driving forces affecting human resource management presentation
Post on 14-Sep-2014
47 Views
Preview:
DESCRIPTION
TRANSCRIPT
Examining the Driving Forces Affecting Human Resource Management
Richard N. Dettling MSHRM, PHR
Human Capital DevelopmentUniversity of Phoenix, Ft. LauderdaleSouth Florida Campus
2005 © All Rights Reserved. 2
Source: Employment Policy Foundation analysis and projections of Census/BLS and BEA data.
Millions of People
Expected Labor Force and Labor Force Demand
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
2030
0
50
100
150
200
250
Labor Needed
Labor Available
2004
2005
2006
2007
2008
140142144146148150152154
A Growing Shortage of Workers in the US: Palpable by the End of This Decade
2005 © All Rights Reserved. 3
A Flat or Shrinking Native Populationin Almost All Industrialized Countries
16%
-5%
20%16%
2%
-21%
-13%
15%
-30%
-20%
-10%
0%
10%
20%
30%
US Canada
2%
-9%
France
7%
-7%
UK Germany
-14%
-28%
Japan
-5%
-27%
Italy China
% change 2000-2020% change 2020-2050
Source: US Census Bureau International Data Base
Percent Change in Working-Age Population
2005 © All Rights Reserved.
Top Ten Countries Based on Population Size and Growth Rates (2005/2050)
4
China
Indi
a
Unite
d St
...
Indo
nesia
Brazil
Pakistan
Bangl
ades
h
Russia
Niger
ia
Japa
n0
500
1,000
1,500
2,000
2,500
3,000
1,3041,104
296 222 184 162 144 143 132 128
1,4371,628
420
308260 295
231111
258101
20502005
2005 © All Rights Reserved. 5
Source: Wikipedia , the free encyclopedia; Foreign Direct Investment
>500
100-
500
50-100
10-50
<10In billions
Foreign direct investment (FDI) -investment made to acquire lasting interest in enterprises operating outside of the economy of the investor.
2005 © All Rights Reserved.
Foreign direct investment (FDI %) by country
6
China
Indi
a
Unite
d St
ates
Indo
nesia
Braz
il
Pakist
an
Bang
lade
sh
Russia
Niger
ia
Japa
n-0.5
0
0.5
1
1.5
2
2.5
3
3.53.1
1.10.9
-0.1
2.3
1.7
0.8
2.1
2.9
0.1
2005 © All Rights Reserved. 7
Age of Workers
16-24 25-34 35-44 45-54 55-64 65+-20%
0%
20%
40%
60%
80%
5% 5%
-9%
18%
48%
15%
Percent Growth in U.S. Population by Age: 2000-2010
Dramatically Different Patterns of Growth by Age
1. Declining number of mid-career workers
2. Few younger workers entering
3. Rapid growth in the over-55 workforce
Source: US Census Bureau International Data Base
2005 © All Rights Reserved. 8
. . . Continuing for Our Working Lives!
Age of Workers
Percent Growth in U.S. Workforce by Age: 2000-2020
under 14 15-24 25-34 35-44 45-55 55-64 65+-20%
0%
20%
40%
60%
80%
7% 8% 7%
-10%
3%
73%
54%
Source: US Census Bureau International Data Base
2005 © All Rights Reserved. 9
A Pattern Found ‘Round the Industrialized World
Source: Demography is De$tiny, The Concours Group and Age Wave, 2003
2 0 0 5 © A l l R ig h ts R e s e rv e d . 1 1
A g e
-2 %
-1 0 %
-1 %
1 4 %
2 2 %
8 %3 %
-2 0 %
0 %
2 0 %
4 0 %
6 0 %
8 0 %
U n d e r 2 5 2 5 -3 4 3 5 -4 4 4 5 -5 4 5 5 -6 4 6 5 + T o ta l
S o u rc e : U S C e n s u s B u re a u In te rn a t io n a l D a ta B a s e
The U n ited K ingdomChange in Popu lation by Age G roup: 2 0 0 0 -2 0 1 0
2 0 0 5 © A l l R ig h ts R e s e rv e d . 1 3
-9 %
-2 4 %
1 1 %1 4 %
9 %1 3 %
1 %
-4 0 %
-2 0 %
0 %
2 0 %
4 0 %
6 0 %
8 0 %
U n d e r 2 5 2 5 -3 4 3 5 -4 4 4 5 -5 4 5 5 -6 4 6 5 + T o ta l
A g e
I ta lyChange in Popu lation by Age G roup: 2 0 0 0 -2 0 1 0
S o u rc e : U S C e n s u s B u re a u In te rn a t io n a l D a ta B a s e
2 0 0 5 © A l l R ig h ts R e s e rv e d . 1 2
A g e
-7 %
-1 9 %
-1 1 %
2 7 %
-7 %
2 4 %
0 %
-4 0 %
-2 0 %
0 %
2 0 %
4 0 %
6 0 %
8 0 %
U n d e r 2 5 2 5 -3 4 3 5 -4 4 4 5 -5 4 5 5 -6 4 6 5 + T o ta l
S o u rc e : U S C e n s u s B u re a u In te rn a t io n a l D a ta B a s e
G erm anyChange in Popu lation by Age G roup: 2 0 0 0 -2 0 1 0
2005 © All Rights Reserved. 10
In 2000, A Fairly “Young” World . . .
Under 5% 5% to 12.4% 12.5% to 20% Above 20%
Source: U.S. Census Bureau
Percent of Population Age 60+ 2000
2005 © All Rights Reserved. 11
. . . Rapidly Aging by 2025
Source: U.S. Census Bureau
Under 5% 5% to 12.4% 12.5% to 20% Above 20%
Percent of Population Age 60+ 2025
2005 © All Rights Reserved. 12
Why? Dramatic Increase in Life Expectancy
1900 1950 1970 1980 1990 20001910 1920 1930 1940 1960
75
70
65
60
55
50
45
40
80
Source: U.S. Social Security Administration
Average Life Expectancy at Birth in the U.S.
2005 © All Rights Reserved. 13
The “Sudden” Boom in Life Expectancy
Source: Census Bureau, 2000
Life Expectancy at Birth: 1000 - 2000
Age
1000 1200 1400 1600 1800 1900 20000
10
20
30
40
50
60
70
80
25
30
3536
38
47
76.5
2005 © All Rights Reserved. 14
Why? Dramatic Drop in Birth Rates
Source: Age Wave
Tota
l Fer
tility
Rat
e
USUK
Fran
ce
Canad
a
Japa
n
Ger
man
yItal
y0
1
2
3
4
3.3
2.8 2.9
3.6
2.0
2.5 2.5
2.01.7 1.7 1.6
1.4 1.3 1.2
1960 2000Total Fertility Rate
2005 © All Rights Reserved. 15
Why? The Baby Boom Pattern
Source: U.S. Census
1930 1940 1950 1960 1970 1980 1990
4.5
4.0
3.5
3.0
2.5
2.0
Birth
in M
illion
s
The Boom Years: 1946-1964
Every 7 seconds, a baby boomer turns 50 in the U.S.
Source: Bureau of Labor Statistics
2005 © All Rights Reserved. 16
The Three Big Challenges for Human Resourcesabout The Emerging Workforce
Immigration • Will the U.S. encourage immigration to deal with the deficit in the workforce?
• Immigration Reform?
Outsourcing • How fast will it develop? Where?• Cheaper Labor vs. Quality and Control
Retirement • Average retirement age continues to lower while life expectancy continues to rise.
• More retirees remain active.• Will the average retirement age
change?
Source: Demography is De$tiny, The Concours Group and Age Wave, 2003
2005 © All Rights Reserved. 17
Workforce Poses Many Secondary Challenges Impacting Your Ability to Attract, Retain, and
Motivate the Talent You Need
• Limited in availability – Workforce growing in the U.S. by only a fraction of a percent per year through the first half of the 21st century
• Chronologically older – Individuals over 55 progressively larger proportions of the workforce: 11% in 2000; 20% in 2015; nearly one-third by 2050
• Lacking key skills – Shortages of needed talent, particularly in high skill areas, such as science and engineering disciplines
• Global – Continuing growth in off-shoring and “right shoring”• Highly diverse – Diverse in virtually every conventional dimension – race,
gender, age, religion and cultural identity – and populated by individuals with widely differing values and assumptions about work itself
• Sharing only healthcare as a core value – Unified in the U.S. only by a desire for premium health care benefits – heightened by increasing “age”
Source: Testimony by Tamara J. Erickson to the Senate Committee on Health, Education, Labor and Pensions, May 2005
2005 © All Rights Reserved. 18
Complicated by the Changing Nature of Work Further Challenging Big Corporations’ Response
• Increased interdependence of countries and cultures–Understanding the international political and economic environment, implications of job creation and transfer, immigration, and familiarity with local regulatory environments.
• Technology advancements –The need to work in remote locations, enhance security and increase operational efficiencies, will include more sophisticated, cost-effective means of global communication and self-service applications, among others. Early 20th Century U.S. Labor was cheap and technology was expensive. Now in the 21st
Century U.S. Labor is expensive and technology is cheap.• Outsourcing—transferring of a business process to an external provider• Offshoring —outsourcing of an operation to a firm with principal base of
operations outside the country• Terrorism, Safety and Security – There will be continuing concern for general
employee safety in the context of unstable countries.• Changing corporate culture – Multinationals will contribute to the expanding
definition of coworkers: they are in the next cubicle or in the next country; they are colleagues or suppliers.
Source: SHRM Special Expertise Panels 2005 Trends Report
2005 © All Rights Reserved. 19
Not a Time of Quick Reactions to Clear, Urgent Signals . . .
. . . But One of Potentially Dangerous Acceptance of Slow-Moving Trends
Source: Demography is De$tiny, The Concours Group and Age Wave, 2003
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
"Our review of economic research finds immigrants not only help fuel the Nation's economic growth, but also have an overall
positive effect on the income of native-born workers."
-Council of Economic Advisers Chairman Edward P. Lazear; June 20, 2007
20
Source: The White House (2007, June 20 ) Immigration’s Economic Impact , Council of Economic Advisers, Government, retrieved from http://www.whitehouse.gov/cea/cea_immigration_062007.html
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
• Immigrants are a critical part of the U.S. workforce and contribute to productivity growth and technological advancement
• Foreign-born workers accounted for 15% of the U.S. labor force, and over the last decade they have accounted for about half of the growth in the labor force.
• Approximately 40% of Ph.D. scientists working in the United States were born abroad.
• Immigrants have lower crime rates than natives. Among men aged 18 to 40, immigrants are much less likely to be incarcerated than natives.
• When immigrants are added to the US labor force, they increase the economy’s total output.
21
Source: The White House (2007, June 20 ) Immigration’s Economic Impact , Council of Economic Advisers, Government, retrieved from http://www.whitehouse.gov/cea/cea_immigration_062007.html
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
• In 2005, illegal migrants accounted for about 5% of the civilian labor force, or 7.2 million workers out of a labor force of 148 million
• Many [illegal immigrants] are working under conditions that are appalling
• Some are paid in violations of hours laws; some are children working in jobs they shouldn't be
• The illegal immigrants will always win in jobs competition with U.S. citizens.
22
Source: U.S. Census Bureau's March 2005 Current Population Survey
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
Farming 24%
Cleaning 17%
Construction 14%
Food Prepara-tion 12%
Production, Installation and Repair
15%
Other 18%
Immigration’s Economic Impact
23Source: The White House (2007, June 20 ) Immigration’s Economic Impact , Council of Economic Advisers, Government, retrieved from http://www.whitehouse.gov/cea/cea_immigration_062007.html
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
Foreign-Born U.S. Workers by Country of Origin
Latin AmericaAfricaAsiaEuropeNorth AmericaOceania
Source: DiversityInc Magazine, September 2007, p. 14; based on information from the Cen-ter for Labor Market Studies, Northeastern University, 2005
24
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
52
5
26
1331
Foreign-Born U.S. Workers by Country of Origin
Latin AmericaAfricaAsiaEuropeNorth AmericaOceania
Source: DiversityInc Magazine, September 2007, p. 14; based on information from the Cen-ter for Labor Market Studies, Northeastern University, 2005
25
The U.S. foreign-born workforce grew by more than 96% from 1990 to 2005-nearly nine times the rate of growth of the native-born workforce.Sources: Migration Policy Institute; 2005 American Community Survey
2005 © All Rights Reserved.
The Three Big Challenges 1. Impact of Immigration
1980 1990 2000 200675
80
85
90
95
100
105
U.S. WORK FORCE
Foreign-bornNative-born
26Source: DiversityInc Magazine, September 2007, p. 14; based on information from the Center for Labor Market Studies, Northeastern University, 2005
2005 © All Rights Reserved.
Higher Homeownership Rates (Foreign-Born vs. Native-Born)
White Black Latino Asian0
10
20
30
40
50
60
70
80
90
Foreign-born Native-born
27
Sources: DiversityInc Magazine, September 2007, p. 14; based on information from U.S. Census Bureau, 2007; Immigrants, Natives, and Homeownership, The University of Michigan, 2002
2005 © All Rights Reserved. 28Source: Migration Policy Institute, 2007,
2005 © All Rights Reserved. 29
Immigrants have driven 47% of total US work-force growth since 2000. New immigrants and their children will account for 100% of the US work-force growth between 2010 and 2030** Assumes net immigration of about one million per year. Sources: DiversityInc Magazine, September 2007, p. 14; based on information from Immigration: Shaping and Reshaping America, Population Reference Bureau, 2006
Source: Migration Policy Institute, 2007,
2005 © All Rights Reserved.
1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 20000
10
20
30
40
50
60
70
37.1 38.5 37.240
43.9
5155.9 57.2
52
39.937.3 38.1
30
Median Age of Foreign-Born Population for the United States: 1890 to 2000
Source: Migration Policy Institute, 2007, based on the 2000 data are from Schmidley, A. Dianne, U.S. Census Bureau, Current Population Reports, Series P23-206, Profile of the Foreign-Born Population in the United States: 2000, U.S. Government Printing Office, Washington, DC, 2001
2005 © All Rights Reserved.
Age Distribution of the Recently Arrived Foreign Born, 2005
0-1513%
16-2933%
30-4436%
45-5410%
55-644%
65+4%
31
Source: Migration Policy Institute, 2007,
Eight in 10 recently arrived foreign born in 2005 were of working age.
2005 © All Rights Reserved.
Educational Attainment of the Recently Arrived Foreign Born Age 25 and Older, 2005
Less than high school
33%High school diploma/GED
23%
Some college15%
Bachelor's degree
17%
Master's or higher12%
Forty-four percent of recent immigrants to the United States in 2005 completed at least some college.
32
Source: Migration Policy Institute, 2007,
2005 © All Rights Reserved.5-17 18-44 45-64 65+
36
6269
81
49
29 188
1510 13 10
Spoken English Ability (Self-Reported) of the Recently Arrived Foreign Born Age 5 and Older by Age Group,
2005
Limited English proficiency Speaks English very wellSpeaks English only
Source: Migration Policy Institute, 2007,
33
2005 © All Rights Reserved.
The Three Big Challenges 2. Outsourcing
Outsourcing Overview• Subcontracting a process, such as product design or manufacturing, to a third-party company.
• Non-core business functions/Cost Center Functions
Outsourcing - Clip
34
2005 © All Rights Reserved.
The Three Big Challenges 2. Outsourcing
35
2005 © All Rights Reserved.
Most Active Areas of Outsourcing
IT28%
Human Re-
sources16%Sales & Marketing
15%
Finance11%
Admin-istrative
9%
All others22%
Business Process Outsourcing
Source: Talent Connections, 2005
36
IT Leads as Most Active
Areas of Outsourcing
2005 © All Rights Reserved. 37
2005 © All Rights Reserved.
Companies Out-source Some HR
Function
Companies with $1 billion+ Annual
Revenues Are Now Considering HRO
HRO Growth from Second half of 2004 to First half of 2005
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
58%
91%
28%
How Common is HRO?
38
In next 5 years, global spending on HRO will double – from $40 billion to
$80 billion.
From 2002 to 2004, 14% increase in large
firms that would consider HRO.
Source: Talent Connections, 2005
2005 © All Rights Reserved.
Background Checks
FSA Administration
Employee Assistance/Counseling
Healthcare Benefits Administration
COBRA
0%10
%20
%30
%40
%50
%60
%70
%80
%
73%
67%
66%
60%
55%
5 Most Commonly Outsourced HR Services
39
2005 © All Rights Reserved.
Pension Benefits Administration
Temporary Staffing
Payroll & Software Services
Retirement Benefits Administration
Recruiting, Staffing & Search - Non-executive
Recruiting, Staffing & Search - Executives
Employee Relocation
Training and Development
Incentives
HRIS & Web-based Services
0% 20% 40% 60%
55%
54%
48%
47%
30%
29%
29%
21%
19%
15%
Other Types Outsourced HR Services
40
2005 © All Rights Reserved.
Employee Communication Plans
Policy Development/Implementation
Strategic Business Planning
Performance Management
0% 2% 4% 6% 8% 10%
10%
4%
4%
3%
Least Commonly Outsourced HR Services
41
2005 © All Rights Reserved.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
89%85%
20%
Satisfaction?
42
Recent survey of 129 large companies representing 2 million
employees.
Source: Talent Connections, 2005
2005 © All Rights Reserved. 43
The Opportunity for a New Life Stage
• Twenty-plus years: post- “Empty Nest” and pre- “Old Age”• Unprecedented opportunity
For satisfaction For exploration and creation For productivity
• Reinventing Entrepreneurial Charitable Flexible
• Potential for rejuvenation of the economy?
Productive Adulthood?
Reap Rewards?
Deploy Human Capital Assets?
Source: Demography is De$tiny, The Concours Group and Age Wave, 2003
2005 © All Rights Reserved. 44
30
25
20
15
10
5
0
More Years Spent in “Retirement”
1900 1980 1990 20000
5
10
15
20
25
13.6
19.4
20-25
1.2
Yea
rs
Source: Age Wave, based on U.S. data
2005 © All Rights Reserved. 45
50 or Under 51-60 61-65 66-75 75 or older Never
4%
20%
25%
16%
1%
34%
At what age do you plan to retire?
Many Employees Plan Not to Retire…
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
2005 © All Rights Reserved. 46
Traditional Retirement: Plummeting from the Peak of Productivity, Power, and Prestige
20s
30s
40s
50s or 60s
2005 © All Rights Reserved. 47
The Shape of Things to Come:“Down Shifting” for Continued Contribution
20s
30s
40s
50s60s
70s
80sCareer
Development
Career Deceleration
Source: Demography is De$tiny, The Concours Group and Age Wave, 2003
2005 © All Rights Reserved. 48
Cutting Back Has New Meaning: Cyclic Work
Working full-time Working part-time Moving back and forth between working full-time and not work-
ing
12%
39%
49%
The most popular pattern for working after “retirement” is not part-time, but moving back and
forth between periods of working and not working.
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
2005 © All Rights Reserved. 49
Shifting Values create Changing Motivational Factors
Respectful for Authority
Loyal to institutions
Motivated by financial rewards and security
Hierarchical
Technology as a treat
Anti-authoritarian
Idealistic
Motivated by changing the world
Competitive
Technology as a tool
Alienated
Non-traditional
Motivated by professional development
Information rich
Technology as an extension of self
Self reliant
Non-conforming
Motivated by social networks
Information overloaded
Technology dependent
Baby Boomers Gen Xers MillenialsTradionalists
Before 1946 1946-1964 1965-1978 1979-1997
2005 © All Rights Reserved. 50
Core Values of Mature Workers: TraditionalistShaped by Stable Teenage Years
Character-Shaping Events
• Stock Market Crash• World War II• First manned space flight• Significant increase in
economic prosperity: home, TV, and automobile ownership
• Growth in white collar jobs
Prime life:
Reaffirmation of economic success
Red sports cars and trophy wives
2005 © All Rights Reserved. 51
Today’s Dominant Cohort: Baby BoomersPulling Away from Corporate Life
Character-Shaping Events
• Assassinations of idealistic leaders, Kennedy and King
• Vietnam War, with television coverage and widespread protests
• Civil Rights movement• Feminism• Watergate and Nixon’s
resignationMidlife:
Volunteer work and a search for life’s meaning
Limited engagement with “work”
2005 © All Rights Reserved. 52
The Pop Culture Cohort: GenXersPulling Away from Corporate Life
Character-Shaping Events• Iranian Hostages• Latch-key kids• Fall of the Berlin Wall and the
end of the Cold War• United States only Super Power• Challenger disaster• War on Drugs• MTV: Heavy Metal, Punk,
Grudge music• HIV/AIDS
Establishing life:
Looking to establish instant wealth
Balancing work life and personal life
2005 © All Rights Reserved. 53
The Internet Cohort: NextersReengineering Corporate Life
Character-Shaping Events
• Columbine School Massacre• September 11th terrorist attacks
and World Trade Center destruction
• War in Iraq and Afghanistan • Creation of the Department of
Homeland Security• The Internet, iPods, MySpace
Starting life:
Limiting the risks of corporate assemblage
Social needs are met in cyberspace
2005 © All Rights Reserved.
10%
46%29%
15%
Traditionalists Baby Boomers Generation X Nexters
4 Generations in the Workplace
Source: A Look at Generational Diversity: Managing the Differences; Society for Human Resource Management
54
2005 © All Rights Reserved.
U.S. Population 1984-2014
1984 1994 2004 20140%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
16-24
25-34
35-45
45+
55
Source: Bureau of Labor Statistics
2005 © All Rights Reserved. 56
I really care about the fate of this organiza-
tion
I am proud to tell oth-ers I am part of this
organization
I am willing to put forth more effort than ex-
pected to help the or-ganization succeed
This organization in-spires the best in me
47%
46%51%
30%
64%
58%60%
43%
Mid-Career (35-54)
Mature (55+)
% strongly/moderately agree
Lower Organizational Connection Among Mid-Careers
2005 © All Rights Reserved. 57
Time seems to pass quickly when I am at
work
I feel very passionate about my job
I often feel energized by my work
I find that my values and the organization's
are similar
36% 43%
33% 34%
61%
53%50% 49%
Mid-Career (35-54)
Mature (55+)
% strongly/moderately agree
. . . And Less Passion and Alignment of Values
2005 © All Rights Reserved. 58
Begin Now: Create a New Relationship Between Employees and Employers
• Retire “retirement” – The average American can expect twenty or more years of active, healthy life after traditional retirement. We need this talent, and must adopt a more flexible view of work to coax more to stay.
• Create bell-shaped career paths – Individuals must be able to continue to contribute to businesses in respected, although less intense ways, into their 70s, 80s and beyond.
• Encourage counterintuitive entry points – Allow individuals to begin “entry” level jobs at multiple points throughout their lives, either as a way into new careers or to gain flexible options better suited to a preferred lifestyle. Many individuals will have two and even three distinct careers throughout their lifetime.
• Design project-based, cyclical work – Already, 49% of U.S. workers who plan to work during traditional retirement years say they prefer periods of full-time work interspersed with periods of no work.
• Accommodate blended lives – Make job sharing and other part-time options widely available• Customize work arrangements – Allow flexibility based on individual needs and preferences
Source: Testimony by Tamara J. Erickson to the Senate Committee on Health, Education, Labor and Pensions, May 2005
Corporations must vary how individuals are compensated, managed, and matched with different
types of tasks
to attract and retain key talent and create higher engagement
2005 © All Rights Reserved. 59
What is Motivation?
• Are excited and enthused about what you’re doing• Resist distractions• Tend to forget about time or place• Ponder current challenges even when you’re not directly
involved in the activity• Invest your free time (discretionary effort )• Identify with the activity• Invite others in (emotional contagion)
You know you are motivated when you . . .
Source: Re.sults Project EMP: Excelling at Employee Engagement, The Concours Group, 2004
Flowas defined by
Mihaly Csikszentmihalyi, former Chairman of the University of Chicago
Department of Psychology
2005 © All Rights Reserved. 60
Productivity
Employee Motivation
Why? A Growing Body of Research Links Motivation to Productivity
Enhanced Desirable Discretionary Behaviors
Innovation– Insight and intuition– Originality and inspiration– Judgment– Humor
Collaboration– Offered input– Leadership– Friendship
Correlation to Outcomes
Higher share price – Fortune “100 Best Companies To Work For” list outperformed the S&P 500
Higher return on assets – Korean firms with higher organizational commitment had a higher return on assets
Lower mortality – U.S. hospitals with higher nurse retention have lower mortality
Source: Re.sults Project EMP: Excelling at Employee Engagement, The Concours Group, 2004, based on the work of Dr. Jeffrey Pfeffer, Stanford University
Improvement in Traditional HR Metrics
Retention rates, Acceptance rates Customer Satisfaction
Emotional contagion of employees in customer-facing roles
Reduced CostsInvestments focused only on those aspects of the employee “deal” that matter most
2005 © All Rights Reserved. 61
Source: Re.sults Project EMP: Excelling at Employee Engagement, The Concours Group, 2004
How? There Are No Universal “Best Practices” for Enhancing Motivation
• Companies with highly motivated employees each do very different things!
• But within each, the elements of the employee experience seem to make sense: The individual’s personality: Tapping into their needs and
values The Organizational fit: Corporation’s values mesh with
Individual’s needs The human resource’s retention practices The specific roles and tasks: Profile Matching The day-to-day work environment: colleagues, first-line
managersSignificant diversity . . . but somehow internally aligned . . .
2005 © All Rights Reserved. 62
• “Customer satisfaction is the second priority. The first is employee satisfaction.” Chairman and CEO Patrick Flood
• HomeBanc Mortgage Corporation defines its mission as showing employees how work can give them a sense of purpose and mission
• Corporate philosophy based on the writings of Robert Greenleaf, an essayist and teacher who defined the "servant-leader" as a person who wants to serve first, before aspiring to leadership
• Our role is helping “people exchange ordinary living for an extraordinary life. To me, a job is too small to fill up a person’s spirit. I want to help them find purpose in what they do, see the bigger picture of what we’re trying to accomplish as an organization.” Chief People Officer, Dwight Reighard
• "You have to realize that when your associates are happy, your customers are happy." Barbara Aiken, a vice president in the Office of People and Culture
Corporate Activism: Encouraging Employees to Lead Better Lives
A Corporate Philosophy Embedded in an Employer Brand Recruiting based on cultural fit, associate emergency fund, extensive training and standards
. . . A Better Way Home
2005 © All Rights Reserved. 63
• From its launch in 1999, created a reservations “call center” based entirely in employees’ homes
• Employees have unlimited shift-trading privileges and participate in self-scheduling and a combination of full and part-time schedules
• Results: a 30% boost in agent productivity, 38% increase in service levels, and a 50% decrease in manager workload per agent
• Reservationists “are the people who are the least compensated in the company, but generate its revenue and interface with the customers more than anyone else except the flight attendants. We cannot afford to pay them huge salaries, so let’s make them happier, let’s let them work from their homes. We train them, send them home, and they are happy.”
—Founder David Neeleman
Clear Choice:Flexibility Rules
Calling HomeUsing flexible, at home work arrangements – finding extraordinary levels of engagement
2005 © All Rights Reserved. 64
Are You Relating to the Meaningful Diversity of the Changing Workforce?
2005 © All Rights Reserved. 65
Productivity
Motivation
“Organizational Fit” – The Challenge of Motivation
“Fit”
With what?
Segmentation –
On what basis?
Customization –
Of which components?
Flexibility –
In which dimensions?
2005 © All Rights Reserved. 66
What is “Fit”?
Identifying “Fit”
Employees fit with Organizations
Organizations fit with Employees
“While many forces can operate to move a company toward ever higher levels of
workforce homogeneity, some firms explicitly seek “non–right types” in an attempt to effect organization change and to take advantage of workforce diversity”. (Dreher & Doughtery,
2001, Chpt 3. pg 6.)
2005 © All Rights Reserved. 67
Identifying your Culture – Corporate and DepartmentalDo your employees match:Styles of Management: X and Y stylesOrganizational Employee’s Needs OfferingsCorporate Values
2005 © All Rights Reserved. 68
Searching for Meaningful Differences and Drivers of Motivation
Measured:• Current levels of motivation• Psycho-demographic
characteristics related to the role of work in respondents’ lives, and
• Preference for and satisfaction with various “deal” attributes
Survey of 7,718 Adult Employees Who Work 30+ Hours per Week
2005 © All Rights Reserved. 69
Gallup Towers Perrin EEE0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
16%19%
55%
64%
17%29% Motivated
Neutral
Bitter
Source: The Gallup Organization, Towers Perrin, and The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Random samples of the working population in the U.S. over 18 years of age
18%
62%
20%
Sources Agree: Few Employees Are “Motivated” in Work
2005 © All Rights Reserved. 70
Breakthrough Results from EEE
• Six very different roles that work plays in our lives – six statistically-valid segments
• Each segment with distinct work-related preferences – how work is structured, how they are managed, how they
are compensated, and so on
• Correlation between the extent to which the specific segment preferences are met and employee engagement levels
Insight into the values and attributes that are most meaningful to each employee segment
Beyond measurement – tangible ways to improve motivation
2005 © All Rights Reserved. 71
Self-Empowered Innovators
14%
Accomplished Contributors 17%
Fair & Square Traditionalists 20%
Maverick Morphers
15%
Stalled Survivors
19%
Demanding Disconnects 15%
Recognizing Meaningful Differences – The Six Segments in Today’s Workforce that Link to Motivation
Work is about building something with lasting value
beyond themselves
Work is about the American dream – a
steady, predictable path to success
Work is an opportunity to be a valuable part of a winning team
Seek lives filled with change and adventure – work is one of
multiple opportunities to achieve these goals
Work is a source of livelihood but not yet (or not currently) a very satisfying
part of their lives
Work is generally frustrating and its value is largely the near-term economic gain
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
2005 © All Rights Reserved. 72
Self-Empowered Innovators
• Work is a source of great personal satisfaction Most likely of all employees to say they are energized by their work, and that time passes quickly on the job
• Entrepreneurial and creative Choose jobs offering individual latitude Avoid structure, routine and detail
• Hard-working and long-working: half say they will never retire
• Self-empowered: most likely to define success as being true to themselves
• Motivated by stimulating work that enables them to continue to learn and grow Less interested in traditional rewards: compensation, vacation, or
benefits
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Work is about creating something of lasting
value
2005 © All Rights Reserved. 73
Fair & Square Traditionalists
• Highly reliable and loyal Longest average tenure with their employers of any segment Enjoy and get satisfaction from their work
• Motivated by fair, predictable rewards Want concrete compensation, benefits and a solid retirement
package Less interest in “softer” benefits like stimulating work or flexible
arrangements The least drawn to riskier compensation like stock or bonuses
• Prefer stable, secure work environments Choose work with structure and routine Avoid careers requiring entrepreneurial risk-taking or individual
latitude• Successful: Above average in household income• Traditional: Describe themselves as family men and women
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Work is about the American dream – a steady,
predictable path to success
2005 © All Rights Reserved. 74
Accomplished Contributors
• Motivated by the organization’s success• Value teamwork:
Choose work that involves working with others Place less value than others do on individual financial rewards Express low need for individual variability: flexible work
arrangements or vacation• Strong preference for environments that are congenial
Fun is the number one correlation with engagement within this group
Cooperation and teamwork are also very important (ranked third)• Value competence
Want work that is personally stimulating Want to learn and grow
• Loyal, hard-working, reliable Willing to put in extra effort – but prefer stable and structured
environments, in return
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Work is an opportunity to be a valuable part of a
winning team
2005 © All Rights Reserved. 75
Maverick Morphers
• Value excitement: not afraid to take chances• Restless and inquisitive
Continuously exploring options and new ways of working Willing to re-shape rules to fit their lifestyles Tenures with employers are often brief
• Motivated by personal (financial) opportunity: bonus compensation and stock
• Independent and self-reliant Motivated by flexible workplaces and schedules based on their
own terms “Own” their career Avoid work with significant structure and routine
• Attracted to education and personal growth 41% have college degrees (highest percent of any segment) Value organizations where they can work with other bright people
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Work is one of multiple opportunities to lead a life
filled with adventure
2005 © All Rights Reserved. 76
Stalled Survivors
• Highly preoccupied by challenges outside of work Feel pulled in multiple directions Trying to balance their lives – personally, financially, and
emotionally• View their current challenges as temporary
Many are starting their careers, attending school, getting married, having children
• Looking for employers who can make it a little easier to cope Seek flexible work arrangements and roles that allow more
balance Seek additional pay, vacation and family benefits or leave Gravitate to work with well-defined routines Tend to avoid work that involves direct personal interaction Value work environments that are congenial and fun
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Work is a source of livelihood but not yet (or
not currently) a very satisfying part of their
lives
2005 © All Rights Reserved. 77
Demanding Disconnects
• Work is frustrating Customers, bosses and colleagues are annoying Do not describe themselves as achievers Turned off by the nature of their work, by a lack of opportunity, or
by perceived unfairness in their employment arrangements• Least committed to their employers and least engaged in
their work Gravitate to jobs that are relatively easy to come by, such as
those in retail Avoid work with significant individual latitude or entrepreneurial
demands Most feel that their current organizations do not bring out the
best in them• Expect a lot
Place high value on traditional compensation and lucrative benefits packages
Want stability and security, more recognition and more reward Source: The New Employee/Employer Equation,
The Concours Group and Age Wave, 2004
Work is generally frustrating and its value is largely (only) its near-term
economic gain
2005 © All Rights Reserved. 78
Work is Clearly Not the Same Thing To All People, Therefore People are Not Motivated by the Same Thing
• Not all people are equally well-suited to all types of work• Not everyone values the same things from the work
experience• There is not one definition of a “good” manager• It is smart to target employees; “Profile Matching,” that are
best for your firm and the type of work you need to do Richard Dettling: First, get the right people on the bus Old Management Wisdom: Hire for attitude; train for skill
• Consistency is key: Right segment(s) for your business Fit with your corporate culture, values, and external image Appropriateness for the type of work Alignment of all parts of the employee experience – job design,
compensation, management style, and so on In short, a compelling, consistent employee brand
2005 © All Rights Reserved. 79
Long-term/Big Picture Benefits or Impact
Immediate Benefit or Impact
Economic Rewards
Psychosocial
Rewards
5
Fair and Square Traditionalists
Retirement savings and
pensions Self-Empowered InnovatorsWork that is
worth-while to society
Demanding Disconnects
Healthcare and salary
Accomplished ContributorsCooperation
and teamwork
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Varying Motivational Preferences for the Employee/Employer Relationship
Maverick MorphersBonus payments and
stock options Stalled Survivors Raises and childcare
2005 © All Rights Reserved. 80
Rank-Ordering of Motivational Preferences: Wide Variation
Work that enables me to learn and grow
Work that is personally stimulating
Workplace that is enjoyable
Work that is worthwhile to society
Flexible work schedule
Comprehensive benefits package
Comprehensive retirement package
Flexible workplace
Ten percent more in total compensation
Two weeks additional paid vacation
Note: BLUE bold indicates that the segment places MORE importance on this element than most other segments do. RED bold italic indicates that the segment places LESS importance on this element than most other segments do.
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
Comprehensive benefits package
Comprehensive retirement package
Workplace that is enjoyable
Flexible work schedule
Ten percent more in total compensation
Work that enables me to learn and grow
Two weeks additional paid vacation
Work that is personally stimulating
Work that is worthwhile to society
Flexible workplace
Self-Empowered Innovators
Fair & Square Traditionalists
2005 © All Rights Reserved. 81
Are You Satisfied with Our Benefits Program?
No . . .
But it hardly matters to me. The fundamental work is so important and
challengingNo . . .
And its really stressful for me. The security of my family
and our future – making sure we’re
covered under every uncertainty – is very
important.
2005 © All Rights Reserved. 82
Motivation Preferences for Management Style: No Common Definition of a “Good Manager”
"Catalyst”• Eliminate bureaucracy and remove
logistical impediments• Offer “stretch” projects• Be aware of signs of burnout and over
extension• “Promote” their work
"Accountant”
• Be clear and up front on expectations; follow through
• Tie compensation to clear goals
• Create a path that respects experience and tenure
• Provide regular professional development Source: The New Employee/Employer Equation,
The Concours Group and Age Wave, 2004
Self-Empowered Innovators
Fair & Square
Traditionalists
2005 © All Rights Reserved. 83
Are You Satisfied with Your Manager?
No . . .
He drives me crazy with excessive structure and
oversight. Yes . . .
The communication is
frequent and thorough. I
appreciate the detailed feedback
and regular reviews.
X type management
Y type management
2005 © All Rights Reserved. 84
Employee Preferences Vary Across the “4 C’s”
ConstructWhat’s the job?
Structure and definition of the work Degree of definition, pace, risk, degree of team interaction
CompensationWhat do employees get in return?
The entire scope of the “deal”Salary, benefits, deferred compensation, learning opportunities, satisfaction from giving back, pleasure from social networks
ConnectionHow do we relate?
Preferred style of managementAmount of interaction, frequency and formality of feedback, preference for hierarchy or participative management
CommunicationWhy do we care?
Key messages and shared valuesAlignment with core values
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
2005 © All Rights Reserved. 85
A Common Condition: 4 C Misalignment!
Self-Empowered innovators
Fair & Square Traditionalists
Accomplished Contributors
Maverick Morphers
Stalled Survivors Demanding Disconnects
Construct Career paths are well-defined and structured
Compensate Salaried by level; generous monetary benefits
Connect Expectations of high
performance and teamwork
Communicate Create a lasting legacyCollaborate with world leaders
Source: The New Employee/Employer Equation, The Concours Group and Age Wave, 2004
2005 © All Rights Reserved. 86
Immediate Contribution and Long-term ContextUse newest hires to develop the next generation of strategic ideas, products and leaders• Significant challenge and risk: A three-month in-house immersion process for all new employees
Month One – Stretch challenges, resulting in intense teamwork, deep bonds with peers, character by being stretched beyond the point of failure
Month Two – Charged to come up with breakthrough new product or service ideas and to develop the business and marketing plan working with Trilogy’s best and most senior people
• Responsibility to “own” your career Month Three – Building on connections with projects or sponsors, a rigorous evaluation by section leaders,
managers and fellow graduates, and a list of specific short and long-term goals, find own place in organization
• Exposure to leaders and experts: Run by top management, including the CEO
• Opportunity for broad impact: Dramatic benefits for the organization Primary R&D engine Development and proving ground for the company’s future generation of leaders Constant source of organizational renewal and transformation
Segment Alignment: Self-Empowered Innovators; Maverick Morphers
2005 © All Rights Reserved. 87
Segment Alignment: Self-Empowered Innovators; Accomplished Contributors
Creating a Strong Link from the Past . . . to the Future Reminding Employees of the Heritage and the Goal
2005 © All Rights Reserved. 88
Employees Caught Doing Things RightSpot Reward Program in the Hands of Attentive Line Managers• Immediate, short-term, task-specific rewards: Outstanding overall employee recognition program
Little money available for cash awards Uses day-to-day, informal, creative recognition, delivered with sincerity
• Managers focused on close connections: Ability to give recognition seen as a key leadership capability Sincere, specific, timely and personalized Managers measured on recognition of their staff – who is being recognized, by whom, and how often Managers held accountable for making and maintaining connections with employees
• Customized: Programmatic support Leadership training programs on personalized recognition Tools and exercises available to help supervisors get to know individuals’ recognition preferences
Segment Alignment: Stalled Survivors and Demanding Disconnects
2005 © All Rights Reserved. 89
• Specific well-structured process, clearly communicated: Extensive, well-defined training New recruits start with a full 5-day training program Managers expected to spend extensive amounts of time with each individual employee During the first year, new employees get 235 hours of training In following years, employees get an average of 160 hours of training Continuing education program – a three-day intensive training program for career-minded employees from
across the organization, including presentations by staff from every department, covering every facet of the firm
• Long-term, career development focus: Success based on attracting, training and retaining a highly capable and fiercely loyal workforce through a culture of trust and openness Employees motivated by an atmosphere of teamwork and service where helping customers is perceived as a
public good Extensive and ongoing investment in employee training and indoctrination in company values
Segment Alignment: Fair & Square Traditionalists, Demanding Disconnects
Investing in a Common Base of Competence A Well-Defined Career Path, with Detailed Training, Creates Fierce Loyalty
2005 © All Rights Reserved. 90
• Team-based processes – hiring, workflow: Employees at Whole Foods have complete control on who becomes part of their team Every store is divided into teams New employees are hired into one of the teams on a provisional basis After four weeks of work, the team votes whether the employee gets to stay or not; requires 2/3s “yes”
• Team-based compensation: Pay beyond base wages linked to team performance People don't want buddies; they want workers -- people who are going to make them some money Teams that do well share in the profits -- up to $2.00 extra an hour is paid right back to team members, every
other paycheck (13 times a year)• "Customers experience the food and the space, but what they really experience is the work culture. The true hidden
secret of the company is the work culture. That's what delivers the stores to the customers.” -- Chris Hitt, former President of Whole Foods
Segment Alignment: Accomplished Contributors
Recruiting for – and by – the Team Employee teams recruit new employees, using peer pressure to build performance
2005 © All Rights Reserved. 91
• Ambitious business needs: Goal to differentiate the Tesco deal from competitors’ by offering choice around pay, training, development and benefits
• Thoughtful, in-depth understanding of meaningful differences: Understood drives and needs by segment • Customization: Tailored the employment proposition to enhance overall commitment levels and improve retention
Created a portfolio of programs to offer more choices to employees and reflect the values and motivations of the different types of employee
For example young parents can take advantage of childcare vouchers, or highly ambitious employees can choose share options
• Organizational reinforcement: Appointed internal “Brand Managers”
Multiple Brands Based on Segmentation Using its Customer Insight Unit, normally dedicated to understanding the brand among shoppers, to segment the workforce
Source: Case Study developed by Lynda Gratton, London Business School
Identified five broad attitude segments within the Tesco
workforce
Work-LifeBalancers
Pleasure Seekers
Want it All
Live to WorkWork to Live
2005 © All Rights Reserved. 92
Plotting Your Journey to Extraordinary Motivation
Business Outcomes and Future Workforce
Requirements
Engagement Levels,
Employee Segments and Current Deal Satisfaction
External Brand
Attributes
Transition Plan for
Alignment of the 4C’s
1. Context
2. Assessment
3. Design
Brand Aspiration and Target Segments’ Experience
Organization’s Hidden Logic and Change Readiness
The Current Employee
Experience: the 4C’s
4. TransitionWhat are the
elements of your employees’ experience
today? What workforce do you have?
How motivated are they today?
What workforce do you need?
What workforce have you promised?
What employer brand is optimum?
How can you create a compelling employee experience – high level design of
the 4C’s – for each targeted segment?
What is the organization’s ability to implement realignment of the 4C’s?
What are the rules governing change in your current culture?
What is the optimum transition process?
2005 © All Rights Reserved. 93
The Evolving Philosophy of Performance Management
Focus on . . .
Efficiency Talent Motivation
Philosophical Focus
Management to standards
Management by objectives
Management of (customized)
employee experience
Variation Vary what we expect you to do
for the corporation
Vary what the corporation will
do for you
1950’s 1980’s Today
2005 © All Rights Reserved. 94
Going Forward: Shaping the New Workforce – Five Key Shifts for HR Leaders
Shift your focus from reactive activity to thoughtful “what if”
Create a long-term workforce strategy that addresses uncertainties related to future needs and counter-intuitive sources of talent. Address the uncertainties and options ahead.
Source: Tamara J. Erickson, The Concours Group
Shift HR capabilities from “doing” to designing and measuringDesign operations for world-class execution through efficient, flexible processes, at the necessary service levels, whether within the firm, or through outsourced relationships.
Shift the culture from competition to cooperationIn a world where value is created through innovation and resources are coupled flexibly, cooperation becomes a critical organization capability. Become masters of cultural change.
Shift the goal from employee satisfaction to employee motivationImproving motivation is a powerful lever to improve productivity. Most companies have exhausted their ability to squeeze increased productivity through top-down pressure.
Shift the HR philosophy from “equal” to “fair”Evolve from treating everyone the same, to customizing arrangements to individual needs and preferences. Develop strong “marketing” capabilities: world-class skills in survey research, segmentation, “brand” management, targeting, and communication strategies.
2005 © All Rights Reserved. 95
The Goal: The Employer of Choice for the Employees You Need
• A company that outperforms competition in the attraction and retention of the type and quantity of talent needed for business success
• An organization that is able to create extraordinary levels of employee motivation: Above average levels of productivity High customer satisfaction Clear link between employee performance and business results
• A distinct brand that improves the quality of candidates, improves retention, and enhances motivation
A Compelling Employee Experience
A Highly Productive, Appropriately-Skilled Workforce
2005 © All Rights Reserved.
The Three Big Challenges 2. Outsourcing
• HR Outsourcing Overview• Impact on Companies• Impact on HR Profession• Impact on Your Career• Selecting, Managing, and Measuring Outsourcing Providers
• Helpful Resources
96
top related