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Talent Management
Todays HR departments do much more than just hiring and firing
alent is the primary driver of any successful company, says Sue Gebelein, an executive VP with Minneapolisbased Personnel Decisions International. Its become increasingly

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BY DAN EMERSON

obvious to most business owners and executive teams that, rather than being constrained by capital, companies are typically most constrained by talent. Corporations have learned that, depending on what your business strategy is and what challenges you may face, at any given time you

need the right talent to execute that strategy or deal with that challenge, Gebelein explains. However, in striving to recruit and hire the right people, companies often miss some incredibly important subtleties, she says. For example, a startup medical device company might hire a sales manager who had

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December 2006

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[human resources]

Seeing the Big Picture

St. Paul-based Securian Financial Group has earned a wall-full of Best Places to Work awards, recognizing its employeefriendly work environment. For 10 years running, Computerworld magazine has named the Kathy company one of Pinkett Americas 100 Best Places to Work in IT. Securian has also been honored by the American Association of Retired Persons as one of the best companies for workers over age 50. Securians Life Balance Program offers a number of flexible work options such as flex-time, job-sharing, telecommuting and voluntary unpaid time off. The company also provides up to six months job-protected leave to care for a family member, financial planning help, seminars on managing major life changes, tuition reimbursement and fully paid life insurance. Kathy Pinkett, second vice president, human resource planning, says Securians benefit programs that make good business sense and also meet employee needs have paid off in low annual employee-turnover rates of around 8 percent. Obviously, smaller companies have fewer resources to devote to employee benefits. But Pinkett points out that the attitudes underlying effective benefit programs are just as important. A number of studies have noted that the No. 1 reason people leave is the boss, she says. So, we make sure our frontline supervisors understand that people come to work wanting to be valued for what they do, feel that they are making a difference and understand how they fit in the bigger picture.

worked for Medtronic. That person may have been a great sales manager for Medtronic and delivered results. But if that person has never had experience starting a sales force, he or she is probably not going to do that well in a startup organization.

The HR Connection
e believe that the primary goal of an HR department should be to improve the decisions that organizations make about people, Gebelein says. When a companys human resources department becomes more involved in strategic management, Gebelein recommends asking, Is HR helping me and my leadership team make better decisions about people? Lee Artimovich, a managing director with Korn Ferry International, notes that todays corporate HR departments and personnel reflect a change in the way businesses perceive HRs function. Theyre changing from HR or personnel director to vice president or director of talent management or talent acquisition. That means looking very holistically at the whole HR life cycle, including recruiting, interviewing, hiring, on-boarding, training/ development and retention. Artimovich also notes that in todays world, there is a very competitive market for really good people; in hiring, counteroffers are now very common, he says. And with the pending mass-exodus of the baby boomer creating openings that will be increasingly difficult to fill, its become essential for

recruiting departments to be very aggressive, and more integrated with the top priorities of the business. Companies are paying more attention to recruiting, because recruiting is more than just filling jobs; it not only gets into talent management, it involves succession planning. Retention is just as critical, and Artimovich has identified one part of the talent-management cycle in which many companies may need to upgrade their methods. We just did a global survey about the process of bringing new employees onboard. Asked how they felt about their own companies on-boarding and assimilation process, 30 percent called theirs average, 22 percent said below average and 10 percent said poor. Artimovich advises employers to go back to the basics of welcoming new employees and helping them assimilate into the company, as opposed to, Heres your desk, heres your cubicle, now go do it. Because an employees initial experience with a company sets a tone, ensuring that they come in with a positive experience becomes part of retention, he says.

Bye-bye, Baby Boomers

he anticipated, age-related talent drain will be an issue for companies for some time to come. Theres been a lot of concern around the aging workforce and what happens when talent walks out the door, says Silvia Masini, who leads Mercer Human Resources Consultings HR effectiveness

business segment in the Midwest region. Its a big challenge; so much of the knowledge base of an organization leaves when those folks leave, she says. Those organizations that capture that knowledge, either by having really good succession plans at all levels or by using technology as a depository for some of that intelligence, tend to weather the storm. Building a succession plan for when an employee quits or retires is critical to the continued success of the company. Some organizations have formal mentoring programs in which the more seasoned veterans take on the responsibility of informal training of younger folks. Another way to look at succession planning is creating development opportunities to enable employees to step up to the next level, especially in anticipation of someones retirement, Masini says. Its becoming more important to think about issues like succession, not just at the executive level, but looking at your best strengths at all levels of the organization and asking where the upand-comers may be coming from. On the optimistic side, organizations are looking at the retirement issue differently today, because even those individuals who retire may come back to the workforce, although it may be in a different form, Masini points out. They could be still available to the company as independent consultants, or they may take on new careers and fill new roles in other companies. Given the demographic trends, in the near future, companies are going to be spend-

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December 2006

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R E P O R T S

Perfect Perks
HR experts say one way to reduce turnover is helping employees feel their contributions are valued by the employer. J & B Group, a St. Michael, Minn.-based food manufacturer/distributor, is a case in point. The company offers a number of low-cost or nocost perks, such as free coffee, lattes and hot chocolate in all lunchrooms; fresh fruit; at-cost employee discounts; a free healthimprovement program; tuition and health club membership reimbursement; and a company yearbook, published every third year. Along with suggestion boxes, J & B Group also maintains a voice mail line to both CEO/founder Bob Hageman and president Mike Hageman (his son) that employees can use to communicate questions and concerns. Several times a year, the Hagemans also host small-group meetings to talk about whats going on with the company, share our financial information and involve them, says Mike. Mike points out that the foundation

J & B Group Production associates underlying the companys HR policies is a living document spelling out the J & B Wayhow we do business and how we interact with people, both internally and externally. The code was established by Bob Hageman when he founded the company 27 years ago. Numbers reflect the companys success in retaining employees, in an industry with fairly high turnover. Of the firms roughly 400 employees, 21 have been with the firm at least 20 years, and 106 J & B employees have 10 or more years of service, according to Mike.

ing more time and capital on compensation issues to retain valued employees, Artimovich says. While some small employers may be hard-pressed to compete with larger companies on a sheer compensation basis, benefits, equity and perks can be used to make up the difference. You can use anything related to benefits or perks such as cars, club memberships or a sabbatical every five years [for example]. There are a lot of creative ways to handle that, Artimovich says. Companies can also position themselves in the candidates mind by selling the benefits of working for a smaller firm. Some people are simply not attracted to the big, corporate world, Artimovich notes. As a potential employer, you can emphasize to candidates that, youll have more impact here than you would in a large corporation; you wont just be a cog in the wheel here.
Dan Emerson is a frequent contributor to MinnesotaBusiness Magazine.

Reprinted with permission of the publisher. 2007 Metropolitan Media Group, Inc, all rights reserved. Any reproduction of this document is strictly prohibited. For reprints call 952-767-2600.

Personnel Decisions International (PDI) is a global human resources consulting firm with distinctive expertise in building leadership talent that provides real competitive advantage. With over 725 team members in 28 offices around the globe, we partner with the worlds leading organizations, enabling them to make consistently effective decisions about leaders.

Using field-tested strategies, systems, and tools that are unique in the industry we help clients identify, develop, and deploy superior leaders. Our aim is simple the well-placed confidence that your current and future leaders are distinctively stronger than the competition, resulting in sustained, superior performance.

Visit PDI at www.personneldecisions.com.