The 7 Crisis Driven C-Suite Questions

As we are seeing some daylight in respect to the economic crisis my Discussion Partner  colleagues and I have identified the top questions we are hearing from our C-Suite Questions.

1. What am I missing?
2. Do I have the right people to get me through this crisis?
3. After the crisis, what type of managerial skills should my executives possess?
4. What do I do to plan for the shifting demographics?
5. How do I exploit the Social Network phenomenon to improve Employee Engagement?
6. What will the future HR model look like?
7. Do I have the right skills to be a CEO? During the next several weeks we will communicate our findings via this blog on the above questions.

Question 1-What am I missing?

The CEO community has been heads down for the last 18 months on coping with the economic crisis. In our Executive Advisory work we are finding our CEO clients becoming less focused on restructuring, stock price, and governance pressures. Our discussion has now shifted to address issues of growth and globalization. The common theme among all of the CEO’s whom we have been working with is that the economic crisis has changed the business fundamentals. This has led to our response when addressing the question “what am I missing” by replying “it is hard to say…..we are all navigating as yet unchartered waters” The growth and global issues are interrelated for self evident reasons. To level set expectations in an environment that is at best unclear the determination of strategic intent is focused on the following questions:

• Do we focus our acquisition efforts outside our host country
• How do we manage a truly global workforce
• Given the parochialism of Americans…..how do we promote a sense of enterprise community
• What is a reasonable ROI in the context of forecasted turbulent stock market conditions
• Will the ultimate measurement of intangibles be a benefit to our enterprise

These 5 filters are leading he CEO’s to be highly reflective as they ponder their next steps. An additional finding from our client work is that the consideration of the above will promote improvisation and creativity in human capital strategy

Tapping into Employee Passion

By:  Karen Warlin

Strategy / Tactics

Employees are extremely passionate about what they do – we need to tap into their passion and competitive spirit to get them jazzed again.  We need them to pull together as a team, and refocus on making the best products in the industry, which means helping them understand the business strategy, how the company is following the strategy and including them in the success of the organization. For example,

·         Key Messages:

o        Think about what you want employees to remember about this time and frame your messaging and actions around that.  This shouldn’t be a time of reactionary communication – employees want to understand the long-term view and see it played out as outlined.  

o        Identify your audiences and determine if there is different messaging for each (leaders, managers, employees, Europe, Japan, etc.)

·         Process: will you go directly to employees or try to cascade the information?  If going directly, try to build in a “heads up” for leaders / managers, perhaps a day before it goes out more broadly, so that they have time to prepare and ask questions themselves

·         Following a change communication approach (announce, educate, adopt and sustain), we can help employees get up to speed on the current state as well as what’s going to happen. The announcement about the current state of business has already been made.  Now we need to help them understand why the decisions were made and how the business will turn around.

·         Educate:

o        Design your early communications around the business strategy and what’s been done to manage to the strategy, including the purchase of the other brands.  It sounds like the purchase was announced, but there was little follow up to help employees understand the value to the business, so now they see these as negatives.  Highlight how these businesses have done, and how they’ve contributed to the success of the company.

o        Provide a global view – how does Europe and Japan impact the overall business?  

o        Also create a link between macroeconomics and impact to your business.  Given the current economy, highlight media reports that might impact your business so employees understand what influences the success of the company.  This is not a doom and gloom effort – just something that helps employees understand the bigger picture as well as help them understand that the current situation was unforeseen, but that you have a strategy in place to manage through it. Perhaps also include competitive information?

o        A tactic might be the monthly meetings you mentioned or perhaps some type of a brief communication campaign that gets employees up to speed quickly. A video on the intranet might work —

·         Adopt:

o        Once employees are educated about the strategy, continue to reinforce the messaging through your regular channels.  Connect everything you can back to the strategy so employees really see that there is a plan in place and leaders are managing to it.  This would include success stories from your various stores (green buildings, pricing changes) as well as any more bumps in the road – if something doesn’t go as planned, help employees understand why and where it fits into the bigger picture.

o        Remain transparent and share as much as you can about the business, and ask for employee input.  Reach out to employees to get their thoughts on initiatives, and recognize them for any ideas that are put in place. The idea here is for employees to get back to seeing that they have a stake in the business, and help draw a line of sight so they know what they can do to help turn it around.

o        One tactic we talked about was a regular business update that included North America, Europe and Japan, which would provide employees with a global view of the organization, as well as how all three legs support the stool.  Perhaps it could also include any external influences that impact the business.

o        You could also consider some social media venues, like Yammer or a CEO blog, where employees could get real time information.

·         Sustain:

o        This would be the ongoing communication efforts, past when the business has begun to turn around; need to review the communication strategy and build it out again for the next effort (how to start bringing back “takeaways”; maintaining leadership communication, etc.)

o        This is also where you would measure the success of your efforts, and make any necessary tweaks to keep employees interested and invested.

o       

Measurement could be via small group meetings again, or via a survey.  I believe you talked about some survey data that could be used as a baseline.

 

·         Themes

o        Visuals and themes are important in this kind of an effort – they help employees know what the information is about and that they need to pay attention –

o        Rather than using financial information, we talked about using snow as a gauge “We need to get to 15 feet, and right now we’re at 7” and building visuals around that imagery.

 

Critical Position Worker Shortages

Rising unemployment cannot abate workforce shortages for some critical positions.

While March brought a rise in the unemployment rate to 8.5%, the supply of workers for several critical positions continued to fall.

Data from the Bureau of Labor and Statistics shows that several occupations may have too few workers to satisfy current demand. In January, the most recent month of detailed data, several occupations recorded an unemployment rate below 4%. 4% unemployment is commonly associated with “full employment,” a term to describe a phenomenon where everyone who wishes to work is employed.

While full employment doesn’t sound like a problem during an economic recession, the reality is that several industries, such as electric utility, mining and oil & gas extraction, are growing. A shortage of critical position workers for an expanding company would have a significant financial impact because these workers hold positions that have a high business impact or mission criticality.

Attracting and retaining critical position workers is a strategic competency for today’s business leader. Below are four groups of critical positions with unemployment rates below 4%. Three groups represent industries. The fourth identifies critical positions within Information Technology. IT is a functional department that two colleges and I maintain is the first corporate area severely impacted by demographic trends (click here to receive a pre-publication copy of our white paper on this trend).

Electric Utility                                          Mining
Nuclear Engineers 0.0%                       Maintenance, Heavy Equip. 0.0%
Nuclear Technicians 0.0%                    Mining & Geological Engineers 0.0%
Power Plant Manager 1.3%                   Roof Bolters 0.0%

Oil & Gas Extraction                               IT Department
Civil Engineers 3.0%                              IT Engineers 3.3%
Maintenance, Heavy Equip 0.0%          IT Hardware Engineers 3.5%
Petroleum Engineers 0.0%                   IT Managers 3.0%

 

What can employers do if they face a shortage of critical position workers? Three things:

Understand the Risk Exposure:  Determine the severity by conducting an internal and external workforce assessment along five risk categories: Supply, Age, Retirement, Turnover and Generational Friction.

Prepare for a Mindset Change:  Change how you think about your workforce. Instead of viewing it as a homogenous labor pool, segment the workers who are in critical positions in a similar fashion as marketers segment consumers. Determine which workforce segments represent growth, attraction and retention opportunities.

Look for Nuggets:  Collect and share success stories where your organization and others are successfully attracting and retaining critical position workers.

Coal Mining Workforce Growth Achieved in Exchange for Retirement Surge

During 2008, workforce growth in the Coal Mining industry came mostly from recruiting aging workers.

 

Surprisingly, while the industry was expanding, younger workers were exiting.

 

This trend is a problem.  While current labor demand is being satisfied, the tradeoff is a future retirement surge.

 

Furthermore, because so few younger workers are being attracted, the labor supply to fill the vacancies will most likely be insufficient.

Recession Affecting Retail Hiring Trends

During 2008, the retail industry satisfied an immediate labor demand by hiring highly educated workers.  Unfortunately – that only solved one half of the problem.  

 

While executives are well aware of the global economic recession’s affects on sales and profitability, few may realize the full implications for their workforce.   

 

A trend emerged in 2008 of highly educated workers taking positions in hourly customer service positions.  Last year, more college educated workers were hired into retail sales positions than any another other occupation. 

 

This trend poses problems.  While immediate labor demand was satisfied, hiring college educated workers into these roles only shifts the labor challenge from today…to tomorrow.  When the recovery begins, retailers can expect to see high turnover as these workers return to their pre-recession occupations. 

 

What can retailers do?  Three things:

 

1. Determine Your Impact – Collect data to determine how this industry-wide trend is showing up in your stores.
2. Monitor Turnover Data – Monitor turnover for this worker sub-group.  Watching the trend may give you an opportunity to prepare replacements.
3. Hang On To Them – Collect information from the sub-group to see what it would take to retain them, if not in their current position, possibly in another.

Critical Position IT Pulse Survey

Demographic trends are colliding with a global economic recession – how will this affect the supply of critical information technology workers is unknown.

 

Many are aware of the demographic trends affecting information technology occupations.  An abundance of senior workers nearing retirement and surprisingly, a dearth of younger workers entering the field. 

 

While the current global recession has tempered demand for IT projects, what will the supply of critical IT workers look like as the economy exits the recession and demand for IT projects rises?

 

Will we satisfy demand with senior workers? 

This response trades one problem for another.  While demand is satisfied, a knowledge retention problem is created for tomorrow as these workers WILL retire.

 

Will younger workers gravitate to the technology field? 

Without younger workers, the labor supply for future vacancies will likely be insufficient.

 

To understand the affects of demographics trends and the global economic recession we are initiating a monthly information technology workforce pulse survey.  Each month, the results will be distributed via email and published on our website. 

 

The survey is 6 questions and will take less than 2 minutes to complete – yet the collected responses from IT executives, like you, will be eye-opening!

 

We are releasing the survey in a few days and hope you will participate.  If you would like to be included on the distribution list, please drop me an email.

 

All the best,

 

Eric Seubert

Principal

Talent Strategy Advisors, an affiliate of Discussion Partners

937-239-0988

Email: eseubert@talentstrategyadvisors.com

Employee Concessions Could Give Rise to Labor Union Membership Growth

The end of The Great Depression saw a significant rise in union membership.  From 1935 to 1940 labor union membership as a percent of the workforce rose from 13% to 26%.

 

While union membership has declined to 12% in 2008, the global economic recession may usher in a resurgence of union membership.

 

Recent news reports include stories of companies requiring workers to accept employment concessions, most commonly involving:

 

• Health benefits
• Federal Legislation
• Salary & performance bonuses
• Vacation & time-off

 

While concessions are being advocated as a way to help the company remain afloat, overtime workers may become dissatisfied.

 

As the level of dissatisfaction rises, union leaders may find conditions ripe for organizing and recruiting new members.  In this scenario, it would be very difficult for management to reverse things once momentum built.

 

What could tip the momentum in favor of Unions?  Three things:

 

• Worker Safety Concerns
• Continued Job Losses
• Management’s Failure to Make Significant Concessions

 

While the current downturn may give many workers no choice but to make concessions, these conditions could lead history to repeat itself:  huge growth in union membership and a new reality for management.

How Bad Is It vs. How Could We Make It Worse

It struck me recently that in over 30 years of consulting this is the first recession where  I have had to cope with Cable TV!  I am no longer sure that the constant flow of bad news is creating a self fulfilling prophecy.   Last week I began counting the “sighs” from those on one News network.  Fortunately at over 50 I had to leave for an appointment.   If I had sat in front of the news all day I would have needed a prescription. 

 

There is no question that we are experiencing difficult times.  All of us have seen our retirement savings plummet, some of us are now underemployed and many are unemployed and worried about theirs and their family’s future.Coincidentally I and 2 of my fellow bloggers were all displaced in the fall of last year so the turbulence for us is real.  At the risk of sounding naïve however, and without ignoring the 12 year lows of the market, I remain optimistic about the Labor Market.  As a global community we were heading for a severe shortage of workers due to expanding demand, shifting demographics, and job aspirations of the “new” labor force.

 

Candidly unless your enterprise was experiencing the pain, we were pretty clueless about the above.  The unintended consequence of the recession to me is it provides a unique opportunity for us to reflect on how we should be thinking about the future workforce.   I would submit that we can no longer disregard the resource constraints and attitudinal differentials that will face us when this recession inevitably ends.   Moreover the one size fits all of how we treat our workers has been for quite some time dysfunctional.

 

The fear that I have is that an already disenfranchised level of Employee Engagement will deteriorate even further during this difficult time.  During the recessions of the 80’s and early 90’s the unemployment rate exceeded the prediction we have presently for this global crisis.   This is due to the demographic shifts.  If we sustain a posture as managers of “you should be glad to have a job” as we did previously, when this recession ends we are in for a very rough ride.

 

The ability to instantaneously share information and a point of view should never be abused.   However in light of this capability, whether it  be the displacement of 1, 100, 1,000, 10,000 or more….we had better treat people who are leaving and staying with respect and support.   The world is much smaller since the advent of Cable News.   We should act accordingly not because of trepidation of criticism: but for respect of our colleagues both current and former, as we are all are navigating very turbulent waters.

The Silent Generation Meets Generation Y: How to Manage a Four Generation Workforce with Panache – Part 6a

In order to accommodate the four generations, companies are going to have to implement the following 4 critical steps: Insure flexibility; Create educational opportunities for as long as employee is working; Create signature experiences for employees to attract and retain them;and  Re-recruit employees everyday.

According to Tom Casey, “managing human assets is the challenge right now” for HR leaders. A few key metrics help to illustrate the urgency that is required now to manage distinct workforces:

• +55 is the fastest growing population in the current workforce
• +65 is the second fastest growing population in the workforce
• 40% of MIT graduates are from outside the U.S. Historically students came to the U.S. and colleges like MIT because of the quality of the education and because they wanted to live and work in the U.S. Today, a large percentage of foreign grads are returning to their home countries to work-leaving a talent shortage. 600,000 vs. 75,000 are the numbers, respectively, of engineering graduates annually from China and the U.S.

These numbers reinforce the reality that the future U.S. workforce is facing not only a worker shortage but also a skills shortage.

Tom Casey gave three requisites that are critical components of future workforce planning initiatives.

• Recognize all four generations of cohorts in the workforce. Acknowledge that one size fits all management is not going to work.
• Adopt a sense of urgency – opt for “speed now” and “elegance later”
• Create a signature experience

Casey addressed a number of specific challenges related to human capital management for HR professionals and corporate leaders. It isn’t enough for companies to say that they are the best places to work and have great corporate culture. Casey terms this “happy talk” and that does little to describe whatever their unique employee experience as a key differentiator is. Companies that are really having success in the areas of talent attraction, retention and workforce planning are concentrating on three or four areas where they can claim bragging rights. Creating signature experiences as told through storytelling is a key differentiator for many organizations. Casey suggests that HR professionals look at Fortune’s top ten companies list and review their best practices in talent management. Casey believes that leading edge companies are focusing on creating signature experiences in areas such as: hiring, employee development, recognition and rewards and talent promotion. Another strategy that is gaining popularity is hiring by team which focuses on collaboration and exposes employees from different generations to the hiring process.

The Conclusion: The Role of HR in Managing the Multigenerational workforce & Putting Work in PerspectiveWorkforce planning is the priority, says Casey, for HR when it comes to managing the multigenerational workforce. HR needs to be ahead of the worker shortages by focusing on workforce planning; HR departments that don’t take this issue seriously are putting themselves and their organizations at risk. Right now there are sectors in the U.S. economy that are running out of workers. Healthcare is facing critical shortages of nurses and radiologists and in the energy sector there’s already a shortage of engineering talent. Survival of an enterprise will be contingent upon the company being successful at attracting talent from a diminishing pool of qualified workers. A poll conducted by SHRM in 2006 stated that 70% of the HR community was not worried about the challenges of staffing related to an aging and retiring workforce. This type of “head in the sand” attitude is going to be detrimental to many organizations. HR departments will need to experience a “disaggregating and a reconstitution” of the traditional HR operations model. According to Casey, HR should be focusing on critical areas such as: learning and development, recognition and reward, talent acquisition and workforce planning. These four components will determine talent readiness. Gen Y employees don’t have the same identity through work that characterizes Traditionalist and Boomers. While Boomers may work long hours and see work as an extension of their life, Gen Y workers have no intention of defining themselves through their jobs. Organizations are going to need to adapt to new workplace attitudes about the role of work. Many Boomer parents are acutely aware that their own children have chosen careers that allow a better balance between work and life. Gen X and Gen Y employees are not lazy; they simply have a different set of priorities than their parents when it comes to work. Gen Y will enter professions like investment banking and consulting that have typically demanded total commitment and long hours. But even the monetary rewards that enticed workers into such fields are probably not enough to get Gen Y to sign over their lives. Gen Y wants to do a good job for their employers, but work isn’t all they want to do.

Based on the Human Capital Institute webcast, The Silent Generation Meets Generation Y: How to Manage a Four Generation Workforce with Panache, February 13, 2008

Talent Practices: Leveraging the Power of Collaboration

  One of my favorite quotes comes from Rob Cross in his book The Hidden Power of Social Networks, ” Research has consistently shown that whom you know has a significant impact on what you come to know, because relationships are critical for obtaining information, solving problems, and learning how to do your work.”  That, is a powerful statement about social networking . . .echoed in this comic selection from “Zits.” As I said in my earlier post, we have just finished a piece of research designed to explore in what ways can organizations leverage the power of collaboration across the talent processes.  Social networking itself is not new, what is new is the impact of Web 2.0 technology on collaborative behavior.  In this post, I wanted to offer just an ‘appetizer’ of insight from that research and talk about it in the context of the current economic issues.

We surveyed over 75 organizations, and overall we found that:

• Social networks are an important component of an organization’s core talent processes . . . While social networking was important to the successful execution of all talent processes, they are considered critical for engagement, on-boarding — transitioning — and off-boarding, and leadership development. 
• Furthermore, respondents believe that networking is important for all levels of the organization, but particularly so for senior executives.  As Michael Watkins so often points out in this book, The First 90 Days, no leader, no matter how capable, can do it all.  Leaders need networks that are constantly being refreshed and renewed to be successful.
• Finally, despite the fact that social networking is not a new behavior pattern, our respondents indicated that they don’t think they are as effective as they could be at leveraging the power of collaboration.  Their organizations may be leveraging the technique and/or tools in selective ways or within functions — creating pockets of excellence.  But overall, many organizations are still experimenting with collaboration tools. 

So, in what ways are companies leveraging the power of social networking across the talent processes?  Let me share just a sampling of what we’ve learned:

• Recruitment: Of all the talent processes, this is the area that has seen the most visible change as a result of social networking and web 2.0 tools.  While I find networking sites like LinkedIn and Facebook interesting, I am far more intrigued by sites like “Beyond.com” and “Jibe.”  Before the recession we were seeing the emergence of ‘talent brokerage.’  But the recession has accelerated a new approach to employment –’gigonomics,’ the act of being employed on a ‘gig’ basis.  Social networking tools allow active communities to form around project based work creating a new type of long term employment experience.  Social networking sites like Jibe, on the other hand, is interesting in that it uses social networking to create transparency around an organization’s culture, allowing potential employees to find a ‘great fit.’ 
• On-boarding/Transitions/Off-boarding: As the recession deepens and we see talent moved in/out/ and around the organization, effectively managing the employee life cycle becomes more important.  Social networking can become a key tool to enabling that process.  Given the short tenure of senior leaders these days, robust on-boarding and transition management becomes a strategic intervention with real impact on organizational performance.  What if you can speed time to effective performance by 3 to 6 months for a Senior Leader through accelerated on-boarding? In a tough economy where performance runways are short, time matters.  Finally, many of us have had to say ‘good-by’ to talented people as organizations are reforming themselves.  Off-boarding with care and keeping connected through social networks is an effective way to ‘keep your talent close’ in anticipation of future opportunities.  Over time, more of our talent will move in and out of our organization on a project or ‘gig’ basis.  Keeping talent networked with us through their employee life cycle, will be an important enabler for organizational agility.  So who does this well?  Look to companies like Baxter,  Capital One, and Johnson & Johnson who have Leaders Transition Programs.  Consulting firms, not surprisingly, have the most interesting approach to employee life cycle management by leveraging 2.0 tools to keep alumni connected — E & Y and Deloitte, for example. 
• Employee Engagement: At any time, particularly in tough economic times, employee engagement is a key enabler to organizational performance, now and in the future.  As organizations have cut their way to survival, they may have already lost their most important asset — employee hearts, minds, and hands.  An effective internal social network is the glue that binds the organization together, keep talent engaged, and facilitates transformation.  As organizations fight for precious customer revenue, engaged employees can provide that point of competitive advantage.  My favorite example of good old fashioned social networking comes from Ford Motor Company . . .clearly a company fighting for survival.  As they introduced the new product line-up for this year, they invited all of their HQ employees down to ‘test drive’ the products . . . hoping that they would ‘activate the purchasing power of their social networks.’  What a simple but powerful way to engage, inspire, and enable employees. 
• Training and Development:  As I prepare my my thoughts for the Winter Professional Development Consortium this week, I am convinced that social networking will have the most profound impact on this talent process.  New social tools will change the fundamental role of the CLO.  We will transition from being ‘content enablers to context enablers’.  These tools will enable employees to access the information they need when and where it is needed — through instant messaging tools, blogs, wiki’s, expertise locators, and so on.  Employees will be able to zero in on the specific information they need to solve problems, perform specific tasks, or quickly update skills.  Our role will be less about creating information/skill content, and more about enabling the context for employess to access information/skill when and where they need it . . . pulling it together quickly and easily to create knowledge. . . experimenting with it. . .creating repeatable transparent processes.  Responsibility for learning will shift to where it belongs . . . with the employee. 

Social networking is real work.  It is not unusual for leaders to think of social networking as a supplemental acticity, something that augments ‘real work’ or ‘personal development.’  For those organizations that actively use social networking and associated tools to share information, cooperatively develop insights or event collectively create product(s) it has become a fundamental work process that adds value to the organization. 

As your organization takes its own unique journey, where do you think it will engage first?  How is your organization harnessing the power of collaboration?