Category Archives: C-suite

A Whole Lotta Business Going On!

Last year I wrote about the HR Technology Conference and titled my post “HR people doing business. Wait.  What?”  I attended this event for the first time last year and was struck by the business activity going on at the conference.  It wasn’t about swag; it wasn’t about recertification credits; it wasn’t about getting autographed books.  Some of it was attendees really having buying conversations with vendors; some of it was vendors doing business with other vendors; and some of it was organizations having hiring discussions with candidates who happened to be attendees, vendor employees, speakers, etc.  And all that was happening this year as well.  You just can’t escape the feeling that business is going on when you walk the halls and floor of this conference.

There was an added dimension to the floor this year.  And maybe it was there previously and I just wasn’t aware.  But there was lots of money at this conference looking for investment opportunities.  I talked with a number of VC and other investors who came to see what was new and to make relationships for investment purposes!

There’s a lot of money flowing into the HCM space these days – untold numbers of VC outfits; strategic buyers like IBM, Oracle, Salesforce; the public markets with IPO offerings like Workday.  With talent issues being top of mind for every business leader with a Chief in their title, it’s no wonder that money is seeking opportunity in this field.

And you could absolutely feel it at HR Tech which concluded in Chicago yesterday.  Investments were being poised to happen in start-ups as angel investments, start-up investments, series A, B and C investments as well as outright purchases.  The talent management issues of organizations all over the world are creating opportunities for innovative solutions that will help us get better talent more efficiently with a great likelihood of longevity.  That’s what we want as business leaders.  And money was there looking for opportunities to make that happen.

As Mark Hurd, President of Oracle, told the conference attendees, “I want the best people at the lowest cost that I can get them.”  Exactly.  As an organization leader who “gets” HCM’s value, Hurd is no longer in the minority of C-suite leaders.  And that means greater emphasis on productivity and efficiency and cost.  And that opens the door wide to innovation and investment.

The HR Technology Conference is the one conference to attend to find out how to make your HCM infrastructure more productive, more efficient, more cost effective and more future oriented.  It’s the one conference to attend to meet senior business leaders who are focused on winning through talent and systems to manage that talent.  It’s the one conference to attend to get a glimpse of what will be possible in the future to ensure organization success.  If it isn’t on your agenda for next year, it should be.

Advertisements

3 Comments

Filed under C-suite, Conferences, HR Conferences, HR Executive Magazine, HR Technology Conference, IBM, Oracle, Salesforce, Talent Management, Workday

“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 FTEFTE 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!

2 Comments

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

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.

4 Comments

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

The Wisdom of CEOs

Booz & Company recently published its 12th annual CEO Succession Survey. It’s fascinating reading:

  • As the economy gets stronger, the numbers of CEOs leaving their jobs are rising to pre-recession rates
  • CEO turnover is highest at the largest companies
  • CEO turnover is highest in market sectors that face the most challenges
  • Outsider CEOs returned to historical averages
  • Insider CEOs bring higher returns
  • Insider CEOs serve longer
  • The combined chairman-CEO model continues to decline

With average CEO tenure declining, the survey’s data are clear that new CEOs – whether they come from the inside or the outside – are under historically high pressure to perform quickly.  (Can you say Leo Apotheker?)  And concerned boards are more frequently appointing the outgoing CEO as board chairman to provide a sort of “apprenticeship” experience in the early months of a new CEO’s tenure.  Interesting stuff.

This year, the study focused on the new CEO’s first year.  Booz & Co. interviewed a number of CEOs from around the world and asked their advice for incoming CEOs.  There were 7 common recommendations:

  1. Deal with the obvious executive team changes as early as possible
  2. Be wary of changing strategy too quickly, even if you think the current strategy is wrong
  3. Make sure you understand how every part of the company operates and how it is performing
  4. Build trust though transparency
  5. Be selective in listening to advice
  6. Find a sparring partner with whom you can discuss plans openly
  7. Manage your time and your personal life with care

The survey provides a great deal of background data and commentary on these 7 “tips” for succeeding as a new CEO — and I encourage you read it.  But I’m thinking this is great advice for any new executive at any level.

And I’m really thinking this list is great coaching for HR.

6 Comments

Filed under Booz & Company, Business Success, C-suite, CEO Tenure, CEOs, China Gorman

The CEO – HR Disconnect: Understandable? Yes. Defensible? No.

The furniture conversation (see my post on that subject here) that HR is so fond of having is, at its heart, a lament about HR not having strategic business credibility. I don’t buy that HR lacks strategic business credibility. I do buy that HR isn’t communicating mission critical data to the C-suite and that creates a credibility challenge.

New data will be published shortly by Achievers that highlights the disconnect between what HR and CEOs believe about key elements of employee engagement in their organizations:   feedback, managerial communication and recognition.  And it’s pretty eye-opening!

When we designed a survey to evaluate how employees rate the current state of these workplace dynamics in their organizations and whether CEOs and HR professionals are in touch with what employees want, we found an added dimension in comparing the differences between the perceptions of CEOs and HR professionals.

  • For example, when we asked CEOs and HR professionals whether they agreed that their employees believe that their organization inspires them to do their best work every day, 61% of CEOs strongly agreed or agreed, while only 31% of HR professionals strongly agreed or agreed.
  • When we asked CEOs and HR professionals whether they agreed that their employees rated their organization culture as positive, strong and motivating, 67% of CEOs strongly agreed or agreed and 37% of HR professionals strongly agreed or agreed.

Wait.  It gets worse.

  • When we asked employees if they agreed that the feedback they received from their managers was constructive and useful, 79% of CEOs believed that their employees would strongly agree or agree while only 33% of HR professionals believed that their employees would strongly agree or agree.
  • When we asked employees how frequently they received feedback from their manager, 56% of CEOs believed that employees would report receiving feedback immediately or on-the-spot.  HR professionals?  11% believed that employees would report receiving feedback immediately or on-the-spot.

These are just four examples in the survey that show the continental divide between how CEOs and HR professionals evaluate crucial aspects of their employees’ engagement.  With these results that underscore the CEO – HR disconnect, we could hypothesize that CEOs have a more optimistic view of their workforce because any time they interact with employees, employees are on their best behavior – trying to impress the boss.  HR, on the other hand, frequently interacts with employees when they are not at their best:  exit interviews, investigations, disciplinary situations, etc.  It’s understandable that HR might have a more pessimistic view of their employee population.

Absent data to the contrary, why shouldn’t CEOs be optimistic? If there were issues, surely, they might think,  HR would share the data.  But when the employee engagement data is consistently less positive than CEOs’ perceptions, it”s clear that CEOs aren’t getting data that informs them of the reality of their workforce. And who has this data?  Well, that would be HR.

So why isn’t this data – and their ramifications – being shared with the C-suite? For HR to understand the workforce and know what is working and what isn’t clearly isn’t enough.  Communicating mission critical data and serving up cost effective solutions are HR’s opportunity. Heck.  Most would say that’s HR’s job!  For certain, they are the ticket to strategic business credibility.

If we needed tangible proof of the CEO – HR disconnect, this survey’s results confirm it.  You’ll be able to download it on June 12 from the Achievers website.

14 Comments

Filed under Achievers, C-suite, CEOs, HR, HR Credibility