Strategic resourcing and talent management – Roundtable Report
11 February 2010 London
Hosted by theHRDIRECTOR.
Chaired by Jason Spiller.
Tom Marsden, Director of Professional Services – Alexander Mann Solutions
Liam Burns, Business Development & HR Manager – New Balance
Paula Michell Leach, Learning & Development Manager – Ford Motor Company
Christian Hasenoehrl, Partner – Gallup
Gabrielle Nelson, Head of Workforce Planning – Metropolitan Police Service
Stella T. Dixon, Head of HR Operations – Associated Press Television News
Claire Thomas, Senior HR & Development Manager – The Penguin Group (UK)
Mark Pearce, UK HR Director – SEGRO
Cathy Tracey, Director – Alexander Mann Solutions
Wendy Trehy, Associate Partner – Davies Arnold Cooper LLP
Julie Armstrong, HR Director – Manchester Airport
“People are the greatest asset” is the much used mantra in business. But words are nothing if organisations do not truly provide a fully functioning and relevant talent management strategy, fit for purpose, relevant and supportive throughout the employee journey.
How has recession impacted on business resourcing needs?
Julie Armstrong: Organisations have struggled with resourcing during the recession. We have had to take a look at what we need to achieve for the business and understand what our core workforce is and be extra cautious about where money is spent. This has meant looking at spend elsewhere such as compensation and reward and channel this into the core workforce invested into what we deem as our core workforce. It’s not been an easy, our task at Manchester Airport is for aeroplanes to take off and land safely, securely and efficiently.
How do you do recruitment?
Julie Armstrong: We do it on quite a low cost basis, work closely with Job Centre and we have established our own academy, with focus on the local community and getting people from the local community to work at the airport, We also work in partnership with the local City Councils to fund that kind of recruitment. So that’s the focus on the semi-skilled, unskilled levels, and then obviously we work with preferred agencies on recruiting the professional skills. The recruitment processes have all been reviewed, competency based. A lot of it is online.
Mark how has construction been affected by recession, in terms of resourcing projects?
Mark Pearce: The property world has been hit by the recession quite badly. SEGRO outsources all of the construction resourcing and what immediately starts happening is ‘speculative development’ ceases. Development is then restricted to direct customer project requirements. In terms of the impact on people, for example agencies have lost a lot of people in the property world and for our business, the impact has actually been there’s been some consolidation. What we’ve really noticed last year was that when it came to voluntary resignations they pretty much all dried up last year, and there was a phase of very little movement. What we’re now starting to see is that it’s starting to pick up and we’re expecting there will be more in the middle of this year in the job market.
Wendy Trehy: In terms of resourcing and recruitment, our clients are much more focused and they have had to make tough decisions. Where organisations are now starting to look at new hires, there seems to be an increased trend to look at high profile role hires and to demonstrate that they are a forward-thinking, strategic organisation that’s looking to recruit for what we hope is the upturn.
Is it a case of focusing on immediate needs as opposed to forward planning?
Wendy Trehy: On the contrary, I think it’s been a great opportunity for HR to actually develop their strategic role. People are more cautious and I think there’s a big realisation that employees have long memories, and if employers haven’t followed best practice and looked after their people, they’re going to find it much more difficult to retain and motivate talent going forward.
Claire Thomas: One of the key challenges is retaining talent in difficult times. The market is beginning to change and pick up, but businesses don’t necessarily have the money to motivate and retain employees. There’s been an acceptance that employees are generally putting their heads down and not thinking about moving but people are working harder, and there comes a point when people begin to think they are being taking advantage of.
Wendy Trehy: I think that’s absolutely right. If you’ve retained your talent, you’ve kept them for a reason. Employers are demanding more of employees who in turn are now multi-skilled people who play multiple roles in organisations, and the challenge is how you keep those talented people, with limited resources.
Cathy Tracey: We deal with all sorts of organisations from global players to smaller, privately owned companies, and each of them have different challenges when dealing with workforce planning in the context of a changing economic landscape and the agility needed to react to change. You need to have a workforce planning process that supports the business plan and has all the operational business process, linkage and forecasting, and future state intent. Of course, it needs to then react to business change and is further complicated when you apply the ever-important geographic overlay. And you’ve got to have a programme in place that actually connects your business plan to leadership strategy.
Tom Marsden: We have seen a change in terms of the strategic resourcing priorities. The cycle time for business strategy is much quicker, and is much faster. The concept of three-to-five year plans is changing, companies are moving towards this model, they need to be more agile. Cost became a bigger issue than it had been before, and control and governance of the process; people needed to justify spend and needed to prove the business impact coming back from any recruitment activity that was going on.
So employers are looking for more flexibility across the board to be able to have that agility to adapt?
Tom Marsden: The model is moving further away from the certainty of a job for life to increasingly assignment based employment. Companies are re-packaging work.
Is this reflected in the changing employer/employee relationship?
Christian Hasenoehrl: At Gallup we measure employee engagement across about five hundred companies, roughly six million employees. The most interesting trend is, about seventy-three percent of those companies actually have seen increased employee engagement. Businesses have optimised their workforce, redundancies have been made and to a degree the people who remain are glad to have a job.
The trends suggest the recession has actually increased loyalty and engagement? Gabrielle, how has the public sector faired, in terms of resourcing in the Met?
Gabrielle Nelson: We actually have something of an opportunity, I think we have a tendency to buck the trend. We’ve worked very hard strategically with a business plan, and linking to that a deployment plan and we have an overarching strategic plan over a three year period. In terms of recruitment, our lead times for a police officer is between six and ten months which means, like an oil tanker: it takes a long time to turn. Our recruitment numbers are fairly high. In a standstill year we would need to bring in about sixteen hundred police officers.
Considering the impact of recession on retention, are we now in talent drought or glut?
Stella Dixon: I think it really depends on what industry you’re in. We probably do not have an issue in our sector. If we do advertise, we get a massive response. But you’re recruiting different types of people. I think where we probably do have an issue is more on the technology side, because to keep at the top of your game you’ve got to just move so quickly with the technology piece of the business.
Clare Thomas: We have the same issues at Penguin. The future is less clear than it has been because of the digital revolution and this will impact our talent plans. There will be new key positions within the business, it’s a slow sea change in a traditional business.
You will need people with different skills, such as IT, you will be looking at recruiting from completely different areas for your personnel?
Cathy Tracey: A major change is the impact of globalisation, how you bring a workforce with multi-cultural differences together as virtual teams and have them work collaboratively. The other challenge is the recruitment of the right leadership. People are talking about some of the competency framework that we’ve been working to, which may not actually be fit for purpose going forward. There’s a lot of shifting sands.
Are you suggesting that organisations have used guess work in leadership recruitment?
Cathy Tracey: No I think everybody had a view of what they want for their organisation, but I think that the speed at which the economy fell away and the response actually took a lot of people by surprise.
Christian Hasenoehrl: Go back a decade or more, most large companies had leaders that were very good at growing businesses, but only a few leaders were good at managing a business that is going through a crisis, or indeed managing a business that’s failing.
Wendy Trehy: Most leaders can develop a growing organisation, but often it’s when that organisation is going through some difficulties that true leaders emerge.
Tom Marsden: There’s also a counterintuitive point here, which is, probably now is the time to be thinking about growth. Businesses are always caught up in today’s news – right now it’s the recession, when actually they should be thinking three years ahead. Some companies are seeing an opportunity in this downturn.
Cathy Tracey: One point, tax changes are about to hit senior management and I suspect people will be moving because they will want to get the increase that they’re expecting and not lose it to tax. I’m expecting a lot of activity at senior executive level.
Christian Hasenoehrl: Back in 2007 a lot of the clients that we work with, put in three year incentive plans with specific goals to keep and retain their leaders for at least that three year period, because they recognised that stability during that three year period was probably the most important factor.
Cathy Tracey: Who around this table have put in retention programmes for top executives?
Paula Leach: I think it is key to target the right people to ensure that you don’t dilute the effect. The larger your organisation the more people have to be involved in the debate about who is included. Essentially there are two criteria: one is all around technical depth, which obviously in our business is really critical; and the other is around senior leadership potential.
Surely for all businesses, there’s a greater reticence for doing any forward planning, and making any sort of long-term promises?
Wendy Trehy: I think the approach taken very much depends upon the business and the sector that they’re in, that’s certainly been our experience, in some sectors, particularly where innovation is key.
Tom Marsden: We’ve been working with a pretty innovative technology company which has a very clear view of their strategic differentiator, they’re boldly going for a market and they see growth and they’re willing to put their risk profile behind that.
Returning to recruitment, how effective have businesses been in meeting resource requirements and success rates?
Paula Leach: We are recruiting in small, targeted numbers at present. Ford and the automotive sector has been affected by challenging market conditions for significantly longer than the recent recession and this has changed our recruitment approach. The area we have continued to recruit with regularity on an annual basis is apprentices. For senior management positions we tend to grow talent and resource internally.
So is that something that your apprenticeship programme’s addressing?
Paula Leach: The apprenticeship programme manages some of it and we would develop a mix of apprenticeships flowing through, with a four year lead time and then topped up with additional point-in-time recruitment.
Liam, what are your resourcing issues up at New Balance? You have a very localised and loyal employee base is Flimby and Warrington?
Liam Burns: I think there are advantages and disadvantages. In terms of the sports industry generally, the last twelve months, in a way, the economic climate has probably done us some favours. We’re going through a major change and normally we would expect to lose key people, to some of our competitors.
Tom, how are your client businesses preparing for a route through recession and preparedness for the upswing?
Tom Marsden: There’s a major focus amongst the client population on retention as a key issue for next year. I think the other challenges? We’ve talked a lot about the globalisation, increasingly we’re seeing companies looking to go to market and certainly outsource recruitment, and they’re increasingly doing so on a global basis. Over the last four or five years, there’s been a significant trend upwards in terms of people looking at their workforce on a global basis and trying to have consistent standards. At senior levels in organisation, talent moves on a global basis and the talent pool must always be viewed globally.
Is this strategy based on cost and efficiency?
Tom Marsden: No, I think it’s much more about having talent available on a global basis and you therefore need to think about your resourcing decisions globally. There are cost implications; for example you may be able to locate activities in lower cost centres, but fundamentally I think increasingly companies are realising that they need more global leadership.
Stella Dixon: This idea of the global resourcing initiatives, I think the downturn has probably driven that within our business. We were previously in a situation where if you had a vacancy in text they just recruited for that job, if they had a vacancy in photos they just recruited for that job.
Tom Marsden: If your customers are global, your resource is global, you have to think how you deploy your resources globally. Even for companies that are UK based, they’re thinking about how they gain access to a global talent pool in terms of immigration or scarce skill sets as well. So it’s not just affecting global companies, it’s actually affecting UK companies that are thinking in terms of sourcing their resources globally.
Clare Thomas: Dorling Kindersley forms part of the Penguin group, and we announced a big reorganisation last year, and we’ve actually been recruiting editors in Delhi for the creation and production of some products. So it’s not just call centres, it’s creative work that’s also happening and it’s a reflection that it’s cost effective, but also a recognition of the emerging markets as well.
Drilling further into this success rate, there are so many different modes to recruitment, so what is and what is not an effective route to resourcing?
Cathy Tracey: Well the problem is not whether you hire the people into a job, it’s how effective they are in that job. And that downstream sometimes is the measurement you might want to take on, in terms of, did you spend wisely and have you had value for that based upon that person’s contribution to the organisation?
Are boards seriously looking at more cost effective recruitment, and what are the dangers?
Tom Marsden: It is an interesting question regarding “how effective is the resourcing function?”. It does come back to this point about how do you judge effective recruitment. One criteria is: are you filling the recruitment requirements that you have at the right time? However, the more sophisticated perspective is how do you measure the effectiveness of people you have recruited? This is where from a data management perspective, we’re looking very closely. I think there are very few companies, who could say categorically across all of their recruitment plans that they can measure the effectiveness of recruitment activity on this basis. And the challenge that brings is the board want to see that data in order to invest in recruitment, so you have a circular argument.
Beyond this there are other common challenges that companies face. First, the need to manage volatility in recruitment and it’s very hard to do that unless you have a larger scale of the model to resource upon; second, how to leverage technology and processes to manage large volumes of recruitment globally; third; how to get meaningful and insightful MI covering workforce plans and to monitor success against them; fourth; how to develop your ‘employment brand’ very consistently with your consumer or corporate brand. So I’d say those are the key challenges. Cost underpins all of that, because if you do manage these things more efficiently then the cost savings will follow. If you use effective sourcing channels, for example, costs can be reduced.
Are businesses noticeably more cautious about recruiting senior personnel?
Julie Armstrong: I really do think that it does depend on what industry you’re in and where your organisation is in relation to respective pressures on it. I mean, say for example, when I worked in telecommunications and we needed to recruit eight hundred people in a few months, actually we needed to get a product out and a service delivered. So the cost almost wasn’t quite an issue, it was the speed and the effectiveness of the recruits that was the issue.
Claire Thomas: There’s an assumption being made: it’s not always the case that actually the more senior position you’re recruiting for, the more rigorous the process you go through. And I think, with opportunities being so rare, you’ve got to get it right. And, we’re increasingly far more rigorous, I would say at entry level position, because this is an opportunity for this person to come into your business and, if you develop your talent from within, to get that right.
Cathy Tracey: The candidate experience in the recruitment process must be consistent. Recruiters externally have the advocacy in terms of the brand in their hands when they come and talk to the candidate. You also have to get the attraction strategy right and those executing ‘on message’.
Paula Leach: We have an internal accreditation process for all assessors and recruiters, so they have to go through certain levels of training, they have to pass an assessment at the end of the training, so that we feel that the quality of our assessors is very high. We feel confident that the recruitment decisions they’re making are appropriate. It is about being objective and following the process.
Cathy Tracey: And also the governance issue around right to work and taking up references, deciding at what point do you do it? Are you doing it ahead of interviewing or behind making a selection? Because there’s lots of filters that you can put on the recruitment process that will actually make some efficiencies in how you spend time and who you spend time with.
Mark Pearce: In our business, the importance of psychometrics is increasing. Obviously, we know what a good surveyor looks like, but the testing gives us a robustness, that the managers making the decisions have found really helpful. They’ve got data now to back up their decision, so that’s been really helpful to us.
Tom, and Cathy, as recruiters, how much are you turning to the metrics aspect of your clients?
Tom Marsden: It’s a big focus for us. We’ve invested very heavily over the past number of years and it’s enabled by good metrics. It does depend on the volume levels because, you don’t need to over-complicate the process when you’re recruiting at smaller volume levels, but for the higher volume levels it definitely is enabled by process and technology. We’re technology agnostic, we work with a lot of different technologies in supporting our clients, and so what we’ve developed are standard metrics, even though we have differentiated processes and technologies across a number of our clients. The key metrics are quite consistent, for example; understanding the recruitment plan and your percentage fill against the recruitment plan, cost per hire or cost to compensation and time to hire. Customer satisfaction ratings are critical, we measure customer satisfaction from candidates in terms of their experience of the process, and both candidates that are successful and candidates that weren’t successful. We rely on hiring manager satisfaction surveys. There is also a range of much more operational metrics, a significant amount of metrics that you use to operationally manage the recruitment process. Our clients are looking to understand the cost of the programme and its impact.
As recruitment becomes more data rich, does this have a positive or detrimental effect on candidates?
Tom Marsden: If you take volume recruitment, having a much more traceable database of candidates that have applied, maybe weren’t successful, and twelve months later you’re looking at a similar profile of role, you can really search the candidate pool because you’ve marked that candidate as a near miss, highly qualified. You can track the candidate using your database search techniques. You’ve been maintaining a relationship with them using technology as well as potentially calling them, so you’ve been keeping them warm, you can pick up with the candidate. The process has enabled what for the candidate is a very customer focused experience. Contrast that with a process where the candidates apply for a job, it’s got stuck in a spreadsheet, you can’t retrieve any of the data and in fact, everyone’s forgotten about its existence.
Is there not a danger that in the wash of process and data, people get pigeonholed?
Cathy Tracey: I think that if a candidate experience is reported as being poor then of course maybe the process will give us feedback because we’ll be going out to look for it, and then we’ll fix it. Whereas if we weren’t looking for that feedback we wouldn’t know it was a poor experience. With the executive hiring, I think that the ‘relationship’ overlay is extremely important, developing ‘talent pools’ fit for hire accelerates the time to hire
Gabrielle, in the Met you must require extreme sensitivities with regards to process in recruitment?
Gabrielle Nelson: I think you almost have tosplit it off into strands. We do an enormous amount of recruiting just because of the size of the organisation. We have the bulk recruitment for uniformed officers, for community support officers. We also do huge bulk recruitment around volunteers, massive volunteer market, which I know we haven’t particularly touched on. And then we have police staff roles, from the very junior admin right up to executive search. So we probably cover just about every single market. And the experience the candidate has is hugely important to us in that we know we’re putting them through a fairly laborious process in terms of meeting national standards, it’s a very lengthy process, so keeping in touch and trying to keep that as personal as possible is hugely important to us. For me in terms of the matrix, there’s different ways of assessing how successful you’ve been depending upon what sort of recruitment you’re doing. In terms of recruits, we look at wastage levels. We now have a completely different training programme which is far more pastoral, it’s development based, and we’ve seen wastage levels drop considerably. So the investment we make in getting a recruit, we’re finding now they’re not leaving.
Wendy, is there a noticeable increase in candidates taking legal action against recruiting firms that they feel have not dealt with them fairly?
Wendy Trehy: Yes. Anybody who has experience or knowledge of the tribunal system knows just how overloaded it is at the moment, particularly in relation to unfair dismissal claims. We’ve certainly seen a significant increase. When there is an economic downturn, there’s always an increase in employee relations issues, because there are difficult conversations to be had and there are difficult processes to be managed. Inevitably some people will be unhappy with how they have been treated or perceive that they have been treated and will take matters further.
What are the primary reasons for that do you think?
Wendy Trehy: It’s difficult to provide a definitive analysis without detailed knowledge of every claim. I think from an unfair dismissal perspective people decide to bring a claim because they genuinely perceive that they’ve been treated unfairly and shouldn’t have been dismissed. Equally, there will be claimants who will bring claims just to see what they can get by way of settlement. Unfortunately, some of the statistical evidence suggests that different groups have been disadvantaged more than others.
Claire Thomas: Just one more point about recruitment and the employee experience. We are just trialling out some social media networks and beginning to use sites such as LinkedIn, and thinking about actually going out to candidates. In a way we have a really strong brand and that continues, and we attract far too many people for the jobs that we have, but actually for some of the keys roles, and certainly on the digital side, which I talked about earlier, we need to think about actually going out to get candidates.
And of course there’s Twitter, Facebook and BeBo et al and an invasive press?
Gabrielle Nelson: The Met tends to get in the press an awful lot. The smallest things can be blown up and can be headlined. We’re always trying to keep one step ahead. We’ve got a very good Press Office that works within HR and we are continually monitoring blog sites, so we’re listening to what’s going on in the community, we’re all members of them and logging on fairly regularly. Recently we had the withdrawal of support for recruitment from the Black Police Association, something we took very, very seriously and we have been in negotiations.
Tom, do you offer advice to clients where you think there profile or brand is detrimental to effective recruitment?
Tom Marsden: The first thing is to recognise the problem. Once you’ve got the awareness that there is a problem with the brand you’ve won half the battle. It’s important to address the employment brand challenges consistently with the approach to developing the corporate brand and the consumer brand. The first stage would typically involve research to understand the challenge in more depth: issues, research groups, focus groups, surveying, looking at competitor brands, looking at the intelligence that comes out of the data analysis in terms of what’s affecting the brand. That’s building the collateral to improve the brand in the marketplace. Segmentation is key – really looking at the people you’re trying to attract, segmenting that group of people, and then thinking through the right channels to attract the right people.
McDonald’s is a good example of changing the employer brand?
Tom Marsden: And McDonald’s is a good example of a company seeking for consistency through its corporate, consumer and employment brand.
Paula Leach: Ford was and is always about the product. What our organisation did was very openly say we may well be saving costs but we’re concentrating on the core of our business, so we’re not reducing anything to do with product development and design. In actual fact what we’re doing is enhancing that area and we’re leveraging global efficiencies through our One Ford strategy. So all of those things, from the business standpoint, have driven a change in the way that we’ve responded.
What is the impact on talent when a whole sector, such as car manufacturing, is in global decline, and on top of that high profile media attention with Toyota?
Tom Marsden: You’ve got to remember that Toyota ultimately before this episode had an extraordinary reputation for innovation, for driving the trend towards faster cycle times. So you’ve got to get the perspective of the current story in the market of where Toyota’s been in the past and where it can go, and think about how that affects their decision.
Cathy Tracey: If you take the lens and look through it differently and you think about your own personal brand and where you would like to go and work. I think we are thinking more about what our choices say about us. What are the Brand values and expertise of the companies we join, Ford or Toyota or whoever. Organisations, then I think should design messages that can demonstrate these and differentiate themselves to attract those individual who see or want to see themselves reflected in these. Because I think that we’ve had a different relationship, individuals are taking ownership of their brand and building it.
Paula Leach: The types of people that you’re trying to attract in many cases would have a much deeper understanding of which organisations they want to work for and why they want to work for them, particularly if they have technical skills and capabilities. And so if you’re an Engineer and you have particular aspirations, you’re probably going to continue to apply to your chosen organisation. I think that applies across industry as well, particularly for people who have particular specialisms. People who are perhaps a bit broader and can cross industry sector may have different choices, but even as a prospective employee I think you’re looking for your opportunity to either develop as a professional or be remunerated appropriately.
You’ve done your matrix, you’ve spent the money on recruitment, you’ve set a sustainable contract with the employee. How do you manage the honeymoon period and beyond?
Paula Leach: The up-front planning is fundamental, before you even go out and recruit. The Supervisor needs to be ready to support and welcome the individual. Particularly where you are running big recruitment programmes where you haven’t got a manager who is recruiting for a specific position, but you’re recruiting volume people for a number of positions it’s making sure that the Supervisors who are going to receive those individuals are fully aware of their responsibility to bring that person on board, to take the time, and to implement any plan that you may put in place.
Tom Marsden: I think there’s another point that I think is probably consistent with that, which is that the way you recruit has to be consistent with the way you manage your internal mobility. Too often they’re separate processes and it just doesn’t make sense, – you need to be constantly benchmarking your internal talent against external talent. There are companies where sometimes people feel it’s easier to leave the company and come back in to get a promotion than it is to move internally, that is crazy. In other cases companies only focus on their current employees and do no or limited benchmarking externally for key roles. You have to get that balance right I think to drive a healthy talent development in the organisation.
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