Developing an Integrated Human Capital Strategy

Developing an Integrated
Human Capital Strategy
Presentation to the:
Florida Society of Human Resource Management

Wendy Heckelman, Ph.D.
WLH Consulting, Inc.
2703 Cypress Manor
Suite 100
Fort Lauderdale, FL 33332
954-385-0770
wendy@wlhconsulting.com

Session Overview

• Business case for developing an Integrated

• Human Capital Strategy Components

• Your HCS Strategy Checklist

• Overcoming barriers and ensuring success

Defining Human Capital

The collective knowledge, skills, and

abilities of an organization's employees.
SHRM

Prepared by WLH Consulting, Inc. 3

The Relationship Between
People and Business Strategy
Focus on People (competencies)
Capable employees
HIGH
Capable employees
are frustrated by the
are matched with
organizational
the business
impediments
strategies, priorities,
to getting the job
and challenges
done

Brilliant business
Organization that strategy
does not meet but lack of talented
strategic business employees to deliver
goals and talent on desired
that is not talented organization
capabilities
LOW

LOW Focus on Business Strategy HIGH
4
Prepared by WLH Consulting, Inc.

Taking Human Capital Strategy to a New Level
Only 9% of HR leaders report their company is effective or
very effective in connecting Human Capital practices to
organizational performance.
University of Southern California Center for Effective Organization, 2009

Closing this gap requires:
● Using an integrated human capital strategy and its
people to create sustained competitive advantage.
● Measuring and managing human capital with the
same discipline as financial capital.
● Providing leaders with key metrics to make better
human capital decisions.
● Determining where and how human capital systems
need to be better or different than the competition.

Why Human Capital Strategy Matters
● Managers have the most control and influence over
an organization’s human capital assets
● Research by leading human resource and consulting
firms report that:
– Effectively managing human capital assets (coaching and developing
others) can improve shareholder value by as much as 30%.
– Human capital has become and will remain throughout the next 20
years more important to business success than financial capital,
strategy, or R&D.
– The demand for smart, sophisticated business professionals who are
technologically literate, globally astute, and operationally agile will
significantly outpace supply over the next 10-15 years.
– The average initial cost of replacing a managerial-level employee
is more than 240% of that employee’s compensation. This cost does
not include the 1-2 years of lost revenues and profits while the new
employee learns how to perform effectively in the job.


The Business Case for an
Integrated Human Capital Strategy
No Integrated HCS Integrated HCS

Weakens an Leverages human capital as
organization’s a competitive advantage in a
competitive strength changing, unpredictable
market
Neglects to groom and Builds a broad, deep talent
leverage its inherent pipeline to meet immediate
bench strength and future succession needs

Lacks a consistent Develops talent at all levels
process to develop to better accomplish
talent and maximizes its business objectives
value

Supports achievement of broader corporate goals and objectives

Human Capital Strategy Framework
Recruit Ready Retain

Talent Pipeline

Core Competencies
System-wide Metrics

● Create an overall framework for attracting, developing, and retaining talent
● Anchor the framework with a validated competency model
‒ Core leadership categories and definitions
‒ Functional / Technical vary
● Create system-wide metrics to monitor HCS efforts
● Develop practical tools to facilitate talent management and ensure a talent
pipeline

Drives ownership, accountability, and sustainability for
upgrading talent to meet emerging business needs

Human Capital Strategy Framework


Talent Pipeline

Core Competencies
System-wide Metrics

Strategic
Process Tools Metrics
Objectives


The Foundation: Competencies
● Work or role-related behaviors representing
knowledge, skills, abilities, and motivations directed
toward successful completion of a task or goal:
– Future-focused to meet evolving business needs
– Support achievement of the broader business strategy
– Actionable
– Observable
– Coachable

● Interview Guides ● Assessment ● Performance
● Career Ladders Instruments Management
● Behavioral Based ● Coaching Forms ● Talent Planning
Interview Guides ● Development ● Learning & Development
Planning Programs
● Leadership Development

Best Practices: Creating a Competency Model
● Determine who would be on your project team
● Leverage existing materials; but remember, a new
model needs to be future focused
● Consider establishing core leadership competencies
that apply across the organization
● Identify how functional / technical differences should
be handled
● Plan key milestones and establish deliverables:
– Data gathering
– Drafting and validation process
● Establish a data gathering process with stakeholders:
– Focus on anticipated changes in the business and marketplace
– Bucket responsibilities and tasks
– Identify specific Knowledge, Skills, Abilities (KSAs)
– Determine functional/technical knowledge required to perform on-
the-job
– Distinguish Behaviors that differentiate exceptional performance.

RECRUIT

Attracting and Selecting Talent
● Develop a recruitment strategy that attracts high quality
Strategic talent to apply to the organization
Objectives
● Establish a compensation and benefits philosophy to
pay market rate or above/below
● Include diversity goals and strategies

● Recruitment Pipeline & Strategy
Process ● Selection Framework & Behavioral Based Interviewing
● On-boarding Process

● Selection Interview Guides that are competency based
Tools ● Behavioral Interview Training

● Offer-Accept Ratio
Metrics ● # of internal promotions versus outside hires
● Talent Ready (# of R1s)
● Time to fill

READY

Developing Talent
Strategic ● Create competitive advantage
Objectives ● Accelerate the mastery of behaviors critical to
organizational success
● Foster an environment where developing talent is a
priority
● Empower managers with the skills to provide ongoing
feedback and coaching.
● Create a learning culture
● Focus on both the individual and group
● Develop an integrated learning curriculum
1. Create and leverage a Development Planning and
Process Feedback Process (assessments, development planning
guides)
2. Utilize Talent Planning to identify ready now leadership
and high potentials
3. Leverage an integrated Management / Leadership
Development effort

Grow and secure a leadership talent pipeline

READY

Developing Talent

● Competency-based ● Coaching/Mentoring
Tools Training ● Development Planning
● On-the-job Learning Guides
● Rotational Assignments ● Instant Assessments
and Cross-training ● Coaching Forms
● Assessment Instruments
(360, self and manager,
self only)

● Completion of Individual Development Plans
Metrics
● Use of field coaching forms
● Developmental assignment rotations
● Mentoring related metrics
● Performance Assessments
● Capability-based Performance Assessment
● Capability-driven Business Results


Best Practices: Development READY

Planning and Feedback Process
● Agree to specific Development Planning strategic
objectives and overall process
● Translate competency model into assessment
instrument(s)
● Determine data analysis plan and reporting requirements
● Prepare managers to provide coaching and feedback
● Design Development Planning Guides
– Specific activities
– Suggested learning programs
– All organized by competencies

Business Impact: Talent Development is closely linked
to strategy and creating competitive advantage

Talent Planning: Best Practices
● Agree to Talent Planning strategic objectives and
overall process
● Make the business case for talent reviews
● Match available present talent to the organization’s
requirements for future talent needs
● Identify promising candidates
● Dedicate resources for development efforts
● Make accountability for Talent Planning a critical
objective
● Integrate Talent Management process with
Performance Management process (includes
bonuses and compensation)

Business Impact: Leadership pipeline identified with specific
development initiatives underway

Performance Management:
Best Practices
● Align Performance Management process with business strategy
and goal development efforts
● Support managers’ ability to clarify performance expectations
and conduct regular performance reviews
● Ensure process in place for periodic coaching and feedback
sessions
● Create systems that support easy documentation and recording
of performance management results
● Develop a formal coaching and improvement process for
employees not meeting expectations

Business Impact: Direct linkage between individual goals
and performance with organizational strategy and results.


Leadership Development Best Practices
● Agree to Leadership Development strategic
objectives and overall process:
– Change thinking and behavior

– Leaders take ownership of and accountability

– Immediate application

– Lead to improved results

● Develop overall blended, learning strategy and
leadership development curriculum plan
● Create developmental activities and tools to
support achievement of Individual Development
Plans
● Incorporate findings from the group assessment
into curriculum development plans

RETAIN

Retaining Talent
● Retains valuable employees
Strategic ● Reduces costs associated with turnover
Objectives
● Recognizes and rewards talent development
● Maintains institutional knowledge base

● Employee Engagement Surveys
Process ● Exit Interview Process
● Retention Risk Training Program
● Integrate Recognition and Rewards

● Retention Risk Assessment
Tools ● Just-in-time tools to prepare managers for a “making the
save conversation”
● Exit interview Reports

● Retention of High Potentials
Metrics ● Turnover Ratios
● Redeployment of talent following reductions in workforce


RETAIN

Retaining Talent

Manager-
Manager-Colleague Relationship
Positive Work Coaching & Performance
Environment Supervision Management

Training & Career Rewards &
Advancement Recognition

Work-life Meaningful Corporate
Balance Work Culture

1-8


Barriers to Overcome
● Make the business case:
– Link HCS activities to the strategy and business needs
– Talent development is a value-added activity
– Competency based tools create a common language and
framework
● Gain senior management commitment
● Approach HCS as a well-planned change effort
● Develop metrics that evidence how HCS drives the
business
● Leverage technology applications
● Provide easy access to information, tools, and learning
application:
– Leadership
– Managers
– Employees
● Ensure HCS activities seamlessly executed and
coordinated with business cycle demands

What are you Measuring Today?

Measuring to Shift focus to
more strategic
Measuring to
Inform metrics Drive Strategy

● Headcount change ● Leadership team capability
● Hires and termination ● Return on investment of human
● Total compensation capital
● Performance against HR ● Employee competency
strategy objectives ● Effectiveness of change efforts
● Training and development ● Employee engagement
return ● HR function effectiveness
● Performance against HR
● HR function effectiveness
strategy objectives
● Discipline and grievance
● Training and development
cases
return
● Number of internal career
moves
Goal is to craft a range of measures that provide senior executive teams
with an idea of how efficiently and effectively the organization is
managing its human assets in support of its strategy.
22


HCS Checklist
● Designed to evaluate your
organization’s overall
– Helps you determine what you
have and what is missing
– Provides an opportunity to
evaluate overall quality of effort
– Allows you to step back and
prioritize need
● Can be shared with others
on your team or your
senior leader


“Integrated” Human Capital Strategy

Systematic integration ensures:
Ownership: Leaders, Managers, and
employees with HR Partnership

Accountability: For developing and retaining talent
with the critical skills needed for
future business challenges

Sustainability: With a comprehensive and linked
set of processes and tools

Ownership, accountability, and sustainability lead to meeting
current and future business needs

WLH Consulting, Inc.

2703 Cypress Manor
Suite 100
Fort Lauderdale, FL 33332
954-385-0770
www.wlhconsulting.com


WLH Practice Focus
Strategy Development & Execution
Strategy Formation
Senior Team Alignment
Execution Planning & Implementation
Mergers & Acquisitions

Business Performance Improvement
Business Diagnostics
Organizational Design & Effectiveness
Process Excellence
Cultural Transformation & Change Management

Competency Models & Tools
Talent Planning
Development Planning
Engagement and Retention
Learning Strategy & Curriculum Design
Blended Learning Solutions


WLH Consulting, Inc. Team
Our team combines the diverse expertise of:
● Ph.D. industrial/organizational psychologists
● Experienced consultants with 20+ years experience partnering
with clients to develop strategies, engage in process
reengineering, and mutually execute business solutions
● Experts in developing comprehensive human capital strategies
and tools
● Designers and developers of integrated, blended learning
systems
● Skilled facilitators to help participants successfully manage
change, identify issues, and resolve problems
● Trained project managers for large scale client initiatives

Unique talents + Collaborative expertise = Breakthrough Results


WLH Commitments
We partner to implement streamlined,
Collaborative customized, and efficient solutions that deliver
results

Our flexibility allows us to adjust to changing
Highly
needs throughout each engagement or project
Adaptive life cycle

We rely on proven methods for data collection,
Scientifically
statistical analysis, and sophisticated
Rigorous organizational development models

We take pride in "going the extra mile" to
Client-
ensure that change initiated becomes change
Centered sustained


Partial Client List


The International Division of a global pharmaceutical company asked
WLH to help it create and deploy a human capital strategy aimed at
attracting, developing, and retaining the best managers and employees
in its various country markets.
● Defined and validated the key leadership capabilities to support its new
mission and strategic objectives.
● Turned capabilities into a 360°Feedback Instrument and administered it
for the client.
● Trained coaches to support the feedback process.
● Created innovative, intense discovery-based workshops to train
managers to accelerate development of these capabilities.
● Created learning modules (print and CD-ROM) to strengthen leadership
capabilities at the team level and linked them to improved business
performance.
● Implemented retention strategies to keep high-potential managers.
● Launched a talent planning process to:
– Identify national and regional leadership development needs
– Target specific candidates for development
– Implement and monitor appropriate development initiatives
● Created metrics to gauge success of the talent planning initiative.

Sample Human Capital Strategy Projects
WLH Consulting has worked on many Human Capital Strategy
projects and developed tools to attract, develop, and retain talent.
Key Elements:
● Build capability models and ensure learning objectives address developing
capability needs
● Use just-in-time tools to provide managers with sustainability tools for
topics, e.g., how to conduct a developmental conversation
● Create Development Planning Guides to support manager’s and
colleague’s ability to identify developmental needs and match meaningful
learning approaches
● Designed customized 360°web-based feedback process, instrument, and
feedback reports

Customized Learning Programs:
● Rx for Retention: designed a training program for managers to identify “at
risk colleague departure” and strategies to retain talent
● High Performers Workshop: designed and delivered a one-day program
to support a manager’s ability in providing developmental feedback and to
support the development of Individual Development Plans


Leadership Development Sample Project
The new executive team of a global healthcare company needed new
leadership skills and attitudes at all levels of the company – in all its
global markets. Asking managers and employees to develop and
commit to these new capabilities would change the organization’s
culture and generate both resistance and risk.

WLH helped this client:
● Define, and then validate the leadership capabilities most important to
supporting its new mission and strategic objectives.
● Turn these capabilities into a 360° Feedback Instrument that WLH now
administers for the client.
● Train coaches to support the feedback process.
● Develop individual learning experiences (print and CD-ROM) that
managers and employees can use to foster their own development
based on the 360°feedback they received.
● Create innovative, intense discovery-based workshops for business
units to train managers to accelerate development of these capabilities.
● Create learning modules (print and CD-ROM) to help line managers
strengthen these leadership capabilities at the team level and link them
to improved business performance.


Leader Led Learning Projects
WLH partnered with a major pharmaceutical company to transform
leadership capabilities development into an easy, practical process that
line leaders could use to produce immediate, visible improvement in
business unit effectiveness.

Customized Learning Programs:
● Provided a flexible, easily accessible range of activities designed to
“push” the practice of leadership competencies down into business units
so that they become a “way of life” and are the preferred approach for
meeting business objectives.
● Created a Manager’s Toolkit to accelerate practice of the leadership
capabilities:
– Learning activities in each of the modules that clearly tie back to the
specific leadership behaviors.
– Re-configuration of modules to specifically reinforce corporate
strategy.
– Assessment checklists for line managers to quickly and accurately
identify which of the leadership behaviors they wanted to
concentrate on developing with their work teams in order to improve
performance.


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