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Creating People Advantage_How to address HR challenges worldwide through 2015

"Creating People Advantage_How to address HR challenges worldwide through 2015"
A comprehensive global study conducted jointly by The Boston Consulting Group (BCG), World Federation of Personnel Management Associations (WFPMA), and Society for Human Resource Management (SHRM) surveyed 4,741 executives in 83 countries and markets.

Downloadable at http://www.bcg.com/impact_expertise/publications/publication_list.jsp?pubID=2638

Summary
(retrieved from EFMD http://www.efmd.org/component/efmd/?cmsid=080519sqlv&pub=080519pnhr)

Executives worldwide see talent gaps as top people challenge in every region and industry
Managing talent is the most critical HR challenge worldwide and will remain at or near the top of executive agendas in every region and industry for the foreseeable future. The ability to gain competitive advantage through people strategies - or people advantage - requires an overall HR approach. This report suggests that it is vital:

To understand the connections that link HR to metrics and strategy. A most effective way is to create a strategic workforce plan. For doing so, there are two steps

• Understand how strategy drives the demand for people (to provide long term guidance)
• Understand the four bridges that connect strategy and HR, namely: sourcing (recruiting, HR branding,), performance (metrics, incentives,), development and affiliation (compensation, motivation)

To deploy operational excellence to bring the HR function up to speed by focusing on three key areas:

• Strengthen capabilities : establish the HR function as a step on the career paths of high potentials , build the people management skills of line managers
• Establish accountability and efficiency by optimizing the HR delivery model by automating processes, sharing services and distinguishing between the various HR roles
• To increase cooperation by designing key HR processes (people reviews, mobility management) and by serving as experts on organizational issues

The future

This "Creating People Advantage" report furthermore analyses and ranks 17 HR challenges. The top 8 future challenges in HR fall into three strategic categories:

1. Developing and retaining the best employees
2. Anticipating change
3. Enabling the organisation

Developing and retaining the best employees

• Managing talent : attracting, developing and retaining all individuals with high potential and communicating the HR value proposition
• Improving leadership development : defining leadership models, assessing leaders and designing development programmes
• Managing work-life balance : dealing with new and non-traditional expectation about work

Anticipating change

• Managing demographics : namely the loss of capacity, knowledge and productivity with an ageing workforce
• Managing change an cultural transformation : by developing an integrated approach to operational and organisational change, focused on employee behaviour
• Managing globalisation by having the right people in the right location and by enabling effective and efficient cross-country and cross-cultural collaboration

Enabling the organisation to become a learning organisation and transform HR into a strategic partner

HR executives must also excel at the fundamentals of the HR function: restructuring the organisation, delivering on recruitment and staffing and mastering the HR processesThe remaining six HR topics are:

• Managing diversity
• Enhancing employee commitment
• Improving performance management and rewards
• Managing CSR
• Measuring HR and employee performance
• Providing shared services and outsourcing HR

The Boston Consulting Group, visit http://www.bcg.com
World Federation of Personnel Management Associations visit http://www.wfpma.com

The 20 Principles of Strategic Recruiting

The 20 Principles of Strategic Recruiting
by Dr. John Sullivan
(retrieved from http://www.ere.net/2008/07/07/the-20-principles-of-strategic-recruiting/)

Corporate recruiting is an interesting field. There are no books entitled The Theory of Recruiting or Principles of Strategic Recruiting. As a result, most individuals in recruiting tend to make it up as they go rather than follow a more defined set of rules or principles.
There is no formal body in recruiting that “codifies” the established practices. In this article, I am attempting to help resolve that problem by compiling a list (from my 35-plus years of experience in the field) that can serve as a foundation for your actions.
Of course, principles are guidelines to point you in the right direction. Remember to vary your direction depending on your business situation and global location.

20 Principles of Recruiting and Talent Management
The following is a list of 20 principles, laws, or guidelines to help you design and implement effective recruiting strategies and approaches:

1. A well-defined strategy. The foundation of any recruiting effort is a clearly defined and communicated strategy that illustrates the brand message, target candidates, primary sources, and most-effective closing approaches (the who, what, when, and how). Poorly defined or communicated strategy elements results in wasted resources and weak hires. In addition, the best strategies have the capability of “shifting” as the economy and the demand for candidates change.
2. Pipeline approach. The most effective recruiting approach is to build a steady stream of applicants (a pipeline). In order to build a continuous “talent pipeline,” use a “pre-need” approach that includes workforce planning, branding, continuous sourcing, and onboarding.
3. Competitive. The most effective recruiting approaches are compared against and are clearly superior to those of a firm’s talent competitors. Because competitors will quickly copy your most effective approaches, a continuous side-by-side assessment of “yours versus theirs” is necessary. A sub-principle applies to candidates: because the very best are always in high demand, if you don’t have to literally “fight” for a candidate, in most cases, you do not have the best candidate in the field.
4. Employment branding. The approach with the highest impact and the only long-term recruiting strategy is employment branding, the process of building your external image as an excellent place to work. By proactively making it easy for potential applicants to read, hear, or see the factors that make working at your firm exciting, you can dramatically increase the number and quality of your applicants over a long period.
5. Global. For jobs that require top talent, the process must have a global recruiting capability. This is because the very best talent is unlikely to live within commuting distance of your job.
6. Target employed “non-lookers.” The best recruiting processes are designed to identify and successfully hire currently employed top performers. This means that the process needs the capability of identifying and convincing employed individuals who work at your competitors and may not be actively looking for a position. Unfortunately, most corporate recruiting approaches are designed to attract “active” candidates.
7. Speed. Making fast hiring decisions is essential whenever a candidate in high demand decides to make a job switch. Top candidates must be hired using “their” decision timetable. Research shows that top candidates are off the market in less than half of the normal corporate time to fill.
8. Sourcing is critical. If you don’t utilize sources that attract a high percentage of top performers, it is unlikely you will make a quality hire. After employment branding, effective sourcing is the most critical element of the recruiting process. Generally, the most effective source is employee referrals. Other effective but under-used sources include recruiting at professional events and contests. Using ineffective sources means that you must spend inordinate amounts of time and money on candidate screening in order to avoid a weak hire. The source that is used must be shift, depending on the type of candidate required for that position. Unfortunately, many recruiters use the same exact sourcing scheme for every job.
9. Data-based decisions. Base decisions on sources, screening tools, and which individual to hire on facts and data, not emotion or even common practices. Making decisions based on objective data helps eliminate biases and causes the recruiting process to produce more consistent, reliable, and high-quality results. It’s also true that in a fast-changing world, “what works” changes quickly so recruiting practices become obsolete quickly. Unfortunately, rather than being a small part of recruiting decisions, emotions and “it’s the way we’ve always done it” tend to dominate corporate decision-making.
10. Build a recruiting culture. The most effective approaches build a corporate-wide “cultural of recruiting” where every manager and employee is a recruiter. Because of their continuous contact and interaction with outside talent, everyone must play an important supplemental role in identifying talent and in spreading the employment brand. The most effective recruiting strategies convince employees to be 24/7 talent scouts, making every employee a recruiter.
11. A candidate-centric approach. Focus the process on the candidate’s needs, their job selection criteria, and the candidate experience. A significant part of recruiting is “selling” the candidate on applying for and accepting the job. At least in part, recruiting must follow the customer relationship management (CRM) and the sales and marketing models. Often, the number-one reason why candidates reject job offers is the way that they were treated during the hiring process. It’s also important to note that candidates may be current or future customers, so treating them poorly can directly impact future revenue.
12. Prioritize jobs and targets. Effective recruiting processes maximize resource utilization by identifying and focusing on the positions with the highest business impact. That generally means revenue-producing and revenue-impact jobs, as well as jobs in high margin and rapid growth business units. The process should also target high-impact individuals known as top performers, innovators, and gamechangers.
13. Managers are the delivery system. Although corporate recruiting designs the process, managers “deliver” and execute a significant part of that process. As a result, hiring managers must understand its elements and support its precise execution. You must effectively demonstrate to individual hiring managers that they will suffer whenever a bad or “butts in chairs” hire is made. Therefore, recruiting must make a strong business case to individual hiring managers that convinces them of the importance of executing the process precisely. The most effective way of influencing hiring managers is by converting recruiting results into their dollar impact on that individual manager’s revenue and profit.
14. Diversity. An effective recruiting process must include enough variation and personalization to meet the unique needs of diverse individuals from around the world. Diversity and inclusiveness are becoming not just legal terms but critical components in building global sales.
15. Selling applicants. The very best recruiting processes builds “relationships” with potential applicants over time in order to increase their level of trust and interest. Unfortunately, no amount of benefits or job features will be convincing to high-demand applicants without this level of trust. Because all candidate-screening processes have flaws, stretching out the assessment process over time allows you to learn more about the candidate and decrease the chances of making a bad hire. The best approaches are designed to take advantage of the fact that a target candidate’s willingness to consider a new job changes quite rapidly, as a result of changes in their own job and organization.
16. Technology. The best processes rely heavily on technology and the Web in all aspects of the recruiting process. Technology can improve screening, increased hiring speed, cut costs, and provide the firm with the capability of hiring globally.
17. Integration. Recruiting processes must be integrated with other HR processes. Those recruiting processes that operate independently rather than in unison with other HR functions like relocation and compensation will produce diminished results.
18. Talent shortages. Although industries often face talent shortages, individual firms can actually have a surplus of candidates if they have a strong employment brand, a great referral program, and a candidate-friendly hiring approach. For example, handsome movie stars seldom have difficulty getting “dates” even when the average “Joe” can’t find a single one. Talent shortages are relative and depend on your image and what you have to offer.
19. Remote work options. Offering candidates remote work options dramatically increases the candidate pool. Firms that have the capability of managing candidates who work from remote locations have a distinct competitive advantage. They can attract the top performer who doesn’t live in the area, who desires working at home, or who isn’t willing to make a long commute.
20. Metrics and rewards impact recruiting. Every aspect of recruiting improves dramatically when managers and employees are measured, recognized, and rewarded for their contribution to recruiting. By convincing senior management and HR to place metrics and rewards on key aspects of recruiting, you send a clear message about its importance.

Final Thoughts
Almost every business function has come to realize that if you want consistency and excellent results, you must clearly define the rules of the game. There are, of course, exceptions and perhaps even additions that can be made to the principles outlined above.
But, after working with recruiters and recruiting managers from hundreds of companies, I found that these guidelines will give you a pretty good idea of the essential laws of recruiting and where to focus your efforts if you want superior recruiting results.

6 Good Metrics for Recruiting

6 Good Metrics
by Stephen Lowisz
(retrieved from http://www.ere.net/2008/07/07/6-good-metrics/)

Recruiting metrics require a number of characteristics to be considered effective and reliable:

• Metrics must be predictive and actionable. Statistics need to provide information that can be acted upon by providing data to indicate trends.

• Metrics must be tracked over time in order to generate internal benchmarks and analyze internal performance.

• Recruitment metrics should include both quantitative and qualitative aspects. Time and cost obviously comprise the quantitative aspects of recruitment metrics, while productivity, retention, efficiency, and candidate performance comprise the qualitative aspects.

Metrics of the Past
Ten years ago recruiting was often seen as a steppingstone to an HR generalist role. Recruiters were trained to “screen out” applicants, thus making their positions transactionally focused. This led to the two most commonly used metrics: cost-per-hire and time-to-fill.
Cost-per-hire, the most common measurement applied to recruiting, only looks at the initial cost — and not the long-term cost — associated with hiring the wrong candidate. Focusing purely on initial cost will drive recruiters to place a ‘butt in a seat’ without regard to the quality of hire or the long-term production the candidate will or will not deliver.
Time-to-fill measurements are often popular due to the cost associated with positions remaining unfilled. Although this cost can be significant, this metric does not take into consideration the long-term cost associated with greater turnover percentages and additional recruitment costs for hiring the wrong candidates. Recruiters will focus on candidates considered the ‘lowest hanging fruit’ in order to fill positions faster.

Metrics of Today
As I speak with staffing and talent acquisition executives from around the country, they all express frustration in creating a measurable that drives one main objective — getting the right candidate for the job. In order to achieve this objective, we must first look at how the recruiter of today differs from the traditional recruiter of the past. Once we have the right recruiter, we can then focus on defining metrics that drive the right behaviors.
The recruiter of today has to move from being transactionally driven to relationship-driven. Recruiters are now sales professionals responsible for prospecting, building relationships, and advancing the sale. This function change requires the metrics associated with success of today’s recruiter to change as well.
Although the following is not an all-inclusive list, the following six metrics are examples of metrics that drive the right results and create the necessary behaviors needed to achieve these results.

• Performance/Quality of Hire: Data is driven by performance appraisal ratings and/or production 6 to 12 months into the new employee’s job as compared to their peers. Quality should be the first and most important recruiting metric. Since there is no formula for determining quality, recruiters and the hiring managers should define the standards for quality before recruiting. Quality of hire can be assessed through a simple survey that lists each criterion separately and asks the manager how the employee meets each standard on a scale of 1 to 5. New hire quality can also be tracked through formal performance evaluations, production reports, etc. A survey reported in Staffing.org’s Recruitment Metrics and Performance Benchmark Report found that the more regularly recruiting professionals measure new hire quality in an organization, the more satisfied hiring managers are with new hire quality.

• Manager Satisfaction: Data is driven by the percentage of managers who are satisfied with the hiring process and the candidates. This metric provides important, easily tracked data to determine a hiring manager’s preferences before recruiting begins, and then to evaluate staffing performance post-hire. Effective recruiting organizations rely on customer feedback to be successful. However, customer satisfaction should never be viewed as a stand-alone metric because it can be misleading.

• Source of Hire: Data is driven by the percentage of new hires from each defined candidate source. Data is also driven by the percentage of hires per source, with highest on-the-job performance and tenure rates. Tracking source of data information allows management to better understand the quality of their sourcing Strategy. This metric also helps recruiting managers see sourcing channels in terms of outcomes, not just sheer numbers.

• Referral Rates: Data is driven by the percentage of hires from referrals generated by the recruiter. Referral programs are most commonly focused on generating referrals from the greater employee population. Referrals generated by recruiters directly soliciting them from prospective candidates and new employees will have a measurable and positive impact on the quality of hire (studies show referrals make better performing hires), cost-per-hire (little to no cost for these referrals), and time-to-fill ratios.

• Candidate Satisfaction: Data is driven by the percentage of new hires who are satisfied with the hiring process as judged by a candidate survey. Candidate satisfaction surveys drive recruiting organizations to have a greater focus on the quality of service provided to each candidate, which has a positive impact on the brand positioning/employment branding of the company. Additional candidate metrics may also be valuable from candidates who were not selected, and candidates who declined offers. These last two groups are often overlooked, but they can provide valuable information about your recruiting operations.

• Pipeline Development: Data is driven by the number of potential candidates the recruiter has developed relationships with for key strategic positions. Data is managed through an effective CRM system. Similiar to tracking pipeline development of sales professionals, measuring recruiter-developed candidate pipelines can have a dramatic improvement on time-to-fill (candidates are already in process for commonly needed positions), cost-per-hire (pipeline candidates have no additional cost associated with placing them), and quality of hire.
Companies can decrease their time to fill and decrease their cost per hire, but if they can increase their quality of hire and quality of service, the entire game changes. Better employees translate into higher performance, more revenue, and higher profits. By using the right metrics you will encourage recruiters to focus their behaviors on the causes and not the symptoms of recruitment success. The combination of having the right recruiter with the right measurements will lead each recruiter to focus on finding the right candidate.