Perceptive HR Technology

I’ve been busy travelling to several customer sites to talk about new talent management projects.  I am very encouraged by what I’m hearing, especially with respect to the way HR leaders are engaging in the process of creating the right kind of ‘bridge’ between process and technology to solve critical business problems.

As I wrote about in my recent post from the cruise ship, many of the companies that jumped into talent management early are now struggling to reap some of the long-term benefits of integration and the use of competencies in collecting data.  But the last three meetings I’ve attended with VPs of HR (in the last three weeks, by the way), I’ve noticed consistency in the longer-term thinking that seems to be taking place.  And some of these customers have point solutions installed — others are just getting started.  But the story is the same — we have to look at the broad range of issues (with surprising focus on building a reusable competency infrastructure) FIRST — then look at business process, then technology.  Now for some, that will require reworking that technology.  For others, it’s a great opportunity to select a well integrated suite of products with an embedded competency framework (sorry, I couldn’t stop myself!).

The benefits of such an approach are broad and game-changing.  Some, like John Ingham in a recent post suggest that the implications are dramatic and could be costing organizations billions.  If it’s true, and companies can really master all elements of good talent management (people, process, AND technology), there should be competitive advantage for those that do.

And if my unscientific data is any indicator, perhaps there’s a trend.  Time will tell, and I’ll be watching.

One more post about my experience at the HR forum two weeks ago………….

Some of you are probably aware that this event has a ‘pay for play’ element to it — suppliers pay to participate, and the delegates attend for free in exchange for a commitment to a certain number of meetings to hear about offerings from the various suppliers.  There’s an elaborate (and I would say effective) matching process to get folks with like interests talking to each other.  But with the goal to make sure that every supplier gets a certain number of ‘meetings,’ you always have a few with someone you quickly discover couldn’t care less about what you have to offer (or vice versa). 

Knowing there would be some of that (and in some cases I could even tell in advance), these delegates became my ‘focus group’ targets — I tested our strategies to see how these folks would react eventhough they probably wouldn’t be our target customer.  A particularly insightful meeting was with a large, national retailer with over 100,000 employees who’s identity I will opt not to disclose.  The delegate, a senior HR person, was telling me about their talent management technology strategy, and the conversation went something like this (paraphrased for brevity, and might slightly miss on a detail or two):

Supplier (me):  How are you addressing your talent management technology needs?
Delegate:  We have a enterprise-wide LMS installed that’s having a real impact on delivering training in the stores, we just started an implementation of a recruiting system, and performance management is next.
Supplier:  How many vendors are providing that technology?
Delegate:  Three.
Supplier:  Are you concerned with the issues of technical integration?  Do you hope to leverage infrastructure like organizational and supervisor structure across those products?
Delegate:  Definitely.
Supplier:  How are you going to do it?  Is IT engaged in the process?
Delegate:  <moment of silence>.. IT is looking at it

And so went the discussion..we also explored how they anticipated leveraging data for decision-making across the full organizational development value chain, and concluded that while those issues had been discussed, these integration elements (see my previous post) are not central to the creation of their technology strategy — at the moment.

I would anticipate that this organization has a real shot at efficient and effective management of their core transactional business processes in talent management.  For training, they’re already doing it.  But at the end of the day, after all those operational benefits are achieved and they want to really get those systems talking together they are either going to spend a fortune consolidating data into one of those systems (and hope that the one is good enough to manage the data from the others) or they will be building the mother-of-all-data-warehouses.  And let’s face it — HR is always number 11 on a priority list of 10, and after all of the money they’ve spent on getting the operational stuff right it will require real clout to get the funding for yet another major HR technology initiative.

Everyone knows about my bias here — that an integrated, ERP-class talent management solution aligned with the system-of-record data about people is the only realistic way for organizations to do breakthrough talent management.  It’s about great operational efficiency AND actionable data about people, and the organizations that get both right will be at a significant advantage.

I recently read a research report authored by Nate Swanson at ThinkEquity research about the Talent Management space. He did a very nice job of articulating what he thought the ultimate winners in HCM will need in order to be successful in our market. He made four key points (and I’m virtually quoting him here):

• A vision of creating the system-of-record for all employee data
• Deployed in a pure on-demand software model
• With applications that were built organically (for the most part)
• That are scalable and can meet the needs of both large and small businesses
• Both globally and locally
• Created for mass consumption, as most HCM applications will be used by employees across the entire organization

I was delighted to read about his perspective on the market given how nicely aligned it is with what we’re doing at Lawson.  Specifically:

1. The system-of-record issues are central to delivering broad talent management solutions at low cost, and no best-of-breed vendors can come close to claiming the ability to address them.
2. Thanks to the Lawson Landmark platform 100% of our application has been built organically.  Oh ok: we are getting some help with parsing resumes from our friends at Talent Technology.
3. Our product will prove to be scalable and it was global from the first day we started it (and we’ve proven it by having one of our very first customers in France).
4. With our introduction of the notion of spaces, we are showing just how effectively we can tackle mass consumption — things like using Outlook for core manager self-service and Facebook to let companies virally market their job openings (never mind spaces within the Lawson UI for HR generalists, recruiters, etc).

Best of all, I can’t wait until next week when we can demonstrate it all, front-and-center at our user conference in Las Vegas.   For those of you attending, be sure to let me know if you think we’re delivering on Nate’s viewpoint!

Last week was a flurry of customer meetings — and measurement in succession management seemed to be on the minds of more than one HR executive.  There’s are real desire to more effectively measure individuals with high potential (HI-POs, as the organizational development folks call them), but a plethora of challenges in doing it.

I’ve written about the issues related to capturing and maintaining data (here), but it’s more than that.  While organizations seem to be able to ‘manually’ identify hi-pos, the ongoing activities that need to be done to keep track of them consistently falls through the cracks.

The Institute for Corporate Productivity did a survey  tracking high-potential employees and the results didn’t disappoint:

• 69% of the responding organizations had a tracking process in place;
• 70% said that development planning was part of the process;
• but only 47% said that they are tracking the effectiveness of their assessment activities

Organizations have multiple challenges with measuring hi-pos — they don’t have clear success profiles for their jobs (and thus a way to measure great performance), measures of potential are often subjective and oriented in point-in-time assessments (rather than on a recurring basis), and almost no one can easily (meaning quickly and at low cost) correlate behavioral characteristics of hi-pos to business outcomes.

The result:  some high level data about hi-pos, in a spreadsheet that gets updated occasionally is as good as it gets for most companies.  It’s going to take a long-term commitment to integrated talent management combining good measurement with reliable data collection (and some decent technology to keep track of it all) to gain a differentiated advantage in managing top talent.

I wanted to update you on a post from a number of weeks ago where I was talking with a manager at Lawson about our merit review process.  I challenged this person to think differently about the situation, and we had our monthly mentoring meeting last week and got an update.

As a mentor, I try to influence and suggest, but not push (too much) and in this case, since I admitted I had been preaching a bit, I deliberately didn’t ask for an update.  But in fact, I did get one (I was hoping!) and was delighted with the outcome:

• This manager was fearful of what very senior people would think of a lower increase, and that turned out to be the easy part.  They understood the rationale and were appreciative of the recognition.
• The manager ended up with a range of increases from 2.5%-8%, and prior to our discussion that range was something like 3-4%.  Bonus points towards admission to HR heaven for really making great performance matter!
• One of the people that got 8% was delighted, surprised and very appreciative.  The second person, not so much.  They expected more (and imagine if that 8% had been 4%!) and that discussion proved to be the most challenging.

Shame on me:  I prepared the manager for the (possibly) difficult discussion with the senior people and what to expect from the delighted/surprised person.  But I left my mentee fully unprepared for the top performer who got a great increase relative to any measure and was still dissatisfied.  I guess 2 out of 3 isn’t bad.

Most importantly, I’d influenced the manager to evolve to a new level, and confirmed that the experience was a good one.  On to the next one!

Jack Welch, the long-time (former) CEO of General Electric has always been an evangelist for the importance of HR in leading businesses.  He writes a column in Business Week where he answers reader questions, and this week’s post was a great one.  The reader asked what to do when a top performer gets a great offer from a competitor.  I loved his answer.  Paraphrased, he said two things:

1. If you’re taking care of your best people at all times from all the right dimensions, it doesn’t matter.  When they decide to go, let them — there probably isn’t anything else you can do to keep them.
2. Anticipate the possibility that just such an event will happen and have a strong succession plan in place so that you could replace a departing star with someone ready to do the work in eight hours.  Yes, eight hours!

This is a provocative idea, and for most organizations you could only manage it on behalf of a handful of people.  But from the HR executives I talk to, more progressive organizations see a need to manage at this level (ok, maybe not the 8 hour SLA!) for dozens, hundreds or even thousands of people.  It isn’t going to happen without technology.

To effectively do this, organizations will need tools that support robust measurement of what people did (performance management) as well as measures of their readiness and potential for target jobs (a key element of succession management).  This requires an integrated database of employee data, performance results and data about future plans.  Plus the analytics to distinguish between people and make fast (for Jack, very fast) decisions when critical positions become vacant.

Hmmmm…maybe a software company should solve that problem for HR leaders around the world!  Oh wait, that’s us!~

I read with some interest Gerry Crispin’s post this week about succession planning.  Some have suggested that succession planning is a futile exercise — the collection and analysis of data is complex and time consuming.  But more importantly, it’s obsolete a month later, because it’s all based on a point-in-time.  Plus, information is stored in a remote silo called an Excel spreadsheet (ok, the execs only saw the PowerPoint presentation).

The real challenge is in building an organizational process that exists on its own, supported by a data repository that lives and breathes.  That means a consistent effort towards collecting the data (at a minimum an annual assessment that speaks to potential and readiness) and a focus on identifying target jobs for individuals followed tracking each individual’s progress towards that next assignment.

Finally, it fails without the kind of technology that captures the data and effectively allows employees and managers to collaborate with flexibility and ease.  Just wait — a couple of companies are going to figure that out, and we’ll be hearing about it on the cover of Business Week.  If we’re doing our job right, that company will be a Lawson customer!

I have spent my career building tools to help HR folks do their best work.  Over the years, I’ve been quick to point out the fact that ‘I live in a vacuum, and I love it!’  With that said, I also consider myself to be a bit more evolved than the average guy as it relates to the practice of HR as a leader.  In other words, I’d like to think that sometimes instead of just telling others what they should be doing, I can occasionally ‘preach what I practice.’

Today I had just such an opportunity.  I was meeting with another manager at Lawson (I suppose you could call it mentorship) and the subject of our annual merit increase allocation process came up.  And this individual manages a fairly large team, so I started asking all kinds of questions — how did performance ratings distribute across the group?  what was the range of increases that you had awarded to people?  and most importantly, when you’re done, how will a person know whether good vs. great performance has any real impact on their salary increase?

To make a long story short, I challenged this individual to get serious about using the process to show people, with crystal clarity, that really great performance results in a really great increase, and good performance results in just an ok one.  It looked like this manager was going to take the easy road — give increases in a very narrow range so that no one got really upset.  The tragedy of that was that it also meant that the few people that exhibited great performance (this manager did a good job doling out high overall ratings to only a select few people) were not going to really feel special (since of course the merit budget is fixed across the whole workgroup).

What was the individual’s greatest obstacle to taking a different approach?  Fear.   Not HR policies, not budgets or bureacuracy, not hard work.  It was, very simply, the fear of how to explain to the people with good performance that they would only get a good increase.  Fear of how to tell someone that the difference between good and great was several percentage points in your raise, not a half-point.  Fear that people would walk away from the experience demoralized rather than energized.

I put it this way — for the people that are good, the message is that if you strive for greatness, the rewards are disproportionately better — by a margin worth striving for!  And for the person that’s great, it’s the kind of reward that will pay dividends in motivation for months, not days (which is how long it lasts for the great employee who only gets a good raise).

So where did the preaching come in?  We’re sitting at Starbucks, and I realize that I am TOTALLY preaching to this person, to the point where I even thought I was laying it on a bit thick.  And now, as I write this post, I’m as convinced as ever that if it’s harder, it’s often worth the effort.  In the case of doling out merit increases, I’m certain that’s the case.

We’ll see what happens — I hope I inspired this person to re-evaluate the approach.  But as a mentor, I can only influence (hey, that was another recent post!).