Human Resources Director 11.10

SPECIAL REPORT

LEARNING & DEVELOPMENT

ONE-ON-ONE BHP BILLITON'S JO MCCONNELL

HUMAN RESOURCES DIRECTOR HCAMAG.COM ISSUE 11.10

BIG DATA & HR A NATURAL FIT?

Bob Hogarth, Heritage Bank

Simone Carroll, REA Group Joanne Allen, Citi

Chris Lamb, Lend Lease Australia

Emma Hogan, Foxtel

Mel Tunbridge, SBS

IN THE FRONTLINE

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HR LEADERS TALK STRATEGY Executive succession | Crisis management HR on boards | Change management | HR skills gaps

HUMAN RESOURCES DIRECTOR: THE NEW NAME FOR HC MAGAZINE

EDITOR’S LETTER / HUMAN RESOURCES DIRECTOR

WHO’S ON YOUR PERSONAL BOARD?

Special repOrt

learning & develOpment

hcamag.com issue 11.10

simone Carroll, rea Group Joanne allen, Citi

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emma Hogan, foxtel

Chris lamb, lend lease australia

Mel tunbridge, sBs

in the frOntline

ISSN 2202-8234

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hr leaders talk strategy Executive succession | Crisis management HR on boards | Change management | HR skills gaps

Human ResouRces DiRectoR: tHe new name foR Hc magazine

COPY & FEATURES EDITOR Iain Hopkins JOURNALIST Cameron Edmond PRODUCTION EDITOR Roslyn Meredith

ART & PRODUCTION DESIGN MANAGER Rebecca Downing DESIGNERS Marla Morelos, Joenel Salvador, Loiza Caguiat TRAFFIC MANAGER Abby Cayanan

CONTRIBUTORS The Next Step, Kenexa, Frontier, REST Super, EmployeeConnect

SALES & MARKETING MARKETING EXECUTIVE Anna Farah COMMUNICATIONS EXECUTIVE Lisa Narroway NATIONAL COMMERCIAL MANAGER Sophie Knight ONLINE COMMERCIAL MANAGER Sarah Wiseman

CORPORATE CHIEF EXECUTIVE OFFICER Mike Shipley CHIEF OPERATING OFFICER George Walmsley MANAGING DIRECTOR – BUSINESS MEDIA Justin Kennedy CHIEF INFORMATION OFFICER Colin Chan HUMAN RESOURCES MANAGER Julia Bookallil Editorial enquiries Iain Hopkins tel: +61 2 8437 4703 iain.hopkins@keymedia.com.au Advertising enquiries National commercial manager, HR products Sophie Knight tel: +61 2 8437 4733 sophie.knight@keymedia.com.au Subscriptions tel: +61 2 8437 4731 • fax: +61 2 8437 4753 subscriptions@keymedia.com.au

Iain Hopkins, editor, HRD

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big data & hr a natural fit?

Bob Hogarth, Heritage Bank

I’ve never had a mentor. Well, I’ve never had a professional mentor. Now I’ve got that off my chest and you’ve jumped to assumptions about the gaping hole in my professional development, you can possibly guess my curiosity (and slight envy) when someone talks glowingly about having a mentor in their life.

Talking with a roomful of six senior HR directors recently for this month’s cover story, I posed that question to them. Not surprisingly (as if to really rub it in), they all said they’d had a mentor in their HR lives. Most still do. Emma Hogan of Foxtel had some clear guidelines for such a relationship. Firstly, she said she had selected her mentors, as opposed to the other way round, and they’d never turned her down. Who wouldn’t be flattered to be asked? Secondly, no matter how high up the ranks you go, mentors remain critical confidants. Hogan said she had several people she still goes to regularly for advice, who act as her own “board of directors”. Interestingly, she reeled off a diverse range of backgrounds: some are internal to her current place of employment; others are external. Some she’s known for 20 years; one she’s known for less than 12 months. One is 15 years younger; others are older.

Indeed, despite the myriad formal networks set up internally in business, Chris Lamb of Lend Lease believes that informality is important.

“You see something that you think they do well, you reach out to them; it goes from there,” he said. “Those connections where you think ‘you’re really good at this; I want to learn this from you’ is where the value comes.”

The most pertinent point, however, was made by Joanne Allen of Citi: “You need anti-role models as well. You need to look at people and say, ‘I don’t want to be like that person!’”

Life is all about contrasts: sometimes you need to see the bad before you recognise the good. So if you haven’t already, it’s time to build your own ‘board of directors’.

EXPRESS YOURSELF!

One-On-One BHP Billiton's Jo McConnell

Human ResouRces DiRectoR

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OCTOBER 2013 | 1

CONTENTS / HUMAN RESOURCES DIRECTOR

18

COVER STORY

HR in the frontline HRD invited six outstanding HR leaders to an exclusive networking event. From CEO succession to the Sigmoid Curve, the agenda was wide-ranging and the conversation flowed freely. Iain Hopkins reports

14

Leading a giant Jo McConnell is at the helm of BHP Billiton’s global HR initiatives and tells Aidan Devine how strategic HR has delivered exceptional results in a business that spans multiple industries and dominates the global resources market

29

Special report: Learning & Development HRD presents its annual special report on learning & development, a holistic overview of L&D trends, including practical tips and advice for your own career

2 | OCTOBER 2013

46

Payroll: Making the smart choice Large organisations typically have complex payroll needs, which if handled poorly can have a significant impact on their financial standing and reputation. What steps can HR take to ensure the right payroll system choices are made?

REGULARS 04 | In brief: Big Data 08 | In brief: Outplacement 50 | Profile: Jeff Vijungo, Adobe

FRONTLINE INTELLIGENCE 10 | In Step – HR career experts 12 | HR consulting 13 | Technology

CHECK OUT THE HRD ARCHIVES ONLINE: hcamag.com

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OCTOBER 2013 | 3

INSIGHT / BIG DATA

HR + Big Data = STRATEGIC EDGE Sixty-one per cent of HR directors report Big Data use as tactical, ad hoc and disconnected from other key systems. Close to 50% say they are unable to integrate workforce data with other systems to make decisions critical to the business in real time. How can this be improved?

The term ‘Big Data’ encompasses not only the huge amounts of data currently being produced that do not fit within traditional database technology, but also the analytical tools and programs used to assess it. The data runs the gamut from employee engagement to customer satisfaction, transaction information, and everything in between.

Despite knowing about it, much of the Australian working world remains unprepared for it; the majority (78%) of Australians indicate that their organisation is not equipped for a Big Data initiative, lacking the relevant skills and competencies, HR services firm Hudson revealed.

Preparation, however, is paramount, as the results achievable through Big Data analysis are staggering.

“The rise of Big Data itself is not only changing the way HR executives are using info, but also evolving the role of the HR execs,” Alec Bashinsky, national partner of people & performance at Deloitte, tells HRD. The use of Big Data in areas such as finance and marketing is fairly black and white – the numbers, while still vast, are easily analysed. However, human beings are much more difficult to corral into algorithms and tables.

BIG DATA EVOLUTION

LEVEL

1

REACTIVE

4 | OCTOBER 2013

Operational reporting. When getting into Big Data, HR should focus on measuring efficiency and compliance, data exploration and integration, and development of a data dictionary. How are resources allocated? What is the state of the HR programs? Most importantly, how are our data measurements themselves?

Training hours, time to hire, cost to hire, leadership pipelines, demographics, grievances and turnover are all areas to be explored at this point.

LEVEL

2

Advanced reporting of operational measurements surrounding benchmarking and decision-making.

How can HR, L&D and business operations improve? What are the trends in the organisation?

Revenue per employee, engagement, risk of loss, and mobility should be examined.

PROACTIVE

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HUMAN RESOURCES DIRECTOR

WHAT IS IT GOOD FOR? Despite this, a high-performing HR professional can utilise Big Data to not only uncover current trends in the organisation but predict what is soon to happen.

It’s the difference between ‘gut feel’ and knowing with some certainty what will happen.

I think

Big Data: Organisational profile

27%

61%

12%

Data Metrics Analytics

Use little-to-no workforce analytics

I know

LEVEL

3

Analytics on segmentation, statistics and development of people models. HR should be looking at measures and tools that dramatically improve the organisation, while segmenting the workforce into various performance and risk pools. Direct support from line executives and strategic visibility is paramount at this point, and should only be undertaken after two or three years have been spent working with Big Data.

STRATEGIC

Use them in an advanced way*

*79% of advanced practitioners use analytics to develop workforce skills in key areas; 66% use them for identifying and developing high-potential employees; 65% use them to understand and plan for future talent needs

Insight & application “Imagine we put a new employee into a role and it takes them two to three years to really get into the particulars of the role,” says John Hansen, Oracle’s vice president, HCM product management, JAPAC. “At the end of the three years they’ve done everything that might be considered ‘new’. Our history data might tell us if we don’t promote people or move them to a different role after three years we may see high attrition in the fourth and fifth year.”

Once this information is garnered, the true potential of Big Data becomes apparent. When using the right systems, HR can analyse what trends are currently occurring with regard to talent management, performance, and – in this case – tenure, and return an informed prediction of what may soon happen based on previous scenarios.

Predictive analytics provides HR with not just what may happen in the future but ways to prevent it. It raises tantalising ‘what if’ scenarios: what would happen, for example, if this person was promoted in the fourth year? The data-mining engine can then go

Use them moderately

Source: Harvard Business Review

back and look at where that pattern has occurred in the past.

Predictive analytics can then be applied to a variety of scenarios and possible problems, ranging from staff turnover to drops in engagement. In addition, the use of analytics gives the HR director – traditionally seen as dealing with ‘soft’ data – a higher level of authority.

Dr Jac Fitz-enz, considered by some to be the ‘father of HR metrics and analysis’, stated: “Without talent analytics, talent management won’t be part of any significant business discussions.”

Yet while being able to collate the data and analyse it is a lengthy process in itself, it means nothing if HR and the Big Data team are not appropriately equipped to execute real action in the organisation using it.

Having data is all well and good; having relevant data is another matter altogether.

“The most important part about data analytics is the ability to pull insights from the information.

LEVEL

4

Often hallmarked as a true indication of Big Data’s power, predictive analytics is the end game for the Big Data team.

Scenario planning and risk mitigation can be achieved by using models to identify potential future risks in regard to skill shortages and gaps, performance gaps and other areas. HR can now use the data from economic conditions and current talent risks to help define the future of the organisation.

This stage must be integrated with workforce planning and talent acquisition, and should only be reached after three to five years in the previous stages.

PREDICTIVE

Source: Bersin & Associates

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OCTOBER 2013 | 5

INSIGHT / BIG DATA

Sometimes it is less about the data and more about the insights around it. What is impacting this metric?

What is impacting our high-potential pool, where they sit and where they are going?” explains Bashinsky.

WHAT SHOULD HR DO? The topic of Big Data is difficult to pin down due to the ever-evolving nature of technology. However, HR directors expanding into Big Data need to take into account two key points: Big Data is not a short-term project that can be quickly launched. HR must recognise they are embarking on a journey of at least five years, and slowly but efficiently measure and collate data, refining the process as they go HR must change in an ever-changing world. A strong team of highly dedicated, highly skilled workers with their fingers on the Big Data pulse is required. Big Data is not your average initiative; it is a complete game changer “Data analytics is probably the biggest thing that is going to change the shape of HR leaders in the future,” Bashinsky says. “It is absolutely critical anyone in HR can not only play with data analytics but just as importantly know how to present it to their executive teams. That is really where they start to demonstrate an understanding of the business from the analytics they have.”

SAMPLE BIG DATA DASHBOARD: TALENT ACQUISITION

Candidates on file seeking vacancies

RATIO INTERNAL TO EXTERNAL HIRES

11

External

16 4 2 <1 month

6 | OCTOBER 2013

3

Internal

2

1-3 4-6 7-9 months months months

4

Consider talent acquisition in the overall context of the business – align your efforts with your company’s strategy and objectives.

Conduct a talent needs assessment to gain insight and gaps against today’s business requirements. If you’re anticipating growth, look ahead to the talent needed to succeed

4

Develop a ‘data acquisition’ plan – understand the type of data you need to support your strategic decision-making. This should include metrics such as time to fill, cost per hire, sources of hire, attrition rates and performance scores

4

Find your data experts or ‘scientists’. Though Big Data is a great tool, it takes knowledgeable people to make the essential connections.

Data analysis takes a specific skill set. If you don’t have or can’t develop such expertise internally, consider looking externally to the company

4

Partner with business leadership – your chance of Big Data success is much greater with support from throughout the business.

Aligning with other business leaders not only helps gain buy-in at the highest levels but also provides opportunities to demonstrate success

KEY PLAYERS

Vacancies filled internally (%)

Average # of candidates on file accepting

TIME TO FILL

STARTING FROM SCRATCH For those starting the Big Data journey from scratch, experts recommend concentrating on one area – and the one area deemed to have the most immediate impact on workforce planning is talent acquisition.

Using talent acquisition as an example, here’s a fourstep process to follow:

Source: EmployeeConnect

The cost of outsourcing Big Data varies dramatically, depending on company size, number of employees, and complexity of data analysis.

Some outsource providers offer both consulting and software solutions. Here are five to look out for: yy yy yy yy yy

Deloitte (deloitte.com) IBM (ibm.com) eQuest (equest.com) EMC2 (emc.com) Hadoop (hadoop.apache.org) is an open-source (free) Big Data tool. HR and IT would need to work closely to ensure this could be modified to meet your organisation’s Big Data requirements

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OCTOBER 2013 | 7

INSIGHT / OUTPLACEMENT

OUTPLACEMENT IN FOCUS

ABS data shows that for the 12 months to February 2013 more than 200,000 people who had been in a job for at least a year were forced to leave due to retrenchment or their employers going out of business. It seems no coincidence that outplacement service providers report being busier now than during the GFC

STATE OF OUTPLACEMENT IN 2013 83%

76%

43%

11%

of companies use some type of outplacement for displaced workers

of companies offer it to at least 75% of their displaced workers

of companies are using traditional in-person outplacement

75%

use a mix of virtual and live or only virtual

of HR professionals do not feel they understand the strategic value of outplacement very well

TOP

Understanding how to use the internet effectively in a job search was rated “very important” or “critical” by

95%

3

of people

MEASURABLE BENEFITS OF PLACEMENT

yy Reduced legal risk yy Employer branding/corporate image yy Increased employee satisfaction levels

DID YOU KNOW? Less than half of companies ask former employees about how well their outplacement experience went

AVERAGE COST OF OUTPLACEMENT PROGRAMS BY EMPLOYER TYPE ($) (’000)

$25–$50

Executive

13.6%

Management

$6.5–$15

$2.5–$6.5 $1–$2.5

31.8%

36.4%

13.6%

4.5%

-

4.8%

23.8%

66.7%

4.8%

Professional/ supervisory

-

-

4.8%

76.2%

19%

Other employees

$15–$25

-

-

52.4%

47.6%

Source: Choice Career Services: Australian Outplacement Review 2012

8 | OCTOBER 2013

The employees thought to need outplacement the most

Group workshops

yy Office - Non-management yy Office - Supervisor/ management level yy Blue-collar workers

The employees thought to need outplacement the least

yy Senior management yy Executives

The employees most likely to receive outplacement yy Senior management yy Executives yy Salaried supervisors/managers

Office space

7% 3.1% 3.9% Post program support 4.7% Access to 3.1% online HR’S program

One-on-one coaching

15.6%

Psychological support

Other

10.2%

12.5%

MOST VALUED OUTPLACEMENT SERVICES

Résumé preparation

8.6% Job search technique

7.8% Networking skills 23.5% Interview techniques

Source: Choice Career Services: Australian Outplacement Review 2012

Source for other graphics: Careerminds

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EXPERT INSIGHT / SUPERANNUATION

TIME TO ENGAGE There is a plethora of changes scheduled for superannuation in the coming months. Damian Hill, CEO, REST Industry Super, outlines what’s in store

The government has announced a number of changes to superannuation, intended to improve the system by making it more transparent, efficient and fair.

These changes present a great opportunity to reconnect with your employees about their super. The key is to engage early to ensure they are aware and can better manage their financial wellbeing.

GOVERNMENT CONTRIBUTION FOR LOW INCOME EARNERS

If an employee earns less than $37,000 per year they may benefit from the Low Income Super Contributions (LISC) scheme. This is a refund of the tax that is applied to any employer or concessional (before-tax) contributions made to their super fund.

An employee may receive up to $500 per year from the government into their super account and if the payment is less than $10, it will be rounded up to $10.

THE GOVERNMENT’S COCONTRIBUTION HAS ALSO CHANGED

If your employees meet the income tests for the government’s co-contribution scheme, they can receive a tax-free super contribution from the government when they make a nonconcessional (after-tax) contribution to their super account.

The government will pay $0.50 for every dollar your employees contribute to their super fund in after-tax dollars, up to a maximum co-contribution of $500 a year.

MORE SUPER FOR EMPLOYEES

The Superannuation Guarantee (SG) contribution rate is progressively increasing from the current 9.25% rate to 12% by 1 July 2019. Plus, people 70 and over, that meet the minimum required working hours and salary, are now able to receive SG contributions.

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“These changes present a great opportunity to reconnect with your employees about their super” - Damien Hill MYSUPER – THE NEW DEFAULT SUPER ACCOUNT

From January next year, if employees haven’t chosen a super fund, your business will have to pay SG contributions into a fund with a MySuper offering.

REST has two MySuper product offerings. REST Super is an award-winning product with a MySuper offering that is open to all employees and offers automatic life stage insurance cover.* Employees can create their own investment portfolio from 13 options including the Core Strategy, which was ranked number one in the balanced option survey over the last five, seven and 10 years^ to June 2013.

REST Corporate is a completely new super product, available now, with a MySuper offering and salary based insurance. The insurance can be adjusted according to employees’ income levels and occupation so they have the flexibility to choose their own level of cover.

More information about these products is available on our website at rest.com.au/ corporate or rest.com.au/super.

THE CONCESSIONAL CONTRIBUTION CAP FOR MATURE AUSTRALIANS HAS INCREASED

For the 2013/14 financial year, there was an

increase from $25,000 to $35,000 of concessional contributions for people aged 60 and over. From the following year, people aged 50 and over can also contribute up to $35,000 per financial year without a penalty, up from the $25,000 cap that applies this year.

HIGHER CONTRIBUTION TAX FOR HIGH INCOME EARNERS

Anyone earning more than $300,000 will now pay 30% tax on their concessional (before-tax) contributions to their super.

The regular contributions tax is 15% so this change is essentially doubling the super tax bill for high-income earners. The additional tax will be assessed when the individual processes their tax return.

Consider whether REST is appropriate to your objectives, financial situation and needs.

Please read our Product Disclosure Statement (available at www.rest.com.au or by calling 1300 300 778). REST Industry Super is the Retail Employees Superannuation Trust ABN 62 653 671 394, issued by Retail Employees Superannuation Pty Ltd, AFSL 240003. *Subject to eligibility SuperRatings Fund Crediting Survey – June 2013 (SR50 Balanced).

Past performance is not an indicator of future performance. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to superratings.com.au for details of its ratings criteria. Ratings, awards or investment returns are only one factor that you should consider when deciding how to invest your super

OCTOBER 2013 | 9

FRONTLINE INTELLIGENCE / HR CAREER MANAGEMENT Lisa Robson is the Practice Manager of The HR Space, the HR insights and consulting brand of The Next Group. For more information, call (02) 8256 2500 or email lrobson@thehrspace.com.au. Website: www.thehrspace com.au

Business capability in demand Whilst building technical HR knowledge is essential, it’s just one part of the equation. The often missing component in HR professional development is building business capability.

We have witnessed a marked increase in the expectations of HR practitioners to demonstrate strong business knowledge through understanding the numbers and commercial drivers.

WHY THE CHANGE?

The brief for the expert HR practitioner has evolved significantly this year. The key drivers for this are: • the continued dominance of the Ulrich model, which is designed to deliver strategic HR business partnering; • the requirement for HR to drive business performance and productivity; and • HR’s own agenda to be a key contributor to business decision-making and direction.

“Those HR practitioners who demonstrate a strong commercial toolkit will be highly valued and sought after” develop business cases, and confidently present to senior leadership teams.

REQUIRED CAPABILITIES

Designer (Executive) role level Designers are typically expected to facilitate C-suite and board meetings, formulate strategy, demonstrate ROI of initiatives and drive organisational transformation.

Activist (Professional) role level Activists are typically expected to drive continuous improvement, build effective stakeholder relationships and demonstrate competence in project planning and delivery.

Being aware of the capabilities required to be an expert HR practitioner is one thing, but where should HR practitioners who are seeking to build on these areas focus their professional development?

It is advised that Activists should focus on developing business knowledge (reading the Business News and Market Wrap sections of the Australian Financial Review is a great start!); understanding their organisations’ revenue sources, costs and profit margins; sourcing and implementing process and systems improvement opportunities within their roles; looking at information critically, and identifying insights from the data they are working with.

Enablers may focus on building their

It is not suggested that the need for strong HR subject matter expertise is decreasing.

This expectation, however, is coupled with the heightened requirement to demonstrate a well-developed commercial toolkit.

The key business-focused capabilities often sought at each HR role level (regardless of whether generalist or specialist) are outlined below:

Enabler (Business Partner/Manager) role level Enablers are often required to interpret business plans and financials, seek out and understand market and competitor trends,

10 | OCTOBER 2013

DEVELOPMENT FOCUS

capability to effectively pitch business cases through the use of both internal financial and business lever data and external market trends. It is also suggested that enhancing facilitation skills, personal brand alignment with the executive team, and understanding the key pain points of business leaders should be in focus.

Designers typically focus their capability build on demonstrating functional strategy influencing business strategy and direction, facilitating and presenting at board and group level, demonstrating ROI for all areas of the function, and bringing external best practice thinking into their organisaton.

DEVELOPMENT SOLUTION

HR Inspire by The HR Space is a 12-month collegiate experiential learning journey designed specifically for the HR profession to build the business capability to be successful at each role level. It brings together cohorts of like-minded and similarly experienced practitioners in a professional development program of 10 learning modules. The program is complemented by a purpose-built communication portal to allow continuous sharing of experience and ideas. HR Inspire programs are designed to be applied directly to participants’ roles to ensure the journey is a highly pragmatic experience.

THE FINAL WORD

The expectations of HR practitioners to complement their technical expertise with business expertise is ever-increasing.

Professional development efforts will require a balanced approach between both of these areas to remain an expert practitioner in 2013 and beyond.

Those HR practitioners who demonstrate a strong commercial toolkit and understand and contribute to the business context that they work within will be highly valued and sought after.

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MARKET MOVES / RADAR

Recent HR Market Moves Lyn Haffenden has been appointed as the HR Director for Blue Care in Brisbane. Recently with Queensland Health, Lyn has also held senior roles at Hamilton Island Enterprises, Queensland Rail and Sydney Water.

Diageo has welcomed Mark Lush as Head of Talent, Leadership and Capability. Mark has a broad OD skill set, particularly in the areas of employment branding, organisational effectiveness, culture and engagement. He joins from Unilever where he was Head of Leadership and Organisation Development.

Grant Whyte has recently been appointed as the National People Operations Manager at Altus Traffic. Altus Traffic is a specialist in traffic management reducing risk to the public.

Grant was previously National Manager of Resourcing, Development and Employee Relations at Service Stream.

Jones Lang LaSalle has appointed Michael Hickton as Compensation & Benefits Manager for Australia. Michael joins the business with over 15 years of experience in payroll and compensation & benefits management, as well as bringing strong subject matter expertise, having working in the commercial real estate sector at Knight Frank.

Mike Cormack has joined ESSSuper as their General Manager Human Resources. Mike’s early career line management financial services roles were a strong attraction to ESSSuper. He has also held a number of transformational HR roles in Australian organisations; more recently he was General Manager Human Resources at the MS Society.

Service NSW recently appointed Nicole Ashe as Director, People & Culture. Nicole has extensive HR generalist experience with a focus on improving organisational capability, and was most recently HR Manager, Retail Operations and Private Label, at the Apparel Group.

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Dallas Wilson has recently joined Navitas, the education services provider, as Head of HR – University Pathways. Dallas recently relocated to Sydney from Melbourne and will head up a global HR team. She was previously HR Business Partner – Sales at Carlton United Breweries, SABMiller.

David has a reputation for successfully leading L&D teams that enable organisations to achieve amazing results and improve ROI.

NSW Trade & Investment has appointed Richard Ganter as Executive Director, People, Learning and Culture. Richard recently returned to Australia from Singapore and brings with him substantial senior HR management experience gained both internationally and locally. He was previously Senior Regional HR Director – Asia Pacific at CH2M Hill.

Phil Jordan joins Challenger Limited as Senior HR Business Partner, bringing with him a wealth of HR experience from small to medium-sized enterprises to global multibillion-dollar businesses. Most recently, Phil has enjoyed over three years with Telco giant Singtel Optus and now embarks on his next career challenge in the investment banking sector.

Ian Price has joined Valspar as HSE Manager (ANZ). Ian is a highly experienced HSE professional, having worked within government, corporate and consulting roles, most recently with a focus on risk management and business improvement. He has strong technical knowledge from his management roles at WorkCover NSW and as OHS Academic Director at the University of Wollongong.

Global cloud-based ERP software company NetSuite recently appointed Rod Ko as Asia Pacific Talent Acquisition Manager. Rod has spent over 12 years in the technology sector recruiting talent from around the world and was previously Talent Acquisition Manager at Dell. Rod joins NetSuite at an exciting time as the company continues to break ground in the ERP space.

David Dowe has joined the Australian Graduate School of Management as their Senior Client Relationship Manager. David brings a wealth of knowledge to this role, having worked in senior learning roles in some of Australia’s largest blue chips.

By supplying Market Moves, The Next Step is not implying placement involvement in any way.

OCTOBER 2013 | 11

FRONTLINE INTELLIGENCE / HR CONSULTING

The ‘generations’ debate degenerates:

FINDING FACTS AMONG THE MYTHS Why do Gen Y’s so often get such a bad rap? Popular media has portrayed Gen Y employees as nothing but spoiled brats with serious entitlement issues.

For many there appears to be an expectation – a fear even – that Gen Y will change the way organisations are run, that they will need to have flexible schedules and managers can only ask Gen Y’s to do personally fulfilling jobs.

Broad generalisations like these beg the questions: How different are the generations at work, really?

Are there areas to manage, or is it all hype? Are the differences suggested true generational differences, or are they simply the effect of age (younger workers are snarky and push boundaries of authority, and older workers are settled, having already fought for their autonomy and position)? Are we taking popular generational stereotypes as fact and implementing inappropriate strategies as a consequence?

Kenexa, an IBM Company, is in a unique position to definitively report on the generations’ work attitudes through its WorkTrends™ research program. Collecting opinion and attitudinal data of tens of thousands of employees back to 1984, we can determine whether differences between Gen Y, Gen X, Baby Boomers and the Silent Generation are truly generational versus, say, career stage.

Among a number of interesting insights to emerge from this ongoing research, the following are a few that highlight how some Gen Y stereotypes are questionable at best.

SOME GENERATIONAL DIFFERENCES ARE PURE MYTHS

Dr Neal Knight-Turvey, executive consultant at Kenexa, an IBM Company, 348 Edward St, Brisbane.

Phone 132 426 or email nturvey@au1.ibm.com.

12 | OCTOBER 2013

Despite rumours of discontented youth and ready job swapping for higher pay, Gen Y employees are no less satisfied with their pay than their older counterparts (around 50% across all generations).

The real difference in pay attitudes lies in career stage. On average, those in the latter and middle stages of their careers are more satisfied with their pay than those in the earlier stages. If Gen Y’s do not feel more entitled at work, then we do them a disservice as managers by perpetuating such a myth, and we do our organisations a disservice by tailoring remuneration strategies to ‘match’ the myth.

OTHER GENERATIONAL DIFFERENCES ARE CONTRARY TO POPULAR BELIEF Although we hear plenty of noise about managing Gen Y employees, leadership must be doing something right. Gen Y’s are significantly more positive about their managers’ performance (74% of Gen Y employees rated their managers’ performance positively compared to Baby Boomers’ 67%). They are also more positive about job security and internal career opportunities – and they are more positive than past generations generally. Overall, Gen Y seems to be a pretty optimistic group. It’s ironic that employees of the Baby Boomer generation in managerial positions find employees of Gen Y mystifying, threatening or both. Not only are Gen Y employees positive about their managers, but Baby Boomer generation employees, overall, are also the least positive on these measures. Why this is true is difficult to say, but the result is that the Baby Boomer generation employees who raise the alert the most are also the generation that is most discontented at work!

DON’T FALL FOR THE POPULIST STEREOTYPES The natural preoccupation with identifying the differences between ‘us’ and ‘them’ sometimes gets the best of us. One group that looks to have suffered the most from such an endeavour is that group labelled (for better or worse) ‘Gen Y’. Books like Y in the Workplace: Managing the ‘Me First’ Generation and Not Everyone Gets a Trophy: How to Manage Generation Y paint a pretty grim picture sometimes.

But wise leaders tend not to rely on conventional wisdom, or catchy titles aimed at selling books or consulting services. They are constantly looking to challenge, not affirm, those seductive stereotypes that subliminally shape and cloud our thinking.

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PAYROLL REQUIREMENTS While change can be daunting, Q preparing for a new system can be invigorating for payroll teams A What advice can you provide for an organisation looking for a new payroll system?

Having the right payroll system in place can be a game changer for many organisations.

Changing systems is a fantastic opportunity to source a solution that will drive efficiency within your payroll department.

It’s a good idea to document payroll needs during a requirements gathering exercise. This is usually done prior to engaging with potential vendors.

It provides an opportunity to formalise your needs and document organisational plans for growth.

Most organisations have their payroll systems in place for at least five years, so it’s important to source a solution that will meet your needs today and well into the future.

As part of the requirements gathering I would recommend you do an audit of your existing payroll processes. This is the best way to identify where manual intervention is currently required and what elements of the payroll process are time consuming.

By documenting the existing processes you will identify bottlenecks and areas where rekeying is required. It will also be easier to identify the functionality required.

Some key functionality items to consider while preparing the requirements document are: job costing, award interpretation, leave calculations, superannuation, multiple contracts, multicurrency, employee/manager self-service, timesheets, expense claims, and integration with both your financial and HR systems.

Your goal for the new system should be to eliminate manual intervention and rekeying of data. Integration with other line-of-business applications will help reduce rekeying and associated errors. A payroll system with an open system architecture that supports integration with other applications can shave hours off payroll processing times. As you prepare your requirements document, consider if integration or improved integration will help streamline payroll processing.

Date-based versus period-based can cause quite a bit of confusion. Not all systems are created equal in this regard. It’s advisable to understand the

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enhanced productivity a date-based system will deliver for the payroll team.

One of the main differences is that a date-based payroll system will allow you to make changes when they occur. A period-based system requires that changes relating to that pay period be entered while the pay period is open; this means all changes need to be stockpiled and not processed when convenient to you. A date-based system allows for changes to occur at any time in the future or past.

Reporting is also more flexible with date-based systems as reporting is not restricted by pay periods; reports can be generated for any time period and can occur for any historical point in time, all of which allows for more detailed analysis.

While collating your system requirements it is advisable to speak with management regarding the types of information they would like from the system. A wealth of information is stored within payroll and it’s crucial that the payroll team are able to access it in order to provide the data that supports informed decision-making. Many contemporary payroll solutions provide sophisticated analytics and graphical management reports; these metrics can be vital for workforce planning and costing, so take the time to document the organisation’s reporting requirements.

It is also advisable to have a firm understanding of enterprise growth plans. If your employee numbers are set to increase, then ensure those numbers are contained in your requirements document. It’s also advisable to determine and document the time available for running the pay.

While change can sometimes be daunting, preparing for a new system can be invigorating for payroll teams. A new payroll system is an excellent opportunity to drive efficiency and streamline processes, which will provide payroll professionals with more time to perform strategic activities, rather than cumbersome manual tasks.

Nick Southcombe, general manager, Frontier Software, phone (03) 9639 0777 ; frontiersoftware.com.

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PROFILE / JO MCCONNELL

“If you look at it from a racing perspective, we want to see people shaving off seconds from what they do. Once you see that across an entire organisation, it really makes a difference” Jo McConnell

14 | OCTOBER 2013

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LEADING A

GIANT

Jo McConnell is at the helm of BHP Billiton’s global HR initiatives and tells Aidan Devine how strategic HR has delivered exceptional results in a business that spans multiple industries and dominates the global resources market Number 180 Lonsdale Street, a boxy office tower in downtown Melbourne, would seem a modest choice of headquarters for a company that last year made more in revenue than all but 62 countries.

The building climbs the sky only as high as the office blocks around it, an exterior of blue and grey glass in a sprawling metropolis of blue and grey class. No flashy signs ornament the tower. No neon lettering, no Donald Trump-style allusions to glory.

It is only at the building’s doors that a small plaque reveals the hidden giant within. This is no place to ignore. Number 180 Lonsdale Street is the headquarters of BHP Billiton, the world’s largest mining company.

The company may not be a name as instantly recognisable as Apple or Toyota or Walmart, but beneath the multinational’s, some would say, deliberately lower public profile, it is just as colossal. Last year, it was among the world’s top 20 most profitable businesses and, a year before that, the world’s third largest company by market capitalisation. Its activities engage 46,000 employees and 79,000 contractors across almost every resources market imaginable.

The unique challenges its 1,800 HR professionals face are as diverse as the business itself. They range from ramping production costs in countries like Canada and Australia to a tense labour environment in South Africa, where regular industrial action reached a peak last year as 34 striking mining workers were shot dead outside a platinum mine owned by BHP rival Lonmin Plc.

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Spearheading this challenge from the top floors of 180 Lonsdale Street is BHP Billiton’s vice president, human resources, Jo McConnell.

An almost 20-year veteran at the company, McConnell overseas HR initiatives at the highest level, but she’s no mere pen pusher. The energetic Aussie started in a fairly typical industrial relations role at BHP, but moved her way through the company’s various commodity businesses in a number of different countries before arriving at the epicentre of the group’s HR initiatives. “It’s a very exciting place to be,” she says.

OUT OF MANY, ONE The biggest challenge BHP’s HR functions face is fostering a sense of shared identity in a group of operations that are markedly different from one another. Gold extraction in Indonesia is a stark contrast to the working environment of petroleum workers in the Gulf of Mexico. The work that copper miners face in Escondida, Chile, is not the same as that of diamond explorers in Angola.

“We’ve met that challenge by sticking to strict global minimum standards,” says McConnell. “Our charter provides the foundation for everything we do in the organisation… it articulates the values by which the entire business works under. The values are at the core of everything we do.”

The result, McConnell claims, is an organisation in which a decentralised model of doing business has still brought about a common organisational culture.

“We think about culture being critical in driving

KEY STATS

46,000 employees and 79,000 contractors n 1,800 HR professionals n $72,190,620,000 – total revenue in 2012 n

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PROFILE / JO MCCONNELL

business performance. By using a platform of common systems and processes, we’ve been able to create business value across a decentralised model. Each business within the group [for example, iron ore, petroleum and potash, copper] follows a set of minimum standards and, from there, the businesses set their own HR strategies and approaches, tailored to the needs of their specific operations and location.”

Central to the company’s values is a strong emphasis on accountability and performance, but a particular focus is on simplicity. In an organisation as large as BHP, the need to keep the business unencumbered by red tape is paramount.

“Our HR processes need to be simple,” McConnell says. “HR can be administratively heavy if you’re not careful, and because we’ve done so much work in simplifying our internal processes, we find that there’s a high degree of commonality in roles across the organisation.”

KEEPING COSTS DOWN Another frequent obstacle for the company is its mounting production costs. Extracting minerals is not cheap. In an industry where it is common for REMOTE WORKFORCE CHALLENGES With many of its mines in some of the world’s most remote areas, BHP Billiton has a unique challenge in managing its workforce. Being far from regional centres with a large population, services, infrastructure and the kind of lifestyle that would appeal to most people, it is impractical for the company to have a residential-based workforce at many of its operations.

The solution: fly-in, fly out (FIFO) workers. The reality is that, for many people, working remotely suits their lifestyle or personal circumstances, and mining companies have frequent requests for FIFO as an employment option.

Historically, FIFO has been a feature of remote Western Australia and Queensland operations, where the bulk of the estimated 50,000 workers and contractors are employed under these arrangements. The trend has since spread to the far west and northwest of NSW. BHP Billiton provides a range of residential and FIFO opportunities, an example of which is the company’s Daunia Mine, opened in September. The mine is run as a FIFO operation, with employees sourced from Brisbane and Cairns, each more than 600km away.

16 | OCTOBER 2013

companies to post end-year financial losses of hundreds of millions of dollars, the fact that BHP walks away with mega profits is a testament to how well thought through its processes are.

“HR can totally make a difference [to the bottom line],” McConnell says. “The way we’ve gone about it is by empowering each individual in the company to make a difference. We encourage them to think about how they are going about their work and how this will enable them to contribute directly. If you look at it from a racing perspective, we want to see people shaving off seconds from what they do. Once you see that across an entire organisation, it really makes a difference.”

The method through which HR achieves this personal empowerment strategy is by developing its leaders, who in turn, develop their people. “Our leaders are our critical interface here. We rely on our leaders to engage and energise our people to the challenges ahead. How we support that in HR is by accelerating the development of our leaders to support all of our people in reaching their full potential.”

BHP Billiton grows its leaders by spotlighting critical leadership behaviours that bring about the best productivity from the teams that work under them. HR works to understand which of those it can influence and draws out a plan of how these behaviours can be developed. “We look at things like coaching. How do you coach individuals on the job, day to day, to be able to perform better?”

WOMEN IN A MALE-DOMINATED FIELD Of course, for an organisation as large as BHP, HR initiatives wouldn’t be complete without a focus on diversity. McConnell herself is a product of this.

Originally set on a career in archaeology, she made her way into the company through its award-winning graduate recruitment program.

“I probably watched too many Indiana Jones movies,” McConnell laughs. “I studied archaeology at university, but then I went on a real-life dig and realised it wasn’t quite how the movies depicted it… I then studied a mixed degree with elements of psychology and business and found the intersection of those fascinating. Eventually I ended up at BHP Billiton.”

The company’s graduate recruitment program is one of the key ways in which it attracts diverse talent.

It currently has 1,200 graduates in the program

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globally, who it views as the future of its technical and leadership pool. Supplementing this program is an Accelerated Leadership Development Program, which targets employees at a manager level who have the potential to become operational leaders.

Forty-three per cent of people in the program are women.

“We have programs right from university level to enhance the number of women in, for example, engineering studies,” McConnell says. “A focus of our graduate program is hiring diverse talent, and right through our leadership development programs we favour diversity.”

CAPACITY BUILDING At the end of the day, BHP’s HR approach may appear ironic for a company that deals in valuable (and mostly non-renewable) resources. “People remain our most precious resource,” McConnell says.

In her view, HR should be a key chair at the leadership table. And that applies to all businesses.

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“To be able to be a trusted adviser, strategic partner, and very much at the core of decision-making is an exciting place to be” “The central role for HR, today and into the future, is to build the capacity of organisations.

That really centres on the people within it. In BHP we’re a long way down the path of being a valueadding partner for the business. And we’ve done that by creating mature people systems that mean the fundamentals of the business are reliable.”

McConnell admits it is a function of business that continues to energise her.

“To be able to be a trusted adviser, strategic partner, and very much at the core of decisionmaking is an exciting place to be.”

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HR IN THE FRONTLINE 18 | OCTOBER 2013

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HRD invited six outstanding HR directors to an exclusive networking event. From CEO succession to the Sigmoid Curve, the agenda was wide-ranging and the conversation flowed freely. Iain Hopkins reports Photo: Deborah Abesser Photography

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COVER STORY / HR STRATEGY

EXECUTIVE SELECTION AND SUCCESSION Key takeaways n

n

Prepare for both internal and external succession plans; ensure internal roles have exposure to the board. The difference between executive roles and one level down is board exposure.

Good CEO succession takes time and actually does not have a ‘start’ and ‘end’ date; consider it a constant, ongoing process, and be prepared to wait for the right person.

Chris Lamb: For CEO succession in a listed company the market expects you will do an external review, whether that’s a full search, benchmarking, or whatever. You can have the best succession plans, you can have five people internally lined up, but the market still expects you will look outside. But for most organisations, if you’ve done a good job, if you’ve developed the right people and given them the right opportunities, an internal successor is a good bet: they know the organisation, they know the culture, they know what works.

Joanne Allen head of HR Aust/NZ, Citi Employees: Approx. 2,000 Aust/NZ (259,000 globally) HR team: 27 2011/12 revenue: $1.9bn

Emma Hogan director, people & culture, Foxtel Employees: 3,000 HR team: 25 2011/12 revenue: $2.2bn

Chris Lamb HRD, Lend Lease Australia Employees: Approx.

17,000 globally HR team: 75 2011/12 revenue: $7.4bn

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Simone Carroll GM, people & brand, REA Group Employees: 600+ globally HR team: 9 2011/12 revenue: $277.6m

Bob Hogarth GM, HR, Heritage Bank Employees: Approx. 800 HR team: 32 2011/12 revenue: $539m

Mel Tunbridge HRD, SBS Employees: Approx. 1,300 HR team: 18 2012/13 revenue: SBS’s main source of revenue, government funding, is forecast to be $247.5m

INTERNAL VS EXTERNAL Newly appointed CEOs in 2012 were, for the most part, familiar faces: 71% of the time, companies promoted people from within; a quarter of incoming CEOs had worked at the same company for their entire career; 81% of new CEOs had the same nationality as the company’s headquarters; and 95% were men. Research also showed that, from 2009 to 2011, 35% of externally hired CEOs were let go versus 19% of those who were promoted from within.

Source: Booz & Company’s 2012 Chief Executive Study

Bob Hogarth: There’s a certain romanticism about hiring someone externally. In days gone by, many organisations looked externally to bring something fresh into the fold. In many organisations, having someone who’s been there for a long period of time has some dangers – they have to live with their mistakes.

Mel Tunbridge: Our CEO is on a four-year contract, so every four years we face that problem. Our biggest challenge is we don’t set the remuneration for our CEO; there’s a government remuneration tribunal, so we are capped. Last time we had probably 60-odd people who were shortlisted, who either weren’t interested in the organisation – because it is quite specific, quite niche – and there were loads of other people who went: “How much?

Sorry, I’m already on… XX”.

Emma Hogan: We’re in a unique situation at the moment where our COO is leaving us, and he’s been with Foxtel for nine years. He’s an amazing guy.

He’s been joint CFO and COO for the last two years. We wanted to retain him; he wanted more responsibility – so we almost built the role around him. And now he’s going we’ll restructure and untangle that area. It’s rare you’d be recruiting two executives at the same time, but we’re in this situation where we can have conversations about how are we going to recruit so the team can position itself well. So we’ll restructure, but I think we’ll prioritise it as structure, strategy and then person.

Previously we’ve maybe done person, then structure and strategy.

Simone Carroll: You’ve also got to look at where the knowledge lies in the company to make sure that’s

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disseminated out as far as it can go, and then be careful with hierarchies. Ensure people aren’t being overshadowed by their manager. Give them as much knowledge as possible and provide them with opportunities to be exposed to the board. You must give them the opportunity to see what that environment is like; otherwise, when it comes to putting an internal up against an external in front of the board, the internals are not going to win.

HR AND BOARDS Key takeaways Regardless of industry, boardroom politics is the coming together of agendas. Understand what everyone’s agenda is; build relationships with people and aim to find a philosophical alignment with them. Once another person’s intent is understood, it’s much easier to position the issue to get an approval or at least a compromise on it.

In terms of building diversity: Analyse what you’ve got now, analyse the gaps between what you have and what you need, and then put a plan in to address that. Be prepared to look outside the usual network and means of attracting diverse board members – diverse not just in terms of gender, ethnic background, etc., but also in terms of diversity of thinking.

Diversity initiatives in general are plateauing; HR needs to develop new tactics and strategies – HR can’t keep saying the same thing and expect the dial to move.

CL: We hired a board member relatively recently.

I should say I wasn’t involved at all in that; it’s a board process and board decision. However, he is famous for doing six months’ due diligence on an organisation before he will join their board.

He expects his first couple of months to be spent listening, asking questions, and not taking assumptions from his financial services background into a property construction company. So, given that a board role is not a full-time, hands-on executive role, your first 100 days is not much. It’s more passive than actually making a mark.

MT: That’s exactly right. I’m on a couple of boards myself, and the hardest board to get onto is your first one. Then suddenly you have a network to

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draw on. From a culture diversity perspective our board is ridiculously diverse. Yet it’s hard to find a real mix. It’s easy to find the same 100 people who are already on boards of similar organisations, but if you don’t search – and sometimes that’s what happens – you go to people you know.

CL: Board-level diversity is a massive issue in Australia. We get stuck on gender, but it’s much broader than that: cultural diversity is terrible on boards [see ‘‘Failing on ethnic diversity”, p.22].

Beyond specific diversity components, I talk about diversity of thinking. You can have a board that is diverse by gender but they all come from the same background; they have the same thinking, they come from the same organisations and roles. To solve big problems you don’t want a bunch of experts all thinking the same way; you want people who bring different perspectives.

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HR AND FINANCE Key takeaways HR has access to some of the most important metrics and analytics; it must therefore build confidence in ‘talking numbers’.

No matter the department or division, the commonality is data.

Those HR professionals who cannot build a solid business case that justifies why a company should invest in their initiative or project should not be practising HR. When the pressure is on, HR needs to help the organisation look at growing revenue rather than cutting expenses.

FAILING ON ETHNIC DIVERSITY Just 3% of directors at top 100 ASX-listed companies are Asian-born. The latest Australian Institute of Company Directors sentiment index showed that while 40% of boards are seeking to increase their gender diversity, only 21% are seeking increased ethnic diversity. The figures come despite warnings the Federal Government may consider imposing a quota on Australia’s top 200 publicly listed companies that would require one third of board members to have ‘deep experience’ in Asia. The call was made in the government’s Asian Century white paper. The report predicts that Australia’s trade links with Asia will rise to at least a third of GDP by 2025, up from 25% in 2012.

CL: The biggest issue is 95% of board positions are not filled through a search or selection process.

Vacancies are filled the same way they’ve been filled for the last 100 years. If you had that process, then you can decide what you need – what sort of experience, what sort of thinking, etc., and rigorously test for that. The board roles that are advertised, by and large, are those that have to be advertised because it’s government criteria to advertise it.

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SC: I don’t like it when I hear, sometimes from HR professionals themselves, that they are not numbers people. We’ve just got to stop saying that to ourselves. If you explore the labour budget and look for opportunities to optimise that, we have some of the most valuable data in HR about where our money is going. My relationship with the CFO is a daily relationship. We are tied to each other. We’ve been to HR conferences together, to learn about the future of HR. I’ve spent time learning what’s happening in her space as well. I think all execs, be it the C-suite or whatever we call it these days, have to know each other’s business.

BH: This is an important issue for HR: the fact that HR see the CFO and finance as distinctly different.

Although we may think differently, we both understand each other’s roles and the roles we play in a successful company. So we need to know how to speak the language of CFOs. We need to have metrics that are convincing, not some airy-fairy metrics that in the past some have passed off as being convincing.

EH: There’s also this thing that finance people don’t get people, and I think that assumption can be just as bad as HR people being perceived as not getting the numbers. It’s an unfair generalisation.

I think the commonality is data. Personally, with our finance guy, I don’t think I’ve ever been so heartbroken to lose a colleague – ever. We’ve been attached at the hip and worked very closely together.

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Joanne Allen: We completed a project recently around reducing expenses, and it was interesting to sit down with finance and say, “OK, we’ve got a task X. Who are we looking at around the table who can deliver that?” We don’t have anything but technology and people so that’s where we go to look. When we started to tease out the expenses associated with human capital management – what we spent on agencies, what we spent on our insurance providers and all these other costs of running a very people-heavy service business – we far exceeded the task we were given.

HR DATA & METRICS Key takeaway Determine the most impactful data that is relevant in your organisation and use it; collecting and analysing incorrect or inappropriate data can actually be more damaging than helpful.

EH: HR is bringing more of these stats to the table, but we can also produce a lot of metrics that don’t

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mean anything. You need to understand what data is meaningful, then you can have that executive conversation regardless of which function you run.

CL: Sometimes it even gets harder because there is so much data, so much more information. Someone latches on to something and says, “I’ve seen this statistic and this tells us…” There’s a lot of distracting information, so being able to filter through that and determine what is actually relevant for the business is critical. The top-line attrition number may tell you something; it may not. But there’s lots of meaningful information out there.

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BOEING FLIES HIGH HR thought leader John Boudreau frequently cites Boeing as a case study when talking about meaningful data. Until the creation of the 787 Dreamliner, the most important people in the organisation were the engineers who built components out of metal. However, the 787 was made largely from composite materials. The new ‘most valued’ employees became those engineers who were the best collaborators with other organisations that made the various composite materials. Previously these people made armrests; they were not valued highly. For HR the lesson is: how do you determine who are the most important people in the organisation? In this instance collaborative behaviours suddenly became highly valued; find the equivalent in your organisation and reap the benefits.

MT: I totally agree with the CEO handling it externally, but internally we share that as an executive team. We’re interchangeable in terms of presentations or being the face of the organisation to the organisation, or even our EBA negotiations.

BH: We had a takeover bid a number of years ago.

HR had an enormous role to play in terms of communication, keeping people informed, keeping morale up, putting up the barricades in terms of how we were going to fight off this attempt.

LEADERSHIP DEVELOPMENT CRISIS MANAGEMENT AND PR FROM THE HR DIRECTOR’S SEAT Key takeaways Alarm bells ring when HR is ‘the face’ of the company in difficult times, at least externally; the issue must be escalated to the most senior appropriate person.

Internally, HR has a critical role to play in times of crisis.

CL: You never want to put the HR director in front of the 6 o’clock news because that demonstrates to the viewer and the public that the CEO doesn’t take it seriously enough to be there. If the HR person has to be the face of that sort of stuff, that would set off alarm bells. I’d be saying, “Where’s the CEO, where’s the COO?” Have you ever seen an HRD on media being the face of a company? Of course, we do all the work behind the scenes. Talking about a major IR issue, we’ve been in Federal Court on a case recently. Behind the scenes we’re dealing with the lawyers and all of that, but I would never suggest that I should be the one to front up to the media to talk about it.

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Key takeaways The most effective leadership development is a combination of experience, skills development and opportunity.

Look at the motivation for learning in the organisation. If leadership is valued and those who are good leaders are being promoted or rewarded appropriately, there will be motivation to follow in their footsteps.

Look at creative ways to give people experiences – work with someone who pushes you to try different options – and live by the mantra ‘what doesn’t kill you makes you stronger’.

EH: It’s a combination of things. Leadership programs are always helpful because they help to sharpen your focus and remind you of what you most need to learn; they also give you time to reflect. But the reality is learning from other great leaders and being given the opportunity to be a leader and diversifying your own responsibilities or accountabilities is where you make the biggest inroads.

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BH: The starting point, from my point of view, is to have good leadership role models. That by itself won’t be sufficient, but unless you see it in action, all those training courses probably won’t have much impact. If you can have really good leaders and supportive elements in place to say “these are the behaviours we like and this is why”, that adds value.

JA: The term ‘leadership’ is a bit cookie-cutter-ish.

Leadership is not one brand; it’s different in different

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circumstances, in different organisations, in different stages of evolution – they each require something different from the leadership team. There is nothing that can take the place of experience, being in tough situations and being supported through that experience. The only way you learn is being in situations that force you to pull different levers.

When I was working in Hong Kong my boss asked me to be the comms lead on the acquisition of a Chinese bank. It was the most terrifying experience. But it was one of those ‘what doesn’t kill you makes you stronger’ moments. It’s that experiential piece: working with someone who says, ‘‘You can do it; I will back you’’.

You need anti-role models as well. You need to look at people and say, “I don’t want to be like that person!”

SC: Have you heard about the productive zone of disequilibrium [see box, top left, p.26]? It’s a concept which explores adaptive leadership. The theory is that you create an environment for leaders to thrive.

It says that a human being has to feel slightly uncomfortable but not at boiling point to feel the necessity to try something different.

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THE PRODUCTIVE ZONE OF DISEQUILIBRIUM A leader creates and sustains a productive zone of disequilibrium when people feel pressure to do the work they must do to live out their values. Like a pressure cooker at the right temperature, the zone creates the right amount of pressure for the work to get done. Too little pressure and nothing happens.

However, too much disequilibrium will push a group over the edge and prevent members from working together productively.

The challenge for leaders is how to create a sense of urgency without creating stress or disengagement.

CHANGE MANAGEMENT Key takeaway Apply the Sigmoid Curve model to yourself, your team, your organisation.

JA: I hired someone in my team recently who has an interesting background. He’s done a lot of work relating to change. I asked him to run a session in my team on the topic, and he introduced me to the Sigmoid Curve [see box at right]. We are not an organisation that ever rests – if you don’t like that, you won’t enjoy Citi. What was great for my team was to say, “OK, it might be painful, it might present some challenges, but we need to keep doing that to perform as a team, as an organisation”. It’s a great little model you can use for yourself, for a team, for an organisation. If you can understand that change is a good thing and why, it’s very powerful.

SC: An exercise you can do is ask where is your company in terms of its lifespan on the curve. Can you see competition coming over the horizon? If you’re in growth phase, what you want to do is come off that natural growth curve and then put your energy into a new Sigmoid Curve. You want to take your momentum, your strategies, to reinvest in different things. One of our strategies is to anticipate market needs, so we’ll tend to get ahead of where our customers, consumers see us going. Not anticipating what they need but telling them what they want – the Apple model. So the Sigmoid Curve is the heart of REA Group strategy.

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THE SIGMOID CURVE The S-curve is about the nature of change.

With any change there is always a first period of experimentation and learning, which is followed by a time of growth and development. Ultimately, however, every curve turns downward. The only variable is the length and duration of each part of the curve.

As demonstrated in Figure 1, the best time to start a new ‘curve’ is before you reach the peak of your existing one (point A). That way, you will be starting something new when you still have the resources, and the spirit. Most entities think of doing something new only when they have reached the bottom of what they are presently involved in (point B), yet if they desire to continue growing and reinventing, they must develop a second curve out of the first. Change at Point A, however, results in a period of confusion, represented by the shaded area in the drawing. At this time there are two contrasting and often competing cultures.

The challenge of the second curve is to find a way to start that curve while still building upon the success, learning and maturity gained from the first curve.

Figure 1

A

B

The Sigmoid Curve

HR SKILLS GAPS Key takeaways HR needs to work on building confidence; be brave and sell your story. Determine what it is the key decision-maker values and build an airtight business case for it.

HR has a crucial role to play in terms of coaching and mentoring, encouraging strengths in people, and building networks for people across the business.

HR professionals benefit most when they’ve spent time outside of the profession.

EH: What’s missing from many HR professionals is a couple of behavioural things. There’s the issue around competence and confidence. HR is moving into an area where they’re much more credible.

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They’re transitioning to being true business people.

I think over time that will just become the expectation. But I don’t think there’s a level of confidence required. I often find HR people do know the numbers and do know the business but are almost so worried the credibility isn’t there that they start off on the back foot. If you’re in there apologising for the job you have, you’re kind of missing the point.

CL: An issue is also leadership. Often you can become quite senior in HR without having led anyone, or no more than two or three people. That’s why often a stint in business, a shared service function or another area can be beneficial.

EH: Sometimes in an effort to be so credible and be such good business leaders we can forget that part of our role and part of our experience is to bring the voice of everyone to the table, not just the business or the people but a combination of both. You must work hard to be consciously objective, otherwise you fall into one category or the other.

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SC: Also, don’t fall into the trap of believing what works in one business will work in another. It’s like a cargo cult [see box below]. What we need is information about strategies and tools that are adaptable but not necessarily the way forward. When learning about other strategies in other companies, you want to hear “it worked for us because…”, not just “this is what the company is doing…”.

CARGO CULTS The term ‘cargo cult’ comes from religious cults of Melanesia whose central belief is that spirit beings will bring them large cargoes of modern goods. After World War II one tribe in particular received food packages from American aid workers.

As these packages came from the air, out of an aircraft, they believed that if they also built a beautifully crafted airplane, out of wood and bark, the same thing would happen: food would drop from the sky. They built the craft and nothing happened.

This same thing happens in organisations all the time: they read the case study and apply it directly to their company.

It then fails to produce results.

OCTOBER 2013 | 27

SPECIAL REPORT / L&D INSIGHTS

28 | OCTOBER 2013

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SPECIAL REPORT

LEARNING & DEVELOPMENT HRD presents its annual special report on learning & development, a holistic overview of L&D trends, including practical tips and advice for your own career

L&D overview 2013 p.30 | Training in a slowdown p.34 | L&D program design p.38 Essential HR skills p.40 | Case study p.44

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OVERVIEW

L&D

EXPLODING THE MYTHS The old adage holds true in L&D: fail to plan and plan to fail.

It’s impossible to build a company-wide L&D strategy without first getting some fundamentals right L&D is a critical aspect of modern organisations, both large and small, and in both private and public sectors across Australia. As business conditions, business practices and the application of technology constantly evolve and the pace of change in all three areas accelerates, most, if not all, of the nation’s workforce need to constantly learn new skills.

Critical questions remain, however. How can these skills most effectively be learned? Can they be effectively taught? And perhaps more importantly, while it’s a given that employee L&D is a large and indeed essential part of the modern economy, why is this function often not given the prominence it deserves?

Many of the answers to these questions lie in the fact that the benefits of corporate training to an organisation have shifted. Once, training was simply seen as a means of slowing attrition. That said, it is surprising that many organisations persist with the view that the chief benefit of L&D is simply ‘more satisfied employees’.

It is true that job satisfaction leads to both strong morale and motivation, but it is also true that one of the major shifts in the dynamics of L&D is the increased focus on cost savings that upskilling

30 | OCTOBER 2013

can deliver in terms of attracting, recruiting and onboarding new staff as unhappy staff depart.

The development of a mobile workforce and therefore a more nimble, agile organisation has emerged, in recent research, to be yet another key benefit of continuous learning to organisations and the nation at large – and a benefit that is absolutely critical in today’s competitive environment.

FRESH INSIGHTS Results of a new study reveal details about L&D functions, trends and practices, from the size and nature of budgets to types of training, how training is measured, and benefits of training to employees, organisations and society.

“Some findings from this research were as predicted,” explains Graeme Philipson, former researcher with Gartner and Yankee Group and well-known columnist at The Age and Sydney Morning Herald, who conducted the research for knowledge experts TP3.* “Training budgets, for example, are roughly the same or smaller than last year’s, and training functions remain largely underresourced. And most organisations, even large ones, do not have a formal training budget. That’s not to say training isn’t

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conducted, but it’s done on a project or ad hoc basis.”

Key budget findings were as follows: yy 17% of respondents had budgets of $100k–$500k yy 16% reported budgets of $1m+ yy 55% didn’t know – either had no formal budget or it was ad hoc Surprisingly, more than half of all respondents did not know what their training budget was. In many cases this was because their organisations had no formal budget – training was said to be funded on an ad-hoc or project-specific basis. It is possible that respondents preferred ‘discretion over disclosure’ in terms of sharing their budget figure with researchers, rather than actually being unaware of it.

It is surprising that many organisations persist with the view that the chief benefit of L&D is simply ‘more satisfied employees’

L&D CHALLENGES

15% 9% 9%

Limited time

Management commitment

Unsuitable training materials

The biggest challenge faced in corporate L&D departments is a lack of resources – essentially, time and money.

Training is one of the first line items on the corporate P&L to be trimmed when times are tight, and today’s training budgets are tight, getting tighter and more likely to be declining than growing.

There is also a perceived shortage of good training professionals and, in some areas, suitable training content, while another constraint reported was that of finding the time needed to train staff when they were already busy in their frontline.

This resourcing component is common in all organisations, but particularly in smaller organisations.

WHAT’S THE RETURN? A key reason why training is underresourced is that it remains difficult to determine the ROI on training dollars. “Few organisations have formal processes to measure training’s effectiveness, but even for them it’s often difficult to tie outcomes back to the training itself – so much so that nearly one in four

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MEASUREMENT OF ROI ON TRAINING

35 30 25

%

20%

Limited budget

20 15 10 5 0

Increased customer responsiveness

Increase in productivity

Don’t measure Don’t measure (but should) Informal judgment, no metrics

Increased job satisfaction

Increased revenues or profitability

Ad hoc metrics Formal metrics

OCTOBER 2013 | 31

Phiillips’ analytics

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{

Kirkpatrick’s analytics

{

32 | OCTOBER 2013

OVERVIEW

surveyed organisations does not measure the ROI of its L&D activities,” Philipson says.

All told, while ROI metrics are possible in some areas such as workplace health and safety, generally speaking it is difficult to establish a firm link between the cost of training and its benefits.

Conversely, the study showed a strong belief that training results in a better skilled, more satisfied workforce – a far cry from the days when training was simply seen as a means of slowing attrition.

Today, many L&D professionals believe training is self-evidently beneficial, and that formal yardsticks are not needed to measure its effectiveness.

Study respondents rated ‘satisfied employees’ as L&D’s chief benefit, while higher revenues and profitability were not rated as highly as direct benefits. “We found this result surprising and, it must be said, disappointing,’’ Philipson says.

“When higher profitability is rated by all groups as the least-important benefit, it illustrates that L&D is seen to be decoupled from profitability.

Perhaps this is due to the perceived ‘intangible nature’ of its benefits, or the lack of clearly identified ROI measures,” he adds.

What is clear is that not enough L&D departments formally evaluate the success or otherwise of their training and professional development programs.

There is a model for measuring training ROI, thanks to the work of Kirkpatrick and Phillips (presented here in simplified form):

ROI

“Did the training investment pay off?

RESULTS IMPACT

“Did the implementation of the training program impact business results?”

“Did the learners deploy the learnings on the job?”

LEARNING

“Did the learners learn the content?”

SATISFACTION

“Did the learners like the training program?”

Source: leanlearning.wikispaces.com/learning_analytics

It is finding the numbers to plug in that is the hard part, and the maths is easy once the benefits of learning investments are quantified. Using the Kirkpatrick model, for example, would include selection criteria such as cost of learning programs, the importance of the program in meeting business goals, and the extent of management’s interest in the outcomes of training and upskilling activities.

These and other factors, such as measurements of training’s intangible or ‘soft’ benefits – while most difficult to measure – greatly influence the ultimate monetary measure of ROI.

PREFERRED L&D TYPES Many findings support long-held assumptions, such as that on-the-job training is king. “Classroom, computer-based training and other forms of formal and informal training all have their place, but there’s no substitute for learning by doing,” says Philipson.

Another key finding of the research was that mobile devices and the advent of BYOD (bring your own device), though becoming much more popular in the workplace, are not yet regarded as suitable for training, even with younger employees.

Management and senior staff like or prefer seminars and conferences to on-the-job training, although the latter was the preferred method by a very small margin. Once again, unstructured PC-based or mobile online learning were the lowest-rated methods.

IMPORTANCE OF TYPES OF TRAINING On-the-job training

7.9

23.6

67.4

Classroom training

7.9

25.8

18

47.2

Structured online or CBT - PC based

13.6

13.6

34.1

33

Seminars and conferences

14.6

42.7

30.3

10.1

Unstructured or ad hoc online - PC

27

18

33.7

3.4

Unstructured or ad hoc online - mobile-device based

37.2 Not important 2 3

23.3

4.7 1

4 Very important

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BUSTING MYTHS PREFERRED TRAINING METHODS – MANAGEMENT AND SENIOR STAFF Seminars and conferences 16.4

29.5

47.5

On-the-job training 4.8

27.4

37.1

30.6

Classroom training 6.5

38.7

11.3

41.9

Structured online or CBT - PC based 16.7

30

30

18.3

Unstructured or ad hoc online - PC 33.9

33.9

16.9

8.5

Unstructured or ad hoc online - mobile device based 33.9

33.9

12.5

7.1

Actively dislike

Like

Don’t like

Preferred method

Don’t mind

More than half of organisations surveyed expect their organisation’s senior managers to have at least an undergraduate degree, and nearly half expect such a degree from professional staff. Some even expect it from entry-level staff, but very few positions need no qualifications – with the exception of sales roles, in which performance is everything.

Senior management

39.0

yy How can L&D encourage employees to drive their own learning while also taking advantage of what’s offered through structured learning events?

48.3

46.6

Technical staff

21.3

33

31.1

44.3

Junior management

14.6 17.5

45.6

21.1

Sales

17

5.7

Questions raised by the research include:

yy If adaptability is the most sought-after employee attribute, can adaptability be taught?

54.2

Professional staff

3.4

KEY TAKEAWAYS

yy What can be done about the finding that 40% of employees who show up for training don’t want to be there?

MINIMUM QUALIFICATIONS 3.4

Other results were surprising. “Evidence suggests that the so-called skills shortage is overrated. Most respondents feel reasonably well served by the skills of their employees and are inclined to believe there’s a skills shortage in the community generally – but not necessarily within their own organisation,” Philipson explains.

Another key finding was what respondents rated as an employee’s most valued attribute.

“By far the most important is ability to adapt, rated ‘very important’ by 73% of respondents and ‘important’ by virtually all the remainder. As businesses change, employees must adapt quickly, and their ability to do so is rated ahead of even academic or trade qualifications which, while often important, can be seen as static qualifications in a rapidly changing world,” Philipson explains.

Finally, L&D is a central aspect of modern business, but it’s also acknowledged that L&D’s benefits are difficult to quantify. “Clearly, the fact that L&D professionals cannot yet provide solid evidence of their value to the organisation remains a significant weakness for the profession,” says Philipson.

34.0

5.7

yy Does job satisfaction come from being empowered and motivated, or is it a motivating work environment that creates job satisfaction?

Entry level

41.0 None High school Vocational training

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18.0

11.5

8.2

Some academic qualification Bachelors degree

*TP3’s research surveyed 120 L&D professionals, representing most industry sectors and many organisations with more than 500 employees. The white paper of the full research is available at tp3.com.au

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TRAINING IN A SLOWDOWN

L&D IN TOUGH TIMES

With key indicators pointing to an economic slowdown, Melbourne Business School associate professor Catherine de Fontenay examines the pros and cons of continuing to invest in employee skills

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“A downturn presents the perfect downtime to enhance the skills your people really need to excel” – Harvard Business Review (HBR), Dec 2008 In a slowdown, companies look for ways to cut their costs; and “companies are known to target HR investments first when cutting budgets” (HBR, Dec 2012). But is it a good idea to cut training expenses?

Many experts think not. This article reviews the rationale for training, and how the rationale changes in a time of slowdown.

Some firms will not train in a slowdown because of financial stress: there is too much chance that they will go bankrupt and will not be around to capitalise on the training later

DO WE TRAIN? WHO DO WE TRAIN?

GENERAL VERSUS SPECIFIC TRAINING Economists divide training into two broad categories: general and specific. General training provides workers with skills that are of value in the general marketplace: Excel spreadsheet skills, machine repair skills, etc. In contrast, specific training provides workers with skills that are only valuable to a specific company: for example, knowing how to use an HR computer program that was designed specifically for the company.

In practice, firms require skills that range from very specific to very general: for example, training in proton therapy would be useful if a doctor from the Royal Melbourne Hospital moved to another of the world’s five cancer research hospitals, so it is fairly specific; while training in reading CAT scans would be useful in most hospitals, so it is more general.

Providing general skills to workers is risky, because those skills have value on the marketplace.

Once an apprentice is trained, he may be hired by another company at a higher salary, or he may bargain for a higher salary based on competing job offers. The training gives him bargaining power.

The more general the training, the more risky it is for the firm, so perhaps workers should study part-time and pay for it themselves, if they want general skills. But we have ample evidence that companies choose to provide valuable general training. For example, conservative estimates of the cost to one firm of training an apprentice in Germany put the cost at over $4,000p.a., even after accounting for the value of the apprentice’s work (Acemoglu and Pischke 1998). So why would it still be worthwhile to train?

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TRAINING AND EMPLOYEE RETENTION Employment is an ongoing relationship, and employees are more likely to stay if they feel that the firm is investing in them. Studies have shown that employees who receive training are more likely to believe the firm supports their development, to be more satisfied with their jobs, to be more willing to work hard and less likely to leave the firm (Koster et al. 2011).

Employers may be paying more for the person with more skills, but they receive large benefits in terms of productivity and reduced turnover. For example, studies of US apprenticeship programs (which are largely unsubsidised by the government) estimate “that employers get a 38% return on their investment in the form of lower recruitment costs and a reduced need for expensive contractors” (HBR, Dec 2013). Companies such as Accenture, Le Pain Quotidien, and Enterprise Car Rentals say they reap the benefits of ongoing training: “trained employees don’t quit as quickly,” says Katherine LaVelle of Accenture; “we feel that if we put time and money into developing our people, they’ll last with us and grow with us,” says Leah Rucinski of Le Pain Quotidien (CNN Money, 5 May 2013).

FIRMS SHOULD TRAIN WHEN THERE ARE FRICTIONS “Many firms fear that if they invest in training on their own, competitors that don’t make similar investments will lure away their workers” – Harvard Business Review, Dec 2012 The consensus among economists is that it is valuable to provide general skills if there are frictions in the

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TRAINING IN A SLOWDOWN

labour market. Frictions are anything that makes it difficult for the worker to walk down the street and get a job that pays him better for the new skills.

The more frictions in the market, the less he will be able to bargain for higher wages based on the new skills. There are three categories of frictions, as described below:

STAY OR GO? THE ROLE OF FRICTIONS Understanding the role of frictions can help a company determine what kinds of training to invest in.

GEOGRAPHIC FRICTIONS: If the job offers that the worker will receive are in another location, the worker may not be able or willing to move. This is a very important factor in more isolated locations: the fact that a worker has chosen to remain in Swan Hill rather than migrate to Melbourne suggests that they have strong attachments to Swan Hill. If there is no other employer who values those skills in Swan Hill, the skills don’t give that worker bargaining power. And if there is a skill that is mainly valuable in the WA mining sector, we can expect that some workers will be lured away to the mines, but not everyone will be willing to move to remote WA. FRICTIONS BASED ON SPECIALISATION: If the training puts the worker into a higher-skill category, and there is a relatively small market for those skills, it can still pay to train. Jobs in that field may only open up occasionally, so the worker would be taking a risk leaving a steady job for a shorter-term assignment elsewhere; his bargaining power is limited. The other consideration is that undertraining has large risks, in these environments: if the company does not train any apprentices in that field, they may be so scarce that the company cannot find any to poach from others. The company is benefiting other companies by training, but also benefiting itself.

INFORMATION/REPUTATION FRICTIONS: A firm with a well-established excellent reputation has a very strong bargaining position. It is difficult for workers, particularly older workers, to credibly threaten to move to another company whose record is less well known; so they have little bargaining power. Many of their competitors may not be as long-lived or as well known. Some industries have a close-knit community, and information flows freely, but information about a young company is not always available. Do they invest in safety? Will they make every effort to cut as few jobs as possible, in tough times?

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Understanding the role of frictions can help a company determine what kinds of training to invest in. For example, it is not always profitable to pay for a general management course for an HR person based in Melbourne, because general HR is not specialised and not geographically restricted: that HR person could get a job in thousands of other Melbourne firms. There are not enough frictions.

The firm may still want to invest in some training, as part of its relationship with the worker, but in less training than for other workers. It does make sense for the firm to invest in rural workers, for example workers who have been settled in that region for years, because there are large frictions.

Finally, the firm does not need to worry about these considerations when thinking about giving a worker a small amount of training (a week-long course, for example): the training will not make enough of a difference to his employment prospects, so it won’t change his bargaining power; but it may improve his productivity.

TRAINING IN AN ECONOMIC SLOWDOWN “‘Are you kidding?’ you might ask. ‘When times are tough, professional development is a luxury’. Not so. Often that is precisely when there is enough breathing room in the daily work flow to give your people the chance to better themselves. Employees at all levels can be sent for training … which pays off when economic normalcy returns” – Harvard Business Review, Dec 2008 OPPORTUNITY COST The cost of training falls dramatically in a recession.

That is because the main cost of training is ‘opportunity cost’: if I attend a three-day training course, the fee is one part of the cost; but the main cost is that I am not available for three days of billable work. If the staff in my department have idle time because of the slowdown, there is no longer an opportunity cost; my department will complete the same work in the same time, even with the training.

It’s critical to realise that this idea of opportunity cost can be missed, if we focus too much on internal accounting. Depending on how we charge different departments for training, a department could still improve its balance sheet by cutting training; and the department will be feeling pressure in a recession.

But if the company makes an overall training plan, understanding that there will be recession times and boom times, it needs to recognise that the company

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will save a lot of money by training in a recession.

You should also encourage your business partners to consider training opportunities during slowdowns, to improve their performance in working with you.

More generally, education tends to be countercyclical (that is, the sector is larger in recessions and smaller in booms) because people have more time and fewer opportunities in a recession.

Some firms will not train in a slowdown because of financial stress: there is too much chance that they will go bankrupt and will not be around to capitalise on the training later. But if your company has been around for more than 10 years, itâ&#x20AC;&#x2122;s unlikely that the slowdown is the end of the game for the business; however, you may need to find a bank willing to support you financially in making longterm investments. This will reduce any short-term financial stress.

HOW ARE FRICTIONS AFFECTED? Generally speaking, frictions get much stronger during a recession, and weaker during booms. So workers are much less likely to voluntarily change

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jobs in a recession. This is one risk of actively training in a recession: some workers will leave for greener pastures when the economy gets better.

And then the firm will have the cost of training them, without the benefit.

Many firms understand the cyclical nature of their business, and try to retain workers during a slowdown. It makes sound business sense: spending money to retain workers reduces hiring costs later on, and strengthens the reputation of the firm as a company that takes care of its workers. In the long term, the firm will reap the benefits of this investment, because in good times workers will be less inclined to move to other firms that are less dependable, even for more pay. The firm will not have to raise salaries as much to retain workers.

In economic terms, this is the information/ reputation friction described above (see box, p.36).

The stronger that friction, the more the firm will reap the full benefit of any training it provides. Thus, investing in saving jobs and investing in training are complementary investments that yield stronger rewards when they are done at the same time.

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L&D DESIGN

Action mapping

L&D

L&D initiatives not getting cut-through?

Perhaps they need to start focusing on performance consulting, not just on training design

According to surveys, L&D practitioners continue to be unappreciated by their organisations.

According to one survey recently reported in the European Business Review, more than 50% of managers believe employee performance would not change if their company’s learning function were eliminated.

That report also said: “Survey after survey has repeatedly shown that the proportion of business leaders who are satisfied with their learning function’s performance is around 20%.”

What are we doing wrong?

“Our main mistake is to view ourselves as information designers,” says Cathy Moore, a training design consultant whose client list includes Microsoft, Pfizer, the US Army and Barclays Bank.

“Many L&D practitioners believe their role is simply to produce training. Worse, they believe that training is ‘transferring knowledge’. This is why we end up with 187 slides of passive presentation, low completion rates, and little or no change in job performance.”

Instead, practitioners need to view themselves as performance consultants, and their first step in a project should be to question the need for training.

For example, rather than obediently converting a PowerPoint slideshow into e-learning, designers should work with the client to analyse the performance problem and make sure that training is really going to solve it.

38 | OCTOBER 2013

In her approach to instructional design, called ‘action mapping’, Moore recommends the following steps: 1. Identify a measurable, specific goal that will reflect an improvement in business performance, not an increase in knowledge.

For example, a goal might be: ‘Increase sales 5% by Q4’.

2. Identify what people need to do on the job to reach that goal. For example, one behaviour could be: ‘Ask questions that uncover the customer’s needs’.

3. For each behaviour, figure out why people aren’t doing it now. Is the problem really one of knowledge or skill that training could help?

Or is it environmental, such as missing tools, inefficient procedures, or even punishment for doing it right? During this step, quick, nontraining solutions often become apparent, such as improving a confusing software interface and creating job aids.

4. If training will be part of the solution, brainstorm activities that will help learners practise what they need to do on the job. It’s best to create realistic, challenging scenarios.

5. Finally, identify the minimum information that people will need to complete an activity, and include that information in the activity, not as a pre-activity presentation.

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The brainstorming process creates an action map, which summarises the activities and other solutions that will be created.

ACTION MAPPING Measurable goal

Increase widget sales Only the essential information for that activity

Job behaviour that will reach the goal Realistic practice activity for that behaviour

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Crucially, for information or an activity to be included in the map, it must directly support an on-the-job behaviour that’s essential for reaching the business goal. Users of action mapping have reported that this requirement helps exclude the unnecessary information that plagues conventional training.

The result of this process is often a mix of efficient solutions, such as improved procedures and job aids, and some lean, tightly focused training.

The ideal training feels like a stream of challenging activities, not like a presentation followed by a quiz, and it gives learners a realistic way to practise new skills.

“Because all the analysis and design is focused on creating a measurable improvement in business performance, designers have the chance to go beyond smile sheets and demonstrate real ROI,” Moore says.

Cathy Moore will present this process in a one-day workshop entitled Training Design for Business Results at the Workplace Learning congress in Sydney this November.

For more information about this event, visit acevents.com.au/ learningatwork/

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HR PROFESSIONAL DEVELOPMENT

Managing YOUR talent

– Investing in YOU

Peter Szilagyi scans the horizon to highlight not just where HR needs to sharpen its skills, but how this can be done

40 | OCTOBER 2013

When talking about the past, how often have you heard the phrase “I can’t believe how quickly the time has flown!”? Alternatively, when talking about the future, how often have you heard someone say, “Next year is a long time away. I can barely plan this month, let alone next year!”? When put together, these statements don’t seem to add up. Is it possible for time to move so quickly in hindsight but so slowly in foresight?

Ten years ago the workforce and the HR department were very different to what they are today: the cloud was a weather pattern, Facebook was a university project, and tablets were strictly for medicinal purposes.

The next 10 years promise to bring even larger and more disruptive change. While there is no crystal ball, there is fortunately much research about the future of HR – and there’s no doubt this is important for our discipline. However, what do these insights practically mean for us today?

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MAJOR TRENDS AND THE ‘FIVE HATS’ There are many diverse opinions on the world of work and the future of HR. Dave Ulrich and John Boudreau have been thought leaders in this space for years. Institutions like the Harvard Business School and Cornell University and professional groups such as the Society for Human Resources Management have all conducted extensive research in this area. Additionally, in the consulting space, McKinsey, Korn Ferry, and Deloitte are among many firms that have consistently contributed to the debate about the future of HR. This information is fascinating but collectively can be overwhelming. If you read between the lines, however, there are some patterns that give direction to the actions we need to take today to prepare for tomorrow. The table below shows these patterns and the ‘five hats’ HR professionals will need to wear in the future.

HR AS… STRATEGIST Strategy is fundamentally about how best to use scarce resources to achieve set objectives. At its core, strategy is about creatively generating alternatives and rigorously applying decisionmaking to define the best possible course of action.

How do we practically build a strategic mindset?

Firstly, learn to be more creative. Creativity can be learned, but surprisingly it takes some discipline.

There are many resources available on creativity, and one of the central figures, Edward De Bono, has numerous books on this topic (he coined the term ‘lateral thinking’). Creativity also requires breadth, and in the business world that means knowledge of markets, industries and organisations. You can build this knowledge by regularly reading business journals and by building your network within and outside your industry.

Trends and patterns yy Globalised (competition for customers, suppliers and resources) yy Volatile (greater market swings and ‘environmental’ changes) Business will be more...

yy Competitive (greater pressure from the market for profitability and increased competition from acquisitions or new entrants) yy Dynamic (faster innovation and product cycles, instantaneous scrutiny from the media, regulators and markets) yy Globalised (global and virtual teams, centralised delivery centres, production hopping to lower-cost locations)

Workforce will be more...

yy Flexible (outsourced/insourced, offshored/near shored, freelanced, crowd sourced) yy Diverse (multigenerational and culturally diverse leadership and operational teams)

Different hats for future success Strategist hat: HR will increasingly inform business decisions on the growth of the company and the resources required Integrator hat: HR will increasingly be a focal point in integration of new acquisitions, technologies, third-party suppliers and managing restructures Influencer hat: HR will increasingly need to influence, motivate and meld geographically, culturally and operationally diverse workforces Analyst hat: HR will increasingly use data and analytical capabilities to develop new insights into talent and performance Risk manager hat: HR will increasingly need to advise the business on complex ethical and legal challenges

yy Talent scarce (talent will always be ‘high in demand’ but ‘short in supply’) yy In the cloud (delivered outside the company network) Technology will be more...

yy Mobile (delivered through multiple devices) yy Social (collaboration and idea generation through social media) yy Insightful (through the use of big data and analytical tools)

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HR PROFESSIONAL DEVELOPMENT

Strategy is fundamentally about how best to use scarce resources to achieve set objectives Secondly, develop a sound working knowledge of decision-making processes and tools. Learn about conceptual models (ie SWOT), business plans, and selection or evaluation tools (ie NPV).

At a minimum you should understand how to contribute to inputs and interpret outputs. Try to practically utilise these tools by supporting business planning initiatives or building business cases.

HR AS… INTEGRATOR Integration is about the successful introduction of business change into an organisation. This, for example, could result from acquisition of a new business, implementation of new technologies or the introduction of an outsourcing arrangement.

How do we practically build an integration mindset? Formal training in project management is important, as well as finding mentors with experience in this area. Develop a strong and practical understanding of core project deliverables such as work plans, training and test plans, communications plans, stakeholder maps and impact assessments. One way to do this is to ask project management specialists in your organisation for a demonstration of these tools, or for them to regularly review the progress of your work.

Proactively look for project roles to build your experience.

HR AS… INFLUENCER Workforces of the future will be a melting pot of diverse geographical, cultural, generational and cross-functional teams. Successful HR practitioners will be strong influencers and negotiators at the individual, team and company level.

How do we practically build an influencer mindset? Ultimately, the best way to influence is to have broad and deep relationships. You can build breadth through active networking and depth through regular contact. Don’t just reach out to people when you have a requirement or need; get to know your colleagues and what matters to them

42 | OCTOBER 2013

most (eg knowing the names of their children or their favourite sporting team). There are numerous tools available to assist your individual influencing style; DISC is one such framework and there are many others.

Influencing across a larger scale such as teams or business units is more challenging and ultimately requires good planning and a multitiered approach.

The baseline for good communication is a plan that recognises the different needs of your stakeholder groups and provides for regular communication through multiple channels. Social media, mobile platforms and video streaming, among many technologies, have revolutionised the way communication is delivered. It is important to stay ahead of these trends to best leverage them as they continue to unfold.

HR AS… ANALYST It is estimated that the world’s information is roughly doubling every two years. In many HR departments organisational and employee data is often stored across multiple systems and geographies. In the future this data will be integrated and will actively talk to each other.

How do we practically build an analytical mindset? One of the most useful skills you (or your team) can learn is data analysis. Sharpening skills with spreadsheets (namely Microsoft Excel or Google Docs) and various functions like vlookups, pivot tables and charts is foundational. The best way to learn these skills is through ongoing and practical application. The challenge for the future will be interpreting data for insight. Data modelling and statistical concepts, while being more advanced subjects now, will become areas to be familiar with in order to generate insight and support ‘telling the story’.

HR AS… ANALYST With financial and consumer markets, supply chains, and technology platforms becoming ever more intertwined, the nature of business risk is rapidly changing. From a workforce perspective as businesses accelerate to outsourcing and offshoring, externalising employee platforms and encouraging social media, the challenges for HR professionals are becoming increasingly complex.

How do we practically build a risk management mindset? Managing risk comes down to some

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fundamental principles about policy, process, procedures and reporting controls. You can build strength in policy by staying on top of regulatory changes and the practical implications of them by broadening your business reading and networks.

Look to build skills in process mapping and understand how this translates to strong business system requirements. Finally, mastering skills in reporting and data analysis as mentioned above will also be important for managing risk.

APPLYING THE FRAMEWORK Building your capability across the ‘five hats’ requires time, energy and commitment. It is important to define your objectives and create a learning plan that incorporates regular weekly and monthly activities that are reflected in your calendar.

DEDICATE 10% OF YOUR EFFORT TO COURSES AND READING There are literally thousands of great resources out there, from books to blogs, videos, and podcasts. One of the great challenges now and more so in the future is handling information overload. Take time to organise your information and learn to use search tools effectively to sift through information (for example, did you know that Google has an advanced search function?). Ask mentors and experts about the websites they find useful. Stay on top of industry trends by aggregating news and information via RSS readers and creating feeds in Twitter, YouTube or LinkedIn to channel the information you receive.

Many universities now offer free courses, and YouTube has thousands of clips on the topics outlined above (particularly tips for using Excel and overviews of new technologies). You could consider enrolling in a Master of Business Administration (MBA) or specialist master’s program (eg Master of Project Management). An MBA covers all the topics outlined above in depth, with a focus on strategic and financial acumen.

There are some basic rules in networking to consider. Firstly, relationships involve both give and take. Offer to help more than you receive, and don’t only reach out because you need support. Secondly, look to stay in touch, even if it is a simple email to say hello. As your network grows this will take discipline, but it is an important part of career development.

DEDICATE 70% OF EFFORT TO ON-THE-JOB LEARNING It is through on-the-job experience that most learning is embedded. There are always many opportunities to proactively develop skills across the five hats. A starting point might be to look at the five hats and understand how they apply to your current role.

Shaping an opportunity to build skills in certain hats is another consideration. For example, building experience in Asia provides important cultural exposure for Australian managers of the future.

This does not necessarily mean living in Asia but could mean creating opportunities to work in virtual teams or projects focused on Asia. Opportunities such as secondments, temporary transfers or stretch assignments are all good short-term options to target a few hats, like influencing or integration.

In today’s business world the average time in a role is arguably about two years and that time will compress in the future. In 10 years that could mean five or more roles. What are the next few roles that will be important to you, and what networks are in place to position you towards those roles?

PREPARE NOW

DEDICATE 20% OF YOUR EFFORT TO MENTORING AND RELATIONSHIPS

Over the course of the next 10 years business change will happen in ever-faster cycles. This will create pressure, as will the need to deliver more with less.

These are exciting times, and in this fast-paced environment it is important to take a step back and think about career development in the context of where HR will be in the future. Preparing now, and as Stephen Covey would say ‘sharpening the saw’, will help you become more efficient and effective in the years to come.

There can be little substitute for advice from an experienced colleague who has ‘done it before’.

Building your network can at first be daunting, but it shouldn’t need to be. Start with the colleagues you already know, reach out to them and get back in touch. Aim to make the most of opportunities like company or industry forums and events organised by professional bodies.

Further reading 1. Ulrich, D., et al (2012), HR From The Outside In 2. Debono, E. (2009), 6 Thinking Hats 3. McKinsey (2012), The State of Human Capital 4. Deloitte (2012), Global Business Driven HR Transformation: The Journey Continues 5. Accenture (2013), The Future of HR 6. Covey, S. (2004), The Seven Habits of Highly Effective People

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Peter Szilagyi, CAHRI, GPHR, HRMP is an experienced HR leader in talent management, transformation and change management

OCTOBER 2013 | 43

CASE STUDY

IAL SPECORT REP

YUM! RESTAURANTS As a registered training organisation, KFC parent company Yum! invests $300m into training annually for its 30,000 direct and franchisee employees. Rob Phipps, chief people officer at KFC Australia, talks about the company’s L&D investments HRD: Why has the company invested so heavily in L&D initiatives?

Rob Phipps: Part of our corporate company values are that anyone can make a difference and everyone is a leader in the business. We take a philosophy that you come to work not just to do a job but you’re building a career as well. The second part of that messaging is it tends to be incredibly engaging for our employees and it’s one of the things that we do well; it’s a strength for us.

HRD: You do employ a lot of young people. Is that a factor?

RP: Absolutely. We offer young adults careers they otherwise might never have dreamed of. A lot of people join us by accident because they want some money to get through school or university, so it’s important for us to message to them that they can actually do more than earn some money when they join us; they can build a career. We teach them basic life skills: high standards, showing up to work on time, all the things that employers tend to ask for no matter where you go for a career.

HRD: KFC has invested in an e-learning tool – why was that decision made?

RP: We saw it as part of modernising the way we deliver training to a new generation of people that actually expected it. It’s just part of doing business these days.

Not being able to use technology, or using programs without some form of technology, is almost incomprehensible for a lot of young folk today.

KEY INITIATIVES Graduate Leadership Program (GLP), a structured career path for tertiary qualified Restaurant General Managers prior to assuming a key field management position. The GLP builds leadership, presentation and time management skills, while also broadening business knowledge across a variety of roles at Yum! Master of Retail Management, a Master of Business Administration program developed specifically for Yum! Restaurants in partnership with the University of Wollongong’s Sydney Business School Education Assistance Program, available to all employees, provides up to $1,000 for continued tertiary study for approved courses. Assistance may help cover course expenses such as HECS fees or non-HECS courses, textbooks, and study or examination leave

44 | OCTOBER 2013

We saw it as an opportunity to standardise and lift up the level of training we were able to deliver in a multisite environment.

That said, we’ve aimed for a blended approach. This was one of the things we discovered along the way: we tried to put too much onto the e-learning environment, but you can’t take away people going away and wanting to learn it, or remove the need for a coach to help with certain areas.

HRD: You’ve also created a Graduate Leadership Program. How do you identify employees with that potential?

RP: We have a group of HR professionals who partner with our operations team and have processes around identifying people who are in university. That’s a big part: they are in university and studying, and they’re doing it the hard way. They are doing it part-time and balancing work. It takes incredibly high work ethic, commitment and passion to do that. That’s a great foundation for someone who will be a great executive in the future.

Beyond that we want to see if they can drive results, fit well with our culture, have intellectual curiosity, and whether they are a good coach. There’s also a notion we talk about, which is taking people with you.

We have a rigorous assessment day whereby young restaurant GMs will be interviewed by people on our leadership team who have years of experience, sometimes in different countries. Then we come together and talk about it. Ultimately, there are four or five different levels of assessment to get the right people coming through to the centre.

HRD: Many companies cut spend on L&D when times are tough. What are your thoughts?

RP: It depends on what tough is. If tough is missing your plan by multimillion dollars, you have to think about how you might more sensibly do it. For us in the way we run our restaurants, cutting back on development is disastrous. In order to run a successful business you simply need people to develop and you need to be able to staff the future business appropriately. If you can’t do that you’ll suffer a lot of long-term difficulty.

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HUMAN RESOURCES DIRECTOR

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OCTOBER 2013 | 45

TECHNOLOGY / PAYROLL

PAYROLL:

Making the smart choice Large organisations typically have complex payroll needs, which if handled poorly can have a significant impact on their financial standing and reputation. What steps can HR take to ensure the right payroll system choices are made?

Much like being an observer at an accident scene, it’s been difficult to shift eyes away from the Queensland Health payroll disaster, which has revealed itself piece by messy piece over the past few years.

Rewinding back to March 2006, Peter Beattie’s government wanted to provide a new payroll and rostering system for public servants; Queensland Health and its 78,000 staff were to be the testing ground.

When it went live in 2010, almost all of those 78,000 staff were underpaid, overpaid or not paid at all. Estimates put the cost to taxpayers at $1.2bn over the next eight years.

As QC Richard Chesterman wrote in his Commission of Inquiry report in August 2013, it was “a catastrophic failure”.

Premier Campbell Newman went further, telling Parliament “it could be the worst failure of public administration in this nation”.

While this was an unusually massive and costly project failure, there are lessons to be learnt for other businesses looking to upgrade their payroll systems.

IF IT AIN’T BROKE… The core of any good HR system is payroll. Much more than just making sure your employees are paid the right amount at the right time, payroll provides big-picture information that helps you run your business efficiently and compliantly.

Unfortunately, payroll often falls into the ‘if it ain’t broke’ category within organisations. “At the moment, many businesses may have more pressing priorities, and it becomes more that they react [to

COUNTDOWN TO DISASTER – QUEENSLAND HEALTH

March 2003

Four government-owned business units and a group called CorpTech partner up to build a “whole-of-government human resources and finance solution” with a budget of $125m – the intention is to roll this out to all public servants in Queensland

46 | OCTOBER 2013

March 2006

Queensland Health joins the group, because its computerised payroll system, called Lattice, will not be serviced or updated after June 2008. Queensland Health cedes its responsibility for developing the new system to CorpTech

December 2006

CorpTech has made little progress

September 2007

Invitations to tender for the work are sent out, and three firms – IBM, Logica, and Accenture – submit bids. A fourth firm, SAP, withdraws

December 2007

IBM is awarded the $98m contract. System launch is planned for 1 July 2008

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HUMAN RESOURCES DIRECTOR

“Cost will always be a consideration, but we find best-in-class organisations take a more holistic approach when selecting a solution”

problems], rather than they plan to avoid them,” Craig Osborne, of Sage MicrOpay, says.

While there are a range of factors that can create problems, payroll software cannot be completely ‘idiot proof’, and payroll teams must be given the right tools to do their jobs, including adequate training and support.

BACK TO BASICS: CHOOSING A PAYROLL SYSTEM As demonstrated by the Queensland Health debacle, there are multiple factors to consider, especially when choosing a new system. With so many options available, how can you ensure you select the right one for your business?

It’s often tempting to start by narrowing down your shortlist on the basis of price, especially if your search is confined by a tight budget. But price alone can be misleading. A basic system at what seems like a great price might be a good fit for your business right now, but does it have the flexibility to accommodate business growth or changes down the line?

Flexibility may command a premium, but if it saves you from having to shop around for a new system three to five years from now, then it’s money well spent.

“Cost will always be a consideration, but we find best-in-class organisations take a more holistic approach when selecting a solution,” says Nick Southcombe, general manager, Frontier Software.

“When these best-in-class organisations are examining cost, which they will, it’s the total cost of ownership [TCO] that they will examine.”

TCO is the total costs that will be incurred for the expected life of the system. These costs include the cost of the software, implementation, annual support and maintenance, IT infrastructure requirements, and so on. The TCO for each option will, of course, be assessed against the anticipated business benefit of each system.

Auditing your existing payroll processes and the

October 2008

IBM’s progress is slow, amidst claims it is not achieving contracted performance criteria.

The plan to build a payroll system across the entire Queensland public service is scrapped.

The decision is taken to push ahead with a payroll system for Queensland Health

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July 2009

The Price Memorandum – prepared by a Health Department director named Anthony Price – attempts to warn health minister Paul Lucas of faults with the payroll system.

The memorandum does not get through to the minister

Nick Southcombe functionality provided by your current system allows you to identify the gap between what payroll is delivering now and what your business requires.

At a basic level the business objective of your payroll processes is to pay people accurately and on time. At an operational level you must eliminate unnecessary steps, automate processes, streamline workflows and increase productivity.

“Process auditing goes beyond a traditional competency audit to look at the strategic and operational needs of the business,” says Southcombe.

“This requires the full input of the payroll team to accurately map each payroll process and the linkages of payroll processes to other business processes.”

Visual flowcharts are an effective way to clearly present the real activities of payroll, including the technology used, databases accessed, authorisation required and time taken (see chart, p.48).

WHO’S BEHIND THE PRODUCT? Before looking at features, it’s worth investigating the company behind the brand. Even with the best features, a payroll system that doesn’t have a proven track record and the commitment of an established vendor poses a risk to your business.

March 2010

After 10 aborted attempts, the system goes live, with 78,000 Queensland Health staff underpaid, overpaid or not paid at all over several months

December 2012

The newly elected Liberal National Party orders an inquiry, which by July 2013 identifies sparring private consultants

Did you know?

The Fair Work Ombudsman (FWO) is active in investigating complaints brought by employees regarding wages discrepancies, and regularly initiates prosecutions in relation to any underpayments that it discovers. Currently, for each individual breach of the act, companies may be fined up to $33,000, and fines of $6,000 for individuals per offence can apply.

Additionally, in cases where a business might be dissolved or become insolvent, the FWO will prosecute directors.

August 2013

Former Supreme Court judge Richard Chesterman’s Commission of Inquiry report details a mess of complex and embarrassing negotiations

OCTOBER 2013 | 47

TECHNOLOGY / PAYROLL

PAYROLL PROCESS AUDIT

Payroll started

New employee paperwork from HR Collect time cards from hourly employees

Route to department head for review and signature

NO

Signed and approved by director of HR

NO

Route to HR for approval

YES

Signed by department head?

New employee information added to payroll

YES Payroll manager enters payroll changes

FEATURES TO CONSIDER Employee changes are reviewed and signed by HR

Bob

Payroll and any changes are reviewed

Joe H.R.

CFO Employee changes are reviewed and signed by CFO

Bob CFO

Approved

by CFO

Timekeeping & payroll YES

Payroll is processed

Payroll is posted

Employee changes are reviewed and signed by CFO

Transfer to employee bank accounts

Bob CFO

Source: Frontier Software

Buying business software is really like entering into a relationship; purchasing software without performing due diligence is like going on a blind date on the basis that you are going to enter into a long-term relationship.

“Business software should never be a getand-forget undertaking,” says Southcombe. “It’s a long-term investment that should deliver ongoing ROI over many years. Maximising that ROI inevitably requires working on an ongoing basis with the provider. As such, due diligence is a vital part of sourcing a provider.”

Ensure your system is going to be around for at least the mid-term. It will grow alongside the business, allowing you to add extra functionality as and when you need it. It’s critical then that the vendor is committed to the introduction of new features and enhancements on the product road map, and has a solid network of integration partners to support the system for years to come.

If you are opting for an outsourced solution,

48 | OCTOBER 2013

investigating the quality of your vendor’s hardware hosting environment is also mission critical. “Many businesses stress the importance of data sovereignty and want a provider that maintains data in Australia,” says Southcombe.

It might be worthwhile testing the waters before committing. Running a small pilot project before going full steam may have helped the Queensland Health project team identify potential problems earlier and given both vendor and client a feel for how they would work together.

Payroll systems vary considerably in their feature offering. Many are stand-alone; others are incorporated into an HR system along with a range of time-capture tools and staff self-service capability.

As HR is a key interface between staff and management, good reporting is essential. Ideally, you want a system that not only allows you to customise reports but also provides a snapshot of data for easy visibility.

What functionality should you look for?

Simplicity. The system should guide you through the payroll cycle step by step. Look for an intuitive user interface too – one that: loads quickly is quick and easy to navigate, with function keys and keyboard shortcuts displays summary screens for easy overviews allows you to set up custom reports that can be printed at the push of a button Comprehensive reporting. If you can, choose a system that allows you to report on allowances, deductions, cost centres, departments and general ledger codes. A broad range of options, such as filtering, sorting and summarising, will help you gather the intelligence you need.

Security. As with any system, security is essential, not just to protect data but to encourage users to submit it. Look for a module that allows multiple access with definable user rights.

THE FUTURE Payroll will continue to be under pressure from complex regulation in an ever-changing legal landscape with regular changes to superannuation, EBAs and taxation. This high level of compliance HCAMAG.COM

HUMAN RESOURCES DIRECTOR

and the mission-critical status of payroll means that payroll systems must always be developed on stable, robust platforms.

Payroll is also developing rapidly to keep up with the needs of a mobile workforce. “We’ll see greater accessibility to payroll data on-the-go, as well as systems that give managers better control over a disparate, multilocation workforce, including a single source of truth across languages and currencies,” Southcombe predicts.

As always, it’s worthwhile asking whether these new features have the functionality needed to solve the business problems now and into the future.

The domain of payroll, for example, relies heavily on the accuracy of information to effectively manage remuneration and personnel information.

Technology has not only played a big part in making the process of managing this vital information easier but has also morphed into a world of self-help for both management and their employees.

Two significant enhancements in this area include:

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1. Employee self-service: reduces the burden on payroll administration staff and eliminates errors associated with double entry; and 2. Electronic time-capture solutions: dramatically improve data accuracy and greatly reduce the risk of so-called ‘time theft’, especially through biometric identification.

Regardless of trend or hype, technology must be robust and proven. Enterprises should look to vendors who have a solid track record and can provide clear examples of their solutions offering clients real, quantifiable business benefits. Not only will that give you a better ROI but you’ll have better overall visibility of your business for years to come.

Finally, take your time. Queensland Health started the process of looking for a new payroll partner in March 2006, because its computerised payroll system, called Lattice, would not be serviced or updated after June 2008. The key lesson here is not to wait until your software is about to become obsolete and then scramble about for a replacement.

HR TAKEAWAYS: MINIMISING RISK HR needs to keep right on top of the payroll software used, assess whether it is reliable, up to date and efficient, and whether newer products that can remove more human error risk factors are available.

Additionally, HR should: provide adequate training and administrative support wherever possible focus on the talent pipeline: payroll requires specialist knowledge, and succession planning is vital promote awareness of departmental workloads

OCTOBER 2013 | 49

PROFILE / JEFF VIJUNGO

“Don’t put on a corporate face.

Be yourself; everyone else is taken”

FIVE MINUTES WITH…

JEFF VIJUNGO, ADOBE Software innovator Adobe’s people resources team is 200-strong globally. Of those, 120 fall under the ‘global talent’ umbrella, and the man in charge is Jeff Vijungo, executive VP of worldwide talent.

He spends five minutes with Cameron Edmond

Photo: Thilo Pulch, pulchphotography.com

50 | OCTOBER 2013

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HUMAN RESOURCES DIRECTOR

HRD: How did you first enter the HR profession?

Jeff Vijungo: I graduated from the University of San Diego and upon graduation I cut my hair and moved north to work in a suit-and-tie environment. There were three things I was considering: one was an executive search firm; another was an inside sales entry-level position with a software company; and a third was to undertake a training program with an investment bank.

I chose the executive search route because I knew I wanted a sales-oriented role but I didn’t know what industry I wanted to be in. The recruiting firm worked in so many different practice areas and I thought I could vicariously get exposure to all these industries. It worked out, so I stayed the course.

HRD: What’s the biggest HR challenge your organisation is facing and how will you set about meeting this challenge?

JV: We currently employ around 11,000 people globally and the biggest challenge we face as a company is we’re still growing. And what a fantastic problem to have! Coupled with that, we’re hiring.

In fact, the Asia region is hiring a lot – they’ve done an exceptional job under my director of talent, who has ensured we’re also very selective in who we choose. So when we think about the talent pool broadly, coupled with our selection process and our filtering and vetting cycle, the talent pool gets increasingly smaller.

We believe in combining talent selection and talent development. You have to approach both.

Recruiting alone is not a good strategy, and what I mean by that is that you have to balance with building internally. So it’s succession planning on all the levels – that’s where we see 30% of our hires filled with internals.

When you look at CEO success rate in Fortune 100 companies, there’s a direct translation to CEOs that are hired from within versus hired externally.

There’s no right or wrong, but we want to have that balance.

have this challenge – it’s HR professionals not understanding that at the core that people are the nucleus of success, and to treat people as innovators, revenue generators and big-scale operators versus transactors. So just understand that the crux of success is centred around people, and people with this good intellectual property and people with these brains that are muscles that can grow. We feel very fortunate because Adobe as a company is very people-resourcescentric.

HRD: What’s been your biggest career challenge?

JV: My biggest career challenge was the big shift

● Stanford University Graduate School of Business – Executive program in leadership, 2011

HRD: What professional skills do you wish you could improve, or do you wish you could acquire?

JV: To be candid, I’m still working on the biggest

1996–2000

career challenge question. That’s still a work in progress. Other than that, I still could improve on not being a ‘hippo’: one big mouth, two small ears. Active listening is such a critical asset to not only show respect but to gather content to make the best recommendations.

HRD: The best piece of advice you’ve ever received is...

JV: Let’s start with the worst piece of advice: that I needed to learn how to play golf in order to be successful, because all relationships and business deals were born and sealed on the golf course.

Best advice was 1) Don’t put on a corporate face.

Be yourself; everyone else is taken; 2) It’s not the answers you have but the questions you ask; and 3) The team you work with makes any type of work fun. Team is everything and a sense of humour never hurts.

the creative world.

with two kids and two dogs. I focus my life in these areas that I refer to as the ‘3Ps’:

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● Stanford University Graduate School of Business – Executive program in human resources, 2006

● University of San Diego – Bachelor’s degree, 1991–1996

HRD: What do you enjoy doing when not at work?

JV: Love spending time with my family. I’m married

I really love what I do. I would say if I were to dislike something about HR – and luckily I don’t

Qualifications

in rigour when managing a handful of people in the hallway to over 100 in over 12+ sites around the globe across 14 different zones.

HRD: Finish this sentence: the thing I love most about HR is...

JV: Changing lives. We’re changing lives here – for HRD: The thing I dislike the most about HR is...

JV: I don’t know if I can answer that because

JEFF VIJUNGO CAREER TIMELINE

Personally – My family Physically – My health Professionally – My career

● Sterling Truex Associates Principal, boutique executive search firm in Silicon Valley

2000–2002 ● Commerce One Senior talent scout – recruiting for following groups: sales, marketing, legal, finance, engineering, product development and other corporate functions

2002

● Google Consultant to sales, marketing, legal – recruiting consultant for teams within the sales, marketing, corporate development and legal organisations

Current

● Adobe VP of worldwide talent – Leads the global talent team responsible for identification, attraction, selection and development of a company with 11,000+ employees that is growing both organically and non-organically through acquisition OCTOBER 2013 | 51

EXPERT INSIGHT / TECHNOLOGY Ari Kopoulos is national sales & marketing manager, EmployeeConnect.

For further information, phone 02 82888028 or visit employeeconnect.com

The future of HR technology is…

PREDICTING THE FUTURE Ari Kopoulos outlines why predictive analytics will soon be leaving its mark on all HR functions It’s very hard to deny the power and impact technology has on our lives. It’s on our desk, in our hands, in our cars; nearly everything we touch has that element of intelligence and connectivity – and it’s evolving at an apparently unstoppable rate. For the HR professional, it means a faster, simpler and more cost-effective way of doing things, but it also offers insight, power and clarity in decisionmaking. It also sets the scene for a Brave New HR World where your talent will come from social networks, your biggest savings will come from the cloud and your most successful HR strategies will depend on your ability to predict the future.

SOCIAL, COLLABORATIVE AND HYPER-CONNECTED

There’s a new reality of social connectivity that goes beyond the organisational chart. Your workforce, already spending time on the many social networks, are no longer bound to top-down structures or physical proximity. They co-exist as part of a greater ecosystem. This makes your employees’ connections your candidate potentials – it also exposes your employees to potential job offers. We can expect social technologies that allow individuals to organically communicate, collaborate and perform in real time to dominate and make their way into, if not replace, certain elements of the HR process. Traditional performance reviews will be challenged by real-time social performance tracking, learning will be a collaborative, effortless and ongoing process, and social recruitment will be the leading talent acquisition strategy.

CLOUD GROWS UP

While there will always be staunch supporters for in-house software, their days

52 | OCTOBER 2013

are clearly numbered. Cloud-hosted SaaS applications have matured and proven themselves to be cost-effective, easier to implement, and faster to deploy than their in-house counterparts. Their very nature is about evolution, and that means continually offering more features and benefits and a visceral user experience that is critical to successful implementations. This gives you a starting point for the transformation of the business into an agile, competitive and highly desired workplace.

ANYTIME, ANYWHERE

The real-time element of a mobile device allows you to tap into the heartbeat of your workforce. Today, it’s the simple transactions that dominate. Soon they will encompass the whole spectrum of HR simply because it’s the way we now access information and formulate decisions.

Workforce management will continue to focus on smartphone capture and access to employee data, while the tablet will facilitate the more strategic elements of HR such as performance, learning and talent management.

PREDICTING THE FUTURE

Perhaps the biggest impact of new technology for HR lies within predictive analytics. Predictive analytics is part of the big data trend of collecting and analysing data from different perspectives in order to identify patterns, relationships and make predictions. It has revolutionised the sales and marketing process by offering insight into consumer behaviour and sentiment, for more targeted campaigns and strategies. Transfer this opportunity to the HR space and you now have the ability to transform HR, as we know it.

Once the relevant data, business rules, and parameters are collected, predictive analytics can answer the what, when, why, how and what-if questions HR requires to develop pre-emptive strategies.

For example, attrition and turnover is an area that all businesses seek to understand and get ahead of, especially when it comes to the critical leadership roles.

These tools offer the opportunity to identify and quantify flight risk employees and allow you to focus on appropriate and targeted retention strategies. In terms of talent management, adaptive algorithms challenge the assumption of past performance as an indicator of future success. As such, this offers a deeper, more accurate insight into future performance and potential by truly analysing competency and behavioural styles. This also extends into the learning area, allowing you to develop targeted development plans.

Although predictive analytics do not guarantee success, they do offer a starting point to rethink and reinvent your decision-making process. It’s early days, but the evolution of algorithms using HR’s big data will eventually result in better future decisions than traditional methods.

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EXPERT INSIGHT / TECHNOLOGY

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OCTOBER 2013 | 53

SALARY WATCH

IT salary and job trends Role CIO/CTO HOT

HOT

Robert Walters

Michael Page

$160,000+

HRD median

$275,000

$265,000

$233,000

IT manager

$125,000

$152,000

$165,000

$147,000

Change manager

$130,000

$142,000

$135,000

$135,000

Program manager

$170,000

$186,000

-

$178,000

Senior project manager

$145,000

$175,000

$145,000

$155,000

Project manager

$115,000

$137,000

$125,000

$377,000

Senior business analyst

$140,000

$120,000

$130,000

Business analyst

$105,000

$112,000

$85,000

$100,000

Project coordinator/administrator

$75,000

$102,000

$70,000

$82,000

ERP/CRM/BI consultant

$115,000

$120,000

-

$117,000

$103,000

$90,000

$170,000

$186,000

Developer/Web developer (Java, .NET, C++, HTML, PHP)

$75,000

-

$68,000

$71,000

Senior developer (Java, .Net, C++)

$115,000

-

$85,000

$100,000

BI/DW developer HOT

Hays

Enterprise architect

Mobile applications developer

$100,000

Development manager Web/UI designer

$120,000

$96,000 $178,000

-

$80,000

$90,000

$137,000

$150,000

$143,000

-

$90,000

$105,000

Test analyst

$80,000

$92,000

$75,000

$82,000

Test manager/QA manager

$130,000

$137,000

$128,000

$131,000

System administrator

$75,000

$91,000

$85,000

$83,000

Network/system engineer

$75,000

$112,000

$98,000

$95,000

$100,000

$102,000

-

$101,000

Database administrator Helpdesk/Desktop support

$60,000

-

$55,000

$57,000

Unix/Linux administrator

-

$100,000

$85,000

$92,000

Helpdesk/Support team leader

-

$80,000

$75,000

$77,000

Helpdesk manager

-

$103,000

$85,000

$94,000

Network administrator

-

$91,000

$83,000

$87,000

Network security consultant

-

$137,000

$100,000

$118,000

Network architect

-

$147,000

$140,000

$143,000

Report writer

-

$92,000

$75,000

$83,000

Data analyst

-

$80,000

$90,000

$85,000

Database developer

-

$102,000

$85,000

$93,000

Architect

-

$142,000

$108,000

$125,000

Technical writer

-

$108,000

$80,000

$94,000

Hays: Salaries are based on Sydney roles, exclude superannuation and are based on a median of a lower and upper range Robert Walters: Figures are for Sydney permanent roles, taken from the median of a lower and upper range and inclusive of superannuation but exclusive of benefits/bonuses; + refers to an undetermined amount above Michael Page: Figures are a median of an upper and lower range and based on 5â&#x20AC;&#x201C;7 yearsâ&#x20AC;&#x2122; total experience in the stated role. Figures are for NSW and are inclusive of superannuation but exclusive of bonus/incentive schemes

54 | OCTOBER 2013

HCAMAG.COM

HUMAN RESOURCES DIRECTOR

IT SALARY INCREASES OVER THE NEXT 12 MONTHS

KEY TRENDS

All my employees will receive the same percentage increase

A requirement for technology professionals has been steady over the last 12 months and is expected to remain that way. Sectors with the strongest activity as organisations consolidate their operations include the public sector, not-for-profit, education, healthcare, and commerce and industry areas Architects, IT managers and program managers have been in highest demand – this is expected to continue due to further developments in big data, mobility and cloud computing There were a limited number of opportunities available for senior technology executives in 2012. This demand is expected to improve over the next 12 months Declining opportunities in overseas markets have seen an increase in the number of technology professionals returning to Australia over the past year Fixed-term contract roles are higher in NSW, with an increase nationally in preference to hiring on a temporary basis. This is expected to increase over the next 12 months WILL THE SKILLS SHORTAGE PLACE UPWARDS PRESSURE ON IT SALARIES?

23% All my employees will receive an increase, but it will vary according to performance

56% Only my best-performing employees will receive an increase

16% No one in my team will receive an increase

5% AVERAGE IT SALARY INCREASES

0-2%

30%

3-5%

67%

6-8%

3%

While the average salary increase for technology professionals will be between 3% and 5%, top performers can expect higher increases

BASIS FOR IT BONUSES OVER THE NEXT 12 MONTHS Team performance

4% Company performance

14% Other

21% Individual performance

15%

25%

No

Combination of all

36%

44%

41%

YES

at the rate of inflation

than YES more inflation

AVERAGE IT BONUS AS % OF GROSS SALARY

1-5%

48%

6-10%

29%

11-15%

13%

16-20%

6%

21-30%

4% Source: Michael Page Salary & Employment Forecast, Australia 2013/14

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OCTOBER 2013 | 55

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