HR Magazine 2015 оны 5-р сарын дугаар

HR MAGAZINE

SPECIAL ISSUE: TRAINING & DEVELOPMENT

MAY 2015

MAY 2015

SHRM.ORG

$8.95

REBUILDING HR

Focusing on Our Profession As HR develops, will you be part of the picture?

PUBLISHED BY THE SOCIETY FOR HUMAN RESOURCE MANAGEMENT

Shara Gamble, SHRM-CP, is taking a competency-based approach to her team’s professional development.

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Contents

MAY 2015 • VOLUME 60, NUMBER 4

26

Shara Gamble, SHRM-CP, with her colleagues at TAMKO Building Products Inc.

78

11

SPECIAL ISSUE: TRAINING & DEVELOPMENT 78 LEGAL TRENDS

26 Rebuilding HR

What worked for HR yesterday likely won’t work tomorrow.

Structure your professional development accordingly.

Narcissists Inc.

Most narcissists will stop at nothing to prove they are right.

By Michael Farnsworth and V. John Ella

By Rita Zeidner

36 A Culture of Learning

By Robert J. Grossman

44 5 Myths About

Employee Learning

An expert from the Wharton School shares her insights on creating a learning culture.

By Monica McGrath

50 The New Graduate

Should an online degree raise a red flag?

By Tamara Lytle

70 Profile: Leading Learner

Hospira Inc.’s Pamela Puryear believes a learning culture is key to advancing the business.

By Tamara Lytle

NEWS YOU CAN USE

36 ADVICE AND ANALYSIS 22 SOLUTIONS Private health care exchanges; FMLA eligibility

By Regan Gross, SHRM-SCP, and Angela Stone, SHRM-SCP

74 HR TECHNOLOGY

Success Networks

How HR can apply organizational network analysis to improve human capital management.

By Stephen Garcia and Greg Wallace

11 HR NEWS The fifth anniversary of the Affordable Care Act; e-cigarettes in the workplace; business benefits of being well; more.

18 EXECUTIVE BRIEFING Are your leaders blocking innovation?

By Dori Meinert

76 COURT REPORT Professor lacks grounds for retaliation claim under FMLA; color bias claim survives absent race discrimination; more.

84 WHAT’S NEW Employee engagement; employee recognition; HR management systems; international HR; more.

HR Magazine (ISSN 1047-3149) is published 10 times a year by the Society for Human Resource Management, 1800 Duke St., Alexandria, VA 22314, (703) 548-3440, to further the professional aims of the Society and the human resource management profession. Members of the Society receive HR Magazine as part of their annual dues, $55 of which is allocated for the subscription to HR Magazine, which is nonrefundable therefrom. Nonmember subscriptions are available from the Circulation Department at the following rates: Domestic (U.S. and its territories)—$70 per year. Canada—$90 per year. International (via airmail)—$125 per year. Published articles do not necessarily represent the views of the magazine or the Society. © Society for Human Resource Management 2015. Periodicals postage paid at Alexandria, VA 22314 and additional mailing offices. POSTMASTER: Send address changes to HR Magazine, Circulation Department, 1800 Duke St., Alexandria, VA 22314. Publications Mail Agreement No: 40041558. Please send returns to BleuChip International, P.O. Box 25542, London, ON N6C 6B2.

This publication is designed to provide accurate and authoritative information with regard to the subject matter covered. It is published with the understanding that the publisher is not engaged in rendering legal, accounting or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.

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COVER PHOTOGRAPH BY STEVE PUPPE / ILLUSTRATION BY SHRM STAFF

In today’s business world, how employees learn is as important as what they learn.

May 2015

4/8/15 1:01 PM

Finding the right people would be easier

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Good talent moves fast. But your bundled HR software is old and slow. Successful talent acquisition now requires its own dedicated

Š Copyright 2015 iCIMS, Inc. All rights reserved.

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Beyond the Page Online this month at www.shrm.org/hrmagazine

PERSPECTIVES 6

Multimedia

FROM THE CEO

Extreme Makeover: HR Edition

By Henry G. Jackson

20

Q&A

Measuring Critical Competencies

Wayne Cascio explains the value of SHRM’s competency-based certification.

Interview by Bill Leonard

24

Even the best business plans require an engaged workforce committed to the organization’s goals.

By Aileen Wilkins

TREND WATCH

Employees Are Happier, to a Degree

Job satisfaction is up, but employers could do more.

By Jen Schramm

SHRM RESOURCES 81

Articles Management Tools: Conducting an Organizational Needs Analysis

VIEWPOINT

The Power of Positive Culture

73

QUIZ yourself with sample questions from SHRM’s competency-based certification exam: www.shrm. org/0515-HR-professional-development.

INSIDE SHRM Annual Conference looks to inspire; free advocacy app; more.

88

Blogs HR Magazine’s Book Blog includes weekly book reviews, author posts and recommendations, including: • Real-life stories from the HR trenches.

• Three books on how to appreciate employees every day.

• Read to lead: books that will make you a better business leader.

• Give yourself credit: nine books approved for SHRM recertification credit.

• HR books you love.

Digital Check out the digital edition of HR Magazine, now available to all SHRM members on the SHRM home page. It allows you to: • Adjust fonts for exceptional reading on all screens.

• Download a PDF of the issue to read later or build an archive.

• Bookmark articles for later reading.

Smartphone SHRM.org and HR Magazine online have been responsively designed to provide an optimal viewing experience on any device— phone, tablet, laptop or desktop. Try them out to enjoy easy reading and navigation with a minimum of resizing, panning and scrolling.

You can also download the HR Magazine app from Amazon, Apple and Google Play.

88

MEMBER SPOTLIGHT Mandy Woulfe, SHRM-SCP, corporate HR director, Classic Resorts, Lahaina, Hawaii

SPECIAL SECTION 86

4

YELLOW PAGES

HR Magazine

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Social Media Follow @HRMagazineSHRM for daily HR-related updates and insights.

“Like” the Society for Human Resource Management on Facebook for the latest from HR Magazine and SHRM. Follow the Society for Human Resource Management’s company page and the SHRM official group.

May 2015

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From the CEO

Extreme Makeover: HR Edition

A

ccording to the latest annual report on human capital trends by the consulting firm Deloitte, there is a gap “between what business leaders want and the capabilities of HR to deliver.” In the report, HR leaders rated their teams a C-minus, showing almost no improvement over the past few years.

Business leaders rated HR even lower—a D-plus.

Unfortunately, this is only the latest voice within the business community calling for an “extreme HR makeover.”

Within the profession, we have also been having a robust discussion about the skills we need to thrive now and in the future. We agree that the transactional, back-office days of our profession are long gone and that modern HR drives business results. Yet research from the Center for Effective Organizations shows that the amount of time HR spends on “strategic business partnership activities”—about 25 percent—has changed little over the past 15 years.

Whether you accept all of these findings or not, there is a clear message that our profession has significant opportunities to enhance our performance. The current perceptions are unacceptable. More important, they do not reflect the true value and potential we bring to business.

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We uncover why and how HR must reinvent itself in this issue of HR Magazine. Our cover story, “Rebuilding HR,” discusses how we can get beyond HR’s image problem and critics to construct a new kind of HR—one that reflects the reality of today’s business world. It shows how one HR leader, Shara Gamble, SHRM-CP, is retooling her HR team by training it on the company’s business model, shifting its focus from performing transactional duties to providing workplace solutions and aligning to overall business needs.

The Society for Human Resource Management (SHRM) is also helping to retool HR—and we can help you do the same to enhance your career. We developed the SHRM Competency Model, which includes the nine behavioral and technical competencies every HR professional needs today, to help you focus your development. One important sign of the times is that successful HR professionals must know and display a set of behaviors that we call competencies. No longer is HR expertise or knowledge adequate to thrive in our profession.

Additionally, to inspire more HR professionals to hone the skills that propel their careers and businesses forward, SHRM launched a new competencybased certification for the HR profession. To date, nearly 35,000 HR professionals hold the SHRM-CP or SHRM-SCP and are on the path to further develop themselves as HR business leaders. Thousands more are preparing to take the certification exams this month.

It’s time to change the conversation and the requirements of the HR profession and to be the strategic business partners our organizations need. As this month’s cover story shows, what worked for HR yesterday likely will not work tomorrow.

SHRM and HR leaders like Shara are taking on the challenge of the “extreme HR makeover.” Will you?

PHOTOGRAPH BY CADE MARTIN FOR HR MAGAZINE

By Henry G. Jackson

May 2015

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For the latest HR-related business and government news, visit www.shrm.org/hrnews

HR News

®

House Minority Leader Nancy Pelosi and House Democrats gathered on Capitol Hill in March to commemorate the fifth anniversary of the Affordable Care Act.

The ACA at 5: Passions Still Run High Five years after the Affordable Care Act (ACA) was signed into law, its critics and champions still view it through vastly different lenses.

“When the ACA was being debated, proponents portrayed it as a panacea for the health care system, while opponents painted it as a poison,” said Michael Maddigan, an attorney in the Los Angeles office of Hogan Lovells. The reality likely lies somewhere in between.

PHOTOGRAPH BY ASSOCIATED PRESS

What’s Worked On the positive side of the ledger, the ACA has: • Provided insurance to millions of Americans by prohibiting pre-existing condition limitations.

• Made insurance accessible and affordable to millions who otherwise could not afford it.

• Spurred additional momentum toward better coordination of care and

16.4M

“results-oriented” pricing.

The law is also freeing people from “job lock,” or being tied to a job because of the employer’s insurance plan, said David Blumenthal, president of The Commonwealth Fund. The Congressional Budget Office (CBO) projects that the ACA will result in employees working 1.5 percent to 2 percent fewer hours over the period of 2014 to 2017. “The CBO believes this reduction will occur almost entirely because workers will choose to work less as a result of the law’s new coverage options,” Blumenthal said.

What Hasn’t Worked On the negative side, the ACA has: • Caused dislocation for some Americans who were forced to give up insurance or doctors they liked.

• Caused temporary uncertainty in the small-group insurance market.

• Resulted in the narrowing of choices

nonelderly adults have gained insurance coverage since the ACA was enacted.

Source: U.S. Department of Health and Human Services.

of doctors and hospitals available in some consumers’ networks.

For small employers, the ACA’s potential benefits have not materialized, said Holly Wade, director of research and policy analysis at the National Federation of Independent Business.

Small-business owners have encountered repeated delays and confusion over major components of the law, she said, such as the Small Business Health Options Program (commonly referred to as SHOP exchanges), the small-business health insurance tax credit and the employer mandate.

The Jury’s Still Out Five years is a short time to draw lasting conclusions about legislation as ambitious and sweeping as the ACA. “Additional studies and evaluations will be needed to paint a fuller picture of its impact on Americans and their health care system,” Blumenthal said.

On that last point, both advocates and opponents should be able to agree.

—Allen Smith, J.D., and Stephen Miller, CEBS May 2015

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HR Magazine

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HR News

®

SENIOR VICE PRESIDENT, PUBLISHING & MEDIA Jessica Perry (Staff e-mail addresses follow this format: jessica.perry@shrm.org) VICE PRESIDENT, EDITORIAL Leon Rubis EDITOR Christina Folz MANAGING EDITOR Desda Moss, technology, books ASSOCIATE EDITOR John Scorza, compensation, benefits SENIOR WRITERS Bill Leonard / Dori Meinert

E-Cigarettes and Work: Finally, Some Guidance Are e-cigarettes a helpful tool for people looking to quit smoking or just a new spin on an unhealthy habit? Despite the popularity of these products, which are tobacco-free and work by vaporizing a liquid nicotine solution, there are still many unanswered questions about their long-term health effects. Now, health professionals from nonprofit organizations, universities and wellness programs are offering employers guidance based on the available research. Employers should: • Consider e-cigarettes the same as they would a tobacco product in their worksite policies.

ONLINE NEWS OPERATIONS DIRECTOR Beth Mirza

• Strive for tobacco-free work environments and ban e-cigarette use in smoke-free work areas. If employers have designated smoking areas, they should establish a separate area for e-cigarette users.

• Continue to offer comprehensive tobacco cessation services for employees who wish to stop tobacco use, and make e-cigarette users eligible.

The full set of recommendations appears in the March 2015 Journal of Occupational and Environmental Medicine.

—Stephen Miller, CEBS

Business Benefits of Being Well Most business leaders say promoting wellness can affect employee productivity and performance, according to survey results from the nonprofit Health Enhancement Research Organization. The top business priorities influenced by health were:

62% Productivity (the quantity of work getting done)

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60% Performance (the quality of work getting done)

LEGAL EDITORS Allen Smith, J.D., workplace law content manager / Joanne Deschenaux, J.D., senior legal editor HR NEWS EDITORS Kathy Gurchiek / Roy Maurer, safety and security, staffing management / Stephen Miller, CEBS, compensation, benefits / Dana Wilkie, employee relations, diversity / Aliah Wright, technology, business leadership COPY DESK MANAGER Gretchen Kraft COPY EDITORS Erin Binney / Natalie Kroc DIRECTOR, DESIGN, PRODUCTION & SALES SUPPORT Caroline Foster ART DIRECTOR John R. Anderson Jr. SENIOR DESIGN SPECIALISTS María-Eugenia Adams / Terry Biddle

41%

30%

29%

PRODUCTION MANAGER Kathy Jackson

Employee engagement or morale

Benefits cost reduction

Safety

ADVERTISING SALES MANAGER Kiristin Reid

May 2015

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HR News

®

Overwhelmed by E-Mail? You’re Not Alone

This year, U.S. workers will receive 22 percent more business e-mail than they did three years ago, and they will send 24 percent more, according to the Radicati Group, a market research company.

Only

9%

That’s probably not a good thing. Here’s why: E-mail is addictive. Checking e-mail “mimics the path that a drug takes through the brain,” according to John Ratey, a psychiatrist and associate professor at Harvard. In other words, people can get a rush when they have a new message and experience withdrawal when they’re away from their inbox.

E-mail impedes focus.

People who shift their attention between two activities—like composing an e-mail and writing a report— spend 50 percent more time on these tasks than if they’d finished one task before moving to the next, according to

David Meyer, a University of Michigan psychology professor.

E-mail wastes time. It takes an average of 64 seconds to recover one’s train of thought after interruption by e-mail, concluded Thomas Jackson of Loughborough University in England. That means people who check their e-mail every five minutes waste more than eight hours a week trying to remember what they were doing moments before.

To help employees break the addiction, encourage them to go through e-mail at scheduled times, turn off distracting alerts and reply only when necessary. And if a conversation topic requires more than three e-mail exchanges, it may be time to pick up the phone.

—Dana Wilkie

of HR professionals believe that their organizations’ employees are very knowledgeable about their employer-sponsored benefits.

Source: SHRM’s 2014 Strategic Benefits—Communicating Benefits Survey.

Employers’ Biggest Fear? A Virtual Disaster Violence. Disease outbreak. Natural disaster.

According to the results of the 2015 Workplace Threats Survey from the International Foundation of Employee Benefit Plans, none of those concern employers as much as the threat of a cyberattack does. Indeed, the fear of workplace cyberattacks has increased by 75 percent over the past five years.

Eighteen percent of the responding companies had firsthand experience with a cyberattack, and 18 percent had experienced a data breach.

To protect themselves, some companies are using advanced encryption techniques commonly used for military communications. “Make it expensive enough and difficult enough and the hacker will find a different target,” said Robert Twitchell, an expert on Department of Defense cyberwarfare.

—Aliah D. Wright 14

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Employers’ top concerns: Cyberattack

37%

Internal data security breach

25%

Workplace violence

19%

Natural disaster

12%

Disease outbreak

2%

Terror/bomb threat

2%

May 2015

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HR News

®

STATE BRIEFS UTAH: GOVERNOR SIGNS LGBT ANTI-DISCRIMINATION BILL A new law in Utah makes it illegal to base employment decisions on someone’s sexual orientation or gender identity or expression. However, employers are not prohibited from adopting reasonable dress and grooming standards or from making reasonable rules to designate sex-specific facilities.

UT Help Keep Employees’ Stress in Check With managers able to reach workers at any time of day or night via e-mail and text, the boundary between work and personal time has gotten fuzzier than ever. And employees are feeling the strain.

A March 2015 survey of 160,000 employees around the world found that more than 1 in 3 reported feeling above-average stress.

Contributing to the problem is the fact that some jobs are no longer measured by the time a worker puts in, but by goals and quotas that may require more than the standard eight-hour workday.

“It’s tough to know when to officially shut down and move away from work for the day,” said Liz Kelly, CEO and founder of employee engagement consultancy Brilliant Ink. On its website, the National Institute for Occupational Safety and Health (NIOSH) defines job stress as “the harmful physical and emotional responses that occur when the requirements of the job do not match the capabilities, resources, or needs of the worker.”

To ease workers’ stress, NIOSH suggests the following strategies: Get feedback. Use group discussions or employee surveys to collect information from workers about what contributes to stress, and give them opportunities to participate in decisions affecting their jobs.

Prioritize tasks. Be clear about which duties are most important and which can wait, and set reasonable deadlines.

Provide resources. Stress management training and access to an employee assistance program can help workers cope with difficult work situations.

Seek advice. Consider hiring a consultant who can recommend ways to improve working conditions and examine if the workload is in line with workers’ capabilities and resources.

—Dana Wilkie 16

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WISCONSIN: THE 25TH RIGHT-TO-WORK STATE Wisconsin became the 25th rightto-work state when Gov. Scott Walker recently signed legislation prohibiting the mandatory payment of dues and fees, making union shop clauses unenforceable. A day later, a coalition of unions sued the state to stop enforcement of the law.

WI

NEW JERSEY: SUPREME COURT ESTABLISHES HARASSMENT DEFENSE An employer can defend against a claim of sexual harassment brought under the state’s anti-bias law by showing that it has and uses a robust anti-harassment policy, the New Jersey Supreme Court ruled. Although such a defense has been available under federal law for years, it was previously unclear whether the defense was authorized by state law.

NJ

NEW YORK: TIPPED WORKERS TO GET HIGHER WAGE The minimum wage for tipped workers in New York’s hospitality industry will increase to $7.50 an hour by the end of 2015 under an order signed by the state’s acting labor commissioner.

Various classes of tipped workers currently receive $4.90, $5 and $5.65 an hour in the state.

NY

READ about state workplace law developments: www.shrm.org/LegalIssues/ StateandLocalResources

May 2015

4/6/15 3:43 PM

Teleworkers Get It Done When properly managed, telework can be a win-win for employers and employees, according to the results of the latest Remote Collaborative Worker Survey, which polled 353 adult Internet users and was conducted by cloud provider ConnectSolutions. Of those who work remotely at least a few times per month:

77% report greater productivity while

Jargon Decoder

H2H

You’ve heard of B2B (business to business) and B2C (business to consumer). H2H stands for human to human and reflects an interest by many businesses in connecting with clients and customers on a human level. HR already knows all about it!

Top 3 Emerging Issues In Employee Handbooks

working offsite.

Paid sick leave

23% percent are willing to work longer

80%

hours from home than they would onsite.

Data privacy

67%

42%

Social media

64%

percent feel just as connected with colleagues as if they were working on the premises.

Source: XpertHR.

Birthday Best Practices If you work in HR, birthday parties aren’t always of piece of cake. Darcey Peterson, SHRM-CP, an HR manager with Martin Foot and Ankle in York, Pa., recently initiated a spirited conversation on SHRM’s LinkedIn page that generated some do’s and don’ts for celebrating birthdays at work.

Don’ts

Do’s

• Don’t have an inconsistent policy. Celebrating some birthdays while forgetting others hurts morale.

• Don’t announce that someone is having a birthday on your company’s intranet or social media sites without first asking the person if it’s OK to do so.

• Don’t publicize the year of someone’s birth. It’s not illegal, but it is impolite.

• Don’t burst into song or give someone a cake without first asking if the person is comfortable with it.

• Don’t pressure employees to contribute money for a birthday gift or to attend a birthday lunch.

• Send electronic birthday cards, especially at large organizations where there are many employees to acknowledge.

• Have managers take celebrants to lunch.

• Offer gift cards to popular stores or restaurants, or contribute to the celebrant’s favorite charity.

• Allow the celebrant to take a “personal holiday” on his or her birthday.

• Opt for monthly celebrations that acknowledge all workers born in that month.

May 2015

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HR Magazine

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Executive Briefing

By Dori Meinert

Leaders Can Drive Innovation—Or Block It About 94 percent of business leaders say innovation is key to success.

Yet just 14 percent are confident about their organizations’ ability to drive innovation, according to a survey of 500 leaders conducted by the Center for Creative Leadership last year.

Why the disconnect? It may start at the top.

When David Magellan Horth, senior fellow at the center, conducts workshops on leadership innovation, he asks business leaders how they react when people come to them with new ideas. Their answers are often telling.

One senior marketing executive expressed frustration: “Why can’t people just do what they are supposed to do?” he asked. Another executive admitted to advising employees to take the afternoon off with the hope that their ideas would just go away.

These reactions reflect the pressure that leaders, particularly those in the middle ranks, often feel when faced with the choice between encouraging innovation and meeting day-today business demands. If a new idea sounds promising but it’s not on the annual list of department goals and there’s no budget for it, it often gets set aside or scrapped.

“The choice tends to be ‘let’s run today’s business’—even if innovation is a concern at the top—‘because that’s what we’re measured on,’ ” Horth says. “We have to do both.”

Seeing the Big Picture Leaders also struggle to take an organization-wide view. They must let go of the myth that innovation comes from one person in a certain department or at a specific level of the company, Horth says.

“Innovation is rarely a single idea with one person driving it. There are usually other people involved,” he says. “Sometimes they don’t get the press they deserve.”

Innovation is not limited to new products; it can lead to new processes as well. And while an idea might not work for one department, project or product, it could be a good solution for another. That’s why it’s important to work across organizational boundaries to connect ideas with the right people, Horth says.

Creating an environment where people can be innovative may require a shift in thinking for many leaders. While traditional business strategy is about removing ambiguity and driving results, leaders who want to encourage innovation must learn to defer judgment, tolerate ambiguity and become curious about what they don’t know.

Nothing kills innovation more than a “know-it-all leader,” says Horth, who co-authored the Center for Creative Leadership’s white paper Becoming a Leader Who Fosters Innovation.

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Creating a Creative Culture Leaders can encourage innovative thinking by asking people who come to them with new ideas the following questions: • What are the positives?

• What are the opportunities?

• What are the potential problems with the new idea?

• How can you address those issues?

Don’t be too quick to toss an idea, Horth says, and be aware that an organization’s culture can work against efforts to encourage innovation. If leaders are sincere, they must model the openness to innovation that they want to see in others.

One effective way to shift the culture is to reward or promote people who have the courage to bring you their ideas.

Doing so communicates “this is the way we want people to be,” Horth says.

Tips for Encouraging Innovation In its white paper Becoming a Leader Who Fosters Innovation, the Center for Creative Leadership offers these suggestions: • Create a mandate for change.

• Model innovative behavior.

• Communicate challenging strategic issues and use them to seek creative ideas.

• Create diverse teams to address strategic issues.

• Give people access to creative tools, methods and experiences.

• Design and build systems to nurture innovation.

• Find a home for the ideas that don’t quite fit for you but might fit elsewhere.

• Break down barriers to innovation, including internal politics and destructive criticism.

May 2015

4/8/15 1:48 PM

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Q&A

Measuring Critical Competencies

Wayne Cascio, chair of SHRM’s Certification Commission, explains why the new competency-based credentials will give you an edge.

Interview by Bill Leonard s chair of the Society for Human Resource Management’s (SHRM’s) Certification Commission, Wayne Cascio is working to ensure that the new SHRM competency-based certifications (SHRM-CP and SHRMSCP) achieve the highest professional standards possible.

HR Magazine talked with him about his work with, and the progress of, the commission and the certification program.

Cascio is the Robert H. Reynolds Chair in Global Leadership and distinguished professor of management at the University of Colorado-Denver School of Business.

Why should HR professionals pursue the SHRM certifications?

Certification is becoming common in many professions, and HR management is no exception. It is definitely a seal of approval for employers. It shows that the

Prior HR-related certifications have emphasized a professional’s knowledge.

But just because you know something doesn’t necessarily mean that you can do anything with it.

The CPA [certified public accountant] credential or any medical certifications require you to demonstrate the competence to do something. We need to send a signal to employers that this is the direction in which the HR profession is moving, as well. It’s not just that people know the technical aspects of the field, but also that they can use that information to solve and address important business issues.

Are other professional certification programs moving toward competency models?

The trend in several HR associations is to move beyond just having

An important goal is to demonstrate that the professionals who went through the certification process perform better on the job than those who didn’t. professionals they hire are competent in the key focal areas of the profession and can bring value to an organization.

Why did SHRM make the new certifications competency-based?

These HR competencies are key differentiators between the SHRM certifications and other HR-related certifications. The SHRM program really focuses on the ability “to do” and not just “to know.”

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technical knowledge in the HR field toward having the ability to apply that knowledge.

For example, the Australian HR Institute and the Chartered Institute of Personnel and Development in the U.K. are working closely together and looking at competencies. The question that everyone is grappling with right now is: How do you develop an assessment process that will reliably and validly

measure if someone possesses critical competencies?

SHRM has chosen to use situational judgment tests to do that. The tests present a range of actual scenarios. Each one offers four possible responses and asks what the best one is. The key consideration here is that SHRM is developing situations that actually reflect key HR competencies.

Is the SHRM Certification Commission an independent body?

Absolutely. We must have a wall between what the commission does, what the exam-development teams do and what the competency-assessment teams do. As an independent commission, we can ask a lot of questions about the program and, believe me, we do. So far, there has been very active and lively interaction.

I particularly like having employer representatives on the commission in addition to HR professionals, academic members and general-interest members.

The employer representatives provide a very important check and balance on what is feasible and practical for employers. This is very important because we need employer buy-in.

Of course, we need buy-in from the HR community, but we also require it from the broader C-suite community— the senior-level managers who develop and set business strategies. We want them on board with this, and we want them to see certified HR professionals as people who can really add value. In my view, this is critical. For years, we have talked about HR people being business partners. If you look at the competencies that the SHRM program is certifying, they are all business-related.

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What skills and experiences do you bring to the table as commission chair?

I chaired the U.S. technical advisory group from 2011 to 2013 that was developing international HR standards. My job then was to represent the interests of the United States HR community in the international meetings, and I had to manage around 40 members of the technical advisory group.

I also chaired the board of the SHRM Foundation and have held a number of leadership roles in HRrelated associations. Chairing the SHRM Certification Commission is a job that I am honored to have and one that I take very seriously.

We on the commission have a chance to use what we know and have built up through a lifetime of experience to help develop an HR certification process that is truly state of the art. In addition, we have the chance to create something that HR professionals want to aspire to— that is, SHRM certification, because they see it as a valuable asset to furthering their careers.

What is your vision or goal for the commission?

The commission would like this certification process to become popular around the globe. The longer-term view is that we have developed an assessment program that works well now, but we would like to take it to

PHOTOGRAPH COURTESY OF WAYNE CASCIO

Wayne Cascio

another level in the next three to five years. The goal is to incorporate the latest thinking in the HR field about the best ways to do assessments in a manner that will serve large numbers of people.

I hope we’re able to reach a point where the testing is mobile and Internetbased. It’s the way technology and the world is moving, and if we can make the process more convenient and userfriendly, then more people will seek professional certification.

Another important goal is to demonstrate that the professionals who went through the certification process perform better on the job than those who didn’t. This will be a key issue in terms of demonstrating the value of the certification to employers.

Is the certification program on track to meet its 2015 goals?

It’s absolutely on track at the moment, and it’s the kind of program that will

need continuous calibration. For example, if SHRM is using situational judgment tests, then there may be situations that are perfectly appropriate and applicable today but may not be tomorrow.

A lot of the feedback we received from those who took the pilot test was very positive. Many of them said, “These are situations that I face each day in my job.” We need to keep receiving this kind of feedback over and over again, to make sure the exam questions and situations are timely and relevant.

How do you make sure that this continuous calibration occurs?

The commission needs to receive regular reports from SHRM about pass rates and the feedback SHRM receives about the exam, while at the same time the commission needs to regularly assess the relevancy of the situations on the exam. We live in what the U.S. military calls a “VUCA” world—that is, a world that is volatile, uncertain, complex and ambiguous.

We keep hearing about what living in this world means to business and how business models can change overnight.

As a profession, HR must be responsive to this.

The SHRM Certification Commission has a very important role to play in all of this. Consider six important features that are represented by another acronym, PESTLE: the political, economic, social, technical, legal and environmental factors that are affecting and reshaping our world. If we follow through and concentrate on these, this will keep the certification program up-todate and relevant to what businesses need from HR professionals.

Bill Leonard is a senior writer for HR Magazine.

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Advice from HR Knowledge Advisors

Why might an employer opt to use a private health care exchange?

A private health care exchange is a marketplace of multiple insurers that offers health coverage and related services. Your company can purchase health insurance from the exchange, and employees can choose a plan and insurer from among the carriers offered.

Exchanges take a defined contribution approach to employee benefits. Instead of both employee and employer contributing to premium costs, your organization would provide employees with a fixed sum with which they can purchase the benefits they desire in the exchange.

There are a number of advantages for employers that use private health care exchanges. Private exchanges may: • Lighten employers’ workloads and reduce administrative costs by shifting plan administration to the provider and allowing employers to sit back as sponsors.

• Offer multistate employers the ability to provide uniform coverage for employees regardless of location.

• Provide more budget transparency by allowing employers to pay a flat rate for workers to use in the exchange. The cost of a private exchange is also more certain, with the employer receiving one bill.

Exchanges can offer multiyear contracts.

• Help employers avoid a 40 percent 22

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excise tax on plans defined by the federal Affordable Care Act (ACA) as offering high-cost coverage. This tax is also known as the “Cadillac tax,” and it takes effect in 2018.

• Allow employers to avoid the ACA’s “pay-or-play” penalty as long as they are meeting the minimum essential coverage requirements and the insurance is both sufficiently available and affordable.

• Increase employee satisfaction by providing workers with different types of plans to choose from. Currently, most employers are able to offer only a few coverage options, such as a health maintenance organization, preferred provider organization or point-of-service plan.

Exchanges allow employees to consider more-individualized alternatives.

However, there are still some unanswered questions. For example, if health care costs increase, will your organization be able to keep its proportion of the costs constant without incurring a penalty? Or will it be required to increase its share?

In offering a private exchange, you also run the risk of overwhelming prospective participants by myriad choices.

Job candidates and employees alike may be turned off by the unfamiliar and sometimes confusing nature of a defined contribution plan. Some studies show that when employees are given more choices, they are actually less inclined to participate, or they will make decisions that leave them dissatisfied. Also, giving up your administrative involvement could result in quality control issues.

—Regan Gross, SHRM-SCP

What hours of work count toward FMLA eligibility?

To be eligible to take leave under the federal Family and Medical Leave Act (FMLA), an employee must have worked

1,250 hours during the 12 months prior to the start of the leave, must work at a location with 50 or more employees either at the same site or within 75 miles, and must have worked for the employer for 12 months. The 12 months of employment don’t have to be consecutive.

In general, only hours that were physically worked—and not breaks, vacation or travel time—will count toward the 1,250 hours for FMLA eligibility. The only exceptions are for those who were on military leave during the 12 months preceding the leave and airline flight crew.

Weeks of vacation or sick leave, while not included in the 1,250 hours, will be counted toward the 12 months of employment requirement for nonexempt employees.

Use the U.S. Department of Labor’s Fact Sheet #22 to determine which hours should be counted, such as travel time or on-call time. In general, if you are required by law to pay the worker for the hours, they are included in the 1,250 hours needed for eligibility.

For exempt workers, the same rules apply. However, many employers don’t track the actual time worked by exempt employees, who may work much more than 40 hours a week. If an employee indicates that he or she has worked the 1,250 hours and you don’t keep records to prove otherwise, you must allow that worker eligibility for the leave. If this becomes a problem, consider monitoring the hours of all your exempt employees.

For employees who were serving in the military prior to the requested FMLA leave, you must credit them with the amount of hours they would have worked had they not been on military leave. Use the employee’s pre-service work records.

An airline flight crew member is eligible for FMLA leave if he or she has worked or been paid for at least 60 percent of his or her monthly guarantee and a minimum of 504 hours, not including personal commute time or time spent on vacation, medical or sick leave.

—Angela Stone, SHRM-SCP

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Solutions

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Viewpoint

The Power of Positive Culture Backbiting and infighting can undermine even the best business plans.

By Aileen Wilkins

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hen I was head of human resources for a technology startup back in the dot-com days, we started off with a bang. Everyone was excited about the future. When times got tough, however, the team turned on itself. Everyone had a different idea about how to get the business back on track. The leadership team was unsuccessful at setting a direction because of incessant backbiting and secondguessing within the team. Ultimately, we determined our own destiny when we spent too much time on internal differences and not enough on achieving the company’s mission. We went under in less than a year.

It was a great lesson for me, and one I

Aileen Wilkins

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have never forgotten: There’s a lot more to success than a solid business plan.

Going Beyond Strategy There are several elements of successful businesses. First and foremost, they need a good—but not necessarily perfect— business strategy and they need to execute that strategy daily and over time.

But, as I learned from my experiences, successful businesses require even more than that. They also need a positive culture and work environment. This factor isn’t discussed much, yet it is just as vital to success as a sound business plan. You need to harness the power of your organization’s talent in order to achieve the organization’s goals.

It’s no secret that toxic cultures create unhealthy internal politics and dysfunction. Conversely, in cultures that support thriving businesses, the talent is engaged. Employees focus on growth, minimize internal politics, and constructively support and challenge each other to do better.

Notice that I said talent is “engaged,” not “happy.” It’s impossible to create a work culture where everyone is happy in the sense of being joyous and brimming with positivity.

That’s just not human nature. However, employees should be committed to supporting the goals and values of the company and to supplying their teams with the resources and support needed to get the job done. They shouldn’t be concerned with gossip or undermining another person’s good work.

Creating a healthy culture starts with strong leadership.

The people at the top set the tone for behaviors all the way down the line.

It Starts with Leadership Creating a healthy culture starts with strong leadership. The people at the top set the tone for behaviors all the way down the line. No matter how large an organization is, it’s hard to hide what senior leaders spend their time on, and everyone else in the company sees it. If there is backbiting and infighting among an organization’s leaders, others will behave similarly.

The attitude of senior leaders is influenced by the degree to which they are aligned with the board of directors, as well as whether the board supports the direction management is headed.

Continuity in the C-suite also helps good organizations prosper. I have experienced disruptive turnover of C-level executives, and nothing is more costly to business success. It creates constant churn and stalls potential forward momentum.

In my role as chief people officer at H&R Block, culture has been at the center of the HR team’s attention. We are working hard every day to create a “noblame” culture. That means having open

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and constructive conversations focused on improving the organization, and not on who made the last mistake. As long as everyone has a similar set of values, you can be honest with your colleagues, even when it is uncomfortable. Our senior team does this, and we are encouraging the rest of the organization to follow suit.

The goals of all organizations must be clear and above any one individual’s motives. Personal agendas have no place in high-performing organizations, and leaders need to make sure this is clear in the minds of their associates.

Cultural Fit Required When someone is not a good cultural fit and they’ve demonstrated that they

cannot adapt, they have to go. The role of human resources is to help people fit into the culture—not to fit the culture to the people. I’m vigilant about this, and I say to senior staff repeatedly, “Our culture won’t assimilate to you.”

We can learn from everyone, but, at the end of the day, senior leaders must adapt their style to some degree to be effective within our culture.

Organizations have to fiercely protect company values or their cultures will gradually worsen over time and their brands will suffer. Along with the CEO, HR is vital in this effort.

HR professionals are the ultimate sponsors and champions for the right set of behaviors, and they should not be phoning it in. There are great HR

leadership teams out there, and there are some mediocre ones waiting for someone else to take care of problems. But HR is responsible for driving the culture, enforcing it, redirecting it and improving it. It’s a continuous process and one of the most important ways HR leaders can contribute to the bottom line of an organization.

Great cultures drive great results.

And great results create career and growth opportunities for talent—two ingredients essential to creating great organizational culture.

Aileen Wilkins is chief people officer for H&R Block, where she leads the company’s people strategies, including workforce planning, talent management, organizational capabilities and culture.

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ENTERPRISE

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Rebuilding HR It’s time to renovate and innovate. Here’s how HR can structure its own professional development to meet the needs of a fast-changing business world.

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hara Gamble, SHRM-CP, knows a thing or two about rebuilding. The company where she works as HR director, TAMKO Building Products Inc., weathered back-to-back tornadoes during the spring of 2011—first in Tuscaloosa, Ala., where the company lost a warehouse and a portion of its payroll facility, and then a month later in its home base of Joplin, Mo., where many company employees lost their homes and were forced to start again from scratch.

In the aftermath of the twisters, Gamble and the payroll team worked with the management at Tuscaloosa to ensure that the company’s workers got paid and supported a team of volunteers dedicated to rebuilding. TAMKO, which has 1,200 employees nationwide, manufactures construction materials, cranking out roofing supplies at a dozen plants across the U.S. It’s a helpful line of work to be in when you live in a town that has been devastated by a natural disaster.

PHOTOGRAPH BY STEVE PUPPE FOR HR MAGAZINE

By Rita Zeidner

yourself with sample questions from SHRM’s competency-based certification exam.

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(Left to right) Shara Gamble, SHRM-CP, Mike Halstead and Theresa Bray of TAMKO Building Products Inc. are taking a competency-based approach to professional development.

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These days, Gamble is involved in a different kind of rebuilding—that of HR itself. She is one of a growing number of HR professionals who are reshaping the business community’s expectations of how HR functions within organizations and of the value that the profession can bring to a rapidly changing, complex workplace. Gamble, like many others in the field, is looking to develop her team’s core skills and competencies. After years of focusing on other departments’ professional development, it’s time for HR professionals to focus on their own.

HR’s Image Problem To be sure, the profession is teeming with high achievers like Gamble, who is the certification director for the Missouri State Council of the Society for Human Resource Management (SHRM) and vice president of the Tri-State Human Resources Association, a SHRM affiliate. Unfortunately, the accomplishments of these high achievers often get obscured by criticism about HR from the popular press, among organizational experts and even within the profession itself. There’s no denying that HR has an image problem—and perhaps it’s not wholly undeserved.

The magazine Fast Company laid out common complaints against the field a decade ago in a snarky cover story titled “Why We Hate HR.” A lack of business savvy topped its lengthy list of practitioner shortcomings. More recently, in the July 2014 Harvard Business Review, business consultant Ram Charan made the case that, even at the highest levels, most HR professionals “are process-oriented generalists who have expertise in personnel benefits, compensation and labor relations.”

While Charan acknowledged that HR departments also focus on engagement, empowerment and managing cultural issues, he held that “what they can’t do very well is relate HR to real-world business needs. They don’t know how key decisions are made, and they have great difficulty analyzing why people—or whole parts of the organization— aren’t meeting the business’s performance goals.”

Getting Beyond the Haters Gamble is among many HR leaders bent on proving the HR critics wrong or, at least, making their most damning observations about the profession obsolete. Aligning the HR function to business needs is exactly what she is focusing on first with her team’s professional development.

Shara Gamble, SHRM-CP, (second from right) with the HR team from TAMKO Building Products Inc. She led her colleagues as they retooled their professional development training to become more aligned with the company’s business model.

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PHOTOGRAPH COURTESY OF TAMKO BUILDING PRODUCTS INC.

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She became concerned when she noticed that her relatively young and inexperienced employees were spending too much time on transactional duties such as payroll and benefits administration. She wanted them to focus on supplying managers with competent, well-trained workers and meaningful analytics.

So she retooled their training so that it was aligned to the company’s business model, making sure her team understood the industry and the diverse mix of skills needed to ensure the company’s

The nine competencies are: • Business acumen—an understanding of and the ability to apply information to contribute to the organization’s strategic plan.

• Communication—the ability to effectively exchange information with stakeholders.

• Consultation—the ability to provide guidance to organizational stakeholders.

• Critical evaluation—the skills to interpret information to make business decisions and recommendations.

Gamble is one of a growing number of HR professionals who are reshaping the business community’s expectations of how HR functions.

continued success. “To have a conversation with our business leaders, HR has to be able to speak their language,” she says.

Gamble also initiated cross-functional training and urged her staff not to be shy about offering solutions that may solve managers’ workplace problems. Her 10-member team rose to the challenge immediately, proposing and implementing a new system for tracking time and attendance, a new virtual orientation and onboarding process, and a leadership development forum.

PHOTOGRAPH COURTESY OF TAMKO BUILDING PRODUCTS INC.

The Competency Model Gamble’s and others’ mission to meet the modern demands of HR has been supported by SHRM in a number of ways. In 2012, the Society developed a competency model that spells out nine basic skill sets that HR professionals need to have to be at the top of their game, no matter where they are in their careers. The model forms the foundation for the new certifications that SHRM rolled out last year—the SHRM Certified Professional (SHRMCP) and the SHRM Senior Certified Professional (SHRM-SCP). Both respond to the business community’s desire for more outcome-focused practices from HR professionals, according to Henry G. “Hank” Jackson, SHRM’s president and chief executive officer.

• Ethical practice—the ability to integrate core values, integrity and accountability throughout all organizational and business practices.

• Global and cultural effectiveness—understanding and valuing the perspectives and backgrounds of all parties.

• Leadership and navigation—the ability to direct and contribute to initiatives and processes within the organization.

• Relationship management—the skills to manage interactions to provide service and support to the organization.

• HR expertise—knowledge of the principles, practices and functions of effective human resource management.

The model also identifies a dozen or so basic performance expectations at various career stages. To meet the proficiency standard for HR expertise, for instance, an entry-level practitioner is expected— among other things—to be able to identify ways to improve operational efficiency and ensure that stakeholder questions get answered. A midlevel professional should be able to serve as the HR expert to managers and recommend policy changes. A senior HR practitioner’s competencies include providing expertise to support staff development, implementing operational strategy and assessing legal compliance risks. Because HR executives have full May 2015

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oversight and responsibility for HR business outcomes, they should be able to keep HR policies and practices aligned with business needs.

As another example, the proficiency standard for business acumen requires an entry-level HR professional to have a basic knowledge of the employer’s business. A midlevel manager should be able to assemble reports and metrics. A senior manager must communicate the organizational impact of metrics. And an HR executive uses metrics and other available data to implement solutions.

A New HR The validated competency model helps dispel the myth—widely held in HR circles—that HR practitioners need only a firm grounding in HR basics, according to Jeff Lindeman, SHRM-SCP, senior director for talent and engagement at the San Diego County Regional Airport Authority and a member of SHRM’s Certification Commission. Moreover, it will help prove to executives outside HR that the profession has strategic value.

at Rivermark Community Credit Union in Portland, Ore. “Many individuals new to the profession may wonder how they can learn to lead or how they can be influential within their organizations. I wondered this same thing as I started progressing through my HR career.” The SHRM Competency Model helps HR professionals learn leadership and other skills critical to the business.

In addition to leading from within, HR must be adept at communicating the company’s value proposition externally, especially in the tightening labor market. As the economy improves and unemployment hits its lowest level since the 2008 recession, competition for talent is intensifying—which means you need a solid strategy for luring the best and brightest talent.

HR professionals must also understand how the composition of the workforce is shifting. For example, at least half of workers in 2020 are expected to be from the Millennial genPaul Belliveau

HR departments have access to an enormous amount of information through the systems they manage. But do they know how to use it?

“No matter where you are in your career, you will need skills that go far beyond what is taught in traditional HR training,” Lindeman says. “You will need to understand your employer’s business model and know who are the customers and stakeholders.

You will need to have negotiation skills to close a deal to bring a talented worker on board. You will need to have communication skills to market your organization’s brand.”

It’s also crucial for HR to be able to counsel others in the business about how to address the changing needs of the workforce. “The ability to effectively influence is a critical skill that HR professionals must possess,” says Jackie HenderJackie Henderson son, SHRM-SCP, an HR leader 30

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eration, says Paul Belliveau, SHRM-SCP, who heads Avancé Human Capital Management Advisors.

“They’re bringing their own preferences to work,” he says. “The workforce we’re seeing develop is taking charge of their own self-development. They have an appetite for short-term assignments, and they want to be their own boss.”

Recruiting and retaining these workers, as well as keeping them productive, will require cultural competency. “HR needs to develop competencies that will allow them to view the workforce through many different lenses,” Belliveau says.

Getting a Leg Up Today there is no shortage of venues where HR professionals can enhance their skills. The demand for certain competencies is often determined by

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uncontrollable factors such as the rate of economic growth, demographic and labor supply changes, and the rate of technological developments. That’s why SHRM will constantly recalibrate its competency model to keep up with shifting business demands.

But never mind that change is the only constant.

Here are some steps you and your colleagues can take to meet HR challenges—now and in the future: Be a human resource innovator and integrator. Keeping up with HR research and trends will help you make better decisions and spot threats and opportunities. In addition to keeping up with relevant business publications (starting, of course, with HR Magazine), be aware of what’s going on in your industry. “HR [professionals] should be vigilant about tracking the competition

Shara Gamble, SHRM-CP

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and keeping their recruiting strategies updated so that they do not end up losing trained employees,” says Ranjana Jha, SHRM-SCP, a manager of HR at TEOCO Software Private Ltd. in Kolkata, India. “Accumulate as much knowledge as possible,” she says, “and don’t hesitate to join meetings and training within and outside the organization to stay updated.”

Keeping abreast of the Ranjana Jha changing needs of the workforce will help HR professionals lead the corresponding adjustments needed within their own organizations. “It requires strong leaders to bring about change and innovation,”

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Jha says, “and this is where establishing relationships with people is important. If HR understands the business process, [it] can contribute by participating and leading the change effort.”

Be a technology champion. Technology is driving many of HR’s key functions—from applicant tracking to strategic communications.

HR’s value starts with its ability to solve problems, Belliveau says—and “you can’t [solve them] without technology.” If HR professionals want to form alliances and walk in lockstep with the rest of the organization, they need to understand how the business—and its leaders—measure success. “Technology is the most powerful strategic tool HR has in proving its worth,” Belliveau says.

Understanding tech tools and social media is also

critical to meeting the needs of the enterprising “me.com” Millennial generation, as Belliveau calls it.

Develop your business acumen. Even if you work for a nonprofit, it’s important to grasp how people-related decisions affect your organization’s bottom line. Make an effort to learn more about your employer’s line of business and get busy helping your company increase its productivity. A class in accounting or labor economics could be a good place to start. “A wonderful way to develop your business acumen is to get on your CFO’s calendar,” Henderson says. “I knew nothing of how to read or interpret the financials until I spent time with my CFO, and he was more than happy to be asked,” she says. “As a result of having

SHRM Certification: The New Benchmark for Assessing HR Employers want proof that, in addition to knowing about HR, you can apply that knowledge to further organizational goals. But what if you already have an HR degree or certification? Why bother with yet another credential?

HR Magazine put these questions to Shara Gamble, SHRM-CP, HR director for TAMKO Building Products Inc., and one of the first HR professionals to earn the new SHRM certification.

PHOTOGRAPH BY STEVE PUPPE FOR HR MAGAZINE

What convinced you to pursue another credential?

If I don’t stay current in my professional field, I will be left behind.

The SHRM certification is not just another credential. SHRM is the most recognized organization within HR, and the certification is SHRM’s endorsement of my ability to show action within a particular body of knowledge. To me, it was a must-do.

Moreover, since I already have my PHR, all I had to do was take the tutorial, not the full test. I would tell anyone with their PHR or SPHR

certification to sit for the tutorial.

There is no financial investment and little time commitment, and you are able to add another credential to your professional portfolio.

Deciding to pursue the credential is a no-brainer.

You’re an early adopter of the SHRM Competency Model. Once your employees get up to speed, will you urge them to sit for the certification exam?

Yes. The SHRM certification demonstrates that employees can not only memorize a series of laws and facts but can also exercise judgment around the knowledge set.

If I am in a situation to add staff in the future, I will be looking for the SHRM-CP or SHRM-SCP to ensure that the candidate is on par with my expectations.

Do you foresee a time when you will base hiring decisions on whether someone has the SHRM-CP?

Yes. Of course, someone has to qualify to take the exam—and that requires some experience or schooling—but having the credential highlights that a person can exercise judgment around key knowledge areas within HR. This is a great evaluation and screening tool for hiring decisions. It shows me that the candidate has the ability to act independently in their area of management and gives me confidence in their decisionmaking ability.

Any suggestions for selling the benefits of the SHRM credentials to top managers?

Focus on the key behaviors within each area. This will show executives the outcome of certification rather than concerning them with the details. Business managers are mainly concerned with whether a person will add value to an organization or not. The certification provides endorsement that the holder can successfully perform these key behaviors, thus adding value.

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strong business acumen, I can actively contribute in senior-level meetings.”

Crunch the numbers. To be a critical evaluator—one of SHRM’s nine key competencies for HR success—you must be able to collect data and, depending on your career stage, analyze it to make business decisions. HR departments now have access to an enormous amount of information through the systems they use for recruiting, payroll, performance management and others. But do you know how to use it? “HR needs to get really good at telling data stories,” Belliveau says. “You don’t need to be a mathematician or a statistician, but you need to know the importance behind the numbers.”

“The HR information systems environment is changing on an almost daily basis,” says Sylvia Francis, SHRM-SCP, total rewards manager at the Regional Transportation District in Denver. To familiarize yourself with basic analytic tools, she

advises taking an advanced Excel course. “Or, to further your education even more, consider classes in predictive analytics, statistics or business economics at your local university or community college,” she says.

Ultimately, HR professionals deal with the most complex component of the business—people. That’s why they need skills that are multidimensional. SHRM’s areas of competency are addressing this need. There’s a lot to learn, but HR professionals have always been oriented toward professional development. As they turn their focus to themselves, the competency model will provide a strong foundation on which to build a whole new HR. Rita Zeidner is a freelance writer who focuses on HR and workplace issues and a former senior writer for HR Magazine. She is based in Alexandria, Va.

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May 2015

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Culture of

Learning S

ome leaders pay lip service to learning but then insist that employees do the same things in the same way without questioning anything. No matter how much they value learning in the abstract and how much they spend to promote it, leaders are not putting their money where their mouth is in order to create an environment that produces curious information seekers.

As a result, leaders are missing out on the competitive advantage realized

by SAP, Apple, American Express and Bridgewater Associates. These companies have at least two things in common: They’re all standouts in their respective sectors, and they nurture top-to-bottom learning cultures.

Corporate learning involves more than finding the right mix of classes and seminars; it’s about nurturing a mindset.

By Robert J. Grossman

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The research linking learning to business success is compelling. “Companies that learn fastest and adapt well to changing environments perform the best over time,” says Edward Hess, a professor of business administration at the University of Virginia’s Darden School of Business and author of Learn or Die: Using Science to Build a Leading-Edge Learning Organization (Columbia Business School Publishing, 2014).

Some jobs are disappearing due to the increasing use of technology and automation, and the positions that are emerging require quick thinking, creativity, and high social and emotional intelligence, Hess says, making the ability to learn more important than ever.

Companies with nimble learners can react quickly to disruptions, adapt to meet the demands of a changing business climate, and harness a wealth of ideas for new products, services and processes.

“The single biggest driver of business impact is the strength of an organization’s learning culture,” says Josh Bersin, principal and founder of Bersin by Deloitte in Oakland, Calif., citing findings from a 2010 Bersin & Associates research report,

‘Intellectual growth should commence at birth and cease only at death.’

—Albert Einstein

High-Impact Learning Culture: The 40 Best Practices for Creating an Empowered Enterprise.

Yet research also suggests that creating a learning culture is easier said than done. Fortunately, like most things, it can be taught.

Learning Gaps In 2013, U.S. organizations spent an average of $1,208 per employee on training and development. Small organizations (those with fewer than 500 employees) spent, on average, $1,888 per employee, and midsize organizations (500 to 9,999 employees) spent $838, the same amount as large organizations (10,000 or more employees), according to the Association for

Calculating ROI Measuring the return on investment for your learning and development programs is critical to business success, says Jennifer Dearborn, senior vice president and chief learning officer at SAP. A good place to start is with your sales team. Dearborn recommends that HR professionals find out what the metrics dashboard measures for the sales team (e.g., close rate, number of products bundled into sales, net new customers and repeat customers). Then: ■■ Home in on metrics that highlight poor results.

■■ Dig into the data to discover what differentiates the team’s top performers.

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■■

■■

■■

■■

■■

Crunch the data available on relationship management, human resource information, learning management and talent management systems to learn everything you can about the top achievers.

Map out the stages of the sales cycle to discover how team members do their job and what top performers do that’s unique.

Compile the data and pinpoint indicators of success.

Create training interventions to develop skills identified with success.

Set up a control group to scientifically validate the outcomes of your

intervention.

At SAP, Dearborn seeks out similar sales groups operating in different territories and compares their performance with a team that has received training to show its impact. “I measure every training or learning intervention I undertake against a control group that doesn’t experience the intervention,” she says.

If a training or learning intervention yields positive results, she rolls it out companywide. Finding control groups is easy at SAP, which has more than 70,000 employees worldwide. It may be more challenging at smaller companies—but it’s still worth the effort.

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Talent Development. In the aggregate, that’s more than $162 billion annually. Yet despite that huge investment, there are lingering questions about whether organizations are getting their money’s worth and if the learning cultures they espouse are real or illusory.

Worldwide, organizations spend at least 11 percent more on training per person than is costeffective, according to Thomas Handcock, senior director at the Corporate Executive Board Co. (CEB) in London. That’s time Jennifer Dearborn employees spend away from their core jobs engaged in learning that’s not germane to the business.

Moreover, only around 1 in 10 companies have a true learning culture, defined as a culture that supports an open mindset, an independent quest for knowledge, and shared learning directed toward the mission and goals of the organization, according to CEB research. And only 20 percent of employees demonstrate effective learning behaviors.

So, in terms of investment and return, there seems to be a clear disconnect. According to Jennifer Dearborn, senior vice president and chief learning officer at SAP America Inc. in Palo Alto, Calif., CEOs are not applying the same rigorous analysis to learning as they do to other business functions.

Unlocking Learning To develop a learning culture, begin by recognizing the key constraints that prevent people from reaching their full potential as learners, says author and University of Virginia business professor Edward Hess. Develop policies and processes that address obstacles that inhibit learning, including: Ego. We all want to be liked and perceived favorably by others. As a result, we defend, deny and deflect what we think may cause us to lose face or to look uninformed or not particularly smart.

Fear. We seek to avoid the embarrassment of failure.

Complacency. When we learn something, we tend to retreat to automatic pilot mode, resisting new challenges and ideas.

work time learning. Seventy-nine percent said their work-related learning came from sources outside the learning and developCorporate learning isn’t what it used to be, when people would ment function, an 11 percent increase since 2012.

Societal and technological advances are playing a large role in squeeze in a class or seminar during their slow period on the job. Increasingly, it is becoming part of the very fabric of work. shaping how people learn. While learning and development proIn a 2014 CEB survey of almost 34,000 employees at all levels, fessionals used to have a near-monopoly on employee education, respondents reported spending nearly 40 percent of their total workers today have much more control over their own development. That’s largely due to the ubiquity of online courses, webinars and social networks. Given a choice, people generally prefer to learn online at their own pace. This preference for independent learning cuts across age groups from Millennials to Baby Boomers, says Dani Johnson, research manager, organizational learning, at Bersin by Deloitte in Oakland, Calif.

So, learning is clearly taking place, but are employees learning what they need to in order to excel at the company? And does your organization support their efforts? To drive culture change, it may be time for HR to reassess its role in learning and development. That role no longer calls just for providing courses and sem—Benjamin Franklin inars periodically; it involves supporting active and independent learning all the time.

Nontraditional Learning

‘Tell me and I forget. Teach me and I remember.

Involve me and I learn.’

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What Is a Learning Culture?

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‘An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.’

A learning culture consists of a community of workers instilled with a “growth mindset.” People not only want to learn and apply what they’ve learned to help their organization, they also feel compelled to share their knowledge with others.

At New York Life Insurance Co. in New York City, for instance, supporting a learning culture means “trying to make each moment about learning, about establishing the intention to learn in every interaction, every relationship and every chance to lead,” says Michael Molinaro, vice president of talent management.

At SAP, a dedication to business results is the catalyst for the company’s learning culture. “You want people who are curious, committed and who understand their role in the bigger picture of your company,” Dearborn says.

American Express, based in New York City, measures the impact of learning interventions on pre- and post-individual and organizational change. The impact of learning interventions on some business functions, such as sales, is easier to measure Michael Molinaro because of the subsequent direct impact on business results.

The 62,800-employee company also looks at its employee pulse survey results to validate the impact of its learning strategy on employee retention and satisfaction. “High pulse rates lead to high retention,” says David Clark, senior vice president and chief learning officer. “When employees are consistently learning, they are happy.”

Bersin by Deloitte offers clients a metrics dashboard that includes data on time-to-market, market share, customer satisfaction and learning agility.

Molinaro says New York Life’s most important measure is a biannual engagement survey fielded to its 10,000 employees, which tells company leaders what impact the organization’s learning agenda is having on corporate culture and business goals.

At companies large and small, leaders set the tone.

“You could put 3.5 percent of your budget into training or give your employees 80 hours of classes every year, yet it might mean nothing,” says Kim Ruyle, president of Inventive Talent Consulting LLC in Coral Gables, Fla. “If you are developing learning programs because the HR police are on your back or for compliance reasons, that’s not what learning

—Jack Welch

cultures are about. In a learning culture, you’ll find people learning because they want to.”

Creating the Culture Once you’ve committed to developing a learning culture, the following key actions can help you get there: Secure CEO buy-in. In vibrant learning cultures such as UPS, American Express, Bridgewater Associates and the Container Store, C-suite executives and leaders within the business are committed to learning. They model behaviors that communicate their belief that being smart is no longer about how much you know or how adept you are at avoiding mistakes. Instead, it’s about being a critical thinker, a motivated learner and an effective collaborator to further the business.

Cultivate a “growth mindset.” Inner motivation is key. Ideally, it is part of every employee’s DNA, driving workers in real time to expand their knowledge, learn from one another and contribute to the mission of the organization.

Hire smart. Teach hiring managers and recruiters how to evaluate candidates’ penchant for learning. This can be accomplished

‘You don’t learn to walk by following rules.

You learn by doing, and by falling over.’

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—Richard Branson

May 2015

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using structured interviews, assessments and behavioral interviews, Dearborn says. “Ask behavioral questions like ‘Do you seek and welcome demanding tasks?’ [and] ‘Are you willing to take calculated risks?’ Look for people who are intrinsically driven, who want to figure out what needs to be done, find a way to do it and do it before you even know about it.”

Teach “how” not “what.” Bridgewater Associates LP, with 1,500 employees, hires the best and brightest talent from Ivy League schools. Once on board, recruits spend 18 months being acclimated to the organization’s learning culture. “It takes that much time to transform a superstar into an independent thinker,” Hess says. At American Express, employees are repeatedly encouraged to reflect on what they learn, to apply it to their work and then pass it along to others.

Encourage candor and dissent. Learning cultures feature flat hierarchies, high levels of engagement and openness. Tough questioning is welcomed. People go outside formal reporting lines to discuss ideas and issues without fear. In teams, there’s constructive paranoia about the pitfalls of groupthink.

Support risk-taking and “failing forward.” As long as people are taking acceptable risks, learning cultures support them, even when they fail. Tolerate, and even encourage, mistakes as long as they support learning and growth (as opposed to repeating the same error). “You can’t learn when you’re too comfortable and without the possibility of failure,” Ruyle explains.

David Clark “If you fear repercussions from failure, you will become risk-averse.”

Practice humility. When leaders and managers don’t take themselves too seriously, they’re more approachable, better listeners and more open to learning, instead of focused on confirming their personal views.

‘Live as if you were to die tomorrow.

Learn as if you were to live forever.’

—Mahatma Gandhi

Build teams, not stars. Foster creative tension by giving teams stretch assignments requiring them to innovate and master new skills. Reward and recognize teams rather than individual performance. People learn more when they are supported by others.

Keep units small and manageable. Small teams are better for learning. As structures grow and become more complex and formal, interaction and intimacy diminish, making learning and sharing more difficult, Hess says.

Create routines to stay on track. Fear, ego, complacency and arrogance block learning. Holding these traits in check requires constant vigilance and focus. At Bridgewater, employees complete daily checklists to keep them focused on learning and help them manage the thoughts and feelings that interfere with it.

Reward what you say you value. Learning cultures value “how” people do something as much as “what” they accomplish. At American Express, a growth mindset is embedded into the company’s performance management process. “Fifty percent of your score comes from how you went about doing your work,” Clark says.

Deliver metrics. Beef up your HR metrics dashboard. Include data gleaned from employee surveys about the quality of learning programs and their on-the-job applications. Track data on the number of employees served and programs offered. “Where is the cause and effect? Can your company point to a learning activity and demonstrate a clear relationship [to a business outcome]?” asks CEB’s Handcock.

Finally, model the behavior you’re seeking to achieve by becoming a lifelong learner yourself and continuously monitor outcomes of learning programs to ensure everyone is engaged and challenged.

“You can’t take your learning culture for granted,” Hess says. “Maintaining it requires rigor and daily vigilance.”

That’s a lesson every business leader should learn.

‘I always did something I was a little not ready to do. I think that’s how you grow.’

—Marissa Mayer Robert J. Grossman is a lawyer and a professor of management studies at Marist College in Poughkeepsie, N.Y.

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N E X T- G E N E R AT I O N C R E D E N T I A L S F O R H R P R O F E S S I O N A L S

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Myths About Employee Learning The vice dean of Wharton’s Aresty Institute of Executive Education discusses common misperceptions about corporate education—and how to get beyond them.

By Monica McGrath

IMAGE BY SHUTTERSTOCK.COM

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wenty-five years ago, Peter Senge, a lecturer at the Massachusetts Institute of Technology (MIT) and founding chair of the Society for Organizational Learning, was the first scholar to talk about the concept of a “learning organization” and the critical importance of learning for businesses. “It is through learning we re-perceive the world and our relationship to it,” he said. “Through learning, we extend our capacity to create.” Senge’s point was that organizations that don’t realign themselves to the opportunities that learning provides are not going to keep up. That’s as true today as it was 25 years ago.

Often, breakthrough learning occurs when an organization goes through dramatic change, prompting leaders to take the time to uncover what is not working when their company is struggling, or even failing. Yet many organizations are finding that dealing with the challenges posed by an increasingly complex global economy and advances in technology requires most of their time and energy, stifling opportunities to build a learning culture. Building such an environment, however, could not be more critical than it is Monica McGrath right now because of those very complexities.

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HR practitioners can be vital partners in developing effective corporate learning programs within their organizations.

Your role is to define the value of the learning experience.

Below are five myths about learning and insights that debunk them.

Do these statements ring true for your organization?

SPECIAL ISSUE

to be designed for “the heart, the mind and the feet.” In other words, organizations must create programs that stimulate learners emotionally, intellectually and behaviorally.

Examine the learning experiences you offer to your workforce and help employees see why time spent learning will add to their value and to the value of the organization.

People who learn and leave hurt the organization not because they are taking intellectual property or competitive information but rather because they are taking a mindset, and knowledge drives results.

Myth # Myth #

Myth #

Our employees don’t have time to engage in learning programs, especially if it takes them away from work.

Leaders with vast responsibilities will tell you that they learn the most when they have time to think about their work, their challenges and their values. Getting away from the day-to-day demands and experimenting with ideas has a value that may be hard to quantify. At work, employees find themselves bombarded with continuous e-mails, tweets, meetings and information overload that distract them from learning. Researchers at the University of California-San Francisco have even found that this constant stimuli hurts short- and long-term memory.

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If we offer our high-potential employees learning experiences, they will take that learning and leave.

This is a common fear—but what is really happening when you lose a highpotential employee? People leave when they don’t have the opportunity to practice, to innovate, to experiment with new learning and new ideas. The real question is, “Do we have an environment, a climate, where learning is valued?”

Silicon Valley is the perfect example of the kind of place where organizations are on the edge of learning all the time.

Businesses are focused on innovation and competition, and the corporate cultures support and value learning—it is a competitive advantage.

To be effective, learning needs to be experiential, not theoretical.

Effective learning is both. Organizations must embrace the experiential part of learning and give learners opportunities to apply theories based on evidence.

Employees want learning that is applicable to their day-to-day challenges. HR professionals must grapple with this duality. If theories are too simplistic or overly pedantic, learners lose interest and check out. Being a leader in today’s business world is daunting, and being in an environment that helps deepen our understanding of business realities, and what to do about them, is both exciting and stimulating.

Take decision-making theory, for example. As we start to look at the number of decisions leaders make every day and examine how they came to each decision, we begin to deepen our understanding of the role personal bias plays in virtually every decision we make. That’s when

May 2015

4/7/15 1:32 PM

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the classroom comes alive. When people walk through the evidence and reflect on their own decision-making, it’s surprising. Everyone has a practical takeaway.

The next decision he or she makes will be much more informed.

Myth #

SPECIAL ISSUE

people who registered for online courses earned a certificate of completion in two years. While it might be convenient to learn away from peers—and reduce initial awkwardness—MOOCs do not capitalize on the richness of learning from others and of reflecting on one’s unique approach to leading. A well-designed online program includes interaction between teams, small groups and faculty.

Myth #

Employees learn best online because they don’t have to worry about looking stupid in front of their peers.

Creating learning experiences in the classroom and on the job gives learners a chance to let down their guard and actively engage in learning. Among executives, there is a subtle, often unspoken sentiment that they have a lot more to lose if they show that they still have things to learn. At Wharton’s Aresty Institute of Executive Education, when we get a group of senior executives in a classroom of peers, their image and self-importance often accompanies them into the room. I often wonder if the popularity of massive open online courses (MOOCs) is driven partly by the reluctance of many adults to reveal just how much they don’t know.

But there are a lot of questions about the effectiveness of MOOCs. A recent study by MIT and Harvard found that only 5 percent of the more than 841,600 48

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To be a learning organization, we need an initiative around it.

At many organizations, a large number of new initiatives are rolled out in conjunction with the latest trend in training.

Learning is not something you can package into a program; it’s part of an organization’s culture. It is something you must do every day. To think that someone can operate in a leadership role without learning from his or her mistakes and embracing new ideas is shortsighted. Leaders learn from their experiences, as researchers Michael Lombardo, Morgan McCall and Ann Morrison detail in their book, The Lessons of Experience: How Successful Executives Develop on the Job (Free Press, 1988). They found that one of the key

Case Study: Google Marketing Academy To build on Google’s innovative learning culture, Wharton’s executive education program teamed up with the search engine giant to create the Google Marketing Academy. The goal of the academy is to “get out of our own selves and really understand the world outside our own company,” says Suzanne Martin, head of global people development, brand and marketing at Google.

In the past six years, the academy has hosted nearly 1,000 “Googlers”—the company’s name for its employees—for a six-month program that includes two live sessions and an on-the-job practicum. “At Google, we believe learning is a process, it’s not an event. It involves feedback, reflection and practice and happens over time,” Martin says.

Google leaders also take the approach that learning is social. “We learn from others and through teaching others and find support in community. Everyone who comes to Google comes with a learning hat and a teacher hat—they have to teach as much as they learn,” Martin says, referring to the company’s g2g, or “Googler to Googler,” program that puts employees in teaching roles.

reasons executives were derailed on the job was that they quit learning.

Maybe the final myth is this: HR professionals are experts in learning, so they don’t need to know anything more about it. As talent management experts, HR must be role models for learning. In fact, no matter how successful and innovative you are, it is critical to think about and reflect on your own approach to learning and to determine if your organization demonstrates a culture that rewards and values people who learn.

Monica McGrath is vice dean for the Aresty Institute of Executive Education at the Wharton School, University of Pennsylvania.

She is also an adjunct associate professor of management. McGrath has taught and coached senior executives for more than 20 years.

May 2015

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THE

NEW

G R A D U AT E

Online learning is taking off.

How can you discern between a reputable degree and a virtual sham?

ILLUSTRATION BY MICHAEL MORGENSTERN FOR HR MAGAZINE

By Tamara Lytle

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he Internet has enabled people to personalize just about everything—from the articles that show up in their news feeds to the music playing through their earbuds. Now virtual classes from forprofit online universities such as the University of Phoenix as well as from traditional brickand-mortar institutions are becoming the iTunes of education. And it’s time for HR to start listening.

“Distance education is bringing about a new revolution where students are putting together their own playlist of curriculum,” says Leah Matthews, head of the Distance Education Accrediting Commission,

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which evaluates online degree programs. “Someone who sits for four years on a nice, leafy New England campus is going to become a thing of the past.”

While most institutions of higher learning aren’t on the verge of closing campuses just yet, online degrees are undoubtedly playing a growing role in the new landscape of education.

About one-eighth of students take their higher education courses at a distance (online or through video, satellite or correspondence work), while another eighth take at least some classes at a distance, according to Russell Poulin, director, policy and analysis, for the Western Interstate Commission for Higher Education Cooperative for Educational Technologies, a Boulder, Colo.-based organization that focuses on best practices and technology for distance learning.

“An increasing number of people will come into the workforce whose education was based on online learning,” says Gerry Crispin, principal and co-founder of CareerXroads, a New Jersey-based talent acquisition consulting firm.

That means recruiters and other HR professionals need to be

Largest Online Universities Number of distance education students per institution (2013).

1 2 3 4 5 6 7 8 9 10

University of Phoenix

→ 207,060

Liberty University

→ 64,503

Ashford University

→ 57,235

American Public University System

→ 55,422

Kaplan University

→ 52,131

Walden University

→ 51,016

Western Governors University

→ 46,733

Grand Canyon

University

→ 45,496 → 39,897

Excelsior College Capella University

→ 34,007

Source: Russell Poulin, WICHE Cooperative for Educational Technologies.

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‘An increasing number of people will come into the workforce whose education was based on online learning.’

—Gerry Crispin, CareerXroads

able to determine the value of online degrees, which historically haven’t carried the same cachet as traditional degrees. Some HR professionals are understandably skeptical of distance education programs—perhaps because they have seen one too many latenight infomercials making claims that sound too good to be true.

To be sure, unaccredited “degree mills” do exist, but so do legitimate online educational offerings. Companies that discriminate against candidates simply because they have online degrees overlook a diverse pool of potential hires. “Corporations that miss out because of their bias will be the losers,” Crispin says.

The Online Revolution Interest in online learning is growing rapidly, while interest in traditional education is waning. From 2012 to 2013, distance education enrollment rose 1.8 percent, compared with a drop of 4 percent in overall higher education enrollment, according to the U.S. Department of Education. There were 5.5 million distance education students in 2013, according to the department.

But that figure may undercount the total online student population because of the way some schools report their enrollment.

One big reason for the trend toward online learning is that it is filling a niche that until recently hasn’t been addressed by traditional education: the need for a flexible, on-your-own-schedule approach that works well for nontraditional students—older people, those with families, full-time workers, lower-income students, minorities and others, says Gary A. Berg, associate vice president at California State University Channel Islands (a fouryear public university near Los Angeles) and author of Lessons from the Edge: For-Profit and Nontraditional Higher Education in America (Praeger, 2005), which took an in-depth look at the University of Phoenix, a for-profit institution.

At for-profit Ashford University, 49 percent of the students are minorities, 72 percent are female and 25 percent are associated with the military, according to Lora Reed, assistant professor at Ashford’s Forbes School of Business. Ashford started in Iowa as a traditional institution in 1918, but now the majority of its students are online learners. Reed teaches virtually from her home

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near Tampa Bay, Fla. Other drivers of the trend toward online learning include the following: • Financially squeezed public colleges and universities are looking for new markets. So many elite public and private schools now offer online education, which has improved the reputation of online learning.

• Improved technology and bandwidth over the past decade have allowed widespread access to online learning.

• People, especially ‘digital natives’ who have grown up with technology, have become accustomed to integrating the Internet into many areas of their lives.

Questions to Ask About Online Degrees ■■ ■■

■■

■■

■■

Questionable Practices While online degrees are becoming more common, some online programs have prompted concerns about “degree mills” that are more focused on taking students’ money (and their federal aid) than on providing quality education.

Some bad actors have been accused of having poor instructors, few support services for students and low graduation rates. For-profit schools, in particular, have faced scrutiny from the federal government. Sen. Tom Harkin, D-Iowa, former chair of the Senate committee that oversees education, led a 2012 investigation of for-profit schools and has introduced legislation requiring more oversight and accountability from schools. “My investigation made clear that taxpayers have been making a huge annual investment in for-profit colleges that continue to leave millions of students with high debt but little increased earning potential,” Harkin stated.

For-profit schools are, by definition, motivated by money, while nonprofits and public schools tend to focus more on students’ learning, says Linda Livingstone, dean of the George Washington University School of Business in Washington, D.C., and chairwoman of the Association to Advance Collegiate Schools of Business, an accrediting organization. While some for-profits may offer a good education, none are currently accredited by Livingstone’s association. In the absence of accreditation, employers need to seek out more information.

Facing increasing criticism, some institutions have changed.

There was a time when some for-profits would recruit pretty much anyone who could pay the tuition, regardless of whether the student had any chance of academic success. Nowadays, however, many such schools have become more selective. In fact, online degrees today are primarily earned not at for-profit institutions, which account for 32 percent of distance learning enrollment, but at private nonprofits and public colleges

Training & Development

■■

Is the school accredited?

Is the accrediting group recognized by the U.S. Department of Education or the Council for Higher Education Accreditation (www. chea.org)?

Does the curriculum satisfy the needs of the job you are filling?

Does the school have an .edu domain? The domains .org or .net could raise a red flag.

Who teaches at the school? What sorts of qualifications do instructors have?

Does the school have connections to professional boards that keep programs current and reflect changes in each field?

and universities, which together account for nearly 70 percent of online students, Poulin says.

How It Works So how do virtual courses work?

In the online world, “office hours” might involve phone calls with students, which is what Reed at Ashford does for her introduction to HR course. Assignments often include instructional videos or online reading, and the syllabus, lectures and homework are typically posted on a common digital discussion forum.

DeVry University, also a for-profit institution, uses a digital platform where students interact with the professor and each other via a chat function, e-mail and video, says Donna Rekau, assistant provost at DeVry, who has a master’s degree in human resource management. Study groups can occupy their own sections of the class’s online virtual space to work on drafts of projects together, students can check virtual grade books to see how they are doing, and faculty can post feedback through audio or video comments.

DeVry’s capstone HR class has the same course objectives, project requirements, grading and content as the school’s faceto-face class. Students are exposed to the same information whether they are sitting in classrooms in Florida or California or at home, Rekau says. DeVry tracks grades, completion rates May 2015

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and test results to compare online students to in-person counterparts and finds little difference, she says.

Some fields are better suited to online education than others.

Computer science and information technology are natural fits, says Berg, who sits on a California state board to develop online programs. But online learning might not be a good fit for health and science fields that require laboratory work or hands-on training.

“Learning to give a shot to a human being only works to a point online,” Crispin says. “At some point, you need to practice on a real person.”

‘As the workplace increasingly uses technology, it makes sense to have students who have shown through their online studies that they are technologically savvy.’

Valuable Skills In some ways, online learning may actually be more rigorous than the traditional sort. “You have to be an active, engaged learner,” Matthews says. Students need to be disciplined and self-motivated to meet deadlines.

And there’s no hiding in the back of the classroom without ever raising a hand. Online classes typically require participation, and it’s easier to track who is and isn’t weighing in when it’s all recorded in bits and bytes.

In this way, online education is not only mirroring what’s happening in the workplace but also preparing students for the emerging work environment. Employees are increasingly working at a distance, and online degree graduates already have proved that they can effectively communicate and engage online.

Online learning is “consistent with where we are going with employers and teams,” Reed says. Employers need people who are self-motivated and who can work independently and collaborate online with colleagues, including critiquing each other’s

—Donna Rekau, DeVry University

work—exactly the skills that online learning builds, she says.

And, “as the workplace increasingly uses technology,” Rekau says, “it makes sense to have students who have shown through their online studies that they are technologically savvy.”

What to Look For There are many ways for HR professionals to suss out the quality of a candidate’s online education, including by looking closely at transcripts and the school’s reputation, by testing for competencies, and by listening to what their HR colleagues have to say about the college’s graduates.

Shoddy or Reputable? A Key to Accreditation For HR practitioners trying to sort out the value of online degrees, the secret decoder ring is accreditation.

International. As companies become increasingly international, they will have the challenge of sorting out the merits of degrees from many countries. The Association to Advance Collegiate Schools of Business has begun looking at schools internationally. The group considers the quality of the faculty, the standards

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for admission, the quality of the education provided and the level of scholarly work done there. Some countries have government accreditors to help guide the way.

National. National accreditation groups primarily deal with vocational schools, religious institutions and other special institutions.

Regional. The U.S. is divided into six regions. Seven commissions offer regional accreditation that is recognized by the U.S. Department of Education.

Regional accreditation looks at an entire institution, not just a particular department. It’s a seal of approval that makes students at those schools eligible for fed-

eral financial aid. Regional accreditation is especially important for students with less specialized degrees, like English, that don’t require licensing exams.

Program. This type of accreditation covers a particular degree program within a school—say, the business school or a nursing program.

Not so credible. Technology has made it easy for so-called degree mills to set up their own “accreditation” that isn’t a valid guidepost to quality. When in doubt, the Council for Higher Education Accreditation (www.chea.org) is a good place to look for information about the relative value of accrediting organizations.

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A transcript might not mean as much for a potential hire long out of college, but, for recent graduates, it shows what they’re good at and what choices they made, says Barbara Brittingham, president of the Commission on Institutions of Higher Education of the New England Association of Schools and Colleges, a regional accrediting organization.

HR should evaluate a school’s academic reputation by looking at publicly available reports that list retention, endowment and graduation rates and where alumni get hired.

Employers often base their assessments of degrees on familiarity with an institution, whether it’s because a school is nearby or because the school’s sports teams are playing for championships. But that’s not the best gauge of quality.

Instead of gravitating toward the familiar, look at outcomes for graduates in the work world and check whether the school promotes its quality standards, whether the school website has any depth to it and, of course, whether it is accredited and by what organization.

It’s also valuable to ask why a candidate chose to pursue online education—it gives insight into the person’s background

Training & Development

and analytical skills.

Additionally, HR conferences are a great place to ask other HR professionals about how graduates of particular online schools have fared as employees.

More companies today are building tests for skills, knowledge and competencies that the candidate should have learned during college, and Crispin advises HR departments to test graduates’ competencies during the recruiting process. “Education is no guarantee of performance,” he says, “whether it’s traditional or online education.”

Still skeptical of online degrees? Look no further than elementary school to understand the future. Matthews says her 11-year-old son must comment on blogs as part of his regular assignments. “Distance education is closer than you think. It’s embedded in learning at all levels,” Matthews says.

HR must keep pace. We all need to be at least as smart as our fifth-graders.

Tamara Lytle is a freelance writer based in the Washington, D.C., area.

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May 2015

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ILLUSTRATIONS BY KEVIN MCFADIN | KEVINMCFADIN.COM

T

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By Fred Barstein

HR Guide to

Target Date Funds W

ILLUSTRATIONS BY KEVIN MCFADIN | KEVINMCFADIN.COM

hen it comes to discussing or selecting investments for their 401(k) plans, many HR and benefits professionals get intimidated. It’s not their area of expertise, as they focus on people and behavior, and the investment community does not make investments easy to understand, intentionally or unintentionally. But if HR professionals are intimidated, imagine how employees and participants in 401(k) or defined contribution (DC) plans feel. As Susan Power at Fidelity notes, “If the discussion about target funds are hard for HR professionals to understand, imagine how their employees feel.”

While it’s unlikely that HR professionals and DC plan participants will ever get a Ph.D. in investing, it’s really not necessary. But when it comes to Target Date Funds (TDFs), the fastest growing investment in DC plans and the most popular managed investment or balanced fund, it’s really important to get it right and have a basic understanding of how they work and what’s best for the company and individuals.

GROWTH OF TARGET DATE FUNDS Let’s start with why managed investments and TDFs in particular have become so popular and important in corporate-sponsored retirement plans. Most employees do not have the knowledge or inclination to manage their own investments or portfolios. It takes a basic understanding of which investments are good or performing, which changes from quarter to quarter; figuring out the Fred Barstein is founder and CEO of The Retirement Advisor University (TRAU), and The Plan Sponsor University (TPSU). TPSU conducts half-day training programs around the country at local colleges and universities designed to help plan sponsors effectively run their retirement plan and receive a nationally recognized designation – C(k)PF; TRAU trains financial advisors to work with their plan sponsor clients to run and improve their plans conducted at UCLA in collaboration with the Anderson School of Management Executive Education with successful candidates receiving their C(k)P designation.

right mix of assets to weather down markets and participate in good markets; an understanding of all the fees charged by the various investments; and then periodically rebalancing as certain investments take a larger share of the pie during certain market cycles.

The best analogy is trying to teach someone how to repair their car: While some people enjoy it (witness the growth of Morningstar), most would prefer to just drop their car off with a mechanic. TDFs allow plan participants to allocate most if not all of their investment decisions to a professional who manages a larger pool of money for many people, making all the decisions necessary while constantly rebalancing. No wonder target date funds have ballooned to over $700 billion in DC plans and nearly two-thirds of recently hired 401(k) participants invested in a balanced fund in 2013 compared to one-third in 1998, according to EBRI. Recent hires have more than three-quarters of their money invested in balanced funds like TDFs, accounting for 90% of their 401(k) account in 2013.

TDFs have grown substantially since 2006 when Congress enacted the Pension Protection Act (PPA), which gave employers safe harbor to use balanced funds like TDFs as the default option when automatically enrolling new or current employees in a DC plan.

The auto-plan, which can include auto-enrollment and auto-escalation, requires that the plan sponsor (that’s you!) pick a default investment on behalf of employees.

Before the PPA, many plan sponsors selected money market or very safe investments because they were concerned that if the default option (called QDIA for Qualified Default Investment Alternative) lost money, the plan sponsor might be liable. The PPA gave plan sponsors safe harbor if they use a balanced fund like TDFs and,

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because all you need to know is the age of the participant, it made for an easy decision.

TYPES OF TARGET DATES But not all TDFs are created equal, and they are not the only type of professionally managed investments available. TDFs have become the most popular type of managed investment because all you need to know is a person’s age and you can assign them the right fund— assuming that they will retire at 65, which is becoming a moving target as people live and work longer. As a person gets closer to retirement, the portfolio becomes more conservative because they have less time to recoup losses if the market collapses and they are more sensitive to risk. Younger people, on the other hand, have a longer investment time horizon.

“Through” funds assume that the person will continue to save and take more risk at retirement. Most investors were shocked when some 2010 TDFs (that assumed the investors would retire in 2010) lost as much as 40% in 2008. That’s because the fund assumed that the investor would continue saving and investing and recoup losses over the next few years, which actually happened—if they stayed invested. Not all people stayed in the funds, however, losing 40% of their assets while withdrawing their money, perhaps putting it into an annuity. Other funds lost as little as 10% because the glide path called for very conservative underlying investments, which fared better in the turbulent equity market of 2008.

Another decision is whether to use index or passive TDFs. Vanguard is well-known for passive or index investing, while Fidelity and T Rowe Price are better known for active investing. Index funds follow their benchmark (like the S&P 500), not trying to outperform the market, while active funds try to pick investments that will do better than the market—for a price.

The glide paths and asset allocation of index and active TDFs may be the same, but the underlying investments (the ingredients) are different. The benefits of index funds are chiefly in the cost, and they tend to be less risky; active funds may achieve alpha, defined as the return above the benchmark, which is called “beta.” What’s better?

Depends on who you speak with, but investors are moving more toward passive strategies overall, not just for TDFs. Morningstar’s Janet Yang notes, “Studies show that fees are the number one predictor of success.”

The riskiest day of a person’s life may be the day they retire.

TDFs have three basic elements: 1. “Glide path” or how much risk is being taken, which changes as investors get closer to retirement; 2. “Asset allocation,” or how much is being allocated to each type of investment, like equities and bonds; and 3. Underlying investments selected or the actual funds used.

If you were baking a cake, the glide path represents the type of cake you want, asset allocation is the recipe to make that cake and the investments are the ingredients. Simple, right? Except that nothing is simple in the investment world.

Within a TDF, there are so-called “to” or “through” funds; the difference between the two became painfully evident during the 2008 recession. “To” funds assume that the investor will stop investing or saving at retirement, and the funds are most conservative at an investor’s assumed retirement date—for example, a 2030 fund assumes that the person will retire and reach 65 on or around 2030. As Rich Weiss at American Century commented, “The riskiest day of a person’s life may be the day they retire.”

2

SELECTING A TARGET DATE FUND When selecting a TDF, it’s also important to understand the roles and responsibilities of your vendors or socalled service providers, which include: 1. Record keepers who keep track of the accounts and provide the underlying technology; 2. Money managers who manufacture the investments like TDFs; and 3. Plan advisors who consult on plan design and investments, advising the company and their employees. ➔

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Another analogy—this time using healthcare: The record keepers are the hospitals, the money managers are the pharmaceutical companies and the advisors are the doctors. Over 10 years ago, the record keepers were forced to offer more than just their own or proprietary investments, as consumers wanted more choice.

Chances are that the record keeper’s investment division was not good at all types of investing (the ingredients), so why not select the best in class helped by a plan advisor?

Morningstar Asset Flows US Open-end & ETF Target Date Funds, Include Obsolete Funds Currency: US DollarPeriodicity: Calendar Year

Fund Family Total Net Assets 2014-12 2014 Growth Rank by Assets

Total

1 Vanguard 2 Fidelity Investments 3 T. Rowe Price 4 JPMorgan 5 American Funds 6 Principal Funds 7 TIAA-CREF Mutual Funds 8 Wells Fargo Advantage 9 John Hancock 10 American Century Invest.

11 BlackRock 12 State Farm 13 Great-West Funds 14 Voya 15 KP Funds 16 USAA 17 Vantagepoint Funds 18 Schwab Funds 19 MassMutual 20 MFS

694,567,824,964 13.95% 192,727,613,277 187,318,095,879 122,287,071,732 28,509,818,086 27,536,898,656 25,736,293,828 22,153,923,137 16,763,928,812 14,995,837,024 12,604,128,211 7,140,235,096 6,228,336,384 6,132,244,971 5,911,484,544 4,091,414,483 3,960,260,127 3,657,393,426 2,951,987,585 1,980,368,863 1,880,490,843

16.00% 0.94% 20.23% 51.59% 47.41% 1.60% 21.70% 7.64% 13.42% 23.67% 12.17% 13.38% 15.23% -2.77% N/A 6.47% 8.18% 10.93% 32.53% 20.45%

© Copyright 2015 Morningstar, Inc. Date:1/21/2015 All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

Past performance is no guarantee of future results.

TDFs are going through a similar transition—the three

largest TDF providers are also record keepers with most of their assets in plans they service (see list). In fact, only one of the top 10 TDF providers, American Century, is not a record keeper and it is in 10th place.

So does it make sense to pick the record keeper’s TDF? Maybe, but not necessarily. In the other article in this supplement (see page 8), the future of TDFs and managed investments are explored. Like some other experts,

4

Alliance Bernstein’s Dick Davies asks the pointed question “What other asset category within a DC plan allows just one investment manager? There is a definite move away from bundling record keeping and TDFs.” Davies further asserts, “Target date funds will not bundle an industry that has been unbundling for the past 20 years.”

Not only is selecting a TDF an important investment decision, it is a fiduciary one as well, which the Department of Labor highlighted in its 2013 guidance on the selection of TDFs. Just picking a TDF because it is offered by the record keeper may not pass the smell test.

In addition, a vast majority of today’s most popular TDFs use only the manufacturer’s underlying investments or ingredients, raising the question of whether one money manager has the best in class for all asset categories. There are more and more open-architecture TDFs emerging, which only makes sense, but performance of one-fund-family TDFs is very competitive with open TDFs and there are some advantages of the TDF manager using only proprietary funds, as noted by American Funds’ John Doyle: “The building blocks need to work together, which requires a level of transparency of the underlying investments, which is harder to achieve with outside funds. Proprietary TDF managers are also less likely to chase a hot fund.”

Now that you understand how TDFs work and the various types, the real question is what’s right for your company. Though easy to use, selecting a TDF is more difficult than selecting any individual investment on your DC plan’s menu (called DIAs—Default Investment Alternatives). Those 10 to 20 DIA investments are selected to provide a diverse offering of well-performing funds with reasonable expenses from which plan participants can create and rebalance their own individual portfolios. Most experienced plan advisors are good at selecting and monitoring these investments after creating an IPS (investment policy statement—a template to judge investments deemed suitable for a plan) using third-party software that generates detailed quarterly reports using underlying data from firms like Morningstar. But TDFs are just one investment for all employees, even if they come in five-year increments. Franklin Templeton has actually developed a guide for plan sponsors to create a QDIA Policy Statement focused on TDFs that works in conjunction with the IPS highlighting their importance.

And TDFs have a different goal than individual investments—they are designed to help investors accumulate enough assets in their plan to replace a set percentage of income when they retire. So let’s step back. ➔

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What is the goal of a company’s DC plan? Retention and recruitment are important, as most companies offer a retirement plan and more employees—especially younger ones, most of whom do not have access to a pension or DB plan and do not believe that Social Security will be around forever—are very concerned about the quality of their employer’s retirement plan. Bottom line, plans should be judged on how successful they are in replacing participant income. While deferral rates and company matches may be more influential in achieving that goal, the quality of the investments are nonetheless critical.

Why are plan outcomes important? Because if employees have not saved enough, they will not retire, costing the company more for healthcare, disability and absenteeism than will younger employees, who may leave because they have less opportunity to move up. Arguably, financially secure employees will be more productive and more loyal if they think their employer is trying to help.

Selecting a TDF has more to do with the demographics of the company than the analysis of the performance of the fund. Factors to consider include: • Age of workforce • Whether a DB plan is available • Salary scale • Company match • Industry type • Turnover • Average retirement age • Health of plan, especially average account balances

critical role of helping their plan advisor understand the demographics, make-up and behavior of the employees to help that advisor select the right TDF. There are many tools that advisors use to analyze TDFs, but most are created by the TDF manufacturers themselves, which is troubling (see Progressive Insurance), and most tools analyze a TDF as if it were a simple underlying investment by looking at performance and cost primarily. As Morningstar’s Yang notes, “Target date funds have not been around long enough to see how they perform in different markets.” Glenn Dial at Allianz Global Investors stresses that “The next generation of target date fund tools will analyze what percentage of employees will make it to determine the reliability of the DC plan to replace retirement income.”

The first decision plan sponsors need to make is what type of cake you want to bake based on the needs and desires of the participants, then whether this recipe actually works, and finally whether the ingredients or underlying investments are any good. While most HR or benefits professionals rely on the help of an experienced plan advisor, they play a critical role in helping their advisor understand the employee base and then making changes as the company changes.

Bottom line, plans should be judged on how successful they are in replacing participant income.

The basic decisions include whether the TDF should take more or less risk depending on these factors (glide path) and whether most participants will take the money out of the fund when they retire (“to” or “through”). In a sense, each participant in a DC plan is running his or her own DB plan, having to decide how much to save, where to invest and how to make the money last. Most people are not equipped to make these decisions, so TDFs play the critical role of helping people to decide where to invest without their involvement. HR professionals play the

6

DOWNSIDE OF TARGET DATE FUNDS The downside of TDF are two-fold—at least. First, TDFs assume that everyone within a five-year age range has the same investment goals. In other words, if the CEO and her secretary are the same age, they both have the same portfolio. Insane, right? Also, most participants do not understand TDFs and think they are like any other investment on the menu, so they might pick different TDFs and augment them with funds available on the plan’s menu. In essence, they are subverting or overriding the decision making process of the TDF manager by adding other investments, or adding ingredients to the recipe that may ruin the cake.

So what’s the solution? As reviewed in the other article in this supplement on “The Future of Target Date

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Funds” (see page 8), some money managers, like Russell Investments, are customizing the managed investment based on a participant’s age, salary, account balance, deferral rate, match and access to a DB plan. Others, like Fidelity, are adding a managed account that uses readily available data as well as consultation with the investor to craft a personalized portfolio that is automatically rebalanced. TDFs are not perfect, but they have provided an important steppingstone to helping investors make wise and reasoned investment decisions. However, they are just a part of the process, not the destination.

To help participants use TDFs correctly, some plans employ the “all or nothing” method, meaning a person invests either all of his or her money in a TDF or none of it. A less harsh and paternalistic method is presenting the investment choices thoughtfully. The first decision (or page or screen) presented to participants is whether they want a professional to manage their money. If yes, all assets are put into the plan’s QDIA, which is typically a TDF or other type of balanced fund. If not, they go to the page or screen listing the investment choices available on the menu and they can craft their own portfolio. Finally, many plans offer brokerage accounts where a myriad of funds

Training

are available. In his seminal book, “Save More Tomorrow,” UCLA behavior finance Professor Shlomo Benartzi, credited with inspiring the auto-plan and the 2006 Pension Protection Act, estimates that 90% of investors should use professionally managed funds, 9% will tinker with a plan’s available investments and 1% will use a brokerage account.

TDFs and professionally managed investments will soon account for the majority of all assets in DC plans, like 401(k)s, for good and obvious reasons. Though HR and benefits professionals are not and should not try to be investment gurus, they need to understand these managed investments and select the right one for their company with the help of their plan advisor based on the demographics and behaviors of their workforce. The investment decisions made will have a profound effect not only on whether more of a company’s employees will be able to retire successfully, but also on whether the company is successful based on the well-being of its most important asset—productive and focused employees who retire successfully. Though DC plans remove the liability and responsibilities of DB plans, the same needs remain—people need help. Selecting the right TDF is a big part of getting employees to a successful retirement. ➔

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By Fred Barstein

The Future of

Target Date Funds E

ven though Target Date Funds (TDFs) are relatively new, becoming popular within the last 10 years, it’s important to think about them not as a destination but as a milestone in the evolution of defined contribution (DC) plans. They are part of the evolution of the movement away from employer-managed defined benefit (DB) pension plans to employee-directed 401(k) plans. In DB plans, investment decisions are made on behalf of the plan’s participants; in DC plans, participants are left to make their own decisions, with most participants ill-equipped or uninterested. With TDFs, participants are able to delegate to investment professionals the important investment decisions and rebalancing as retirement nears. And though TDFs have been wildly popular, reaching almost $1 trillion in assets, they are very crude instruments that put all investors set to retire within five years of each other in the same portfolio. Certainly we can do better.

The reality, however, is that crude as they may be, TDFs are still fairly effective, providing good results for a large percentage of people. So as we review alternative professionally managed investments, it’s important to be mindful of whether the costs, time and effort will be worthwhile and, if so, for which groups.

There are two distinct roles that professionally managed investments can play. One is to help people accumulate assets. The second is to generate retirement Fred Barstein is founder and CEO of The Retirement Advisor University (TRAU), and The Plan Sponsor University (TPSU). TPSU conducts half-day training programs around the country at local colleges and universities designed to help plan sponsors effectively run their retirement plan and receive a nationally recognized designation – C(k)PF; TRAU trains financial advisors to work with their plan sponsor clients to run and improve their plans conducted at UCLA in collaboration with the Anderson School of Management Executive Education with successful candidates receiving their C(k)P designation.

8

income, either through a guaranteed stream of income for life or at least an even distribution of income over a set period of time. Money managers are trying to evolve TDFs in two ways during the asset accumulation phase—customize them for the unique needs of an entire company based on the employee population and behavior and, secondly, customize the investment for each individual. For retirement income, there is a lot of smoke but very little fire, which is not surprising given TDFs’ brief history. But technology and demand as well as the investment community’s search for the next new thing will make both retirement income and TDF customization a reality within the next three to five years.

CUSTOMIZED TDFS In the companion article to this supplement, “HR Guide to Target Date Funds” (see page 1), the different types of TDFs are explained, including “to” or “through” funds and passive or active funds. TDFs usually come in five-year increments so that the provider has a full suite of offerings, but the important question is whether they match the needs, demographics and behaviors of a company’s employee population. With so many DC or 401(k) plans using their record keeper’s proprietary funds, it raises the question of whether companies have conducted a thorough analysis to make sure there was a match or whether there was any process at all. Some experts believe that selecting the Target Date Fund is now more important than the selection of a record keeper just as picking the movie is more important than the theater.

Even with a thorough analysis, there may not be a good match out there for a plan. Though there are a lot of TDF providers, there are only a handful with significant assets and capabilities, with each making decisions about the

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S PECIA L A DV E RTIS I N G S EC TION

construction of their TDF suite for all clients. So does it make sense for a DC plan to work with a TDF to create customized investments to meet the needs of its unique employee base?

Fidelity’s Director of TD Strategies Matthew Jensen advises, “Plans should start with the goals of their DC plan. Is it central to their employees’ retirement? How do they save?” Lori Lucas at Callan Associates notes that “Plans should start with what percentage of income they intend to replace and determine whether that glide path gets them to that percentage, taking into account the wage scale and turnover at the company.”

The percentage of plans offering custom TDFs almost doubled in 2014 from 11.5% to 22.3% at the expense of record keepers’ proprietary TDFs which dropped from 47.5% to 28.7% according to Callan Associates. For larger plans or those with more than $1 billion in DC plan assets, the driver can be cost. Exxon-Mobil, for example, can create an index fund that follows the S&P Index for 0.25 basis points where 100 basis points equals 1%, according to Lew Minsky, Executive Director of the Defined Contribution Investment Industry Association (DCIIA). So larger plans can attract TDF providers to customize their glide paths, asset allocation and underlying investments to meet the unique needs of their employees for less than what it costs for off-the-shelf products.

The best of both worlds.

But smaller plans will be challenged to attract TDF providers to customize for less or even the same as what they charge for their current products. Fear not—there are some alternatives that are readily available, with more to come. BlackRock, with over $4 trillion in assets under management and a leader in both active as well as passive investments, offers regular TDFs under its Life Path brand. But it has started offering three flavors of each five-year increment through a larger advisor group, NFP Retirement, so plans can select an aggressive, moderate or conservative risk model for their 2015 TDF, for example, based on the perceived needs of their

employees. In partnership with MassMutual, an industryleading record keeper servicing smaller and mid-sized plans, advisors can select from the three risk models for each client as well as select and change the underlying investments, with BlackRock overseeing the glide path and asset allocation models. Both of these models offer a level of customization that would meet the needs of most plans.

Another model similar to BlackRock that is gaining popularity among very experienced plan advisors is to work with an established asset allocator like Morningstar or Mesirow to create models (glide paths and asset allocation models), with the advisor selecting and monitoring the underlying funds acting as a 3(38) or fiduciary who has been delegated full investment discretion. With this model, the advisor works closely with a plan and especially the HR professional to design a suite of managed investments uniquely suitable for the company. The 3(38) solution should only be used with highly experienced advisors that have significant assets and plans under management.

It’s really too early to tell whether these customized solutions perform better than off-theshelf TDFs since most have a very short history. Mutual funds usually are not even considered until they have at least a five-year history, but TDFs are portfolios, or a basket of funds, rather than a single investment, so the history may not be as important. In addition, mutual funds are regulated and overseen by the SEC, whereas most customized funds are made available through collective trusts or separately managed accounts that have less oversight and transparency.

So if the knock on TDFs is that not all people born within five years of each other have the same investment goals, even if a TDF is customized for each company, do all people in the same company of a similar age have the same goals? And is it feasible to create a customized TDF for each individual? Russell Investments, in partnership with a technology company, has developed a product

For retirement income, there is a lot of smoke but very little fire.

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called the Adaptive Retirement Account, which crafts an investment for each plan participant based on age, salary, account balance, deferral rate, match and even gender. The product assigns each person an investment that has the necessary level of risk to help him or her replace sufficient income at retirement. According to Josh Cohen, Managing Director at Russell, “Part of our service is on-track reporting showing the impact of different deferral rates on retirement income. The tool can send instructions to automatically escalate deferral rates to keep the participant on track.”

With technology that seems to anticipate our needs tracking every movement, it’s only a matter of time before investing becomes automated. Russell’s service needs the cooperation of the plan’s record keeper to get the necessary participant information and make changes.

So far, most record keepers have been resistant, especially those that have their own TDFs. Wonder why.

And of course the ultimate customization is a managed account where the portfolio is designed specifically for an investor. There are additional costs and it may take involvement from the investor, but costs are coming down and so-called robo-advisors are springing up, making it easy and cost-effective. Schwab recently launched Schwab Intelligent Portfolio, an automated managed account with no direct expenses to the investor. Fidelity is augmenting its off-the-shelf TDFs with managed accounts for people that need or want them. Fidelity’s Jensen asserts, “Target date funds are suitable for the vast majority of plan participants, but some people need customization afforded by managed accounts. The issues are cost and engagement.”

is that the underlying investments are all proprietary funds. It seems to make sense to be able to select best of breed for each asset class to maximize returns. Jeffrey Snyder and colleague Denis Burns, consultants at Cammack Retirement, in a 12/24/14 article in Money Management Intelligence, predict, “Existing asset managers [will] broaden their product offering by including outside managers who may complement their core strategies.”

Alliance Bernstein is a pioneer in so-called openarchitecture TDFs, teaming with Morningstar to make manager selections. AB creates the glide path and asset allocation, with Morningstar making the selection of funds from partners that include well-known managers like Franklin Templeton, MFS, T Rowe Price and AQR along with AB which requires 30% of the assets. With limited history, there’s no proof that open TDFs consistently perform better than proprietary products, which have greater transparency with all managers under one roof unlikely to chase the next hot fund.

The passive strategy or index fund v. active fund debate continues, with more money moving to passive as they are much less expensive. Morningstar’s Janet Yang notes that “Studies show that fees are the number one predictor of success.” In fact, the AB open TDF product allocates 20% to ETFs, another form of passive investing.

BlackRock, working in partnership with Pensionmark, a large RIA focused on DC plans, created a set of customized TDFs using so-called smart-beta, or funds that do not follow traditional market-weighted indices. So what’s best? The answer seems to be a combination of active and passive, with certain asset categories like large cap value funds (funds that invest in mature, larger companies) better suited for passive strategies where it is so hard to beat the index or beta, whereas passive funds may make more sense for small cap growth funds. While HR professionals need not go too deep into the weeds on this debate, most experienced advisors use a combination of active and passive, which seems to make sense for TDFs as well. ➔

Studies show that fees are the number one predictor of success.

ALTERNATIVE MODELS With so much money flowing into TDFs and more predicted, new models are springing up and will continue to. Another knock on the current crop of TDF providers

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Finally, there’s a growing use of alternative investments inside TDFs, including private equity, hedge funds, commodities and real estate, all investments that larger pension funds regularly use and a trend that Cammack consultants Snyder and Burns will move to TDFs. Alternative funds are rarely made available as standalone investments in DC plans for a number of reasons, including limited liquidity and complexity, just as ETFs are rarely offered because of trading issues. But both ETFs and alternatives may be appropriate parts of a diversified portfolio with managed investments like TDFs. RETIREMENT INCOME UCLA Professor Shlomo Benartzi likened the current DC plan model to people on an airplane and right before they reach their destination, the pilots parachute off, leaving the passengers to land themselves. There is a lot of innovation within DC plans to help people to enroll through auto-enrollment, get to the right deferral amount through autoescalation and then invest wisely through professionally managed investments like TDFs. But what about when they retire? Which raises an important question for plan sponsors—should they care about employees after they retire?

If DC plans are meant to replace DB plans, then they should provide either guaranteed income for life or at least distribute income evenly. According to the DCIIA’s Minsky, “A small group of plan sponsors want to be proactive in post-retirement; a larger group would like to be but are concerned about liability. They need support from regulators.” Adds American Funds’ John Doyle, “Plan sponsors are concerned about the burden of maintaining records and don’t want to be liable for lost participants.

Perhaps that burden can be shifted to record keepers.” But more participants, even in retirement, means more assets, better buying power and lower costs. And with concern by regulators and the White House about

abuses in the IRA rollover market, it is expected that more plan participants will keep the money in their DC plan.

There are fundamental issues with retirement income products, especially those that guarantee income for life.

First, does anyone today know about the financial viability of a financial services company in 10, 20 or 30 years, especially after the 2008 market crash? Secondly, with people living longer, it’s harder to assess how much it will cost to provide income for life. These issues have driven up the cost of annuities used in conjunction with other investments within retirement income products, making them much less attractive. The DOL has recently blessed the use of annuities within TDFs, but most plan sponsors are waiting for safe harbor to protect them if the retirement income product, which might be part of a TDF or offered in conjunction, blows up and the former employee looks to the plan sponsor for relief.

Also, if a participant invests in a retirement income product, it is hard if not impossible to move that investment to another plan.

Finally, most people are reluctant to give up control of their assets even if income is guaranteed.

Put succinc tly, American Funds’ Doyle states, “The issues with in-plan retirement income products are cost and portability.

Most retirement income [products] are too complex, hard to get in and out of, [and suffer] from a lack of transparency.”

But before we bail on retirement income or TDFs that help people after retirement, there is growing need and demand to help investors, especially as the baby boomers shift into retirement. Alliance Bernstein’s Dick Davies was surprised to see at a 2015 Pensions & Investment Conference that “60% of the audience indicated that target date funds with imbedded annuities would be the most popular default option in 10 years. More plans are accommodating retirees and encourage participants to keep their money in the plan or even roll in assets from other plans.” ■

There are fundamental issues with retirement income products, especially those that guarantee income for life.

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Training & Development

SPECIAL ISSUE

Leading Learner

By Tamara Lytle

E

ven in a family of Ph.D.s, Pamela Puryear is an overachiever. Her education didn’t end when she obtained her doctorate. Learning has become central to her professional life—and she believes it should be integrated into every company’s DNA. Indeed, the thought leader and organizational development expert maintains that learning should be a priority at every level of a business and not just the purview of HR. Her passion for education started early. As a child growing up in New York City, she was influenced by parents who were Ph.D.s and college professors.

After earning her MBA at Harvard University, Puryear got involved in the real estate investment business for 10 years and then spent 12 years running her own consulting firm. But as her clients’ needs morphed from how to start a business to how to develop vision, structure, search and performance goals, so did her interests.

So she jumped headfirst into learning

Notes and Quotes Biggest challenge: “Finding enough hours in the day to embrace all the opportunities, personally and professionally, to advance my growth and development, and that of others.”

How she describes herself: “I’m fundamentally a builder, not a maintenance person. I like a blank slate.”

Personal: Single; lives in Chicago.

Diversions: Scuba diving, traveling, spending time with family.

Connections: DrPam@JoinDrPam.com.

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about organizational development, picking up a doctorate in organizational psychology. Soon, she was packing up her San Francisco consulting practice and heading to the Chicago area to join Hospira, a Lake Forest, Ill., company that makes injectable drugs and infusion treatments. A Harvard classmate brought her in as a consultant at first and then created an organizational development staff role for her in 2009.

Heather Mitchell, president and chief operating officer of Capri Capital Partners, a Chicago investment firm, says her friend is highly adaptable, so it was no surprise that she could switch from real estate to consulting to organizational development. “She’s very deft at managing and working with lots of different personalities and leaders and very complicated projects,” says Mitchell, who met Puryear as a client 10 years ago.

New Opportunities Working for a global company that has grown into a workforce of 19,000 employees was a big switch from being an entrepreneur, but Puryear was drawn to the blank slate of the new role.

“Health care is a dynamic field, and it’s obviously very important to deliver services in health care to patients who need them. There’s a real mission in the work,” she says.

Her current role as VP of organizational development and chief talent officer at Hospira Inc. encompasses performance management, talent management, succession planning, learning programs, corporate culture, engagement and diversity.

She sees organizational development as occurring on three levels: the individual level (including performance management and learning), the team level

(including creating high-performing groups and preparing leaders to head up teams) and the enterprise level (which involves engagement and culture).

One of the major initiatives Puryear has spearheaded at Hospira is Ignite: Spark the Fire Within, an employee awareness campaign designed to highlight the company’s learning value proposition. The campaign was launched in 2010 and now includes grants that employee teams can apply for to meet a learning and development need, as well as a career development toolkit to assist individual employees in managing their careers. The initiative is aimed at building excitement and understanding about the learning and development programs offered at Hospira and for its organizational development, performance improvement and career development offerings.

“The ultimate goal of Ignite is to engage employees to be accountable for their own careers and to understand that all of this programming is of value to them,” Puryear says.

And to Hospira.

The strategy is to drive individual performance and engagement and ultimately business results. “If everyone ups their game, it is going to drive value for the company,” Puryear explains.

Skills building and leadership development are a natural fit for someone who’s a change agent at heart, says Puryear’s longtime friend Nancy Sims.

“She’s a big-picture thinker, and she has always looked at how change can affect organizations,” Sims says.

Instead of pushing mandatory learning programs, Puryear has relied on word-of-mouth to drive interest in learning opportunities at Hospira. Her programs for directors, called Leading@

PHOTOGRAPH BY REGINALD T. PAYTON FOR HR MAGAZINE

For Pamela Puryear, VP of organizational development and chief talent officer at Hospira Inc., a learning culture is just good business.

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Hospira and LeadingGrowth@Hospira, are in high demand. More than 12,000 employees have participated in the development programs Puryear has introduced.

Although she isn’t overly concerned about metrics for the programs, Puryear does see evidence that they are delivering return on investment. “The metric I look at is, if we offer workshops, do people come?” (And do business leaders within the company want to make the investment to send their people?)

Customer-Centric Focus

PHOTOGRAPH BY REGINALD T. PAYTON FOR HR MAGAZINE

Puryear says one reason for the success of Hospira’s learning programs is that course ideas often come from the company’s business leaders themselves. Her emphasis on what customers want is reminiscent of her days as a consultant—a role where you have to lay out solutions and trust that the client takes the advice. “We’re not HR Inc. This is Hospira Inc. It’s not about HR. It’s about what can HR do to enable the business to be successful,” Puryear says.

Obstacles to organizational learning include scarce time and money, so collaboration with business leaders is especially important, she says. Her experience drumming up business and listening to clients as a consultant has been valuable in shaping her approach to developing Hospira’s learning strategy.

“Trying to get to the root of what causes pain in a consumer-centric focus is what I bring to the job,” Puryear says.

When a manufacturing executive asked her to look at workplace culture in the plants, she developed a comprehensive culture transformation program that has been her focus for the past two and a half years. Part of the project includes workshops for employees called MakingADifference@Hospira that focus on how to lead people to develop effective behaviors that drive value for the company. Puryear reinforces those objectives with half-day May 2015

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Training & Development

sessions she calls “booster shots” that remind attendees of the company’s goals and strategy.

A Lifelong Learner Puryear’s professional efforts are backed up by her personal willingness to keep learning. “She’s not an individual who becomes complacent. She’s all about continuous learning and skills building,” says Sims, president and CEO of the Robert Toigo Foundation in Oakland, Calif., a nonprofit that offers fellowships to minorities interested in financial services careers. Recalling the years when Puryear consulted for the foundation, Sims says she would shake her head in wonder each time Puryear came in telling of her plans to embark on some new project, like learning to scuba dive.

SPECIAL ISSUE

Puryear also sets an example as an HR leader by modeling a healthy balance between her personal and professional life. She takes time to travel and be with her close-knit family and friends. Whether it’s a work trip that leaves her extra days to explore the area or a diving trip to Fiji, Puryear loves to soak up different cultures and explore the world. Her father, who taught entrepreneurship and management at Baruch College of the City University of New York, spent part of his career as an executive at the Ford Foundation. His work provided Puryear with opportunities to nurture her passion for travel from a young age.

Puryear’s father also instilled in her the confidence to apply her talents to what interests her.

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Even before returning to school to earn a Ph.D., Puryear was on a learning quest. Curiosity about color and lighting led her to spend evenings working toward a certificate from the University of California, Berkeley, in architecture and interior design. Today, her Chicago condominium is filled with colorful walls and a carefully curated personal art collection.

“I have a creative mindset. I don’t think I do things the way everyone else does them,” Puryear says. “In the business world, a creative mindset sometimes helps me innovate new ideas or better solutions to address business needs.”

Tamara Lytle is a freelance writer in the Washington, D.C., area.

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www.shrm.org/trends

Trend Watch

Employees Are Happier, to a Degree More employees are satisfied at work, but often not with what matters most.

By Jen Schramm

W

orkers are feeling better about their jobs than they have in years, but that doesn’t mean employers can rest on their laurels. With unemployment down and more HR professionals having difficulty recruiting candidates for strategic positions, organizations need to step up their game in order to attract and retain the best talent.

Last year, 86 percent of employees said they were at least fairly satisfied with their current job, an increase of 5 percentage points from 2013 and the biggest jump since 2002—the year the Society for Human Resource Management (SHRM) began fielding its annual Employee Job Satisfaction and Engagement Survey.

Improved economic conditions may be helping employees feel more secure in their jobs—a key to job satisfaction, especially during bad economic times. But today it’s not job security that employees value most, according to the results of SHRM’s latest job satisfaction survey, which were released in April. Instead, “respectful treatment of all employees at all levels” and “trust between employees and senior management” were most important.

Unfortunately, however, employees aren’t very satisfied in those areas, and they’re even less satisfied in other areas that have traditionally been important to them. For example, they appear to be the least satisfied with the ability to advance in their career. Only about 1 in 5 employees are very satisfied with their job-specific training (22 percent), their career development options (21 percent) and career advancement opportunities in their organizations (20 percent).

Dissatisfaction with training and career development is likely a residual effect of the recession, which led many

organizations to slash their budgets for these programs. In many cases, the cuts were supposed to be temporary, but they remained in place due to the length and depth of the economic downturn. As a result, many employees spent a good chunk of their prime career years effectively at a standstill.

With the job market picking up steam, many of those who had been playing it safe by accepting limited career progression in exchange for job security will want to make up for lost time—which may lead to increased turnover and the loss of high-potential employees. Organizational leaders can alleviate this by showing a renewed commitment to the career development of their employees.

Of course, each organization is

unique. HR professionals must be proactive about discerning which job satisfaction factors matter most to their employees. Often, the best way to begin is by focusing on a limited number of priority issues. Involving employees in finding solutions and giving them the chance to make suggestions are important ways to address areas where job satisfaction is low. The recession and ensuing slow jobs recovery may have made some organizations forget about the importance of keeping their employees happy. But complacency just isn’t an option anymore.

Jen Schramm is manager of the Workforce Trends program at SHRM.

Job Satisfaction Disconnect Employees aren’t very happy with several of the most important factors affecting job satisfaction.

72%

Respectful treatment of all employees at all levels

33% 64%

Trust between employees and senior management

28%

Benefits

27%

Compensation/pay

63% 61% 24%

Job security Opportunities to use your skills and experience in your work Relationship with immediate supervisor Immediate supervisor’s respect for my ideas

59%

32% 34%

58% 40% 56% 37%

Workers Who Rank Factor as “Very Important” Workers Who Are “Very Satisfied” with Factor Source: SHRM 2015 Employee Job Satisfaction and Engagement survey report.

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58%

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HR Technology

Success Networks

Organizations’ ability to see—and analyze—connections outside formal structures is increasingly important to maintaining strategic business relationships.

By Stephen Garcia and Greg Wallace

O

rganizational networks, not hierarchies, define business success today. People share ideas, make decisions and solve problems by forging a network of relationships. But leaders and others in the business often don’t understand how these important connections work, limiting their ability to target, measure and adjust corporate strategies for maximum impact. To be successful business partners, HR professionals must learn how to analyze these organizational networks to maximize the return on human capital.

recommendations on improving organizational effectiveness.

Next, define the project scope for your analysis. For example, are you targeting the North American division, the marketing function, the entire company or some other group? And what are the relationships of interest—problem-solving relationships, decision-making relationships or other kinds of relationships?

Here are three ways HR can apply an organizational network analysis: To identify emerging leaders. Traditionally, emerging leaders in an organi-

With these decisions made, you can begin collecting network data. This data can be gathered passively (for example, by analyzing historical e-mail traffic) or actively (for example, by asking employees, typically via a Web-based survey, who they communicate with most frequently about different topics).

Once the data are collected, use software to map the network and analyze its characteristics. This will become the basis for findings and

zation are identified from the top down.

Executives select the up-and-comers they believe are best-suited to lead the organization in the future. Often, HR provides historical performance data to aid executives in the identification process.

While executives undoubtedly have an important role to play in identifying emerging leaders, their perspectives can be skewed. Often, senior leaders are several levels removed from an organization’s front lines. In addition, they may

Application

Aside from formal organizational structures, people create their own networks at work in order to solve problems, make decisions and enlist personal support.

It is through these connections that the real work often happens. Progressive HR leaders are applying organizational network analysis (ONA) to gain insights into these powerful interactions.

ONA is a method for mapping, visualizing and analyzing the informal networks of people within organizations. While many organizations have conducted some form of ONA for years, more-sophisticated analyses have become available only recently, thanks to increased computing power and easyto-use software.

How to Conduct an ONA The first step in conducting an ONA is to identify your business objective.

Do you need to increase collaboration between departments? Do you want to identify emerging leaders? ©2015. International Association for Human Resource Information Management. Used with permission.

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What Are Organizational Networks?

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Case Study: Westwood Professional Services Westwood Professional Services Inc., a multidiscipline survey and engineering firm based in Eden Prairie, Minn., conducted an organizational network analysis (ONA) of one of its business units following a period of rapid growth.

Business Challenge

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Kevin Larabee is vice president of HR for Westwood.

In his role, he looks to support the organic rela-

tionships that underpin the firm’s creative problemsolving with just enough formal structure to ensure efficiency—and he wanted help. “We believe that if we put smart, creative people together in one room, great ideas happen, successful projects result, and we save our clients time and money,” Larabee says.

How ONA Helped Larabee and his team

be prone to identify only people similar to themselves, a common selection bias.

By contrast, an ONA uses a bottomup approach. By asking employees who they turn to for help in solving problems, making decisions or increasing their energy, for example, a picture emerges of those associates who are most critical to the organization’s success. Often, at least half of the employees named as having significant levels of influence come as a surprise to senior leaders.

To develop employees. More than ever, leaders’ success depends on their ability to build and maintain strategic relationships. That reality means new leadership competencies are needed.

These include the ability to manage in a matrix environment, lead without authority, break down silos and collaborate across functions.

An ONA can provide individual employees with an assessment of their personal networks. It can also analyze

deployed a Web-based employee survey to uncover work connections within the business unit and to define the degree to which members of different subteams collaborate. The team then worked to overlay proposed organizational charts on organizational network data to determine where connections between managers and their reports were strong, weak or nonexistent.

dimensions that show how well a leader’s network supports skills such as creativity, influence, execution, positivity and resiliency—key traits that contribute to leaders’ success.

To retain talent. An ONA can serve as an early-warning system for two types of employees at risk of leaving the company: people who have become disengaged and those on the verge of burning out.

The analysis identifies disengaged employees by assessing their relationship with their direct supervisor, their access to personal support at work, and the degree to which they are engaged in the larger network of problem-solving and decision-making.

Research has shown that employees who do not enjoy a strong relationship with their boss, lack personal support and are not plugged into the larger network are much more likely to leave than their peers. In addition, the workers who everyone seeks to connect with

Coined by organizational design expert Jon Husband, the term “wirearchy” means a dynamic two-way flow of power and authority, based on knowledge, trust, credibility and a focus on results.

It is enabled by interconnected people and technology.

Results As Westwood continues to grow, the company looks to Larabee to make sure the organization’s networks are aligned to achieve its business goals.

Based on the ONA, “We immediately undertook targeted team-building and organizational design measures to strengthen our network,” Larabee says.

can become overwhelmed, increasing their likelihood of leaving. By applying an ONA, HR can intervene in such situations before it’s too late.

Whether your top priority is identifying emerging talent earlier, developing key leadership skills or making sure employees are engaged, insights from an organizational network analysis will radically increase your visibility and help enhance the impact of all your programs.

Stephen Garcia, Ph.D., is a partner at Philosophy IB, a management consulting firm that achieves meaningful and sustainable performance improvements by bringing clients’ strategies to life. He can be reached at stephen.garcia@philosophyib.com.

Greg Wallace is sales and marketing director for SYNAPP, a Web-based predictive people analytics solution based on organizational network analysis.

He has 20 years of experience in B2B technology marketing.

He can be reached at greg.wallace@ philosophyib.com.

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THE PROCESS IS SIMPLE AND FREE. If you are a current holder of an HR generalist certification* in good standing, or obtained your certification by January 31, 2015, you are eligible for SHRM’s new certification — at no cost — by completing the following steps by December 31, 2015. Any professionals who have obtained a generalist certification after January 31, 2015, will not be eligible for the online tutorial pathway and instead can take the SHRM certification exam during the spring or winter exam window.

It’s Easy to Get Started STEP 1

Go to shrmcertification.org/pathway

STEP 5

Agree to abide by the SHRM Code of Ethics.

STEP 2

Create an account and select “Online Tutorial Pathway.”

STEP 6

STEP 3

Affirm that you hold a valid HR credential.

Access and complete the online tutorial focusing on the SHRM Competency Model via the link sent to your e-mail.

Enter current certification details: certification name, issue date and expiration date.

STEP 7

STEP 4

Receive your SHRM-CP or SHRM-SCP once you complete the pathway process, and begin a three-year recertification cycle.

* Eligible HR generalist certification programs include PHR, SPHR, GPHR, HRBP, HRMP and IPMA-CP. Please note: PHR, SPHR, GPHR, HRBP and HRMP are registered trademarks of the HR Certification Institute and are not SHRM certifications. SHRM has no rights to the “IPMA” trademark, and IPMA-CP is not a SHRM certification. Other HR generalist credentials may also qualify based on SHRM’s review. Please e-mail shrmcertification@shrm.org for more information.

You will not lose or have to give up any of your current credentials in order to obtain the new SHRM certification.

15-0166

Start today at shrmcertification.org/pathway/may.

Court Report

New cases are posted online each week. Visit www.shrm.org/law

Professor Lacks Grounds for FMLA Retaliation Claim Carter v. Chicago State University, 7th Cir., Case No. 13-3367.

Suspicious timing and a statement by management that it had “no reason” for selecting one professor over another in making a promotion decision were not enough to support a claim for retaliation under the Family and Medical Leave Act (FMLA), according to the 7th U.S. Circuit Court of Appeals.

Tollie Carter was a tenured associate professor who began working at Chicago State University in 1986. Carter was appointed chair of the university’s accounting and finance department in January 1995 but was removed from the position in June 1996 and returned to an associate professor role due to his “overall ineffective leadership.”

Carter was still in an associate professor role in January 2008, when he went out on FMLA leave to care for his mother. Upon returning to work in late March 2008, Carter was assigned nonteaching duties for the remainder of the semester.

The university had covered Carter’s three-month absence by hiring a parttime professor to teach one of his classes and assigning other professors in the department to teach the others.

One month after returning to work, in April 2008, Carter applied for an appointment to be chairman of the accounting and finance department but was passed over in favor of a peer who held a doctoral degree and whom the university deemed more qualified.

Seven months later, in November 2008, when the department chair position again became vacant and was to be filled by an “acting” chair, Carter was again passed over.

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against the university alleging that it adverse employment action is rarely sufretaliated against him for having taken ficient to show that the former caused FMLA leave by twice failing to appoint the latter.” him to the department chair position.

Carter also tried to attack the uniA jury found against Carter on the versity’s decision-making in determinApril 2008 department chair promoing the acting chair appointment, citing tion claim, and the district court judge a statement by the dean that he had “no entered summary reason” for appointjudgment against ing the successful Professional Pointer him on the Novemcandidate to the posiber 2008 acting chair tion other than he Tread carefully when claim. “had to appoint one implementing employment actions with negative Carter appealed person” as evidence consequences close to the time the summary judgthat the university’s of a worker’s protected leave. ment order on the reasons for not selectAs always, carefully document November 2008 acting Carter were all performance issues. ing chair claim but pretextual. did not appeal the The 7th Circuit jury award on the April 2008 chair pronoted that the dean’s statements were motion claim. “admittedly terse,” but it found that In evaluating Carter’s FMLA claim, Carter presented no evidence that the the 7th Circuit applied the traditional dean’s explanation lacked credence. framework for analyzing a retaliation The appeals court also concluded claim: a showing that 1) the employee that Carter failed to make a prima facie engaged in protected activity under the case of discrimination because he failed FMLA statute—in Carter’s case, takto present evidence establishing that ing FMLA leave to care for his mother; the university granted the promotion to 2) the employee suffered an adverse someone who was not better qualified employment action—i.e., Carter was than Carter. denied a promotion; and 3) there exists a He alleged that the person appointed causal connection between the first two had a J.D., not a Ph.D., and that a J.D. points. typically would not satisfy the departThe appellate court was unconvinced ment’s tenure requirements.

by Carter’s argument that a period of But Carter conceded that the person seven months between the end of his selected was granted tenure and Carter FMLA leave and the university’s denial did not identify any criteria used by the of the acting chair appointment was sufuniversity for determining acting chair ficiently close to raise a suspicion of disappointments. criminatory intent.

The court noted that it has repeatedly held that “temporal proximity between

By Tracey L. Truesdale, an attorney in the an employee’s protected activity and an Chicago office of Ogletree Deakins.

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Color Bias Claim Survives Absent Race Discrimination Etienne v. Spanish Lake Truck & Casino Plaza LLC, 5th Cir., No. 14-30026. promote her to a managerial position, Statements by a general manager that a despite the fact that she was qualified, former employee was “too black to do because of her race and color. various tasks” and that a “dark skin” Etienne submitted an affidavit by black person was not allowed to handle Jeannene Johnson, a former manager at money constituted direct evidence of Spanish Lake, in support of her allegadiscrimination, according to the 5th tions. In the affidavit, U.S. Circuit Court of Johnson indicated Appeals.

Professional Pointer that Terradot deterEsma Etienne, a mined each employblack woman, sued While claims of race and color ee’s responsibilities her former employer, discrimination are frequently based on the employSpanish Lake Truck joined together, it is important ee’s skin color. John& Casino Plaza LLC, to remember that a claim for color discrimination can stand son further indicated for violations of Title on its own. that Terradot, on VII of the Civil Rights numerous occasions, Act of 1964. Specifisaid Etienne was “too cally, Etienne, who black” to perform certain tasks. worked as a waitress and bartender, The district court granted summary alleged that Spanish Lake’s general judgment in favor of Spanish Lake. manager, Bernard Terradot, failed to

The 5th Circuit vacated the district court’s decision and remanded the case.

According to the 5th Circuit, the district court, relying heavily on the fact that most of the managers in the casino were black, focused its analysis of Etienne’s discrimination claim on race rather than color. The 5th Circuit noted that while the court had never explicitly recognized “color” as a separate, unlawful basis for discrimination, Title VII prohibits discrimination against an individual because of the individual’s “race, color, religion, sex, or national origin.”

By Kathiana Aurelien, an attorney with Swerdlow Florence Sanchez Swerdlow & Wimmer, the Worklaw® Network member firm in Beverly Hills, Calif.

Holding Company Not Joint Employer of Defunct Entity Shiflett v. Scores Holding Company Inc., 2nd Cir., No. 14-1594-cv.

A holding company that owned a nightclub but did not manage the club’s personnel matters or make decisions concerning employee hiring, firing, discipline or compensation could not be held liable for alleged discrimination and retaliation by the nightclub, the 2nd U.S. Circuit Court of Appeals ruled.

Elizabeth Shiflett worked as a cocktail waitress at Scores West in New York City beginning in October 2007. She claimed that she was harassed by her manager based on her race and sex and that, when she complained about it, she was terminated in retaliation in March 2008. Scores West was owned by Go West Entertainment Inc., which was dissolved in July 2010 after bankruptcy proceedings. Go West was related to Scores Holding Company Inc., which remains in operation.

In June 2013, almost three years the court, the companies must have comafter Go West was dissolved, Shiflett mon ownership—which was applicable brought a lawsuit against Scores Holdhere—but they also must have common ing under Title VII of management, interthe Civil Rights Act related operations or Professional Pointer of 1964. She claimed centralized control of that Scores Holding labor relations.

If joint owners of a company fail to keep their human should be liable as a The 2nd Circuit resource functions separate, joint employer. Scores noted that a company they can share responsibility for Holding argued that representative testiemployment law claims brought it was not a joint fied that he exercised against any one owner. employer because, no control over mandespite its common agement or personnel ownership, it did not have control over decisions at Scores West. Without such personnel matters at Scores West. The involvement, the 2nd Circuit determined trial court agreed with Scores Holding that Shiflett could not hold Scores Holdand dismissed the case against it, and ing responsible as a joint employer.

Shiflett appealed.

On appeal, the 2nd Circuit described

By Jeffrey L. Rhodes, managing partner of the standard for holding a company the civil division of Albo & Oblon LLP in liable as a joint employer. According to Arlington, Va.

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Legal Trends

Narcissists Inc. An employee with a big ego can come at a high cost.

By Michael Farnsworth and V. John Ella ompanies don’t need to put up with ruthless, mean or narcissistic people in top positions just because those people drive results. In fact, placing narcissists in high places could actually be harmful to your business. Because once they’re in, removing them can be difficult.

People with narcissistic personality disorder (NPD) may account for a disproportionate amount of employment-related lawsuits, and research suggests that plaintiffs with NPD may litigate longer and more persistently than others.

A 2008 epidemiological survey of tens of thousands of U.S. adults found that the overall prevalence of lifetime NPD was 6.2 percent, with rates greater for men (7.7 percent) than for women (4.8 percent). Many of these people are employed, and they bring morale down as their egos swell.

Like all personality disorders, NPD is a deeply ingrained and enduring behavioral pattern, manifesting as an inflexible response to a broad range of personal and social situations. Individuals with NPD are often incapable of viewing themselves as being wrong in any situation because they lack the ability to perceive their own faults and shortcomings.

Narcissism is a spectrum trait, ranging from mild self-centeredness to severe maladaptive characteristics that lead to constant conflict. Many individuals with narcissistic traits, and even full-blown NPD, climb high up the corporate ladder in their careers.

They may come across as selfabsorbed, imperious and quick to take personal offense in neutral situations.

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have high opinions of their own “specialness,” and rage in the face of setbacks. Sound like anyone you know?

Narcissistic Employees Because employees with NPD are quick to take offense at criticism, even when it is fair, they are often spoiling for a fight—which in some cases takes

the form of litigation and in other cases may even lead to violence. They just can’t fathom that they could be wrong and will become obsessed with seeking retribution. Their behavior is often self-defeating as well, as they can lose sight of the big picture of how their actions could affect their longterm reputation or career.

Other common traits of NPD, such as paranoia and sociopathy, are apt to

compound the problem, causing significant frustration for the HR professionals tasked with dealing with these employees.

Unfortunately, counseling from HR or supervisors is unlikely to help in most cases. Typically, the employee’s intransigent and inflexible attitude will eventually lead to termination of employment.

Narcissistic Plaintiffs A plaintiff-employee who believes that he or she is right and the rest of the world is wrong can pose a difficult problem for the defendant-employer. Even though so-called at-will employment is generally recognized in the United States—allowing employers to discharge employees at any time, even without cause—many exceptions can apply.

Terminated employees, for

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example, often can find a plausible legal theory on which to base their complaint if they want to pursue their grievance in a court. This could include discrimination—since virtually everyone is a member of at least one protected class—and defamation, along with contractual claims such as tortious interference (the intentional interference with a contract).

A terminated employee may be able to convince an attorney to take the case on a contingency basis, or he or she may pursue a case “pro se,” or without an attorney. Due to their skewed judgment, people with NPD will often fail to recognize when a case has questionable merit and ignore the cost of litigation.

In fact, we’ve seen cases where plaintiffs diagnosed with NPD have spent their life savings only to have their administrative charge dismissed, their

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Due to their skewed judgment, people with NPD will often fail to recognize when a case has questionable merit and ignore the cost of litigation. lawsuit let go by a trial court judge, and the decision affirmed by the court of appeals.

Employers and insurance companies that seek to resolve a case with this type of plaintiff may offer a significant amount of money to settle meritless claims. Often, however, plaintiffs with NPD refuse these offers as they expect to be vindicated in court.

They are fully confident that a judge

will declare them absolutely correct in everything they have asserted.

And, just as paranoid people sometimes have actual enemies, plaintiffs with NPD can have legitimate legal claims. Only the court system can determine that. Don’t expect these folks to be amenable to alternative dispute resolution or mediation. Their

candidates with NPD, but conduct the tests carefully as their use may lead to claims of discrimination.

Being a highperforming leader involves more than just being able to drive deals or crunch numbers. Hiring based on business results alone could backfire, so take

Diagnosing NPD According to the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition: DSM-5, a person must have at least five of the following traits to be diagnosed with narcissistic personality disorder: • A grandiose sense of self-importance.

• A preoccupation with fantasies of unlimited success, power, brilliance, beauty or ideal love.

• The belief that he or she is “special” and unique and can be understood only

claims will likely need to be decided by a judge or jury, often after significant expense.

by other special or high-status people.

• The need for excessive admiration.

• A sense of entitlement—unreasonable expectations of favorable treatment or automatic compliance with his or her expectations.

• The tendency to exploit others to achieve his or her own ends.

• A lack of empathy.

• Envy of others or the belief that others are envious of him or her.

• Arrogant, haughty behaviors or attitudes.

the whole person into account when filling your top slots.

Three Takeaways So, what can HR professionals do to discipline or discharge workers with NPD—or to avoid hiring them in the first place? Keep in mind the following: • Employees with narcissistic personality disorder can be very distracting and even destructive. Keep them in check.

• Don’t waste time trying to settle a lawsuit once you realize you have someone with NPD on your hands.

Litigate away!

• Personality tests can screen out

Michael Farnsworth, M.D., is a forensic psychiatrist in private practice in Nisswa, Minn., and the medical director of Blue Earth County (Minn.) Mental Health Center.

V. John Ella is an employment lawyer with the Minneapolis office of Jackson Lewis PC.

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Inside SHRM

SHRM Annual Conference: Prepare to Be Inspired Three well-known keynote speakers will share their perspectives on leadership, motivation and success at the SHRM 2015 Annual Conference & Exposition in Las Vegas June 28-July 1.

Dr. Mehmet Oz is an Emmy Award-winning TV host and best-selling author as well as a heart surgeon.

He is vice chair and professor of surgery at Columbia University and directs the Cardiovascular Institute and Complementary Medicine Program at New York-Presbyterian Hospital. He was a featured health expert on Oz “The Oprah Winfrey Show” for more than five seasons and has written seven New York Times best-sellers, including You: The Owner’s Manual (HarperCollins Publishers, 2008.)

Sheryl Sandberg is chief operating officer for Facebook and author of the best-sellers Lean In: Women, Work, and the Will to Lead (Knopf, 2013) and Lean In for Graduates (Knopf, 2014). She founded LeanIn.org, a global community committed to empowering all women to achieve their ambitions.

Sandberg has served as vice president of global online sales and operations at Google, chief of staff for the U.S. Treasury Department under former President Bill Clinton, a management consultant with McKinsey & Co., and an economist with the World Bank.

Sandberg Marcus Buckingham is author of the best-seller, StandOut: The Groundbreaking New Strengths Assessment from the Leader of the Strengths Revolution (Thomas Nelson, 2011) and a number of other books.

He’s also the founder and chairman of The Marcus Buckingham Company, a consultancy. He has appeared on “The Oprah Winfrey Show,” “Larry King Live,” “The Today Show,” “Good Morning America,” “The View” and National Public Radio’s “Morning Edition.”

He worked for nearly two decades at The Gallup Organization, where he served as a senior researcher and later as senior vice president, and is a former member of the Secretary of State’s Advisory Committee on Leadership and Management.

The conference will offer more than 200 education sesBuckingham sions based on the SHRM Competency Model as well as opportunities to discover new products at the Exposition Hall and network with your peers. To register, visit www.annual.shrm.org.

New Advocacy App Download the free SHRM Advocacy app to get the latest legislative and agency news affecting the workplace and advocate for the HR community.

The new tool allows you to: • Respond to SHRM calls to action on HR-related issues pending before federal or state lawmakers.

• Connect with your federal and state lawmakers and learn your lawmakers’ positions on HR-related issues.

• Receive SHRM public-policy briefings, position statements and talking points on those issues.

• Report the outcome of your conversation with a lawmaker to SHRM. • Engage with elected officials and fellow HR professionals on social media.

• Join the SHRM Advocacy Team (A-Team) and access its resources.

Did You Know?

7,700

The number of SHRM Advocacy Team (A-Team) members who volunteer to keep HR issues front and center with federal lawmakers

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ap im fre

Inside SHRM

Upcoming Events

1-July 15

Testing window for SHRM certification exam

14-15

Business Acumen: Integrating HR Across Operations, Alexandria, Va.

18 Conflict

& Relationship Management, Alexandria, Va.

SHRM members met with U.S. Rep. Tim Walberg, R-Mich., in his Capitol Hill office during the SHRM 2015 Employment Law & Legislative Conference in March. From left are Angela Grissom, Michelle Czolgosz and SHRM staffer Kelly Hastings.

Guide Recommends Changes For U.S. Immigration System A guide explaining the U.S. immigration system and advocating changes to help employers is available on SHRM’s website.

Moving Forward on Immigration: How the U.S. Employment-Based System Works—and How It Can Work Better was released by SHRM and the Council for Global Immigration (CFGI) at the SHRM 2015 Employment Law & Legislative Conference in March.

More than 200 SHRM members distributed the guide on Capitol Hill as they met with their legislators to discuss workplace issues—including the need to improve E-Verify, a government program used by employers to confirm that applicants are eligible to work in the U.S. The guide serves policymakers as they consider potential reforms.

“Our immigration system is complicated, inefficient, and incompatible with the speed at which business moves and our ever-changing economy.

We need to reform the employment-based immigration system so that it supports, not hinders, America’s employers,” said CFGI Executive Director Lynn Shotwell.

The guide contains: • A pullout poster of employment-based immigration terms, forms and federal agencies.

• An overview of the U.S. employment-based immigration system.

• Information on President Barack Obama’s executive action.

• Details on the so-called skills gap and why employment-based reforms are critical to addressing it.

• Lessons from the global competition for talent.

CFGI also released a video depicting the challenges professionals face when assigned immigration responsibilities for their organizations.

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18-19

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4-5 Compensation Essentials, Alexandria, Va.

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SHRM 2015 Annual Conference & Exposition, Las Vegas

PHOTOGRAPH BY STEVE PURCELL

May

May 2015

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Free Workflex Assessment Employers can now gauge how their workplace flexibility strategies compare with others in their industry in the U.S. using a free online assessment. The tool, launched in February, is part of When Work Works, a partnership between SHRM and the Families and Work Institute. It takes about 15 minutes to complete and provides a score and percentile rank comparison of how an individual employer’s workflex strategies compare with those of other U.S. organizations of similar size and sector in the same industry. The assessment also provides advice for employers on how to improve their score.

For more information, visit www.whenworkworks.org/ workflex-assessment.

Young HR Professionals Advise SHRM Fifteen young HR professionals were elected to serve on SHRM’s Young Professionals Advisory Council for a one-year term beginning on Jan. 1, 2015.

SHRM received more than 200 applications for 15 council spots. The advisory council advocates for SHRM members under age 30 and advises SHRM on attracting and retaining young professionals as members.

The council members are: • Daisy Alviso of Alamo, Texas, senior employee relations specialist, Frost Bank.

• Daniel Cross of Wilmington, Del., senior HR consultant, Capital One Financial Corp.

• Ashley Eckard of Rising Sun, Md., HR director, Calvert Manor Healthcare Center.

• Kelsey Esquinas of Columbus, Ind., talent acquisition manager, Faurecia Emissions Control Technologies.

• Tom Eyberg of Overland Park, Kan., HR coordinator, Erickson Living.

• Chanel Jackson of Raymond, Ohio, HR

business partner, Honda R&D Americas Inc. • Brooke Liu-Boston of Caledonia, Mich., corporate project manager & HR specialist, Acrisure.

• Gregory Low of San Francisco, senior business partner, HR, Jones Lang LaSalle.

• Jessica Lustig of New York City, assistant director, human resources, The College Board.

• Jeromy Manke of Reno, Nev., HR generalist, Strategic HR Partners LLC. • Kevin Mottram of Issaquah, Wash., HR manager, Microsoft.

• Catherine Preim of Philadelphia, HR generalist, SYSTRA Consulting.

• Christopher Stewart of Raleigh, N.C., regional HR consultant, McDonald’s USA LLC. • Eve Sweeting of Punta Gorda, Fla., HR generalist, Charlotte County Board of County Commissioners.

• Callie Zipple of Lincolnshire, Ill., senior HR coordinator, Zebra Technologies.

SHRM Board of Directors Chair Brian D. Silva, SHRM-SCP Fresenius Medical Care NA

PHOTOGRAPH BY STEVE PURCELL

Immediate Past Chair Bette J. Francis, SHRM-SCP Wilmington Trust, Wealth Advisory Services President and Chief Executive Officer Henry G. (Hank) Jackson, CPA Society for Human Resource Management

Directors at Large Jeffrey M. (Jeff) Cava Starwood Hotels and Resorts Worldwide Inc. Jorge Consuegra The Fearless Group Thomas W. (Tom) Derry Institute for Supply Management My-Chau Nguyen, CPA Sirius XM Radio Coretha M. Rushing, SHRM-SCP Equifax Inc.

José Tomas, SHRM-SCP WellPoint Inc. Scott R. Washburn, SHRM-SCP Tree Top Inc. David Windley IQ Talent Partners Patrick M. Wright, Ph.D. University of South Carolina Gretchen K. Zech, SHRM-SCP Arrow Electronics Inc.

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What’s New

Employee Recognition PlaqueMagic is a new do-it-yourself award-making kit that allows employers to make personalized employee awards, avoiding the hassle of ordering from trophy or awards centers. With PlaqueMagic, human resource managers can customize recognition plaques or trophies and create a professional-looking employee award.

(303) 799-8979 | www.plaquemagic.com | info@plaquemagic.com

Employee Engagement Glint Inc. has launched a Web-based employee engagement tool that offers human resource professionals, executives and managers instant access to their organization’s engagement data.

This innovative engagement solution features analytic functions that help companies identify and measure key drivers of worker engagement.

(650) 817-7240 | www.glintinc.com info@glintinc.com Listening Impact has introduced Listening Intelligence, a set of business principles and practices designed to help employers engage and harness the skills and knowledge of each employee through improved listening techniques.

By embracing listening as a strategic core value, organizations can promote a healthy culture that fosters innovation and productivity.

(303) 440-1278 | www.listeningimpact.com info@listeningimpact.com

HR Management Systems TeemWurk has announced the launch of its new corporate website. The website provides TeemWurk clients with an array of human capital management online services and resources, such as benefits and payroll administration.

(916) 932-2898 | www.teemwurk.com info@teemwurk.com

International HR ECA International has released its new Mobility in Asia report, which is designed to assist employers with their mobility management initiatives in one 84

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of the world’s fastest growing and most dynamic markets. Drawing on ECA’s wealth of data and experience supporting multinational businesses in Asia, this report can provide employers with a valuable overview of the region’s key business issues and trends.

(212) 582-2333 www.eca-international.com eca.ny@eca-international.com

Retirement SmartDollar is a new financial wellness program designed to help employers and plan advisors show retirement plan participants how to manage their finances better and how to create viable and sustainable retirement savings plans. The program provides a step-by-step guide on how individuals can take control of their retirement savings and also offers new and innovative insights on financial planning.

(800) 754-4220 www.smartdollar.com info@smartdollar.com

Staffing Findly Inc. has launched Lead Capture Micro-Sites, a recruiting and candidate sourcing tool. This Web-based tool allows employees to create individual and personalized job candidate pages and then use the pages to post candidate profiles during recruiting events. All leads are then connected directly to an employer’s candidate relationship management system for immediate access and sourcing by recruiters.

(800) 603-0680 www.findly.com | info@findly.com

ADP has announced the expansion of its popular background screening and candidate selection services worldwide. The services are designed to meet the growing demand from multinational employers for increased transparency during the recruiting and hiring process.

(800) 225-5237 www.adp.com info@adp.com

Training and Development Career Partners International (CPI) has launched Executive Onboarding Strategy, a new staffing and orientation tool designed to increase the success rates of executives in new leadership roles and, in turn, reduce turnover costs for organizations. The tool features personalized coaches who use proven onboarding techniques developed by CPI. The coaches then identify individual needs of executives and organizations and help develop strategies that improve productivity and create measurable business results.

(800) 686-5999 www.cpiworld.com info@cpiworld.com

Workplace Management Red Butler has announced a new service designed to help startups and smaller businesses manage HR-related issues such as executive productivity and staff retention. Red Butler’s new Web-based Delegate to Accelerate program offers administrative support to individuals and teams at a monthly subscription rate that is often less than the total cost of hiring an in-house administrator.

(888) 288-5372 www.redbutler.com info@redbutler.com Product manufacturers and developers provide information for What’s New. Inclusion in this sample of products does not necessarily imply endorsement by SHRM or HR Magazine. For an online directory of new products and services by category, please visit www.shrm.org/publications/ hrmagazine/whatsnew.

May 2015

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Apply for a SHRM Foundation Scholarship 110 Scholarships for SHRM Certification ($750 each) Scholarships include these new awards for 2015: 3M Certification Scholarship Career Spa, LLC Certification Scholarship Sara Rynes Certification Scholarship Jim Schultz Certification Scholarship Talent Connections, LLC Certification Scholarship Virginia SHRM State Council Certification Scholarship SHRM members* working toward SHRM-CP or SHRM-SCP certification are eligible to apply. Affiliated SHRM chapters and state councils organizing local certification preparation programs are also eligible.

20 Academic Scholarships ($2,000 each) SHRM members* pursuing a graduate or undergraduate college degree (part-time or full-time) in HR or a related field are eligible to apply.

Application Period Open April 1–July 15, 2015 15-0178

*Includes SHRM professional, general and associate members with active SHRM membership as of July 15, 2015.

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Learn more at select “Scholarships and Awards.”

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Yellow Pages

BENEFITS

Veterinary Pet Insurance

www.petinsurance.com/hrmag 877-280-8873 Veterinary Pet Insurance can strengthen your company’s benefits package as one of the fastestgrowing, frequently requested voluntary benefits. In fact, 65% of pet owners want their employers to offer pet insurance. There is no cost to your company, no minimum participation and no administrative hassles. Plus, your employees receive a discount.

PRE-EMPLOY TESTING/ SCREENING

Verified Person

www.VerifiedPerson.com Get a free $10 music gift card when you take the Verified Person Simple Rules Challenge. Just go to www.

VerifiedPerson.com and click the challenge graphic. You’ll quickly see how simple your background screening can be. You can also request a demo of our newly designed user interface, which is simply fantastic.

COMPENSATION

ERI Economic Research Institute

www.erieri.com info.eri@erieri.com 800-627-3697 ERI Economic Research Institute provides current market data for more than 1,000 industry groups.

Thousands of corporate subscribers rely on ERI’s salary survey, executive compensation, geographic pay, and cost-of-living data to give them boardroom, court, and employee level credibility. Nothing beats real data and reproducible results, with reported rates of error.

RECRUITMENT

CareerArc

www.careerarc.com Employers@careerarc.com 888-303-2526 CareerArc is the leading HR technology company helping business leaders recruit and transition the modern workforce.

Our social recruiting solution— TweetMyJobs—and our modern outplacement solution— CareerBeam—help thousands of organizations, including many of the Fortune 500, solve critical business issues with 21st century tools and technology.

HR TECHNOLOGY

Oracle Human Capital Management

800-633-0738 www.oracle.com/hcm Oracle’s global, web-based, application platform is designed for organizations of every size, industry, and region. Oracle Human Capital Management has been the HCM solution of choice for over 20 years and has 18,000 customers in over 140 countries; 6,000 of whom are in the cloud.

RELOCATION

Mayflower

One Mayflower Drive Fenton, MO 63026 800-374-9781 OnPoint@unigroup.com www.mayflower.com Employers have trusted Mayflower to relocate their employees for more than 80 years. Mayflower gives transferees the ability to book other services like cleaning and home network installation along with their move. With Mayflower’s OnPoint Preferred packages, your employees can also choose Mayflower’s Flagship Protection and identity theft protection.

PRE-EMPLOY TESTING/ SCREENING

HireRight

5151 California Avenue Irvine, CA 92617 800-400-2761 949-428-5800 www.hireright.com Trusted by more than one-third of the Fortune 500, HireRight offers comprehensive, on-demand solutions for employment background screening, drug screening, and employment eligibility. With HireRight’s award-winning screening solutions, HR professionals can realize greater efficiencies, faster and more reliable results, and improved effectiveness in managing an organization-wide screening program.

HireRight provides unique turnkey integrations with top talent management solutions and global reach to more than 200 countries and territories.

RELOCATION

United Van Lines

One United Drive Fenton, MO 63026 800-283-5743 StraightTalk@unigroup.com www.unitedvanlines.com United knows that your transferees have a lot to think about when they move. Help them get settled faster with United’s exclusive Straight Talk Advantage packages.

These packages allow your employees to schedule maid service and electronic assembly and disassembly along with United’s industry-leading moving services and gold standard protection.

Company listings do not imply recommendation or referral by SHRM.

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May 2015

4/7/15 12:49 PM

TRAINING & DEVELOPMENT

SHRMâ&#x20AC;&#x2122;s HRJobs

1800 Duke Street Alexandria, VA 22314 1-855-475-7476 Fax: 703-535-6468 hrjobs@shrm.org jobs.shrm.org Looking to advance your career?

Find your next job with the career site exclusively devoted to HR professionals. Add your resume to our searchable database, and employers will come straight to you!

With hundreds of new positions added each week, there are endless opportunities on SHRMâ&#x20AC;&#x2122;s HR Jobs.

BizLibrary

285 Chesterfield Business Parkway Chesterfield, MO 63005 888-432-3077 www.bizlibrary.com BizLibrary is a leading provider of learning & talent management solutions designed for small & mid-sized organizations. Our award-winning online libraries include streaming videos, interactive e-learning courses, reference materials and e-books. Our cloud-hosted LMS, Performance Management & Social Learning applications help smaller organizations streamline & simplify important talent management processes.

TRAINING & DEVELOPMENT

Development Dimensions International (DDI)

1225 Washington Pike Bridgeville, PA 15017 800-933-4463 info@ddiworld.com www.ddiworld.com Virtual Mid-Level Leader Assessment DDIâ&#x20AC;&#x2122;s latest assessment breakthrough, Leader3 ReadyÂŽ, drives better leadership decisionsâ&#x20AC;&#x201D; and catalyzes the development of the right leaders faster. This realistic, virtual assessment gives you the talent intelligence to identify, select, and develop the right mid-level leaders to emerging executives for the role theyâ&#x20AC;&#x2122;re in now and in the future.

Youâ&#x20AC;&#x2122;ve implemented strategies to attract and retain top candidates.

VISION CARE

Davis Vision, Inc.

175 E. Houston St. San Antonio, TX 78205 800-278-6673 www.davisvision.com Davis Vision ensures quality vision care and affordable rates for our members and clients. Our end-to-end process delivers an unbeatable combination of cost savings, unmatched product choices and a variety of convenient independent optometrists, ophthalmologists and retail options.

SHRMÂŽ

PEOPLE INSIGHT

But what really MOTIVATES your workforce?

An Employee Job Satisfaction & Engagement Survey Service

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To schedule a brief demo or to order now, contact us at: shrm.org/peopleinsight/may

|

+1.703.535.6295

|

peopleinsight@shrm.org May 2015

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HR Magazine

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Member Spotlight

Mandy Woulfe, SHRM-SCP Corporate HR director, Classic Resorts

G

rowing up in a small town in Colorado, Mandy Woulfe dreamed of having a career. That dream seemed to fade when she got pregnant at 17 and dropped out of high school to focus on raising her son. But she never gave up on her education, earning her GED and an associate’s degree, and eventually landing a job as an executive assistant in the hospitality industry.

When the company’s HR manager resigned, Woulfe jumped at the chance to apply for the job—and got it. She became inspired to pursue a career in HR after attending her first local Society for Human Resource Management (SHRM) chapter program.

Since then, Woulfe has earned her bachelor’s degree in human resource management, aided by three SHRM Foundation academic scholarships. She also won the 2014 Susan R. Meisinger Fellowship, a $10,000 award for HR professionals pursuing their first master’s degree.

She’s been active in SHRM throughout her career. In Colorado, she served as president of the High Country HR Association and as Colorado state council certification director.

In 2011, Woulfe moved from Colorado to Hawaii for her current job. She now serves as co-director of membership for SHRM’s Hawaii chapter and state council.

What’s next?

Ten years ago, I made a decision to actively grow my career in the hopes of someday becoming a vice president of HR, and that is still my goal. I’m pursuing a master’s degree in HR management with an emphasis on integrating functional and strategic HR. I’m also passionate about leadership development.

The incredible honor of receiving the 2014 Susan R. Meisinger Fellowship at the SHRM Volunteer Leaders’ Summit in Washington, D.C. I’ve also had the privilege of mentoring several amazing HR professionals. Each time I’ve left a job, a member of my team was selected as my replacement.

Do you have any hobbies?

I’m a Toastmaster. In the past two years, I’ve competed three times in the Hawaii state conference. Four days a week, I am on the beach for a 5:30 a.m. boot camp, and I practice Bikram yoga whenever I can. I also just ran my first 5K—a huge accomplishment since I once hated running.

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What’s your greatest accomplishment to date?

HR Magazine May Month 2015 0000

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BUSINESS SUCCESS depends on getting the most out of people. Now more than ever, businesses rely on HR professionals to make the most of a changing workforce. Because great HR makes great organizations.

Elevate Your Performance with

NEXT-GENERATION HR CERTIFICATION

SHRM-CP SHRM-SCP

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Competency-Based. Always Relevant.

The SHRM Certified Professional (SHRM-CP) and SHRM Senior Certified Professional (SHRM-SCP) exams test both HR competencies and HR knowledge—and their application— to ensure an HR professional’s ability to demonstrate what they know and how they use their knowledge in the variety of situations they encounter.

Applications for the Winter Exam will be accepted beginning May 1!

WINTER WINDOW

REGULAR APPLICATION DEADLINE LATE APPLICATION DEADLINE

Dec. 1, 2015 - Feb. 15, 2016

October 16

November 13

shrmcertification.org/apply/may

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Creating a global workforce that maintains a local touch isn’t easy.

ADP utilizes data-driven insights that help prepare you for the future of work, no matter where it’s being done. That allows you to focus on what really matters and better connect with your employees regardless of the language.

Visit adp.com and see how we can provide a more human resource for your business.

A more human resource.

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ADP and the ADP logo are registered trademarks of ADP, LLC. ADP – A more human resource. is a service mark of ADP, LLC. Copyright © 2015 ADP, LLC.

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THERE’S A LAUGH, AND YOU REALIZE YOU’RE SPEAKING THE SAME LANGUAGE.