Who’s Next?

My process improvement friends like to say, “Improving the work is the work.”  There is some truth to that in HR as well.  But, I think that it is also fair to say that “Keeping the talent pipeline full is the work.”  I’ll admit that it’s less catchy.

Succession planning is a topic as old as business, so I will cut to the chase:  This may be an area where companies are getting better.  The data is interesting as well in that it shows (at least in this sample) that public companies are better at it than private ones.  I would be curious as to whether there is an additional split between family owned and other types of ownership among the private companies.

I think that transparency (welcomed or not) has a lot to do with boards (and, hopefully, HR) being more concerned about high level succession planning.  Part of what big investors are buying is the leadership team and the more focus there is on CEOs and their impact, the more concern investors will have in the less-than-famous leaders.

Good succession planning does not stop at the C-Suite.  It should be considered part of talent development for every position in the company.  Whether it is at the entry (where are we going to find new employees?) or management (how can we identify leadership potential?) levels, the work is ensuring that there is a strategy for identifying talent.

This process involves both valid assessment (who is interested and capable of doing what we need?) and development (what are the experiences that a person needs to be prepared for the next move?).  Keeping the pipeline full means focusing on both so that when a position comes open the question, “Who’s next?” can be answered quickly and reliably.

Shaping Skills to Your Work

It is important to use valid selection tools to hire people for the work you have for them.  But, what happens when technology changes the tasks or the jobs get replaced by automation?  You can let people go as their work becomes obsolete and hire new staff.  However, in times with low unemployment, this strategy will be difficult to execute.  Or, you can train people to acquire the new skills.  This has big implications in industries where tech is changing the nature of work, such as mining and warehousing, just to name two.  However, trying to train lots of people in new skills assumes that they have the interest and aptitude for learning them.  Remember, people chose to pursue their given job/career for a reason.

Amazon and Walmart provide an example of this type of investment.  Their programs include technical and college training.  What is telling about their plans is that neither company considers it a “nice to have.”  Rather, it is an acknowledgement that the skills it takes to run their businesses are changing and they don’t think they can find enough talent to meet future needs in the labor pool.  This may be because so many young people want a career that requires as little work as possible.

The situation also makes one think about selecting people for industries where the skills required change rapidly.  Instead of using tests or interviews that focus on specific abilities, perhaps addressing broader ones, such as openness to new experiences and general aptitude, will serve companies better.

Trying to Stop the Tides

It seems very old-school, but sea ports are still very big business.  The twin ports in southern California (LA and Long Beach) are a huge economic driver (they are the primary sender/receiver of goods between North America and Asia) and employer.  But, they are also one of the biggest polluters in the region.  For as long as I can remember, there has always been a balancing act to keep the ports humming and making the area healthier.

A bit more under the radar has been the creep of automation. While car companies fought this battle with their unions a generation ago, the idea that automation can be stopped is still alive and well among the longshoremen.  This article gets into some of the specifics regarding the plan and it potential impacts.

From an HR perspective, the bigger story here is not the automation (it is going to happen as it makes the port more eco-friendly and efficient), but the lack of planning regarding the retraining of workers.  It is somewhat surprising that this is occurring at the ports because most of the labor disputes over the last 20 or so years have not been over wages but over the number of jobs.  The port and the union are now in negotiations about retraining and head count for different positions, but this is time and goodwill being spent now on solutions that could have been anticipated.

A better approach would be:

  1. Analyze the skills required for current jobs and for those created by the automation. Yes, new equipment needs to be programmed, maintained, etc.  Metrics of productivity and cost need up to updated, tracked, etc.
  2. Where the skills map directly, there no problem and this should be communicated to those employees.
  3. Where the skills don’t completely map, determine how the skills can be acquired.
  4. Communicate the path to skill acquisition clearly to those whose positions are going to be eliminated or changed. It should be presented as an opportunity rather than a threat.
  5. Provide adequate resources (tuition reimbursement, time away from work, etc.) to allow for the retraining.
  6. Develop and/or promote an internal posting system for those who cannot be placed in the new positions.

Automation has always been a part of business and that is not changing any time soon.  Trying to prevent is as useless a stopping the tides.  However, planning for it allows companies to keep valuable employees and for employees who are willing to upgrade their skills to stay employed.

Are Organizations Becoming Less Biased?

I’ve written quite a bit about bias in this blog. It is an important topic to me because I believe that people in HR and industrial psychology can be gatekeepers to a more fair society while improving organizational performance. Of course, bias in employment is merely an extension of what happens in the greater society. One of the assumptions about bias is that it is fairly stable so we have to almost trick people into being fair.

However, this study has some better news. Their analysis indicates that over a 20 year period bias against skin color and sexual orientation have been reduced. However, bias against weight has increased. Attitudes towards age and disability have stayed the same. Strangely, gender bias is not addressed.

The study raises many interesting questions about whether these changes are being experienced across demographic groups or only primarily within specific ones. However, it does provide some questions for HR practices, such as:

  • What steps can we take to reduce bias in hiring based on weight? Phone interviews instead of live ones?
  • Do we need to change our anti-discrimination training to focus more on weight and less on other issues?

The data does seem to point to those characteristics that we perceive as choices (being overweight) as having stronger biases than those that we have always perceived as innate (skin color) and those that the culture is now thinking of as such (sexual orientation).

Each organization can see where its implicit bias “blind spots” are by analyzing its hiring and promotional data. I understand that this can lead to some unkind truths. But, it will also allow for focus on areas where bias can be reduced.

Selection When There Are More Jobs Than People

As the economy adds new jobs, some sectors are having a problem finding enough workers for them, including construction. This is regardless of the pay and benefits associated with the jobs. However, the same is true in other blue-collar sectors. This is not a shock to those of you who have been trying to hire people for these types of positions in companies that were not hit by the great recession. For instance, utility companies have been having a difficult time recruiting lineman (sic) for years, and these jobs pay into the six-figures will full benefits.

While the reasons for the hiring shortage are numerous (“You can’t pay me enough to do that kind of work,” “I’d rather work in tech,” “I want to set my own hours,” etc.), these businesses do have a significant challenge. There are some things that you cannot use technology to replace (yet).

In this situation, HR should take the long view. With low unemployment, it’s unlikely that you can just hire your way out this. The labor pool won’t support it. Rather, companies need to engage with high schools and trade colleges to develop candidates. But, they also need to promote and market these jobs in a way that will make them more appealing because right now. This is because many more young people (and their parents) would rather code than swing a hammer.

To avoid the expense of high turnover when hiring for these positions, companies need to do a very good job of validating good selection tools with tenure in mind (as well as performance). They include:

1) Modified versions of Interest inventories (what are someone’s likes and dislikes).

2) Biographical information (do candidates enjoy physically difficult hobbies) surveys (also known as biodata) are very useful ways to determine whether a person is likely to stay in a specific area of work.

I have had good success in validating these for hard to fill positions in manufacturing. This is especially true where giving physical ability tests are either expensive, have a risk of injury, or may lead to high levels of adverse impact against women.

These companies also need to embrace the investment in training and accelerating wages as new hires gain more skills. I have seen this put to effective use in reducing turnover.

There will not be a silver-bullet for creating enough workers for physically demanding jobs in the near term. However, employers who think long term may find viable solutions that will serve them well.

Higher Minimum Wages and Success in the Hospitality Industry

The state of California and several of its cities have been on the forefront of raising the minimum wage.  The arguments for (people cannot live on the current minimum wage) and against (it will cost jobs because business will need to lay people off) it are familiar.  But now there is some data that makes a very interesting link between quality and the impact of raising wages.

This study looks at the impact of raises in the minimum wage and restaurant employment in the San Francisco Bay Area.  Don’t be fooled by the academic nature of the paper—the authors do a good job of explaining things in English before digging into the math (though you can get another explanation here with an eye towards the political).  The main takeaway from the article is that well run restaurants (in this case, defined by high Yelp ratings) are not impacted by minimum wage hikes.  Crappy restaurants (based on quality, not menu price) saw their already higher closure rate go up with the increases.  So, what does this mean for HR?

  • Well run businesses can absorb higher wages when their competitors cannot. This may mean higher prices (in some instances people will pay for quality) or that these businesses can survive on lower profit margins.  HR can contribute to this through good hiring (brining in people who can deliver high levels of customer service) and training (developing a learning culture) practices.
  • Use data to improve quality. The study shows that online feedback (in this case, Yelp reviews) is strongly correlated with business success.  This customer input should be used to improve service and quality.
  • If we presume that the vast majority of the workers at the restaurants are at minimum wage (as the paper does), this research tells us that paying more is not an indicator of quality or success. If restaurant A is getting a rating of 5 and restaurant B is getting a rating of 3, it is not due to wage differentials.  Rather, it is likely based on the quality of the product and the level of service.  HR may not have much impact on the former, but it certainly does on the latter.

What the paper really tells is that that business can succeed without necessarily being the one that pays the highest wages.  When wages are held constant, hiring the best people from the available labor pool may lead to higher service delivery.  This, in addition to a good product, can keep a business successful, even if wages are forced to go up.

When Even Tech Job Training Lags Behind Need

In any employment market there are going to be jobs in high demand and those that go unfilled.  In our tech driven economy, the jobs that are hard to recruit for range from utility lineman (long hours, hard work, and fabulous pay) and, strangely enough, cyber security.  With all of the hype and news around hacking, I was surprised to learn that these $80k/year jobs are readily available.  But why?

From a selection standpoint, good cyber security engineers need an odd combination of skills.  Of course they need to be great programmers with high levels of critical thinking.  However, they often need to have a criminal’s mindset (“How would I get into this system without someone knowing?”), which makes them a risky hire given their access to sensitive data.  And makes them attractive on the black market.

The incentives for prevention jobs are also difficult.  After all, they are performing well when nothing goes wrong.  But, when someone breaks into the system…

This is an opportunity for industry and universities to work together.  College students want tech jobs (sorry to those of you who recruit linemen), but they tend to want to work in the sexier product/app development area. Tech companies can show higher education how to make the field more “fun,” perhaps through gamification and appealing to the cat-and-mouse aspect of the work.

My sense is that they pay for these jobs will also need to rise to fill them.  If it is true that good cyber security engineers have good hacking skills, there needs to be a sense of doing the right thing pays at least almost as well as breaking into systems.

What we see is that even tech companies need to be thinking about how to get future workers trained and recruited for jobs that are not that appealing.  As our economy constantly evolves, companies will still need “legacy” employees (yes, some day, app development will be boring compared to what is hot then).  And it is possible that the cycle of job obsolescence will become shorter.  This makes the challenge for schools to provide the skills to future employees even greater.  Industry and education will both benefit if they work together in that venture.  I just hope in the meantime no one has hacked my blog.

Learning to Manage

I cannot tell you how many times I have worked with a client who has told me some sort of story about how they promote from within, but have a problem with the supervisors and/or managers not being able to let go of wanting to do the technical work instead of managing the technical work.  It is not hard to understand.  People get into a field because of their interests or passion, rarely for their desire to manage others.

An organization’s challenge is to either create technical career opportunities or help those who are technically proficient to successfully move into management.  But how?  Here are some tips:

  • Clearly identify the skill sets required of managers and note how different they are from those required of technical workers. One of the places I would start is with Delegation and Holding People Accountable.
  • Make the management skill sets part of your internal recruitment AND learning and development process.
  • Require internal candidates to demonstrate management skills before being promoted through an assessment center or other valid selection process.
  • Start people at an appropriate management level, regardless of how technically proficient they are.

While I’m not one to think that sports are necessarily a good analogy for the business world, I found this article to be an exception.  It describes how John Elway,

a multiple Super Bowl winning quarterback with the Denver Broncos, learned management skills from the ground up.  He wasn’t made a Vice President of the team after he retired.  Rather, he honed his business skills in another field and then transferred them to a low level of football.  It wasn’t until he demonstrated success there that he was giving the big opportunity.  The time spent out of the spotlight clearly led to many learning experiences.

What makes the story powerful is the understanding that while there were some technical skills which would translate for him from the field to the front office, Elway (and his bosses) understood that others would have to be learned.  The organization was willing to let him take the time to learn how to manage and lead in a non-technical role.

The lessons for the rest of us are that:

  • Management skills are different from technical ones (e.g., the best sales person is not necessarily the best sales manager). We can use valid tools to identify which of our technical experts possess them.
  • Management development is a journey, as is the acquisition of any skill set.

Why Change is Hard and How To Make it Easier

Organizational development specialists always tell us that change is difficult. They say that people are resistant to new things, are too comfortable in existing processes, and that we really need to be pushed or coddled to leap into the new. Others feel that change is natural and welcome and that it’s “fake change” that we resist. So, which is it?

This article leads us to believe that it is the former. It describes how there are many people who want to buy electric cars, but that many dealerships are reluctant to sell them. There seems to be a choice here: Dig in your heels against change and continue to reap short-term profits or invest in some training and embrace a new market.

The automobile was one of the most disruptive technologies of modern history. Yet, the automobile business is one of the most reluctant to change, whether through a history of fighting federal fuel efficiency standards Download DraStic DS Emulator For PC (which the industry always meets after whining and crying) or suing to prevent new distribution models. Resisting change when the consumer wants it is futile—electric cars will be sold through dealers and new distribution channels. It’s just a matter of when.

So, how do we get our organizations to embrace disruptive change? Here are a few (not exhaustive) useful guidelines:

  • Gather meaningful input. Big changes should not be implemented until you know the potential impacts on all shareholders. Not everyone will be happy with change, but it should be a cultural imperative that you hear from those affected before making a decision. People are more likely to embrace change that they author. So, if you are a dealership, how can we make the sales cycle for electric cars closer to that of existing ones? How can we quickly educate ourselves and consumers about them?
  • Show firm leadership. Once a decision has been made, top management needs to be clear in its resolve and describe the benefits of the change, while acknowledging any negative affects. Management needs to be open to small tweaks, but committed to the direction. The dealers are afraid that more electric cars will lead to less profit in the service department. That should be acknowledged as well as the benefits of change (we can be the go-to dealer for this new technology; this gives us the opportunity to develop lifetime relationships with people who are eager to try new things, etc.).
  • Make the people part of the change the first priority, not the last one. Whatever your great new process or technology, it has to be implemented by employees. Have your communication and training in place before the change is implemented. Part of resistance to change is that people are afraid that they won’t be as good at their jobs anymore. You can alleviate that by putting employees before technology. This could be realized by providing the sales and repair staffs with training about the new technology before being asked to sell or work on it. Build their confidence rather than making them frustrated.

Organizational change is complicated and messy. I’m sure several of you have other tips and experiences with it besides what’s listed above. I’d love to hear your ideas!

Are we receptive or resistant to change? That all depends on the change and what we think is in it for us. As change agents, we need to embrace the person dynamic of accepting the new in order to be effective.

 

 

The Fish Stinks From the Head

Whether or not you are a soccer fan, you’ve likely heard about the scandal at FIFA (the world body that oversees the sport). The long and short of it is that executives in the organization, leaders in some country soccer committees, and sports marketing companies are accused of accepting bribes. They alleged payments were made to FIFA to ensure that tournaments were played in specific locations, including perhaps for votes for the site of the World Cup (the international soccer championship held every 4 years).

Things like this can happen for two reasons: Lack of transparency/poor governance and support by the organization’s culture. The latter comes from the top executives, which is why the President of FIFA resigned yesterday. Many feel that he jumped before being pushed by sponsors (it always comes down to the money) or the FBI. This culture he established led the organization to be arrogant and be closed to scrutiny.

How does one change a culture which is damaging to the brand? There is not any good science behind this, but one train of thought is that a sick patient cannot heal itself. In the link above, it’s suggested that there be a mea culpa through a truth commission so that all of the dirty laundry can be aired. Another thought is to have the bylaws and governance policies be rewritten by an outside organization. Both of these remedies would perhaps satisfy (to an extent) outside observers, but they also paint those who remain (and didn’t participate in unethical activities) with a brush of suspicion. This could lead to the exodus of top talent. However, in a sport as large as soccer, I have to believe that there are talented people outside of FIFA who could run it well.

I believe that a commitment from a top executive to change may help a culture shift in some cases. I’ve been working with a client on their team building. One barrier to them moving forward is a terrible mistake made by the president last year. It genuinely affected the trust between her and her team an among the team members.

When presented with this before a planned offsite, her first reaction was surprise that people were still bothered by it as she had previously apologized. At the time I thought this attitude would be a significant barrier in improving the team’s performance. Something must have clicked in her mind because at the beginning of the offsite she addressed the issue head-on. She took ownership of the error and for being the reason for the break in trust. Without being defensive, she outlined a path forward and what she would be doing to win back the trust. Her statement lifted a dark cloud and allowed the group to make progress during the session.

Does culture change in a day? Of course not. But this leader had the courage to shift it and, just as importantly, modeled accountability and humbleness to her staff. It’s a good beginning.

For more thoughts and insights into organizational change and employee engagement, contact Warren Bobrow.

 

 

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