Transcript Becoming An Employer of Choice

Becoming An
Employer of Choice
APPA National Conference
June 25, 2007
Outline
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What It Means to be an Employer of Choice
How to Attract and Retain Critical Talent
An Employment Value Proposition (EVP) for the
Future Workforce
The Importance of Flexibility
How to Create an EVP for Your Organization
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What It Means to be an Employer
of Choice
Historical Definitions
 Able to attract and retain best and brightest
 Recognized and respected among employers
 Competitive pay, benefits and growth
opportunities
 Leader in effective human resource practices
 Enjoy high levels of employee satisfaction
 Known as a good place to work
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What It Means to be an Employer
of Choice
Why Our Definitions Must Change
 “The worst employment crisis ever is on the horizon as
baby boomers leave the workforce faster than new
employees can take their place.”
CEO, Monster.com
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Over half of 76 million baby boomers eligible to retire in
next decade
U.S. Dept. of Labor states that 60% of 21st century jobs
will require skills that 20% of workers have
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What It Means to be an Employer
of Choice
Why Our Definitions Must Change
 Only 5% of U.S. students earn
undergraduate degrees in science and
engineering
 Bureau of Labor Statistics estimates that
more than 300,000 new IT jobs will remain
unfilled
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What It Means to be an Employer
of Choice
Why Our Definitions Must Change
 Towers Perrin study in 2005 found only 21% of
U.S. workforce considered themselves fully
engaged
 Gallup’s U.S. Employee Engagement Index:
 29%
truly engaged
 54% not engaged
 17% actively disengaged
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What It Means to be an Employer
of Choice
New Definitions
 Ability to attract and retain the right people
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Target recruitment for high performance
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Excited by what they’re doing
Fiercely loyal to the organization
Productive for the long-term
Intelligence
Right skill set
Clear performance standards
Organizational fit
Employee engagement as competitive advantage
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Goes beyond job satisfaction
Extent to which employees commit to something or someone in the organization
How hard they work
How long they stay
Likely to go the “extra mile”
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How To Attract and Retain Critical
Talent
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Build and deliver an effective employment value proposition (EVP)
What Is An EVP?
Attributes labor market and employees perceive as value gained
from an organization
What Is In An EVP?
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Tangible rewards
Opportunity
 Nature of work itself
 Characteristics of the organization
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Understand what matters to employees at different stages
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Financial drivers
Work content (interesting, challenging and meaningful)
Development and real-life learning
 Communications
 Affiliation and connection
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How to Attract and Retain Critical
Talent
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Benefits an effective EVP delivers
 Increases
size of talent pool (60% vs. 40%)
 Reduces new hire compensation premium (4% vs.
21%)
 Improves commitment of new hires (38% vs. 9%)
 Improves commitment after first 12 months of tenure
(31% vs. 3%)
 Enables shift of expenses from recruitment costs to
development investments
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The employment value proposition (EVP) drives attraction and commitment in the labor market
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Compensation and career opportunities show disproportionate returns at improving attraction
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Pay (Also) Keeps Talent Inside
Compensation has a much larger impact on retention than effort
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Understanding the Benefit Plans That Matter Most
"Brand" your benefit program
Maximum Impact on Employee Discretionary Effort Due to Benefits Programs
Source: Corporate Leadership Council, Driving Employee Performance and Retention
Through Engagement: A Quantitative Analysis of the Effectiveness of Employee
Engagement Strategies, Washington D.C.: Corporate Executive Board 2004, p. 83.
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© 2006 Corporate Executive Board.
All Rights Reserved.
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Development opportunities, job-interests alignment, respect,
and people management are critical for commitment
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Out of 38 employment value proposition (EVP) attributes, seven are critical for driving attraction
or commitment across all major talent segments and geographies, but only three drive both
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Definitions of EVP Attributes
Collegial Work Environment
 Whether the work environment is team-oriented and collaborative
Compensation
 The competitiveness of the job’s financial compensation package
Development Opportunities
 The developmental/educational opportunities provided by the job
and organization
Future Career Opportunities
 The future career opportunities provided by organization
Manager Quality
 The quality of the organization’s managers
Organizational Stability
 The level of stability of the organization and the job
Respect
 The degree of respect that the organization shows employees
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Employees join for “the opportunity” and “the rewards”
and stay for “the people” and “the organization”
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The Role of the Manager
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Tremendous impact on employees’ commitment to team, organization and
job
Managers serve as the enablers (connection) to many attributes of the EVP
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Compensation
Development
Future career opportunities
Respect
Work/life balance
Empowerment
Almost all manager activities drive employee effort
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Provide clear, consistent and honest communication
Building collaborative teams
Enable access to individuals and networks
Commitment to diversity
Offering frequent and job relevant informal feedback
Focusing on employee contributions
Creating linkage between employee’s job and organization’s mission
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The Role of the Manager
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According to one survey, 32% of an employee’s
decision to stay with their organization is based
on trust for their direct supervision
Key Actions to Enhance Management Quality
 Establish
selection criteria for supervisors and
managers
 Use 360 degree feedback and coaching
 Invest in supervisory training and leadership
development
 Enroll best managers as mentors and facilitators
 Provide tools to enable managerial productivity and
effectiveness
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An EVP for the Future Workforce
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Four Generations in the Workplace
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Traditionalists (1925-1945) = 52 million
Baby Boomers (1946-1964) = 80 million
Generation X (1965-1980) = 51 million
Millenials/Gen Y (1980-2000) = 76 million
EVP for “Mature Workers” (age 55+)
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Meaningful work and responsibility
Opportunity to learn
Congenial and respectful workplace
Fair pay
Benefits that reflect the value of their experience and retirement
preferences
Flexible employment relationships
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Retiree return programs
Project-based assignments
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An EVP for the Future Workforce
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EVP for Mid-Career Workers” (Born 1951-70)
 Comprehensive
benefits plans
 Flexibility to meet work and life commitments
 Stimulation, variety, change of pace
 Enjoy work with a service component
 Opportunity to leverage existing skills while learning
new ones
 Mentoring for knowledge and skills transfer
 Availability of training and development
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An EVP for the Future Workforce
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EVP for Newer Workforce Entrants
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Individual responsibility and freedom to make decisions
Sociable and enjoyable work environment
Opportunities to learn and grow
Opportunities to contribute right away
Pay for performance
Team-based work
Lots of feedback, frequent and positive input
Manager who is a show horse and a plow horse
Boss as mentor
Open communications and accessibility
Very fast responders and expect the same
Focus on effort vs. results
Flexible everything – work schedules, workplace, work policies
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An EVP for the Future Workforce
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Common Core EVP Attributes
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Development opportunities
Compensation
Respect
Manager quality
Delivering an EVP Across Generations – ACORN Imperatives
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Accommodate employee differences
Create workplace choices
Operate from a flexible management style
Respect competence and initiative
Nourish retention
from Generations At Work, Zemke, Rains, Filipszak
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The Importance of Flexibility
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Key to Being An Employer of Choice
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Provide employment value across talent segments
Increase engagement and reengagement
Flexible Work Arrangements
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Customization of schedules, hours, and career paths
Time off
Telecommuting
Organization of work
Elastic job content
Efficient systems and processes to eliminate nonessential work
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The Importance of Flexibility
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Flexible Learning Opportunities
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Lifelong learning for all employees
Leverage information technology
Knowledge networks
Action-learning experiences
On-boarding new employees
Flexible Compensation & Benefits
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Customization
New variables in benefit segmentation
Educate employees and retirees
More kinds of incentive compensation
Fairness vs. equity
Key resources required for productivity
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How to Create an EVP for Your
Organization
Defining Relevant EVP Attributes
 Identify attributes that matter most to
attraction and retention
7
core attributes
 Segment-specific
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Select attributes that represent your
organization’s strengths
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How to Create an EVP for your
Organization
Find Competitive Opportunities
 Study what your competitors don’t do as well
 Review which attributes aren’t promoted by
competitors
 How to find out which EVP attributes matter
 Published research
 Employee preference surveys
 Focus groups (segmented)
 Data collected from job seekers
 New
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employee follow-up
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How to Create an EVP for your
Organization
Assess Strategic Alignment
 Determine which attributes best support
your organization’s strategic objectives
and culture
 Evaluate level of HR investments
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How to Create an EVP for Your
Organization
Define Your Competitive EVP
 Focus on most competitive and
strategically relevant EVP attributes
 Focus on opportunities that offer:
 Competitive
differentiation
 Strategic alignment
 Low implementation costs
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SRP’s EVP
Relevant EVP Attributes
 Organizational Stability
 Compensation
 Development Opportunities
 Manager Quality
 Collegial Work Environment
 Respect
Organizational Stability
 Rich history
 Stability of ownership and leadership
 Well-managed
 Makes good business decisions
 Reputation
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Good corporate citizen
Environmentally responsible
Honest in dealings with customers and employees
Understands its mission and strengths
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SRP’s EVP
Compensation
 Market-based pay
 Corporate-wide incentive program
 Spot awards
 Defined benefit plan
 401(k) plan
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100% immediate vesting
 Pre-tax, after-tax and Roth
 Company match at 80%
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Health/Benefits
PPO and 2 HMO’s
Preventive health and wellness coverage
CHAMP
 Hearing and vision
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SRP’s EVP
Compensation (cont.)
 Retirement and financial planning
 Retiree medical coverage
 PERA Club recreational services
 Voluntary benefits
 Long term care insurance
 Auto and homeowners coverage
 ID theft protection
 Group legal
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Work/life programs
Lots of benefits communications
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SRP’s EVP
Development Opportunities
 Tuition assistance
 On-site bachelor’s degree program
 Leadership series
 Apprenticeship program
 Certification support
 Extensive classroom training schedule
 Online training
 Community involvement and leadership assignments
 Ongoing technical training
 Professional and industry association participation
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SRP’s EVP
Manager Quality
 Thousands of years of experience
 Industry experts
 Continuous investment in leadership development
 Accessibility and approachability
 Active engagement in the community
Collegial Work Environment
 Begins with on boarding new employees
 Foster principles of teamwork, cooperation and
interdependency
 Building an inclusive environment
 Recognize longevity and service
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SRP’s EVP
Respect
 Safety
 Onsite EAP resource
 Harassment-free workplace policy
 Positive discipline
 Wide communication and equitable application of policies
 Investment in communications
 Doing the right thing
 Take care of each other
Overall: We strive to treat every employee with dignity and respect and
ensure the fair and consistent application of policies, programs and
practices
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Marketing Your EVP to Candidates
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Ensure that communications during recruitment process
are:
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Candid (reflects reality)
Accurate (enable self-selection)
Consistent (impact new hire commitment)
Broader labor market distrusts traditional channels
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Job ads and third-party job boards are typically trusted by less
than half of labor market
Organization’s website is trusted by 63% of candidates
Online forums (blogs) are least trusted (22%)
Most trusted channels are:
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Current employees
Friends/family
Former employees
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81%
72%
65%
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Common employment value proposition (EVP) communication channels not trusted;
trusted channels not advocates for the organization
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Few organizations have a significant population of employees
who actively promote the employment value proposition (EVP) and the vast
majority have a large percentage who do little to promote the organization
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Marketing Your EVP to Candidates
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Keys to Building Employee Advocates
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Trust essential to employees’ willingness to promote the
organization
Empowerment creates sense of ownership and increases
likelihood employees will promote organization
Communication of values strengthens employees’ perception of
what organization stands for and increases effectiveness in
promoting it
Successful Communications Emphasize:
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Organizational reality
Message consistency
Self-assessment
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Summary
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Knowing Your Employment Value Proposition is
Critical to Attraction, Commitment and Retention
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Select Core Attributes as Foundation for Your
EVP
Differentiate From Your Competitors
Align With Your Organization’s Strengths
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COMMUNICATE
Your EVP Internally and Externally
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Selected References
Workforce Crisis, Ken Dychtwald, Tamara Erickson, Robert Morison, 2006
Attracting and Retaining Critical Talent Segments, Corporate Leadership Council, 2006
It’s 2008: Do You Know Where Your Talent Is?, A Deloitte Research Study, Deloitte Development LLC, 2004
Leveraging the New Human Capital, Sandra Burud, Marie Tumolo, 2004
Driving Performance and Retention Through Employee Engagement, Corporate Leadership Council, 2004
“What It Means to Work Here,” Harvard Business Review, March, 2007
Great Place to Work Institute, www.greatplacetowork.com
Families and Work Institute, www.familiesandwork.org
Society for Human Resource Management, www.shrm.org
Center for Creative Leadership, www.ccl.org
Good to Great, Jim Collins, 2001
“The 100 Best Companies to Work For,” Fortune Magazine, Robert Levering, March 2007
“The Rewards of Work: What Employees Value,” Sibson Consulting Group, Nextera, WorldatWork, 2001
“Engaging the Massive Middle,” Beverly Kaye and Sharon Jordan Evans, 2007
“Leveraging Employee Engagement for Competitive Advantages: HR’s Strategic Role,” Nancy R. Lockwood, March, 2007
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