Monthly Archives: July 2012

July 31, 2012 · 5:00 am

Getting leave management wrong has consequences — and they aren’t what you think!

Leave management is one of those tactical HR functions that we’re required by law to get right.  With more than 300 state, local and federal laws/regulations with which to comply, U.S. employers have to stay on top of an ever-changing morass of guidelines that impact their employees in very personal ways.  It’s not just about vacation or PTO.

Workforce Management has published trend survey data on this topic and even though the subject of tracking employee time off is pretty tedious, the issues surrounding it are business critical.  The 2011 trend survey, published in early 2012 and sponsored by WorkForce Software, is amazingly interesting. I know, surprising, right?

For example, unless you’re the one responsible for ensuring compliance with all applicable laws/regulations, did you know that 40% of employers report an error rate of 3 or more unearned leave days per 100 employees per pay period? That’s pretty big from a payroll expense perspective.  And what do you do when you find out? Clawback the unearned time? And how do you do that? Take time out of next year’s leave pool? Ouch.

That’s why I found it really interesting that when the survey asked employers what the greatest negative impact of non-compliance was, Employee Morale was far and away the biggest impact. Regardless of the employer’s size.

Here’s why this makes sense to me:  I learned early in my leadership career that you have to get employees’ compensation right. You have to pay them the right amount; you have to pay them on time; and you have to manage their time off accurately. You can’t screw up any of these and not impact morale. And if you screw up any or all of these up more than once you’re sunk.

And so it really isn’t surprising that more than litigation fines/costs and brand equity/reputation, employee morale is HR’s biggest concern in ensuring compliance in managing time off. I don’t think this concern is driven by the old “touchy-feely” rap that HR used to get. This is cold, hard reasoning about the cost to the engagement and retention of employees if the organization can’t get the basic building blocks of paying people correctly right.

So reducing the error rate isn’t just about reducing payroll dollar mistakes, it’s about productivity and morale. There’s more interesting data in this report. You can download it here.

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Filed under China Gorman, Connecting Dots, Engagement, HR Data, Leave Management, PTO, Talent Management, Workforce Management, WorkForce Software

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July 26, 2012 · 6:12 pm

“Survey Says…”

I was talking to a friend in the research/analysis business the other day and she lamented that there didn’t seem to be a firm understanding of the definitions of FTE (Full Time Equivalent) or Head Count in the HR world. Specifically, she shared that when research firms like hers send out surveys to HR professionals there frequently are demographic questions that include asking how many FTEs are in the HR function in their organization.  My friend has been frustrated by the frequency of responses that show the confusion between the definitions of FTE and Head Count and how that impacts the ability make accurate conclusions from the rest of the survey responses.

Here’s the thing:  I know that HR professionals know the difference between FTE and Head Count. But somehow, when surveys need filling out, confusion reigns.

I’ve spoken to a number of HR folks over the last couple of weeks and asked what the head count in their HR department was. They quickly came up with a number and the answer usually started with “…around…”   Then I asked what their budgeted FTEs were.  Regardless of the size of the organization, the answer started with, “well, I’m not sure. I’d have to look that up.”

HR people know head count, that’s for sure – or can come pretty darned close.  But they first ask if you want them to include temps, interns and other “off the budget” people. They literally count heads. Which, of course, is correct. Thus the term, Head Count.

If you ask for FTEs, they are frequently not sure. FTE seems to require preciseness; head count, not so much.  Maybe it has to do with the budget.  Budget-related = official:  “I’ll look it up.”  Not budget-related = unofficial:  “I can get close.”

Here’s  how SHRM defines FTE:  FTE is an abbreviation for full-time equivalent, which represents the total labor hours invested. To convert part-time staff into FTEs, divide the total number of hours worked by part-time employees during the work year by the total number of hours in the work year (e.g., if the average work week is 37.5 hours, the total number of hours in a work year would be 37.5 hours per week x 52 weeks = 1,950 hours). Converting the number of employees to FTEs provides a more accurate understanding of the level of effort being applied in an organization. For example, if two employees are job sharing, they constitute one FTE.

So there is a difference; and sometimes it’s a big difference.

The next time you receive a survey from SHRM, a research organization, or your C-suite, and it asks for FTE information, don’t confuse Head Count for FTE – and go ahead and look it up!

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Filed under C-suite, China Gorman, FTE, Full Time Equivalent, Head Count, HR, HR Data, SHRM, Survey

July 17, 2012 · 4:30 am

Paycheck Pessimism

Most people in the HR space know Glassdoor™ as a social media site that gathers anonymous information about employers from current and former employees.  Users can leverage their Facebook network to uncover connections at a company, view current openings, as well as review proprietary information that includes salary reports, company reviews, interview questions, CEO approval ratings and more.  It’s an incredibly useful site for job seekers to get the real skinny on a potential employer from the people who know it best:  its employees.

Of course, for employers and HR professionals, the site offers a full array of branding and recruitment-oriented services including the ability to create enhanced company profiles, Facebook career profiles, targeted job ads and more.

But for our purposes at Data Point Tuesday, we like Glassdoor™ because of its Quarterly Employment Confidence Survey.  Couple this report with monthly BLS reports and you get a robust picture of workforce and employer confidence and other dynamics.

For example, the Glassdoor Employment Confidence Survey surveys employees on their confidence in the areas of pay raises, job market expectations, company outlook and job security.  It’s great data and it’s presented in a highly consumable format.

The most recent survey was conducted by Harris Interactive between June 12 and 14 of 2,208 adults 18 years or older and was published on July 6.  Generally the data show improving or holding steady opinions on workplace confidence dynamics by employees with the exception of optimism in pay raises.  This dropped since last quarter to 40% (from 43%), while 37 % do not expect a pay increase – a low since the survey began in Q4 2008.

At first glance this seems a little off.  Expectations for a raise are at the lowest point since the 4th quarter of 2008 – and lower than the 4th quarter of 2008 when the economy was at its worst? Aren’t we starting to feel better about the economy?  Well, some of us are and some of us clearly are not!  The report says this:

  • Employee optimism in pay raises has dropped slightly since last quarter to 40%, while 37% reported they do not expect a pay increase…
  • The gender gap is closing around expectations for a pay increase over the next 12 months; 41% of women expect an increase compared to 40% of men.  However, men’s optimism around pay has declined five percentage points since last quarter while women’s optimism crept up one percentage point.
  • Younger workers are significantly less optimistic about pay raises than last quarter; 37% of 18-34 years olds expect pay raises in the next 12 months whereas nearly half (49%) expected raises last quarter.  All of the other age ranges have increased 2-4% from last quarter – 48% of 35-55, 42% of 45-54 and 36% of 55+ year olds.

So, if I read this right, men and young people under 35 report strong declines in optimism about pay increases while women report slight increase in optimism.

Men:  down 5%

Young people:  down 12%

Women:  up 1%.

How does this track with your turnover and engagement data?  Tracking turnover data by gender and age demographic is common.  How about engagement data?  Can you make connections between this lack of reported paycheck optimism among males and young people to the engagement data in your organization?  It might be worth a look.

And it might be worth keeping an eye on during the coming quarters – particularly in relation to the election in November.  Young people played a very active and pivotal role in the last presidential election.  Is their level of paycheck pessimism such that they won’t participate as strongly?  Or will it motivate them to even higher levels of activism?  And how will that translate to your organization’s turnover and engagement rates?

This is what’s so great about data.  They let you connect import dots.  Also, they always raise more questions than answers – but if you’re interested and aware you’ll start asking more of the right questions and connecting critical dots.  And who knows?  That could lead to formulating more effective people management and business risk mitigation strategies.

Isn’t that what HR is all about?

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Filed under Bureau of Labor Statistics, Connecting Dots, Engagement, Glassdoor, HR, HR Data, Turnover

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July 10, 2012 · 5:00 am

Data Analytics: Too Sophisticated for HR?

Mercer and WorldatWork have collaborated again on a survey and report about current total rewards/compensation trends in metrics and analytics.  The focus of the research was to understand what types of analytics are currently being conducted and what technologies are being used to conduct them.

It’s an interesting report – especially from the vantage point of what it says about the relationship between HR and data and HR and analytics.  The survey was fielded in February, 2012 to compensation leaders who are WorldatWork members (the dataset held 560 scrubbed responses , a final 10.9% response rate), so they all have more than a passing knowledge of the total rewards function.

The big takeaways of the survey data are that:

  • Rather than use sophisticated analytical approaches like projections, simulations and predictive modeling to support decision making, organizations are more likely to use ongoing reports and benchmarking from internal and external peer groups.
  • Survey respondents report lack of access to and confidence in data regarding education competencies/capabilities and training investments – critical to workforce analytics.
  • Compensation professionals may be falling behind their colleagues in other HR functional areas in their adoption of more sophisticated analytics methodologies.

The report discusses why adoption of more powerful analytics is low despite 67% of respondents indicating adequate skill levels to engage in higher level analytics and almost half (47%) having 1 -2 FTEs tasked with HR-related analytics.  More important, 75% of the respondents reported that C-suite executives in their organizations have asked for workforce projections, simulations or predictive modeling.

Mercer and WorldatWork point out that while respondents report that some data is not available or of poor quality, 75% of respondents say their organizations are working to improve the consistency of their data. Paradoxically, 52% are unclear where responsibility for data integrity lies.

I found it interesting that the researchers suggest that “unavailable” data may result from a lack of interest in the data rather than an ability to access it.  A compelling point.

From the responses outlined in the exhibit above, one could readily agree with the researchers that critical workforce information about education, competencies, prior work experience and investments in training aren’t top of mind for compensation professionals. It could easily be that compensation professionals believe these datasets and their analysis more naturally belong to other HR functions:  learning/development and talent management/acquisition.

The writers argue that rewards/compensation professionals have a preoccupation with the behavioral side of rewards and overlook the “asset side” – the impact of rewards on the ability of the organization to acquire appropriate talent.

The bottom line for the researchers is to encourage rewards/compensation professionals to begin to think more expansively – and use higher levels of analytics – on the role of rewards in driving human capital development and business success and focus a little less on salary competitiveness and pay-performance sensitivity as performance drivers.

A very interesting report and very useful data as you begin to plan your 2013 budget.  Stepping up your workforce analytics sophistication could be a game changer for your organization.

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Filed under C-suite, China Gorman, Employee Benefits, Engagement, HR Analytics, HR Data, HR Technology, Mercer, Rewards & Recognition, Talent Management, Total Rewards, WorldatWork

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July 9, 2012 · 4:30 am

Is Your Workplace Engaged?

My friends at Achievers are collecting applications for inclusion in the 2012 Achievers 50 Most Engaged Workplaces™ Awards. As an HR business leader you should think about applying. Today. Because time is running out.

The process is not onerous and even if you don’t win – it’s a highly competitive and influential list – the process of answering the application questions will get you thinking and focusing on what you need to do create an engaging workplace.

Achievers, the leading next-gen solution provider in the Rewards & Recognition space, has identified Eight Elements of Employee Engagement™:

  1. Leadership
  2. Communication
  3. Culture
  4. Rewards and Recognition
  5. Professional and Personal Growth
  6. Accountability and Performance
  7. Vision and Values
  8. Corporate Social Responsibility

The questions in the application survey ask employers to comment on their programs, policies and structure around each of the eight elements. In some cases, as in the Vision and Values section, the survey asks how your organization handles behavior that is NOT in line with a core value.

Each answer can be no more than 250 words, so the survey won’t take hours to complete – but will require thought in order to be both comprehensive and brief.

Previous winners have included organizations as diverse as ADP, Walt Disney World Swan and Dolphin Resort, North Shore-LIJ Health System, Glassdoor.com and E&A Credit Union.

The winning organizations will be notified on August 20 and the public announcement will be on August 27th, with the awards galas on October 25th in San Francisco (U.S. list) and November 14th in Toronto (Canada list).

Achievers has a strong history of research and analysis in the engagement arena and is a strong go-to source for current data and thinking on how engaged workforces outperform their unengaged peers.  Check out these white papers here and here.

Winning an award like this is great. Being able to declare to your talent community and other stakeholders that you are an organization publicly recognized for its effective focus on creating a culture and environment focused on employee engagement is pure gold. Apply here before time runs out to be included in the 2012 list. And good luck!

*Full disclosure: I’m one of 6 judges who will determine the final winners.

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Filed under 50 Most Engaged Workplaces Award, Achievers, Business Success, Engagement, HR, Razor Suleman, Talent Community, Talent pipeline

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July 5, 2012 · 4:30 am

A Day in the Life…

One of many things that SHRM does well is to try to evaluate the services it provides to its members. So I wasn’t surprised that SHRM sent me an invitation to evaluate my experience at this year’s Annual Conference in Atlanta. And I tried to be honest. But really, how do you give feedback to an organization that executes its biggest event so well – year in and year out?

But I’ve been thinking about the question that asked what I would recommend for future Annual Conferences.  I gave a quick answer.  And I’ve been thinking about it more and I’d like to expand on my answer.

I suggest having a series of sessions called “A Day in the Life of…”  When I answered the question I was specific: engage one of the CHROs in the Fortune 100 to describe what their job and life are really like as an example for emerging HR leaders to see. We don’t see many CHROs on any stage at SHRM. I understand all the reasons why we don’t see them, but I think SHRM needs to try harder. Presenting a role model in the flesh would be high impact.

But as I’ve been thinking about it, why not also have sessions with CHROs from a privately held company with 5,000 employees, from a public company with 25,000 employees, from a large education institution, from a think tank, from a large national non-profit, and from a pre-IPO tech start-up? Not a panel discussion. A session by each of them, individually.

Not everyone in HR wants to be the CHRO of GE, but some do. Not everyone in HR wants to be the CHRO in a privately-held company, but some do. Show them what it’s like. Show them what it takes to get there – and stay there.

And then I thought, well, how about other functions? What’s it like to be the Chief Marketing Officer in the Fortune 100 – and what do they think about and want from HR?

How about a day in the life of the CFO of a global public retailer – and what they think about and want from HR?

How about the Chief Information Officer at a large privately-held technology company?

And how about the head of Total Rewards in a Fortune 250 company – how did they get there?

The head of Talent Acquisition in a Fortune 500 company – how did they get there?

The Chief Learning Officer in a global hospitality company – how did they get there?

You get my drift. A series of “A Day in Life of…” would put real leaders on the podium to share what works for them and what doesn’t work for them.  How they got there and what they’d do over again and what they would skip. And from everyone:  what advice for emerging or aspiring HR leaders.

Not only would this be interesting for intentional HR professionals, it would be helpful for those who got here by accident and aren’t sure where to go, whether or not to stay, and what is possible.  Holding successful HR (and other) leaders up for conference attendees to hear from and get coaching from might be the next big step in speaker impact that SHRM is looking for.

As with most good ideas, this came out of several conversations I had with HR leaders in Atlanta. Thanks. You know who you are.

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Filed under China Gorman, Conferences, HR, HR Conferences, SHRM, SHRM Annual Conference

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July 3, 2012 · 4:30 am

Is HR in a Bad Mood?

Results from The Fifth Annual Talent Management Study by Knowledge Infusion and Human Resource Executive® were published recently in HR Executive by Mike Brennan and some of the findings were surprising.

I didn’t find it surprising that 63% of the respondents report that they have trouble filling jobs and that they can’t find the right candidates. That’s been reported frequently.

It also doesn’t surprise me that more organizations than not will be increasing their investments in Learning/Development, Performance/Goal Management and Workforce Analytics/Planning services and technology. That’s obvious.

What really does surprise me is that 58% of HR executives believe that peer leaders in their organizations “do not buy into talent management.”

Lordy, I hope this isn’t the furniture conversation. And I’m willing to believe it isn’t because 83% of the respondents also believe that “many of our managers do not know how to manage people.” Additionally, 65% of the respondents believe that “many of our HR generalists/business partners are not equipped to consult with the organization on talent.”

Ouch. Either the HR respondents to this survey were all in a colossally bad mood, or they’re starting to look clear-eyed at their organizations and re-calibrate their challenges.

It’s clear that many organizations need to look at legacy systems and programs in the talent management arena (can you say annual performance review system?) and, according to this survey, they are. But focusing on leadership understanding and managerial effectiveness in talent management might be a strong first step.

It’s a great day for HR if the results of this survey mean a new focus on talent management effectiveness – at the top, in the middle, and most importantly, in HR.

But if it was just a systemic bad mood, we’re sunk. Because, in the words of one of my favorite movie characters in one of my favorite movies, “we have serious problems to solve, and we need serious people to solve them.”

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Filed under American President, China Gorman, HR, HR Credibility, HR Executive Magazine, HR Technology, Knowledge Infusion, Managerial Effectiveness, Talent Management

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