesses excel in measuring talent management. But what was more interesting was that there are certain metrics that high-performers are a lot more likely to use than lower performers. "Quality of hire" is a case in point and "regrettable termination rate" is another. Based on the greater use of these qualitative measures, we contend that sophistication counts. Good metrics don't just describe whether you are losing or gaining employees, but whether you are losing or gaining really good employees.

i4cp's 4-Part Recommendation:

Start by analyzing your current set of workforce-related metrics. Is there an organizing principle behind them or are they all ad hoc? The more you can devise a set of metrics that lend support to one another and provide coherent pieces of a larger pictures, the more success you're likely to have finding meaning in your metrics and understanding the story the metrics are telling.
Determine what you're really trying to accomplish. It doesn't have to be just one thing, but you should have specific goals in mind, such as making sure your organization has a strong leadership pipeline. In a larger organization, these goals can't be effectively set up by just one person. They need to be decided in conjunction with an executive team that represents the needs of various parts of the organization. As part of i4cp's ongoing research in this area, we interviewed Larry Israelite, Vice President of Human Resource Development at Liberty Mutual Group. He notes that in his organization, "The management team has agreed on the data dictionary. The team must agree to changes to people measurements, which ensure alignment and consistency."
Put a plan in place to improve your metrics over time. Accurately calculating metrics such as quality of hire and regrettable termination rates is not a simple task, but it's probably worth the time and trouble. When determining a method and process, test it with a pilot group before applying it to the whole organization. Present the metrics and processes for determining the measurements to managers so they will understand the purpose, provide feedback and eventually buy into the authenticity of the metrics. The last thing any company wants is to invest in producing good metrics that no one believes or will act on.
Know how to tell a story with the metrics. Human beings are wired for narratives and stories. Data-heavy reports, no matter how accurate, will do little to convince others of the legitimacy of your analysis. The numbers must tell a story that makes sense to others, and reports should make their conclusions and recommendations clear. It's not enough to be correct; you must also be compelling.

Managing Tomorrow Today

Wed, 19 May 2010 11:43:00 GMT

"The future ain't what it used to be," Yogi Berra once said.

This was the first line of one of our earliest TrendWatchers, published in 2000, on the role of futurism in the development of business strategy. As we publish our 500th TrendWatcher today and reflect on the past decade, many of us probably agree that Yogi's quip remains prophetic. Time indeed flies, and thanks to ever-evolving technologies, innovative business plans, mergers, etc., the future seems to hurtle toward us at increasing speed, bringing change almost overnight.

In the inaugural TrendWatcher, we observed:

Most HR departments are already in the midst of transforming themselves…HR is striving to become faster, smarter, and more forward thinking…Being fast also means becoming smart and creative enough to anticipate what's around the corner…By being able to analyze and anticipate trends; HR also becomes a better strategic partner.

Ten years and five hundred TrendWatchers later, we can say - without too much bragging - that the track record of i4cp's most widely read publication is pretty solid in terms of identifying and forecasting important human capital trends. In 2000, for example, we examined the controversial trend toward employee investment freedom. This was over a year before the Enron implosion wiped out employee retirement savings and a decade before employees in every sector saw their 401(k) s become "201(k)"s. We also looked at where the rising costs of healthcare might lead, noted that obesity was an emerging issue, examined the meaning of "digital capital," made observations on the virtualization of education, and predicted that the concept of corporate social responsibility would become more mainstream.

Building on that foundation, we're forging ahead with ever more rigorous and empirical identification of trends and strategies that will boost corporate performance into the future, with a specific focus on human capital.

So, how has HR matured over the years? That depends on perspective. From one point of view, there's been some real progress. As we reported in our last TrendWatcher, 63% of the respondents to a recent study say that their organization has a strategic business partner (SBP) role. That number increases to 91% in large (10,000+ employees), high-performing organizations (compared with 70% of their lower-performing counterparts).

But relatively few HR professionals in general - and SBPs in particular - are able to effectively "anticipate trends," as we phrased it back in 2000. That could, however, change over the next ten years. Dr. Jac Fitz-enz, founder of The Saratoga Institute and, many would say, the father of HR measurement, believes the HR profession is getting closer to realizing this ideal.

In his upcoming book, The New HR Analytics: Predicting the Economic Value of Your Company's Human Capital Investments, Fitz-enz lays out a four-step model to guide organizations in creating an environment where the HR function can truly drive business success.

"We don't manage the future well," Fitz-Enz explained in a recent interview. Managing the future well will become an even higher priority now that strategic business partners have moved from the realm of theory into practice. The ability to anticipate the future and take steps today to shape that future is a source of competitive advantage. "You can't change the past," Fitz-Enz says, "and given the time it takes to analyze the present, it is already too late to effectively change because the environment has already changed." Therefore, Fitz-Enz advocates for organizations to purposefully dedicate resources to "manage tomorrow today."

How is HR doing in terms of using data to help shape human capital strategies? Results of i4cp's recent Predictive Human Capital Analytics Survey show that organizations that focus on metrics tend to perform better and that all companies, high and low performing alike, believe they should do better at using predictive metrics to guide decision making. Only a quarter (24%) of all respondents report that their organizations make human capital decisions based on data to high or very high extent. That number breaks out to 29% of higher-performing organizations, compared to 14% of lower-performing organizations. Survey responses also show consistent gaps in terms of the extent to which organizations generate predictive analytics that shed light on human capital issues compared to the extent to which they think their organizations should do so.

What are the primary obstacles that prevent organizations from delivering predictive analytics? The survey found a three-way tie of intertwined issues that hinder organizations: Data is in disparate systems and it is a challenge to integrate, it takes too much time given other priorities, and many organizations do not fund this effort. What was not cited as an obstacle was trust in the data.

While it's clear that HR has made significant progress in the past 10 years, focus must now turn to predictive metrics in order to ensure that, in the future, HR's reality is the fruition of the effective SBP dream.

i4cp's 4-Part Recommendation:

Document your organization's hypothesis. The key to starting any predictive measurement strategy is to understand the organization's beliefs and expectations. Through documenting decision maker's beliefs you can develop hypothesis to test and verify with data. There are three key sources to obtaining organizational beliefs and expectations: business strategy documents, performance management plans, and asking management directly.
Be deliberate. Given the amount of effort to produce predictive measurements and the potential value to decision makers, it's wise to start small with one or two issues. Starting with your organization's hypotheses, determine the key issues that would assist management in their decision making process.
Tell a story. "Data without a story is just numbers," Jay Jamrog, i4cp SVP of Research says. Jamrog contends that HR professionals need to get better at telling the organizational story that is supported by data and not to just expect a series of graphs and charts will make an impact. This is even truer when you are considering the future and trying to look around corners. "The story needs to capture the executives' imagination and be compelling to cause action," Jamrog instructs.
Dedicate resources. Many organizations have the raw materials to produce predictive measurements but lack the will to do it. In the future, organizations that create a strategy and dedicate resources to predictive measurement will achieve a competitive advantage over rivals who are merely wishing for insight.

Real-world Application of the Strategic Business Partner Role

Wed, 05 May 2010 13:32:00 GMT

Fourteen years after the publication of Dave Ulrich's ground-breaking book HR Champions, organizations are still grappling with how to implement his recommended model for organizing HR to deliver optimum value. A key to that model is becoming a strategic partner, or what has come to be known as the creation of a strategic business partner (SBP) role. According to a recent i4cp study on the subject, Ulrich's proposal that organizations create a strategic business partner position has turned out to be challenging to both conceptualize and staff.

At the request of an i4cp member organization, we recently conducted a study to determine how the role of strategic business partner functions in high-performing organizations. For the purposes of the study, a SBP was defined as being "responsible for ensuring that the business or global function they support has the organizational capabilities, leadership and talent that are needed and to ensure that employees in those areas are engaged, motivated and rewarded to achieve both long- and short-term business objectives."

In essence, the effective SBP delivers value to the business through the work that they do. This is accomplished by providing strategic and operational advice, consultation and coaching. SBPs are expected to influence the senior leadership on critical organization and people-related issues and to help them achieve business priorities and objectives for which the business leaders are ultimately accountable.

Overall, 63% of study respondents reported that their organization has a SBP role. When looked at by organizational size and market performance, however, we found that 91% of large (10,000+ employees) high-performing organizations use a SBP role, compared with just 70% of their lower-performing counterparts.

But it turns out that most organizations are not placing all of the responsibility of the SBP function on one individual. Three-fifths of all the respondents reported that the SBP responsibilities were shared among multiple roles, and two-thirds of high-performing organizations reported distributing the duties among multiple roles.

Ed Lawler, Professor of Business at the University of Southern California Marshall School of Business and author of Talent: Making People Your Competitive Advantage, was not surprised by the i4cp study results. As he explained in a recent interview, there are distinctions between the "strategic partner" and "business partner" roles. The strategic partner role often resides with the head of HR and carries with it responsibility for providing "human capital information that will influence organizational decisions." The business partner function is more of an implementation role, and is responsible for "understanding the business needs to execute the human capital strategy." In large organizations it makes sense to distribute such responsibilities.

Our study indicates that a slight majority of large, high-performing organizations structure the SBP as a director role that reports to the SVP of HR (52%) and apparently acts as an HR leader for their business units. But, as we noted, there's no single standard on how to conceptualize or staff this position. Based on interviews with study participants, there are other models being used to implement a SBP role, and each has unique advantages.

For example, an SBP can be an HR professional who reports to line management with a dotted-line reporting relationship to HR. Our study shows that only 8% of organizations use this model, but Alliance One International, Inc., an i4cp member organization, is among them.

"If you want to assure alignment with the business, change the reporting relationship," says Mike McDaniel, SVP of HR for Alliance. The advantage of this model is that the SBP is part of the business unit management team that is directly responsible for the business outcomes.

In another model, a Center of Excellence (COE) develops the business-driven human capital strategy decisions and is advised by SBPs from individual business units. The advantage of setting up the role this way is that the COE gets direct feedback from the business unit when designing enterprise-wide initiatives. This creates a greater sense of camaraderie and forges an HR function that is more closely aligned with front-line situations.

While two-thirds of large high-performing companies have a job description and/or competency model describing the SBP role, many companies have yet to create one. In such cases, how do organizations select a candidate to take on the SBP role?

Part of the selection decision should be based on the traits of potential SBPs and how those traits fit the needs of the culture. A SBP should have "a real curiosity and interest in how the business makes money and [have] shown that they are open to change and able to learn," says Susan Layman, VP of HR at FT Services. Susan has successfully lead HR transformations in multiple organizations and says that these are the characteristics she looks for when filling SBP roles.

Our study indicates that, although there is no one-size-fits-all model for how the SBP role should look or be structured, the presence of a SBP does indeed provide real advantages for organizations. We recommend looking first at how successful organizations with similar needs have designed and implemented the role before deciding what structure will work best in your organization.

i4cp's 4-Part Recommendation:

Be committed to the SBP role and staff it wisely. Not every HR professional is cut out to be an effective SBP, so organizations should make a careful and thoughtful selection based on skill and business acumen. Organizations that give HR professionals the title of Strategic Business Partner without restructuring the work, communicating expectations, and providing the necessary tools are setting their SBP up for failure.
Balance and cooperation between the SBP and other HR professionals should be designed into the role. While the SBP may be at the "top of the food chain," as one executive described, they cannot be successful without the support of the operations staff. The performance of the SBP role should be evaluated by how well s/he utilizes the expertise of other HR functions and vice versa.
Create a succession plan for the SBP role. For many organizations, introducing the SBP role is part of an overall HR transformation; the selection and training is set up as a one-time event that may not be repeatable. Organizations should develop a career path for the SBP, including competency lists detailing the types of experiences and behaviors required to be successful.
Align rewards for the SBP that reinforce expectations of the new role. i4cp's SVP of Research, Jay Jamrog, believes that firms should use metrics that are tied to how the whole organization is doing in the marketplace, not just traditional HR metrics. Metrics should be "more outside-in than inside-out," he states. The key is to identify the human capital measurements that support the business and demonstrate impact, then reward the strategic contributions rather than the tactical or administrative efforts.

Strategies of Successful HR Executives

Wed, 21 Apr 2010 12:35:00 GMT

For HR professionals who suspect that the never-ending quest for the proverbial "seat at the table" is an unattainable objective, there are a growing number of examples of HR executives who have not only gained entry to the inner circle but have leveraged positions of significant influence within their organizations with great success.

Such wins give those still wrestling with the challenge hope, but they also make us wonder how much of the ability to achieve this goal is about factors such as the culture of the organization or the talent and charisma of the individual HR executive. Is it about a specific process or formula or does luck play a role? Could it sometimes simply come down to having the right credentials and being in the right place at the right time?

It's all of that and more, says Mike McDaniel, senior vice president of HR at i4cp-member company Alliance One International, Inc., a Fortune 1,000 company. He states that, first and foremost, learning the business is a critical imperative. Being an HR expert might get you in the door of the board room but, to get a seat at the table, you must have an intimate understanding of what's driving the business.

McDaniel's edict about knowing the business is supported by the results of i4cp's recent HR Executive Insight Survey, which looked at the degree to which HR execs are key decision makers. The respondents to this study tended to be a select group comprised of senior HR executives: 87% of the respondents were VPs, SVPs, or senior executive leaders working in the HR function.

Fully 83% of respondents from companies where HR execs play key roles said they highly or very highly agree that they gain credibility with other senior leaders through deep knowledge of their organizations' financial and other non-HR business issues. By contrast, a mere 33% of respondents from organizations where the role of HR execs is not key say they gain credibility via their business expertise to that same extent.

But business knowledge alone isn't enough to win a seat at the table. HR execs had better be very good at what they do. Fully 100% of respondents from high-market performing organizations report that, to a high or very high extent, they gain respect by performing well in their areas of expertise. Such excellent performance leads to trust and strategic business relationships.

The need to be a trusted expert in human capital issues is highlighted by David Kaput, senior vice president of HR at office supply manufacturer ACCO Brand. He says that in order to become strategically effective, HR executives need to aim for the role of trusted advisor rather than a front-and-center spotlight position. "The power base is more subtle," says Kaput, who recommends investing a year or two in building relationships and gaining credibility behind the scenes.

And HR executives must be equipped with facts and data to back them, Kaput says. This way, incremental value can be established beginning with how HR can help the manager succeed and extend the proof of effectiveness up the chain. If you can consistently prove that the investment is worthwhile, the perception of the importance of the work HR does won't need to be argued.

Kurt Thomas, VP of Human Resources at Mortgage Guaranty Insurance Corporation, says that HR executives must have the ability to manage the sometimes precarious juggling act of effectively advising the C-suite and getting a firm grasp on compliance issues, while also being able to hire the right people and maintain a healthy culture. "The most acute pressures on business today involve HR - HR is in the center of all of it, so HR executives have to have a firm understanding of their role, know the business, and have credibility with the CEO as well as the rest of the organization including senior management and the board. You have to have those pieces to get to this level - and sometimes it's a matter of timing - it has to be the right fit all the way around."

The executives we interviewed agreed that it's not necessary that the head of HR come from outside the HR profession to be perceived as credible among other senior leaders in the organization, and our study showed the same thing. Out of all the factors used to gain credibility with senior managers, having a head of HR who comes from outside the HR profession was ranked last.

Thomas says that while expertise and knowledge are important, the comfort level between the CEO and the head of HR is as important. "First, you have to have exceptional knowledge of this craft that is human resources. Second, you have to have very solid professional or executive presence - by this, I mean you must be able to state your case and articulate your opinion and recommendations in no uncertain terms. You have to have the wherewithal to speak your mind. If you can do those two things - and they go together - you'll be successful."

i4cp's 4-Part Recommendation:

Build credibility by doing your homework. Make use of existing data to prove the value of HR in almost every activity and to help you present whatever case you're arguing. For example, McDaniel successfully argued that a new change management process needed to be developed before he would accept a new position as head of HR while Alliance One was going through a merger. He leveraged research that showed that mergers fail because of the "people problems" that result from poorly implemented change management processes.
Over prepare. If you plan to cover an issue with the CEO, senior management, and/or the board, amass a battery of information to have on hand to help make your case and support your recommendation. Try to anticipate every question that might come up. Don't look to the CEO to make a decision for you; present her/him with recommendations based on logic and backed by facts.
Tell your story and develop relationships - beyond using metrics to track performance, become expert in demonstrating how HR's efforts add value to the organization, who has benefitted and how. And ask questions when you need to. Questions can help clarify where there may be confusion in other parts of the organization.
Look at developing more systematic ways of providing cross-functional education to ensure that the HR staff gains fluency in the business; for example, send HR employees out on sales calls and be creative in facilitating opportunities for collaborative interaction with other departments.

Sharpening Customer Focus: The Power of a Market-Oriented Culture

Wed, 07 Apr 2010 11:37:00 GMT

What's the key to creating a customer-focused organization? Here's one of the answers from the trenches of a high-performance company: "A culture of accountability makes a good organization great and a great organization unstoppable."

That nugget of wisdom is part of i4cp's new major study on customer focus, conducted in partnership with the American Management Association. We found that accountability that starts at the top is critical to customer focus. Sixty-seven percent of respondents from high- market-performing companies that are good at focusing on customers say their organizations hold at least one corporate officer responsible for the customer experience. By contrast, a tiny 3% of lower-market-performing firms that are poor in this area hold an officer accountable.

Companies that excel in overall performance do something else about customer focus differently, too. They make sure that a commitment to customer service doesn't stop with senior leaders - or even with customer-facing employees. Leaders of top-notch firms create customer-focused cultures that suffuse their organizations, reaching from sales professionals with daily customer contact to production-line employees who may never have a conversation with a consumer but whose efforts are just as vital to company success. Nearly seven out of 10 high-performing organizations say they work to build such a power culture. Lower performers? Fewer than half.

"Alignment of the corporate mission, vision and goals with customer satisfaction" is viewed as a critical practice, according to one study participant from a high-performing company. "Bringing these concepts to the employee level and creating secondary visions that align their actions with the overall vision has increased [our] focus on exceeding customer expectations."

Four out of five respondents from high-performing companies say that financial growth is the key driving force behind their focus on customers. Certainly, i4cp research has shown that market focus - which revolves around a focus on customers - is one of the five core attributes of high market performance. So it makes sense that a corporate culture centered on customers is likely to yield positive bottom-line results. But how does an organization seeking better performance bring about that kind of culture shift?

Along with accountability, communication and training are among the most vital components in culture-building approaches, the study found. "We are more actively sharing competitive data with lower levels of the organization," one business leader revealed. In addition, the company is "instilling a culture of innovation and customer obsession to drive behavior focused on the customer."

Multiple respondents from high-performing companies described their firms' educational efforts. Customer-focused training "is part of our onboarding and new employee orientation," said one. Another cited "continuous training on customer care practices" and a third explained, "We run training on a different customer service topic every month."

Companies that achieve high levels of performance in today's volatile marketplace demonstrate not only a dedication to customer service but also a commitment to anticipating customer needs and being proactive in meeting those needs. This type of forward-thinking mindset is one of the hallmarks of a culture that is truly customer focused.

i4cp's 4-Part Recommendation:

Include accountability for customer service and satisfaction in performance reviews for managers and employees alike. Forty percent of i4cp respondents say they hold their entire executive teams responsible for customer focus. Reinforce accountability by aligning rewards and recognition with customer-focus goals.
Build a powerful corporate culture that supports an organization-wide commitment to customer service. One study participant explains how: "We developed a new, customer-focused mission statement and had a bottom-up planning session to gain buy-in and establish critical success factors and SMART objectives. We will align our HR, organizational, management and communication practices to align with these objectives."
Retool internal communications to ensure support for a customer-focused culture. Share customer stories, feedback and insights with all employees. Involve senior leaders in modeling customer-focused behavior and in communicating the company's customer-centric values and mission.
Make customer-service training an ongoing commitment. Begin during employee onboarding and follow through with more training on a continuing basis. One company participating in the study demonstrates how to make the process enjoyable by offering a "Lunch'n Learn Customer Appreciation Program."

Don't Plan Succession, Manage It

Wed, 24 Mar 2010 11:44:00 GMT

"Succession planning" is not just a flawed term, it's based on a flawed business paradigm. In fact, thinking of succession in terms of just "planning" is among the top reasons most organizations perform poorly in this area.

Consider this: Improving Succession Plans: Harnessing the Power of Learning and Development, a major new study published by the American Society for Training and Development in partnership with i4cp (and free to members of both organizations), shows that a mere 14% of respondents describe their organizations' succession planning efforts as effective to a high or very high extent. In other words, most think their company's efforts are mediocre or worse.

So, why are so many study participants - there were 1,247 usable responses to the survey - so cynical about the effectiveness of their succession planning programs? The answer is simple: It's because organizations are coming at the issue from the wrong direction. They too often assume succession is a planning process rather than a crucial dynamic management task that must be integrated with the rest of the talent management system.

Yes, succession management should have a planning component. After all, the study shows it's a future-looking process in which the top two goals cited by respondents are to "identify and prepare" future leaders and to "assure business continuity." But many companies focus only on the identification part of the process rather than on the preparation part.

That's reflected in the metrics companies use or, rather, fail to use. When we asked what respondents' organizations are measuring, we found two things: 1) there's a striking and worrisome absence of solid metrics in regard to succession management, and 2) the metrics that are most commonly used are very basic indeed. Among those with succession planning programs, a meager 36% even track the positions filled by succession candidates to a high or very high extent and just 31% track the number of candidates in the pipeline to that same extent.

Yet, organizations are even less likely to use true performance indicators such as senior management ratings, business outcomes, and performance appraisal scores. And they seldom hold managers accountable for succession planning, either.

That's a bad sign, of course. In the famous words of management legend Peter Drucker, "What gets measured gets managed." This lack of good metrics is, in fact, one of the reasons why Jay Jamrog, i4cp's senior vice president of research, argues in favor of the term "succession management." That term implies an overarching endeavor that embraces not only the act of planning but the full scope of processes related to succession implementation, supervision, evaluation, development and performance.

There's no doubt that many business professionals think that development, in particular, should play a much stronger role in most of today's succession programs. The ASTD/i4cp study found enormous gaps between the degree to which respondents say their organizations use certain developmental tactics and the degree to which they should use them. For example, just 30% say their organizations, to a high or very high extent, provide regular performance/development feedback to succession candidates, but a full 92% say their organizations should do so.

Perhaps some managers think succession candidates don't need feedback, believing that they're already learning enough from the school of hard knocks. But the study suggests that many employers are also neglecting experiential development. Whereas just 30% of participants say their firms provide challenging or "stretch" assignments to succession candidates (to a high or very high extent), the vast majority (85%) say their firms should do so.

Of course, such gaps wouldn't mean much if they didn't influence the effectiveness of succession programs and overall market performance. But this study indicates that there are strong correlations indeed between effective succession programs and the use of various development options. What's more, we found a significant statistical relationship between some candidate development practices and higher market performance.

In short, it often pays to approach succession from a management and development approach rather than a planning approach.

There will be plenty of opportunities for organizations to change the succession paradigm in the near future. Around half of respondents to the study said their firms would modify their succession planning programs over the next two years, and only 18% said they wouldn't, with the rest saying they weren't sure.

i4cp's 4-Part Recommendation:

If you don't have a formal succession program, seriously consider developing and implementing one. Companies that have formal programs score much higher on the ASTD/i4cp Succession Planning Success Index than those that do not. One participant stated it succinctly: "We are losing talent, missing developmental opportunities, and losing knowledge because we don't have a formal succession plan in place."
Measure effectiveness and hold managers accountable. The measurement of logistical items such as the number of positions filled by candidates or number of candidates in the pipeline is necessary, but organizations also need to track metrics that are more performance-related. For example, they can examine the business outcomes of units led by succession candidates or the results of 360 degree assessments. In addition, they should hold leaders accountable for tracking and developing succession candidates.
Do more to develop succession candidates. This seems to be an obvious strategy but many organizations fail to effectively accomplish this. For more information on this, see i4cp's The Five Best Practices for Developing Succession Candidates.
Integrate and align. That is, align leadership competencies with the organization's overall objectives and business strategies. Too often, companies rely on generic leadership competencies, failing to consider which competencies are most critical to their own unique businesses. Once the right competencies are identified, integrate succession planning into your organization-wide talent management program. If it's a stand-alone program unconnected to development and other systems, then it's unlikely to have much of an organizational impact.

Achieving High Performance with Leader Athletes

Fri, 12 Mar 2010 11:55:00 GMT

Today's elite athletes are performing at levels few can hope to achieve, yet with each race, each competition, they consistently demonstrate the capacity to push themselves and reach heights once thought unobtainable. In the business world, it should be the goal of every leader to emulate world-class athletes. This is a reachable objective and we see examples of exceptional adaptability and agility as chief among common traits shared by leaders of high performing organizations.

Outstanding leaders have traditionally been associated with coaches rather than athletes. They guide, teach, motivate and inspire. But they are not usually thought of as demonstrating the dynamic, heroic effort of sports figures in the course of leading companies. But that's changing quickly.

The ability to recognize and anticipate the next challenge is the hallmark of many great athletes. And there's a certain attitude that goes with agile athletes. They thrive on change because that's where they excel. "Agile leaders aren't afraid of change - they embrace it rather than try to manage it and they encourage those around them to do the same," states i4cp's CEO Kevin Oakes. "It really is about being fearless, and some leaders are better at this than others."

i4cp's research indicates that the agile athlete is an apt metaphor for what it takes to execute strategy that results in success. In partnership with Prof. Bill Joiner, co-author of the book Leadership Agility, i4cp conducted the Organizational and Leadership Agility survey in February 2010, finding that the agility of leaders seems to be strongly linked to organizational performance.

In his recent i4cp webinar, Joiner notes, "Accelerating change and growing inter-dependence are continually raising the bar for the level of agility needed for sustained competitive advantage." And yet, fewer than a third of respondents in the study ranked their company as being largely proactive in anticipating and initiating changes needed for sustained high performance. Nearly half of companies that have already achieved a level of high performance say the same, however.

Respondents from these high-performance organizations are about twice as likely as those from low-performance companies to report that their top executives set clear expectations for agile executive leadership behavior to a high or very high extent. The same pattern holds true for the statement, "Our top executives model agile leadership behavior" (36% vs. 18%).

The performance disparity is even greater when looking at leadership selection. Study participants from high-performing organizations were nearly three times as likely to say their selection and/or promotion criteria include leadership agility to a high or very high extent. Similarly, those from high performing organizations were over three times as likely to report that their reward systems include leadership agility measures.

In short, high-performance organizations are considerably more likely to model, clarify, select for and reward agile leadership behaviors among executives. Yet, a scant 40% of respondents said their organizations are adept at recognizing and responding to strategic challenges in a timely manner, and just 32% said they are proactive in anticipating and initiating the changes needed for sustained high performance beyond their immediate strategic challenges.

Another driving factor behind the need for leadership agility and ability is the increasingly interconnected nature of the business world. We asked participants about the extent to which their corporate success depends on the collective ability of their executives to work effectively with customers, suppliers, business partners and other stakeholder groups. Four out of five respondents said it was important to a high or very high extent.

To work effectively in a dynamic and interconnected business environment, organizations are trying to develop the equivalent of executive athletes, people who are - organizationally speaking - nimble, strong, quick and smart. These people should be able to cope in a complex work environment filled with many different players, and they should be able to recognize and respond to strategic challenges, largely because of their ability to see patterns and anticipate changes and equip others to do the same.

"Leadership in this new era of rapid change is about empowering others to decide for their selves and empowering others to reach their full potential. Leaders can no longer view strategy and execution as abstract concepts, but must realize that both elements are ultimately about people (transformational leadership)," says Col. Dann Pettit, Director of Operations at the Oklahoma Air National Guard.

Being agile is also about getting the best out of team members, knowing when to "pass the ball," set the tone and provide good direction. In fact, our study shows that participants from high-performing organizations are over three times more likely to say that they "create highly participative, accountable teams where candid dialog and creative problem solving is the norm."

i4cp's 4-Part Recommendation:

Ensure that your executives set clear expectations for agile leadership behavior. Such behaviors should be clearly communicated and woven into the leadership development process. Organizations should also require executives to model such leadership behaviors, and this should be part of the performance assessment process.
Select and promote based on leadership agility criteria. That is, promotion and succession planning decisions should be based, at least in part, on candidates' display of leadership agility behaviors.
Ensure that your executives do not send mixed messages about the desirability of candid conversation and feedback. Our study finds that such "mixed messages" are the single most widely cited barrier to a leadership agility culture.
Use benchmarking and networking practices to discover what other high-performance organizations are doing to lead change in today's complex environment. For those practices that mesh with your organization's business plan, inquire about executive development programs. Ask questions such as:
- What are your most effective tactics for developing agile leaders?
- How do you implement those tactics?
- How do you encourage and reward agile behaviors?
- What are the most important lessons you've learned in term of acquiring and developing agile leaders?

Serious About Sustainability in 2010

Fri, 26 Feb 2010 12:03:00 GMT

A funny thing happened on the way to 2010. Amid blistering debates over health care, arguments over how to deal with double digit unemployment, and a general sense of conflict and gridlock on many other socioeconomic issues, one area of virtual consensus has emerged in the business world: the rise of "green" initiatives.

That's one finding from i4cp's 2010 Major Issues Study conducted in December 2009. Over three quarters (78%) of 515 responding business professionals projected there would be more "green" business initiatives in companies this year. Among many future-looking statements about what would happen in 2010, this one showed the greatest amount of agreement.

Okay, so this probably isn't a surprise to anyone who watches even a modicum of television these days. Commercial after commercial plays up the environmentally friendly missions and programs at many of today's major corporations. No company wants to be tarred with the ugly brush of environmental irresponsibility.

But just how serious are companies about this? Is it mostly public relations or is there something truly significant going on?

Every organization is different, of course, and there's definitely a PR angle to "going green," but the data suggests that many business professionals view this issue as vital to business success. Our forecast study shows, for example, that 70% of respondents said that sustainability (that is, social and environmental responsibility) would be of high or very high importance to their organizations in 2010.

Karen B. Paul, Ph.D., who is the Head of HR Measurement at 3M, an i4cp member company, notes that 3M has a long history of what are today called sustainability practices. She notes that Dr. Joseph Ling, 3M's former Staff Vice President, Environmental Engineering and Pollution Control, was a pioneer in the field of environmental and air quality management and is today recognized as the father of pollution prevention.

Dr. Paul states, "At 3M, sustainability is now embedded in the culture." She believes that there are strong interconnections among sustainability, employee engagement and innovation. "Sustainability is a wonderful lever to really challenge and engage employees in the areas of innovation." In one example, 3M offers its Pollution Prevention Pays (3P) award to employees on an annual basis. The 3P program has been around for 35 years and has prevented more than 2.9 billion pounds of pollutants and saved nearly $1.2 billion since the first year of the program. It's become a key element in moving toward sustainability for 3M. Dr. Paul states, "People all over the world at 3M compete for the award."

In addition to providing this award, 3M communicates about sustainability on a regular basis, includes sustainability-related questions in its climate survey (such as, "3M makes business choices that support the environment such as waste reduction & disposal, energy conservation and vendor selection") and reports out many metrics related to sustainability.

Still, just because 70% of respondents said that sustainability would be important this year doesn't mean that most companies are especially good at implementing sustainability practices. Another large study, which i4cp did in partnership with the Institute for Sustainable Enterprise at Fairleigh Dickinson University (FDU), specifically looked at trends related to sustainability and puts the details into better perspective.

That study confirms that sustainability is an important issue but one that most employers are still just learning to manage well. Taken as a whole, only a little over a quarter of respondents said their organizations are implementing a sustainability strategy to a great or very great extent.

More specific questions reveal the same pattern. For instance, these business professionals were asked about the extent to which they agreed that their organizations have made sustainability central to their business strategies. It turns out that nearly two-thirds of participants either somewhat or strongly agreed with this. That sounds like sustainability has become very influential, but if we break it down, only 24% strongly agreed with this statement.

What's more, a mere 15% strongly agreed with the statement their companies have an "effective means to coordinate and integrate various functions working in the areas of environmental and/or social responsibility."

Of course, things could be worse in this area and, by some measures, they indeed were just a few years ago. When i4cp conducted a similar study in partnership with the American Management Association back in 2007, the average score for the "centrality to business strategy" question was considerably lower. What makes that finding especially interesting is that the score rose despite the fact that the original i4cp/AMA survey included more responses from European organizations, which tend to score higher on sustainability issues.

The good news for sustainability advocates is that 41% of respondents from higher market performing companies say they believe (to a great or very great extent) that their companies implement a sustainability strategy, but the same can be said for only 18% of lower market performing companies.

In regard to sustainability tactics, some areas need more work than others. While most business professionals said their organizations are good at ensuring the health and safety of their employees, relatively few said their employers do well in terms of improving energy efficiency and reducing waste or using cross-functional teams and/or other groups to coordinate sustainability activities.

The study also inquired about the role of HR professionals in sustainability efforts. It turns out that many HR pros understand the potential impact of environmental and social responsibility on their corporate brand and their ability to attract, retain and engage talent. But they aren't very likely to be strong advocates for making sustainability issues central to their organizations' business strategy or for helping non-HR leaders see the connection between sustainability and talent management.

That's a shame, according to Jeana Wirtenberg, Senior Advisor at the Institute for Sustainable Enterprise and co-author (with FDU Professors Joel Harmon and Kent Fairfield) of an article on this sustainability data in an upcoming Special Issue of People & Strategy Journal on "Transitioning to the Green Economy." She notes, "Sustainability represents a huge opportunity for HR to play a more strategic role in their organizations, something HR has been aiming at for years. In many ways, it falls right into HR's sweet spot. Under the right circumstances, HR professionals can help infuse sustainability into talent management systems in their organizations, but they have to build up their own competencies in this area."

i4cp's 4-Part Recommendation:

Create a steering committee or cross-functional team to evaluate current sustainability trends and determine what, if any, sustainability programs need to be implemented in your organization. This group should track best practices, as things are quickly evolving in this area as new initiatives are developed, implemented and then evaluated.
Conduct sustainability scenario planning. There are many unknowns on the horizon. Among the uncertain factors that will influence sustainability in the future are regulations, pollution levels, climate change research, availability and costs of natural resources, health trends, new technologies, and others. Through scenario planning, organizations can consider the potential ramifications of these factors and how they might influence their businesses in the future.
Encourage the leadership team to study sustainability from a strategic orientation, asking whether it makes sense to take actions such as tying sustainability into core business strategies, aligning performance standards with it, and integrating various functions around the concept.
If sustainability is a priority, ensure that managers and HR professionals have the necessary competencies in this area. They can potentially take advantage of such skills by adopting a variety of actions, such as:
- designing and delivering training programs to support sustainability;
- articulating which leadership knowledge and behaviors align with sustainability;
- facilitating organizational change management programs that take sustainability into consideration;
- formulating and implementing measures and rewards to support sustainability;
- designing sustainability criteria for recruitment and promotion.

Reviving Training's DOA ROI

Fri, 12 Feb 2010 10:00:00 GMT

ROI is a funny thing. Why is it that no one directs the IT department to "get us the return-on-investment on our e-mail system," yet corporations think nothing of forcing the training department to project ROI on every learning program and technology deployed? And a down economy only intensifies the scrutiny.

It's to be expected that the CEO of a large company that's spending millions on training and developing employees might wonder what he or she is getting in return, especially when the pressure is on to cut expenses in order to meet analyst's quarterly estimates. However, as with most "soft" issues, it can be difficult to show tangible results from such intangible processes. Although employee training has been an integral part of the corporate environment a heck of a lot longer than e-mail, it hasn't reached the "we don't need to measure it - we know it's invaluable" status in most organizations.

The perception among many senior leaders that training isn't "mission-critical" is often the reason why the training budget is the first on the chopping block when companies look to reduce expenses. But as previous ASTD/i4cp studies have shown, cutting the training budget is a practice most associated with low-performing organizations; high performers generally keep it intact. If that's the case, why is training ROI all too often dead-on-arrival in companies today?

While most training professionals recognize the importance of evaluation, few have mastered the art, according to a new study by ASTD and i4cp. The study focused on whether or not learning evaluation actually pays off for organizations and, if so, which tactics are most effective. Only about one-quarter of respondents to the survey said they agreed that their organization got a solid "bang for their buck" from their training evaluation efforts. Reactions were only slightly better when respondents were asked if their learning evaluation techniques helped meet learning and business goals.

But, presumably pressed by senior management, training departments aren't giving up. The study finds that most companies continue to spend time and money on some form of evaluation, although it's clear that many are uncertain how to go about it and not sure what to do with the results.

How are organizations evaluating learning?

The famous (some might say infamous) five-level Kirkpatrick/Phillips model of learning evaluation is the most common method used. Ninety-two percent of respondents reported that they use at least Level 1, which simply measures a learner's satisfaction with a program. As the levels of evaluation get more strategic and bottom-line focused, however, the use of the model drops off dramatically at each subsequent level. Put simply: trainers often struggle with correlations between training initiatives and business results.

Many industry experts would recommend that organizations evaluate at all five levels while trimming the number of programs that are evaluated as they move up the levels. Instead, it appears that most organizations are evaluating at the first couple of levels exclusively, then dropping off completely before getting to the most value-affirming metrics.

The survey results also found that isolating training as a factor that affects bottom-line results works as an impediment to effective learning measurement. But the problems are often more basic than that. Many respondents said that metrics such as business results and ROI are sometimes just too complex and time-consuming to calculate. Let's face it: statistics probably wasn't the favorite class of most individuals in the training profession.

For perspective, I asked my longtime friend and unquestioned guru in the industry on training ROI, Jack Phillips, to share his thoughts on why this happens in so many organizations.

"Financial analysis and evaluation of effectiveness are not core competencies of most in the training profession," Phillips told me. He should know; there's little question he's talked to more trainers about ROI than anyone on earth.

"However, more training professionals these days have come around to the reality that tying learning to business metrics should be a core component of a program from the early design stages," Phillips said. "I think the work being done today in this field is better than ever before, but clearly there's still a long way to go for effective evaluation to be commonplace."

Certainly the money has been there to support this. Depending on their size, companies can spend anywhere from a few thousand dollars to tens of millions of dollars on training their workforces annually, with about 5.5% of that being spent on evaluation. That's an astounding amount of money being spent on something that most would agree isn't very effective. Keep in mind, much of that spending is on the very basic "How was the program?" Level 1 type of question and analysis.

But by focusing that investment on business impact, companies can have greater success. Our study found that in most cases, using more of the Kirkpatrick/Phillips levels is associated with more success in the area of learning metrics. The exception to this rule is at Level 1 (i.e., where most of the money and focus is now).

More importantly, study results also show that firms using more of the Kirkpatrick/Phillips levels have better market performance. In short, if you are actively measuring how learning affects the bottom-line, chances are your culture is one that encourages measuring the impact and effectiveness of various initiatives, and the affect that quality training can have on an organization is often quite significant.

The Value of Evaluation: Making Training Evaluations More Effective is available to i4cp members through our website. The report is also available to non-i4cp members through the ASTD website.

i4cp's 4-Part Recommendation:

Trainers should solicit feedback from line managers to gain a full understanding of what will make various business units more successful and design programs that will close the knowledge gaps in each department.
When designing training programs, consider strategy-relevant learning measurements from the beginning. After-the-fact measures don't track learning's impact and limit the levels of evaluation that follow training.
Stop spending money on Kirkpatrick/Phillips Level 1 evaluations. Focus evaluation efforts on Levels 3 and above.
Use the more strategic evaluation measurements to promote training effectiveness. Senior management will never understand the impact training is having on the business unless they hear it often and have it presented in the same financial metrics that the company uses to measure its overall success.