Event: The Conference Board 2006 Hot Topics & Hot Issues HR Forum--Dilemmas, Demographics & Direction: The Current and Future State of HR
July 18-19, 2006, at the Marriott Marquis Hotel, New York City
What: The Conference Board is the world’s leading business membership organization, with a global network of nearly 2,000 businesses and organizations in 61 countries. Conference Board sessions provide executives with an opportunity to share practical business experience, rather than theory, primarily from senior executives from major organizations.
Conference Info: For more information about Conference Board events, click on www.conference-board.org.
Day 2: Wednesday, July 19, 2006
Best panel Day 2: No surprise here, but the best panel was the last one, on "The Future of HR." Janet Clardy (vice president of human resources for Korn/Ferry International), Greg Waldron (partner and chief talent officer for Porter Novelli) and William Stopper (partner at the Walker Group) had the kind of panel discussion you don't hear at the typical HR conference.
So, what is the future of HR? Not surprisingly, "It's all about talent management," according to Parker Novelli's Waldron. This has been the drumbeat of forward-thinking HR people for some time, and the drums are beating louder and more frequently about it. The panel's consensus was that the key role for HR is all about talent—finding it, deploying it, developing it, retaining it. HR needs to do other things, of course, but leading the charge for talent will be the key function for HR departments moving ahead.
The panelists also offered this assessment on the "State of HR Today."
- HR professionals experience great conflict around their roles and expectations.
- There is a disconnect in HR people between perception and reality.
- There is a great need in HR for self-examination.
- Practice results-based human resources. "We must be able to translate everything we do into a measurable result that the rest of the business team understands," he says.
- HR needs to speak a language the rest of the business can understand and relate to. "Don't get fooled into just talking financials," Waldron said. "It's much broader than that." He feels that HR professionals need to have a greater understanding of how their company makes money and what are the key product lines. "Who do you have lunch with?" he asked. "How are you spending your time to learn the business?"
- You need to be the best businessperson at the table. There’s no reason, he said, why HR people can't be as well-grounded in the economics of the business as anyone else. In short, HR needs to better understands the business drivers for their company, and how HR can suppport those drivers. "If you can't get an MBA," he said, "do whatever you can to get more business or financial training."
- Go beyond ROI and achieve trusted advisor status. He said that you need to combine HR expertise with expertise in the business. "This means becoming a student of the business and becoming confident enough to render a solid judgment or opinion based on both business principles and HR."
- HR must work to win the "new war for talent" and survive the great baby boomer retirement.
- You must be able to manage the transition from productivity to sustainable value. It's not just the financial metrics or the way to cut costs to increase productivity, Waldron said, but it is looking for big ideas to create a sustainable, competitive advantage by better leveraging and utilizing the workforce. In other words, "it's about top-line growth, not just cost cuts."
- HR must make "global" a way of life. There is a new realistic definition, the panel agreed, on what operating globally is all about. HR can play a role in defining this.
- HR needs to be always asking, "What's next?" Rather than embracing the latest fad (which places you behind the wave), you need to be confronting what will be the next big thing in a smart way. Waldron gave an example of what the Starbucks CEO said when he was asked what he expected of HR. The answer? To stay ahead of our growth. The panelists agreed that is a key role for HR everywhere.
Day 1: Tuesday, July 18, 2006
How you know this is a Conference Board event: By the size and quality of the audience. This event is a little more sparsely attended than most of the Conference Board sessions I have been to, maybe 80 to 90 participants rather than the usual 100 to 120, but the crowd is made up of a lot of VP-level executives and directors.
Best speaker of Day 1: Jack Phillips, chairman of the ROI Institute. Although I have heard many speakers talk about how to measure the ROI (return on investment) of HR initiatives, this was the first time I have ever heard someone demonstrate the specific method of calculating HR ROI and walk everyone through how to do it. There are some caveats, however:
- Intangibles are frequently the most important data set, and these are usually difficult to credibly convert to a monetary unit for the purpose of an ROI analysis. Dr. Jack’s advice: When this is the case, just leave them as intangibles rather than making the credibility of the analysis suspect.
- HR ROI studies should be conducted very selectively, usually on only 5 percent to 10 percent of the projects, because they take a lot of time to do properly and it doesn't make sense to do one for every single initiative.
- AN ROI methodology can be implemented for about 3 percent to 5 percent of HR’s learning/development budget.
So, what is the actual ROI calculation? In the end, it comes down to this: (net program benefits divided by the program costs times 100). However, there is a lot of other work to actually get to that final calculation. Dr. Jack has a flow chart that breaks it all out that you can get from the ROI Institute at www.roiinstitute.net.
Employee engagement, the next frontier: Employee engagement was discussed a lot at this conference, mainly in the context of being the "next productivity frontier," as Matt Schuyler, chief human resource officer at Capital One, put it. Schuyler pointed to such companies as Starbucks, Valero Energy (a 2006 Workforce Management Optimas Award winner) andSouthwest Airlines as organizations that have highly engaged employees that help to drive the business and create more value for shareholders because they are highly satisfied in their job and give an increased discretionary effort.
According to Schulyer, there are two levers to drive greater enagement:
- Emotional commitment—getting employees or associates to value, enjoy and believe in their jobs, their managers, their work teams and the organization.
- Rational commitment—getting employees to believe that their managers, teams and the organization have the employee's self-interest in mind.
Schuyler made a great case for engagement, but I couldn't help thinking that this is a tough one to leverage given how so many companies have spent the past 20 years systematically breaking the loyalty bond with their workforce and treating associates as disposable parts easily discarded and replaced. It sounds good in theory, but many of the companies he pointed to that are so good at this (such as Starbucks and Southwest) are relatively new companies and built employee engagement into the organization’s DNA as part of the larger business strategy. I doubt it would work very well at, say, Ford or United Airlines.
Buzzword of the conference: "Resilience," as in building more employee resilience. Amy Richman of WFD Consulting, along with Robert Carr and Kay Campbell, of GlaxoSmith Kline, had a session on why building a resilient workforce is so important today--mainly because resilient employees feel confident that they can manage the pressures of their work and maintain job performance during times of change.