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HUMAN RESOURCE

MANAGEMENT
Prof. Dr. Armin Trost

1
Professor Dr. Armin Trost

 Born 1966 and raised in Tübingen/Germany


 Studied psychology and business
administration in Tübingen and Mannheim
 Doctoral degree from University of
Mannheim. Thesis about „Reliability of
Employee Survey Data“
 More than five years in different functions of
Global Human Resource at SAP, lastly as
Global Head of Recruiting
 In 2005 one semester full professorship for
HR and statistics at University of Applied
Sciences Würzburg
 Since Wintersemester 2005 professor for
human resource management at Furtwangen
University

 Contact: trost@hs-furtwangen.de

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 3

Recommended Books

 Bohlander, G, Snell, S, Sherman, A, 2001, 12th ed. Managing


human resources, South-Western College Publishing, Ohio
 Noe, R, Hollenbeck, J, Gerhart, B, Wright, P, 2004, Fundamentals
of human resource management, McGraw-Hill, Boston
 Holtbrügge, D, 2004, Personalmanagement. Heidelberg, Springer

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 4

2
Overview

 Introduction  Performance Management

 Job Analysis  Compensation & Benefits

 Employer Branding  Training & Development

 Sourcing

 Candidate Selection

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 5

Introduction

Prof. Dr. Armin Trost

3
Overview

 Human Resource Management – Definition

 Contribution of Human Resource Management to


the competitiveness of companies

 Macrotrends, which drive future challenges of


Human Resource Management

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 7

Employees = Human Beings

Skills, Knowledge &


Experiences
Personality
Hidden
Potential (Talent)

Emotions

Needs &
Employee Expectations
Creativity,
Ideas

Social Relations,
Power to Friends & Family
work
Values &
Health
Believes

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 8

4
Human Resource Management

All planned and controlled activities


within an organization to shape the
relation between employees and the
company in order to meet both
business objectives and employee
expectations

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 9

From Problems to Solutions

 What is the problem in terms of numbers? Who has


Problem the problem? How does the problem impact
competitiveness of the company?

 What are the major causes and drivers of the


Causes problem? Which tendencies can be observed?

 What would the problem cost the company if it would


Costs not be solved?

 What is the core of the solution? How does the


Solution solution work? Which assumption should one make
belief the solution will work? What does the solution
cost?
 What are the financial and intangible benefits of the
Benefit solution?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 10

5
Example: Candidate Selection

 23% of all new employees (100 new hires anually) do


need meet their performance expectations 6 months
Problem
after being employed

 One cause could be seen in lacking quality (validity) of


Causes the candidate selection procedures used

 Lost added value of 14.000 Euro per underperforming


employee: 23 Ees × 14.000 Euro/Ee = 322.000 Euro in 1.
Costs
year + future additional losses

 Strutcturred interviews conducted through multiple


Solution interviewers lead to better prediction of future
performance. Additional costs per hire: 800 Euro (→
total: 80.000 Euro)

 The solution can solve the problem by 32%. Benefit =


Benefit 32% × 322.000 Euro = 103.040 Euro

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 11

Typical Problems

 Which capabilities do  How can we achieve


we need on the long run required equity when
to stay competitive? determining individual
salaries while staying
 We are not well know in competitive?
the labor market. The
best people prefer other  Many employee aren‘t
employers willing and able to cope
with technological and
 We do not get in touch disruptive advances
with the most talented
people  How can we fully benefit
from the potential of our
 Many new hires do not employees?
demonstrate expected
performance

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 12

6
Voice over Internet Protocol (VoIP) sets Telco
Industry under Pressure

What does this


mean for the
Human Resource
of traditional
companies in the
Telco industry?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 13

Move from „tranformational“ to „tactic“ Tasks

In the US:
Labor ~40% of the entire labor market
Demand ~70% of jobs created since 1998

Future

Past

Tranformational Tactic
Tasks Tasks
According to McKinsey & Company

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 14

7
Changes in HR budget 1994-2003

Median Proportion of HR Budget


as Percentage of Operating Costs
1,2

1,1

0,9

0,8

0,7

0,6
94 95 96 97 98 99 00 01 02 03

Taken from: Bureau of National Affairs and the Society of Human Resources Management (2003)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 15

Changing Generations and Industries

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 16

8
Population changes among 25-34-agers

Relative changes compared to 2005


125

China
120 Germany
India

115 USA Population in 2005 (in Mio.)

250
110 212
200 178

105 150

100
100
50 40
10
95 0
China India USA Germany

90 Source: U.S. Census Bureau, Population


2000 2005 2010 2015 2020 Division/International Programs Center (2006)
http://www.census.gov/ipc/www/idbsum.html

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 17

Major Challenges of Human Resource


Management

 Globalization and global competition

 Technological advancements

 Change from the hand to knowlege worker

 Fast changing markets

 Cost pressure and productivity

 Changing values in society

 Demographic changes

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 18

9
Job Analysis

Prof. Dr. Armin Trost

Overview

 Target Group Segmentation

 Definition: Job, Position

 Linkage between job analysis with other human


resource management instruments

 Methods of job analysis

 Focus: Critical Incident Technique

 Content and limitations of job descriptions

 Dejobbing

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 20

10
Segmentation and Prioritization of Target Groups

Low availability/
hard to find/get
IIa I

Labour Availability
Market of Talents

III IIb
Good availability/
easy to find/get

Required but not Mission-


mission-critical critical
Relevance for
Company-Success
Size indicates Demand

Company Strategy
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 21

ABB Leadership Competency Model

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 22

11
Job – Position – Employee

Job Position Employee

Senior Specialist Senior Specialist CRM Garth McGrath

1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
Creativity Creativity Creativity

Teamwork Teamwork Teamwork

Presentation Presentation Presentation

Project Mgmt Project Mgmt Project Mgmt

Mobility Mobility Mobility

SAP R/3 SAP R/3

English English

Development Needs

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 23

Jobs, Positions and Employees

Employee

Job,
Position
Role

Organizational Job Family,


Units Tasks, Jobtitle

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 24

12
Job Description – Example: Account Manager

Summary Qualification/Requirements
Execute sales strategy, initiate – Basic sales skills
contact with existing and – Excellent written and verbal
potential customers, identify communication skills
their needs and sell appropriate – Demonstrates effective
merchandise to meet those negotiation and closing
needs. techniques
Duties and Responsibilities – Strong analysis and judgment
skills
– Manage assigned accounts
– Works well in a team
– Call prospective customers and environment
establish buying cycles,
customer needs, and create a
customer supplier relationship.
– Increase sales in respective Education/Training/
accounts
Experience
– Prepare sales information for
– High school diploma
customers
– Previous sales and
– Establish buying influences,
telemarketing experience a plus
budgets, and purchasing criteria
for assigned accounts
– Secure and place orders taking
into consideration delivery dates
and inventory levels for
fulfillment

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 25

Job Analysis Impacts different HR Activities

Personnel Candidate
Marketing Selection

Development Performance
Planning Appraisal
Job
Description

Compensation Employee Layoff

Job Analysis

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 26

13
During Recruiting Process a Job Description is
more or less a Matter of Communication

Hiring Vacancy
(Manager) (Manager)

Selection Briefing
(Recruiter) (HR Consultant)

Job Description

Application Job Analysis


(Candidate) (HR Consultant)

Job Posting Requisition


(Personnel (Recruiter,
Marketing) Manager)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 27

Job Analysis Dimensions

 What are major activities?


 What are the job incumbent‘s responsibilities?
 Who are the customers the job incumbent?
 What are outcomes and resulting values of this job?
 Which knowledge skills and competencies are required to do the job well?
 Which mindset and intrinsic motivation is required to do the job well?
 Which level of authority is given to the job incumbent?
 Which physical abilities are required?
 What are specific working conditions?
 What is the daily working environment?
 What are major interfaces in and outside the firm?
 What are appealing elements of the job?
 What are the downsides of the job?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 28

14
Steps of a Job Analysis Process

Select the job to be analyzed and


 Focus on systematically
relevant stakeholders selected jobs
 Be clear about the purpose
Determine the desired applications of job analysis
of the job analysis
 Systematically decide
upon application of
Decide upon job analysis methods methods
 Use available background
information
Gather Information about the job
 Ensure buy-in of all
relevant stakeholders
Write a job description  Validate results and get
final approval
Verify accuracy of job information  Document results in
and description with stakeholders written

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 29

Critical Incident Technique (CIT)*

 Critical incident
Situation, where a job incumbent must go it’s limit and
where difference between strong and weak job
incumbents can be determined

 Basic assumption
To understand nature of a job one must look at the 5%
critical incidents, where the chance to dramatically
succeed or fail is high

 The CIT as part of job analysis involves the


following steps:
a) Identify critical incidents
b) Distil successful versus not successful behaviors
c) Select distinct behavioral patterns
d) Translate behavioral patterns into competencies

* by: Flanagan, J. C. (1954). The critical incident technique. Psychological Bulletin, 51(4), 327-358.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 30

15
Questions to a Job Incumbent while using the
Critical Incident Technique (Examples)

 What are specific challenges


and obstacles a jobholder
must cope with?

 What will successful job


incumbents do differently?

 Which particular behaviors


might be critical for doing the
job well?

 How can you determine


whether a job incumbent is
successful in dealing with
critical situations?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 31

Most typical Elements of a Job Description

 Name of the Job  Responsibilities,


functions and duties of
 Job Identification the jobholder
Number
 Required knowledge,
 Department where job is skills and competencies
assigned to
 Required education and
 Name and title of work experience
immediate supervisor
 Immediate working
 Location conditions
 Salary of jobholder  Equipment to be used
by job incumbent
 Number of open
positions

Look at www.jobdescription.com or at www.monster.com for some examples

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 32

16
Limitations of Job Analysis and Description

 Job-related aspects change over time


 It might be the employee who defines
his/her job (dejobbing)
 Limited validity of job analysis results
 In most cases job analysis don‘t cover
generic aspects such as culture
 Job descriptions may increase
bureaucracy
 Focus on jobs rather than focus on
employees and customers
 Who controls job application of job
analysis?
 Job descriptions support the „this-is-
not-my-job“ mindset

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 33

Dejobbing

 Changing business environments required


flexible deployment of employees

 Tasks of employees reflect their talents,


strengths and individual preferences

 Employees are responsible to actively identify


and take care for critical challenges

 Cooperation in work teams and changing,


rotating responsibilities among group members

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 34

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Corporate Culture and
Employer Brand at Gore

 At Gore you'll find direct communication, a team orientation, and


one title - associate - that's shared by everyone. [..]
 How we work sets us apart. We encourage hands-on innovation,
involving those closest to a project in decision making. Teams
organize around opportunities and leaders emerge.
 [..] There are no chains of command nor pre-determined channels
of communication. Instead, we communicate directly with each
other and are accountable to fellow members of our multi-
disciplined teams.
 [..] Associates (not employees) are hired for general work areas.
With the guidance of their sponsors (not bosses) and a growing
understanding of opportunities and team objectives, associates
commit to projects that match their skills. [..].
 [..] Leaders may be appointed, but are defined by 'followership.'
More often, leaders emerge naturally by demonstrating special
knowledge, skill, or experience that advances a business
objective. [..]
Source: www.gore.com
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 35

Employer Branding

Prof. Dr. Armin Trost

18
Overview

 Definition: Employer image, employer brand,


employer branding

 Impact of an employer brand

 Characteristics of strong employer brands

 Building an employer brand

 Types of employer positioning

 Employer branding to the inside

 Meaning of Web 2.0

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 37

International Brands

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 38

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" Imagine having the resource to influence tomorrow‘s reality
today, and having fun while you do it. That‘s Microsoft. Right
now, we‘re looking for people who think big and dream big –
people a lot like you“
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 39

Product Brand versus Employer Brand


Source: Corporate Leadership Council (1999)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 40

20
Characteristics of a strong Employer Brand

 Overall a strong employer brand provides an


answer to the question „Why should I work for
this company?“

 As such an employer brand offers a clear


Employment Value Proposition (EVP)

 The answer must be …


– Unique: It is different from the messages sent by the
strongest competitors in the labor market
– Consistent: All messages and communication
measures consistently reflect the EVP
– Apealing: The EVP is attractive in the eyes of the most
important target groups
– Realistic: The EVP must reflect what an employer
realistically can offer

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 41

Which Company?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 42

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Employer Branding Cycle
Strategic HR
Planning

Evaluation of Labor Market Segmentation/


Brand Effectiveness Target Group Definition
Operation

Analysis
Operating Marketing Determination of
Measures Target Group Preferences

Development and Testing Market/Competitor Analysis/


of Branding Material Weaknesses and Strengths

Positioning, Definition of
Employer Brand Strategy and Employer Value Proposition

Strategy

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 43

Insights into Dimensions require Inputs from


multiple Sources

Recruiters New (Target Group)


(internal/external) Hires

Target Group
Employment Target Group
New Hires from Strenghts Preferences Members
Competitors (internal/external)

Competitors‘ Competitors Employer Current


Branding Employer
Websites Positioning Strategy Image Career
Website
Visitors
Targeted Company/
Available Employer Product
Employment Image Brand
Studies Applicants

(Senior) Line Marketing Experts


Management (internal/external)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 44

22
Possible Components of an
„Employment Value Proposition“

 Location  Work-Life-Balance
 Products & Services  Compensation & Benefits
 Stability & Success  Training Opportunities
 Security  Career Opportunities
 Company Reputation  Learning Opportunities
 Competitive Position  Task itself
 Company Values  Innovation
 Workforce Personality  Alternation
 Company Culture  Freedom & Flexibility
 Management Quality  Impact of Company
 Opportunity to leverage
ones strengths

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 45

Employee Quick Poll (Example SAP)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 46

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Five Types of Employment Value Propositions

 Focus on Offers
„At our company you get more than what you get elswhere
(e.g. benefits, culture, career opportunities)“

 Focus on Personality
„In our company we are like this. If you fit to that you can stay
as you are and you find people similar like you are“

 Focus on Values
„That‘s important for us in our company. If you share these
values you are welcome and can life according to what‘s
important to you“

 Focus on Company itself


„Our company is a very special company, successfull, global
etc.“

 Focus on Tasks
„At are company you will gt the chance to do this. If this is
what, you are excited about you are welcome and have fun“

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 47

Focus on Offers

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 48

24
Using Personality Traits

 Smells new business opportunities


 Listen to customers
 Desire to please
 Sincere Smile
 Multi-tasking arms, ideal for tackling 10
projects at once
 Thinks „differently“
 Passion for new ideas
 Signs of creativity
 Team player
 Understated air of self-confidence
 Appropriate use of humor
 Calm under pressure (on the surface
anyway; underneath, adrenalin is going
like the clappers)
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 49

Focus on Personality

 Be passionate, engaging, cosmopolitan, inspiring, connected, ambitious, perfect,


firendly, cooperative, outstanding, different, intuitive … Be Lufthansa
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 50

25
Focus on Personality

 A Case that didn‘t work


– Hiding Faces?
– What’s about teamwork?
– Joke versus Reality?
– Intercultural fit?
– So what?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 51

Focus on Company Values

 At The Ritz-Carlton, our Ladies &


Gentlemen are the most important „Ladies & Gentlemen
resource in our service serve Ladies &
commitment to our guests. Gentlemen“
 By applying the principles of trust,
honesty, respect, integrity and
commitment, we nurture and
maximize talent to the benefit of
each individual and the company.

 The Ritz-Carlton fosters a work


environment where diversity is
valued, quality of life is enhanced,
individual aspirations are fulfilled,
and The Ritz-Carlton mystique is
strengthened.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 52

26
Focus on Company – AT&T

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 53

Focus on Tasks
(Example: Enterprise Rent-A-Car)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 54

27
Web 2.0 – „Employee Branding“

Web 2.0 stands for the second generation of the Internet


where content (e.g. text, picture, videos, products) are more
and more generated by the users

Approaches for employer branding are

 Employee Blogs (e.g. Sun, Yahoo!, Festo)


http://blogs.sun.com/
http://www.ausbildungsblog.de/
http://www.prweaver.com/blog/2005/01/29/112-yahoo-employee-blogs

 Video-Streams and potcasts about the


company (e.g. Spreadshirt, Siemens)
http://www.spreadshirt.net/Arbeiten_bei_Spreads.779.0.html

 References on public sites which guide


knowledge and oppinions (Wikipedia,
Dooyoo)
http://www.dooyoo.de/arbeitgeber/

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 55

Sourcing

Prof. Dr. Armin Trost

28
Overview

 Current changes that impact labor market


conditions
 Passive versus active seekers
 Passive and active sourcing strategies
 Talent Relationship Management

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 57

Current Trends that will Change Human Resource


Practices dramatically

 Innovation is the main factor for competitiveness


in Germany and in many western industries

 Growing importance of tactic tasks

 Shortage of talented and qualified candidates


and employees due to demographic changes

 Decreasing loyalty of highly qualified employees

 Growing transparency and speed of global labor


markets due to the Internet

 Growing occurence of competitive actions and


engagement of professional service companies

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 58

29
Types of Seekers

10-20% of target group,


Active which will find openings
Seekers automatically

10-30% of target group, which


Passive
need to be attracted at places
Seekers
they naturally show up

Non-Seekers 20-80% of target group


which can‘t be attracted at
all

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 59

Prioritization of Target Groups impacts


Sourcing Method Usage
Active Methods

Hard to hire/
difficult to find

B1
A
Availability on
the labor market

B2
C
Good
availability

Necessary but Mission-


not critical critical

Passive Methods
Impact on Company Success

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 60

30
Methods of Talent Identification and Attraction

Passive  Public Job Posting

 Public Labor Agency

 Contingent Workforce

 Search in Public Job Boards

 Executive Search/Headhunter

 Job Fairs

 Search in Corporate Talent Pools

 Employee Referral

 Campus Recruiting

 Competitive Intelligence

Active  Talent Scouting

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 61

Job Fairs

 Direct Competition with  Direct and immediate


other employers contact to potential
candiates
 Limited focus on specific
target groups  Immediate pre-selection
and job offering
 Limited contact to passive
seekers  Low quality candidates

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 62

31
Internal Career Portals

Career Counselor

Employee & Support


Job Data

Employee
Job Profile
Profile

Recruiter
Emplyoee

Career Portal
Search Search for
for Jobs Employees

Monitoring Portal
Management

Corporate HR

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 63

Advantages and Disadvantages of


Internal versus External Hiring
Internal External

 Limited Hiring Risk  New Ideas

 Short Time-to-Fill  Limited Costs of Education


Advantages

 Reduces Cost-per-Hire  Access to Information about


Competitors
 Internal Competition
 More options to choose from
 Employee Integration

 People Development
Disadvantages

 Limited Options to choose  Higher Cost-per-Hire


from
 Employee Integration
 Higher Costs of Education
 Higher Hiring Risk
 Disappointed Employees
 Higher Turnover Risk
 Conflicts among Managers

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 64

32
Executive Search

 Placement of suitable candidates for critical and


hard to be filled positions (management
positions, specialist position) through executive
search consultants (headhunters)
 Annual salary of position incumbant are above
100.000 Euro and more
 In most cases searches are handled secretly
 Leading executive search companies are Egon
Zehnder International, Heiddrick & Struggle,
Russel Reynolds, Korn/Ferry
 Most typical areas fo executive search are
– Retained search versus contingent search
– Direct search versus search through job ads

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 65

Executive Search Process

Determine
Requirements related to Interview Candidates
Position to be filled

Identify Target Check References of


Companies most suitable
(Consider off-limits) Candidates

Negotiate job-related
Candidate Search and Conditions (e.g. Salary,
direct Approach Sign-on Bonus)

Present profiles of three Coach new Executive


possibly suitable during first 100 Days of
Candidates Employment

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 66

33
Business Communities in the Internet
(Example: www.xing.de)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 67

Referral Programs – „A Player know A Player“

 Employees recommend potential


candidates (friends, former
colleges) outside the firm to be
hired
 Referred candidate will either be
approached by an external
consulting partner or asked by the
employee to actively apply
 In case of hiring the employee who
has referred the candidate gets a
special bonus
 Advantages of referral programs:
– Low cost per hire
– Short time to fill a position
– High quality of new hire
– Strong cultural fit

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 68

34
Proactive Referral Program at
Lilly and Company

1. New hires are asked to identify top performers they


may have worked with or know in their fields

2. HR Department hosts "focus groups" among current


employees to target top performers in their fields
and assign specific individuals to reach out to them

3. HR Department hosts "Bring Your Own Rolodex"


meetings with managers to probe the networks of
senior staff

4. HR Department encourages dedicated managers to


build relationships with passive, but high value
prospects

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 69

Critical Factors for Campus Recruiting

 Target group focused student attraction

 Strong business line involvement

 Early relationship building to graduates

 Fast and responsive recruitment processes

 Entering natural student networks

 Global consideration of available talent

 Highly professional treatment/communication

 Competitive employment offers

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 70

35
Campus Recruitment requires specific Roles

HR
HR Business
Business Partners
Partners Executives
Executives
support
support Business
Business LineLine build
build lon-term
lon-term relationships
relationships
Representatives
Representatives and and take
take to
to business
business schools
schools
care
care for
for logistic
logistic of
of
recruitment
recruitment events
events

Recruiting
Department
Overall monitoring,
Targeted reporting,
Business
Business Line
Line coordination
Students
Representatives
Representatives
execute
execute recruiting
recruiting asas
direct
direct contact
contact for
for students
students

Campus
Campus Ambassadors
Ambassadors
identify
identify and
and support
support best
best
strategies
strategies to
to get
get in
in touch
touch
with
with top
top talents
talents

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 71

Competitive Intelligence

1. Identification of most promising competitors and


target groups/functions (e. g. sales, design, F&E)

2. Identifiction and documentation of most attractive


target persons on competitor‘s side with the help of
executive seach firms and employees (e. g. Key
Account Manager)

3. Determination and documentation of actual status


and preferences of most promissing target persons
(e.g. through Google, OpenBC)

4. Direct approach of target persons in situations where


loyalty is expected to be poor (e. g. during mergers &
acquisitions, large-scale organizational
transformations)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 72

36
Competitive Intelligence at FirstMerit
(Most-wanted "interviewless" hires)

 Developing a "most wanted" list of the five best


proven performers at their competitors.

 Conversation with these "most wanted"


candidates in order to verify that they were highly
desirable

 The team then sent each of them, without warning


or an interview, an offer letter and a cover letter
that stated that they could start in two weeks

 All prospects called back asking if the offer to start


was for real, and they were told that it was

 The recruiter then asked the prospects who they


wanted to interview with and when

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 73

Talent Scouting

1. Definition of critical target populations where it is


presumed that critical talent might occur (e. g. former
employees, customer contacts, competitors)
2. Identification of places, where target populations
naturally show up and demonstrate their potential (e.
g. congresses, natural workplace)
3. Occupation of target population by dedicated talent
scouts (e.g. employees, managers, corporate talent
scouts, headhunters)
4. Setup and maintenance of a target list of potential
candidates
5. Validation and prioritiziation of target candidates both
in terms of their preferences (readiness to change
career) and their potential
6. Active approach of target candidates through line
managers or headhunters

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 74

37
A new Paradigm in Recruitment

Corporate Leadership Council, 2000

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 75

Internship Program

Employee

Company keeps
Talent relationship to former
Formal Assessment Pool intern

Responsibility for a small


project of relevance for
Project Work
the company/business
function

Transactional work on a
daily basis in one or more
Regular Internship
business functions

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 76

38
Selection

Prof. Dr. Armin Trost

Overview

 The recruiting pyramid

 Social judgment and related biases

 Selection methods
– Reviewing Résumés
– Psychological testing
– Interviews
– Assessment center

 Criteria to evaluate selection methods

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 78

39
Recruiting Pyramid

New Hire 1 20
1,5
Job Offer 1,5 30
3
Assessment 4,5 90
5
Interview 22,5 450
3
Pre-Selection 67,5 1350
10
Application 675 13500

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 79

Objectives of Candidate Selection

 Valide, reliable and objective prediction of future


performance and development

 Reduction of hiring risk (wrong hires, wrong


rejections)

 Fairness, transparency and acceptance of


methods used to select candidates

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 80

40
The Goal of Selection: Maximize “Hits”

High
Miss Hit
Inaccurate Accurate
prediction prediction
(Person would have (Person succeeds
Job Performance

succeeded on the on the job)


job)

Hit Mis
Accurate Inaccurate
prediction prediction
(Person would not (Person fails on the
have succeeded on job)
Low

the job)

Low High
Predicted Success

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 81

Applicant 1

 Clever

 Leadership Strength

 Engineer

 Result-oriented

 Self-confident

 Future-oriented

 Ambitious

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 82

41
Applicant 2

 Clever

 Leadership Strength

 Engineer

 Result-oriented

 Self-confident

 Future-oriented

 Ambitious

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 83

Judgement Biases

 Primacy Effect (First  Stereotyping


Impression) The tendency to
The tendency for a generalize about people
perceiver to rely on early in a social category and
cues or first impressions. ignore variations among
them
 Recency Effect
The tendency for a  Contrast-Effect
perceiver to rely on The tendency to judge
recent cues or last upward or downward
impressions. because of a comparison
with another applicant
 Projection who was recently
The tendency for evaluated
perceivers to attribute
their own thoughts,  Halo-Effect
priorities and feelings to The tendency to provide
others similar ratings across
different personality
dimensions

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 84

42
Most Important Selection Methods

 Reviewing Résumé  Reference Check

 Heuristic Rules  Background Investigation

 Ability Tests  Physical Examination

 Personality Tests

 Biographic Questionnaire  Graphology

 Interview  Physics

 Projective Tests

 Games

 Assessment Center

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 85

Usage of Selection Methods in Germany

0 20 40 60 80 100

Résumé

References

Interview

Work Sample
Skilled Worker
Biografic Questionnaire Trainees
Management

Assessment Center

Source: Schuler, Frier & Kaufmann, 1993; N = 105 dt. Unternehmen)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 86

43
Applicant Dimensions

Talent

Competencies Knowledge

Applicant
Motivation Personality

Interest Attitudes

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 87

Types of Tests

 Personality Tests
Measure stable and individual behavioral dispositions

 Cognitive Ability Tests


Measure an individual’s thinking, memory, reasoning, verbal
and mathematical abilities

 Physical Ability Tests


Measure strength, endurance, and muscular movement

 Knowledge Tests
An achievement test that measures a person’s level of
understanding about a particular job

 Preference Test
Measures a candidates interests towards future employment

 Psychomotor Tests
Measure dexterity, hand-eye coordination, arm-hand
Prof. Dr. Armin Trost
steadiness, and other factors.
Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 88

44
16 PF (Catell) – Selected Items

 I like tasks which involve  I am tender minded.


extensive thinking.
 I am very easy going.
 I prefer strange films.
 I suspect hidden motives
 I reveal little about myself. in others.

 I favor the surreal.  I love to read challenging


material.
 I am abstract.
 I frequently second guess
 I am outgoing. myself.
 I would rather lead others  I want everything to be
than follow. "just right."
 I am unusual.  I get angry easily.
 I am a very private person.  I am exacting in my work.
 I make friends easily.  I am carefree

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 89

The „Big Five“ Personality Dimensions

 Extraversion
Sociable, gregarious, assertive, talkative, expressive

 Adjustment
Emotionally stable, nondepressed, secure, content

 Agreeableness
Courteous, trusting, good-natured, tolerant,
cooperative, forgiving

 Conscientiousness
Dependable, organized, persevering, thorough,
achievement-oriented

 Inquisitiveness
Curious, imaginative, artistically sensitive,
broadminded, playful

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 90

45
d2 Test of Attention

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 91

Intelligence
Select the option that best fits the pattern of For each question determine the number
the previous images that best fits the pattern of the previous
numbers

1. 1, 3, 6, ?
2. 3, 5, 8, 13, 21, ?
3. 3, 6, 18, 108, ?
4. 4, 1, -3, -4, ?
5. 95, 36, 15, ?
6. 6, 13, 29, 63, ?
7. 1, 1, 2, 6, ?
8. 12, 33, 55, ?
9. 99, 86, 73, ?
10. 2, 5, 8, 35, ?
11. 4, 16, 49, ?
12. 73, 61, 56, 62, ?
13. 1588, 1820, 2148, 2204, 2284, ?
14. 923, 937, 963, ?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 92

46
Intelligence

There is scientific evidence, that people who earn


much money are often not as happy than those who
earn less money.

Please create as much thesis supporting this finding


as possible.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 93

Projective Tests

Thematic Apperception Test Rorschach Test

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 94

47
Online Tests

 Advantages
– Global access/availability
– Low operating costs
– Opportunity for adaptive item
presentation
– Automatic/immediate analysis and
reporting
– Opportunity to track response time

 Disadvantages
– Limited control over test situation
and subject behavior
– Limited opportunities to
professionally support
interpretation of results

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 95

Advantages of Psychometric Test Methods

 High objectivity due to limited impact of test operator

 High comparability across candidates due to highly


standardized test conditions

 Limited costs per test usage

 Test can be used as modules complementing other


selection measures

 Tests require minimal infrastructures and can be used


in almost every situation

 Tests can be exposed even online at any time and at


many locations

 Analysis is very simple (e.g. score is equal to the


amount of correctly answered items)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 96

48
Process of Interviewing
 What are main duties, responsibilities, working
Job Analysis conditions etc. of the job?

 What are the most critical elements of the job to


Prioritize job‘s
be caputured during interview?
main duties

Create interview  Deside upon interview technique and structure


questions and  Prepare questions reflecting critical elements
benchmark answers  Define expected answers to each question

 Arrange interviews, invite candidates, and


Appoint interview panel persons to be involved
and conduct interview  Share relevant documents
 Conduct the interviews

Review, summarize  Collect interview results and conduct wrap-up


interview and draw session immediately after the interviews
conclusions  Document results and decide upon future steps

Provide feedback  Call all candidates within a few days after


to candidate interview and provide feedback

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 97

Typical Interview Structure


 Introduction
– Informal conversation to make the candidate feel comfortable
– Outlook on interview structure
– Introduction of persons involved in the interview

 Presentation of Company, Department and Job


– Description of the company‘s business and culture, the function of the department
– Presentation of duties, responsibilities and requirement related to the job in question

 Candidate Presentation
– Work experience of and most significant achievements relevant to the job
– Preferences and expectation for future employment
– Motivation to change career (including the family‘s readiness)

 Reviewing Competencies
– Discussion critical situation (using situational questions)
– Examining critical competencies
– Examining the candidates knowledge (based on real cases)
 Open Questions of the Candidate
 Finishing
– Generic feedback to the candidate (if appropriate)
– Clarifying next steps („we call you in three days“)
– Concurrent application processes
– Formalities (e.g. travel cost reimbursement)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 98

49
Most Important Questions during an Interview

Candidate Employer

 Why am I invited?  Why are you here?

 What can your  What can you do for


company offer me? us?

 What kind of  What kind of person


employer are you? are you?

 What distinguishes  What distinguishes you


your company from from others who have
others? the same skills?

 Can I afford working  Can we afford you?


at your company?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 99

Interview Questions to Assess Competencies

 Describe a time when you inspired others to reach a


common goal (Leadership).
 Describe a time when things didn’t turn out as you had
planned. What did you do to analyze the situation and how
did you address the issue? (Planning)
 How does the work you are currently doing affect your
organization’s ability to meet its’ mission and goals? Do you
think your work is important? If yes, why? If no, why not?
(Strategic Thinking)
 Give an example of a situation where the group of people
you worked with on a regular basis had a serious conflict.
What was the conflict about? How were you involved in the
conflict? What was the outcome? (Interpersonal Relations)
 Tell me about a time when you really had to pay attention to
what someone else was saying, actively seeking to
understand their message? How did this challenge affect
the manner in which you portray important messages to
others? (Communication)
Source: Corporate Leadership Council (2004):
Interview Questions to Assess Competencies

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 100

50
Interview Questions to Assess Competencies

 Describe a situation where you were successful in getting


people to work together effectively. (Teamwork)
 Describe a change in your work you have personally had to
make in the last couple years. At the time, how did you feel
about making the change? What did you do to make the
change? How do you feel about the change now?
(Flexibility/Adaptability)
 Describe something you have done that was new and
different for your organization that improved performance
and/or productivity. (Innovation)
 Tell me about a time when you had to identify the underlying
cause of a problem. How did that analysis help you to solve
the problem more effectively? (Problem Solving)
 Describe a particularly trying customer complaint or
resistance you had to handle. How did you react and what
was the outcome? (Customer Focus)
Source: Corporate Leadership Council (2004):
Interview Questions to Assess Competencies

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 101

Assessment Center Definition

Appraisal of …

 multiple candidates
up to 12 candidates of a specific target group

 in multiple situations
individual and group exercises

 along multiple criteria


according to required profile

 by multiple assessors
line-managers and psychologists

 through application of multiple methods


tests, group-exercises

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 102

51
Teilnehmer und Beobachter

Teilnehmer

Beobachter Facilitator

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 103

Assessment Methods
 Presentation  Group exercise
Involves a 10 to 15 minute Includes problem solving within a
presentation on a pre-determined committee or team.
topic.
 Meeting with current employees
 Case study interview. Involves candidates meeting with
Requires candidates to read a large employees currently working within the
folder of information and then answer prospective position to discuss the
questions relating to the subject matter nature of the job.

 Competency-based interview  Practical/creative problem-solving


Includes personal history questions task
and problem-solving tasks and Includes building a structure with
scenarios limited materials
 Fact-finding exercise  Psychometric/Personality/Aptitude
Includes research and retrieval of test
information on a given subject or Includes a personality questionnaire
interaction with the interviewer to and/or numerical, verbal, and
obtain further information from them diagrammatic reasoning tests.
 In-tray test  Role-play exercise
Includes prioritizing documents, Involves acting-out a business-related
drafting replies to letters, and situation.
delegating important tasks
 Written exercise
Involves producing a concise written
summary from a collection of
documents

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 104

52
Appraisal Scheme
Example Präsentation

Behavior Grade Comments

1. Speaks soundly

2. Keeps eye contact

3. Follows a clear structure

4. Uses body language

5. Is understandable

6. Keeps on time

7. Makes usage of time

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 105

Combination of Exercises and Criteria


(Example)
Group Pre- Personal Cognitive
Decison Negotiation
Discussion sentation Interview Ability Test

Structured thinking
and acting

Mental agility

Initiative
and self-control

Cooperation

Conflict
Management

Endurance

Communication and
social behavior

Influencing others

Motivation

Intellectual
Capabilities

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 106

53
Advantages of Assessment Centers

 High objectivity, reliability and validity through


multiple methods, exercises, criteria, assessors

 Comparability of candidates within and across


assessment Center cycles

 Reflection of future duties and responsibilities

 Limited risk of social desirable behavior

 High transparency of requirements in the eyes of


the participants

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 107

From Observation to Actual Performance

Observation Diagnosis Prognosis Performance

Testing results; Determination Occupational Actual


Interviews; of candidate aptitude; performance
CV abilities Selection after a period
… (e.g. leadership decision of time
strength) (e.g. future (e.g.
leadership Leadership
behavior) appraisal)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 108

54
Correlation

 Correlation reflects r = 0,5 r=0


linear relationship
Y Y
between two
variables (X and Y)

 Correlation
coefficient r shows
strength of linear
relationship X X

r = 0,9 r = -0,5
It can vary between
Y Y
-1 and +1

 Correlation does
not indicate
causality of
relationship
X X

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 109

Validity
Examining Criterion Validity
 Validity describes the
extent to which results of Subject Test Criterion
an assessment method
1 78 72
relate to what it is
2 67 68
supposed to measure
3 44 51
 Criterion-Related Validity …
Correlation between n 89 83
assessment results and
actual performance
r
(e.g. Performance)

 Content Validity
Criterion

Content validity is high if the


assessment methods
constitute a fair sample
reflecting the whole range of
the construct to be assessed Prediction (e.g. Test)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 110

55
Reliability

 The extent to which a predictor Examining Test-Retest-


repeatedly produces the same Reliability
results, over time
Subject 1. Test 2. Test
1 78 72
 Test-Retest-Reliability
2 67 68
Multiple application of the same
method leads to similar results 3 44 51

 Inter-Rater-Reliability …
(= Objectivity) n 89 83
Different rater produce similar
outcomes
r
 Inter-Item-Reliability
(= internal Consistency)
Different items of one test show
similar results
Measured and expressed
through Cronbach‘s Alpha (ranks
from 0 to 1)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 111

Objectivity

 Multiple rater independently Examining Objectivity


produce the same results

 Objectivity can relate to Subject Rater 1 Rater 2


execution, analysis and 1 78 72
interpretation 2 67 68
3 44 51

n 89 83

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 112

56
Performance Management

Prof. Dr. Armin Trost

Overview

 The Performance Management Cycle

 Objective Setting

 Performance Appraisal

 Dealing with low performers

 Limitations of Performance Managements

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 114

57
Performance Management Cycle
Strategy/Team objectives

Review Objective Setting Plan


(Performance &
Development)

Performance Development
Appraisal Planning

Coaching Feedback

Performance/
Development
Monitor Act

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 115

Purpose of Performance Management

 Cascading and strategic objectives from upper


hierarchical level to the bottom line

 Alignment and focus of individual and team


performance with overall target

 Clarity about mutual expectations within an employee-


manager relationship

 Continuous learning and constant improvement of


performance through timely feedback and target-
oriented people development

 Foundation for numerous key processes in human


resource management such as compensation, people
development, succession planning (horizontal
integration)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 116

58
Cascading

CEO

Garth McGrath

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 117

Rules about How to Set Objectives

 Specific  Positivly stated  Challenging

 Measureable  Understood  Legal

 Accountable  Relevant  Environmental


sound
 Realistic  Ethical
 Agreed
 Time bound
 Recorded

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 118

59
Objectives
(Examples)

Example better

Development, design and Increase of hit rate on corporate


implementation of an online website to 2.000 hits per day by
marketing concept end of 2006
Increase of number of parking Reduction of misdemeanour by
tickets by 5% in the year 2006 5% in the year 2006

Closer cooperation between sales 20% of leads generated by


and marketing marketing lead to customer
presentations
Increase of revenue in the Eastern Increase of revenue in the Eastern
Europe market by 10% in 2005 Europe market in 2005 5% higher
compared to the market leader

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 119

Performance Management Form 1/2


(Example: Performance Objectives)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 120

60
Performance Management Form 2/2
(Example: Development Plan and Overall Rating)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 121

360-Degree-Feedback
 A focus person is evaluated
from different perspectives
(outside perception)
Direct
 A focus person evaluates
Supervisor him/herself (self perception)
 There is a direct relation
between appraiser and focus
person
 Evaluation happens
anonymously, in written by
using standardized and
Peers Self Customers structured methods (e.g.
questionnaire)
 The evaluation is about both
behavior and performance
 The focus person gets a
personal report to be
discussed with his/her direct
Subordinate supervisor
 Purpose is to determine a
focus person‘s strengths and
weaknesses

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 122

61
Behaviorally Anchored Rating Scale (BARS)
(Example: Teamwork)

Level 1 Level 2 Level 3 Level 4

Participates willingly Takes responsibility for Builds support and Builds highly productive
towards the team activities that stretch enthusiasm for the teams from highly diverse
accomplishment of goals of beyond own functional accomplishment of team disciplines, cultures or
one’s own team, doing his area. goals. organizations.
or her share of the work.
Solicits the input of team Uses the agendas and Creates commitment to and
Demonstrates respect for members and encourages perspectives of others to enthusiasm for the
the opinions and ideas of their participation. establish mutually accomplishment of
others. beneficial objectives. challenging objectives across
Ensures participation of diverse teams.
Does not remain silent or others who are affected Takes responsibility for the
withhold differing opinions in by plans or actions. accomplishment of team Masterfully integrates people
team settings. goals. and resources to achieve
Puts team’s agenda and high levels of synergy.
Is willing to accept the good of the whole Removes obstacles that
compromises to progress ahead of personal needs. get in the way of team Resolves dysfunctional
toward the achievement of success. conflict within or among
group goals. Finds areas of agreement teams to ensure business
when working with Gives recognition and success.
Follows through on conflicting individuals or credit to people who have
commitments made to other groups. contributed to team
team members. success.
Helps others to solve
Keeps people informed and work problems and Takes specific steps to
up to date. achieve team objectives. keep morale and levels of
performance high during
times of intense work
pressure.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 123

Overall Performance Ranking Scale


(Example: Microsoft)

Rating Definition
Exceptional performance rarely achieved. Marked by precedent-setting results beyond the scope of the
5.0 position. Demonstrates the highest standards of performance excellence relative to individuals with
comparable levels of responsibility
Consistently exceeds all position requirements and expectations. Accomplishements are highly valued
4.5 and may be well beyond the scope of the position. Demonstrates higher standards of performance
excellence relative to individuals with comparable levels of responsibility.
Consistently exceeds most position requirements and expectations. Accomplishements are often
4.0 noteworthy. Overall performance is consistently above levels of quality and quantity relative to
individuals with comparable levels of responsibility.
Exceeds some position requirements and expectations. Successfully accomplishes all objectives.
3.5 Overall performance matches levels of quality and quantity relative to individuals with comparable levels
of responsibility.
Meets position requirements and expectations. Accomplishes most or all objectives. Some aspects of
3.0 overall performance may require additional development or improvement to match levels of quality and
quantity relative to individuals with comparable levels of responsibility.
Falls below performance standards and expectations of the job. Demonstrates one or more
2.5 performance deficiencies that hinder acceptable performance relative to individuals with comparable
levels of responsibility

Does not meet minimum requirements in critical aspects of the job and has numerous performance
1.0-2.0 deficiencies that prevent success at Microsoft.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 124

62
Compensation & Benefits

Prof. Dr. Armin Trost

Overview

 Objectives and challenges of compensation &


benefits

 Factors to determine compensation

 Total Rewards

 Building a base pay system

 Pay for performance

 Pay for company success

 Benefits: components, rationale, cafeteria


system

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 126

63
Challenges and Objectives of a Compensation and
Benefits Strategy

 Ensure employees‘ livelihood

 Driving performance according to the company‘s


strategy

 Procedural and distributive equity for employees

 Attraction and retention of talented candidates


and employees

 Legal compliances with all appropriate laws and


regulations

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 127

Equity

 Distributive Equity
A One‘s performance
reward relation
Reward

compared to others
Equity  Procedural Equity
Do procedures to
B determine compensation
lead to equitablel
results?

Contribution to Company Success

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 128

64
Factors Driving Individual Compensation

Nature of Job Performance

Seniority Competencies

Compensation

Status Market

Cost of Living Company Success

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 129

Total Rewards

Total Rewards

Total Compensation Non-financial Rewards

Base Pay Variable Pay Benefits Recognition

Wages Bonuses Insurances Autonomy

Salaries Incentives Pension Opportunities

Stocks Services Networks

Piece-Rate Pay

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 130

65
Development of a Base Pay System

Job Analysis

Job Evaluation Pay Survey

Pay Policies Pay Structures

Job
Individual Pay
Appointment

Implementation,
Communication,
Monitoring

Source: Mathis & Jackson: Human Resource Management

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 131

Compensable Factors
(Example: Hay System)

Know-How Problem Solving Accountability


Magnitude
Environment

Challenge

Impact of end results


Managerial skills

Freedom to act
Human relation
Funcitonal Expertise

8 7 3 8 5 8 4 Dyn.

Total Point Value


Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 132

66
Job Evaluation using Point Method
(Example Consulting Company)

Assistant Junior Cons. Senior Cons. Manager Principal

Compensable Factor Weight Rating* Value Rating Value Rating Value Rating Value Rating Value

Expertise 2 2 4 3 6 8 16 6 12 4 8
Leading People 3 0 0 1 3 2 6 4 12 8 24
Responsibility for Results 1,5 1 1,5 2 3 4 6 8 12 10 15
Cognitive Requirements 3 2 6 3 9 4 12 6 18 10 30
Learning & Development 2,5 2 5 6 15 5 12,5 4 10 10 25
Networking 3 2 6 3 9 3 9 10 30 12 36
International Mobility 1 0 0 5 5 7 7 12 12 8 8
Strategic Impact 2 1 2 1 2 2 4 6 12 10 20
Job Value 24,5 52 72,5 118 166
* Scala ranking from 0 (=does absolutely not apply) to 10 (=totally applies)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 133

Determine the Market Line through Pay Surveys

 Benchmark jobs are


Market Market
Jobs at other Pay Line
companies with similar
duties, requirements
etc.
 Collect compensation
data about benchmark
jobs (pay survey)
 Computing market line
by using statistical X
regression analysis
Market line represents Job
Value
relationship between
job value and market Benchmark Jobs
pay
Market Line = X + Job Value × Y

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 134

67
Compensation Quartile Strategy

Organizations
Amount of

Market
Quartile 1st 2nd 3rd Pay

1st 2nd 3rd

Below-Market Strategy Middle-Market Strategy Above-Market Strategy


 Inability to pay more  Balancing cost-  Competitive
presure and
 Limited labor-market competition  Focus on mission-
competition critical and hard-to-be
filled position

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 135

Pay Structure
Pay Grade, Pay Range, Pay Rate
Pay Range

Pay Grade
(Job Value)
7

5 Red Circle in
e
etL
k
4 ar
M

3 Green Circle

1
Pay Rate (€)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 136

68
Opportunities and Threats of Job Evaluation

Opportunities Threats

 Common foundation for  Significant bureaucracy


compensation-related during implementation
decisions
 Acceptance of all
 Job-related distributive stakeholders involved
and procedural equity
 Requires clear job
 Transparency of definitions
compensation-related
decisions  Reduces flexibility of
compensation-related
 Active elaboration of job decisions
values and contribution
to company‘s success  May reduce innovation
and employee
engagement

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 137

Types of Variable Pay Plans

 Profit Sharing
 Employee Stocks
Organization
 Employee Stock Ownership

 Group Incentive Plans


Group

 Piecework
Individual  Merit Pay
 Bonuses
 Sales Commission
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 138

69
Piecework Systems

 Example
€8.00 (hourly rate) * 12min/unit (standard tim per unit)
= €1.60/unit
60min

 Preconditions
– Employees must have full control over output.
There is little or no impact of supply, methods and
tools on output
– Individual contribution can be determined easily
– Required employee capabilities can be easily
acquired

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 139

Merit Pay

 Linking pay increases to Performance Appraisal/


performance appraisals Responsibility
Compa-
ratio - -/+ +
 Increases become part of
base pay
120 0% 0% 0%-3%
 Compa-ratio = pay level/
midpoint of pay range
110 0% 0%-3% 0%-5%
Example:
16.50€ (current pay)
X 100 = 110 100 0% 3%-5% 5%-7%
15.00€ (midpoint)

 Pay Adjustment Matrix 90 0% 5%-7% 7%-9%


determines pay increase
according to actual
performance, responsibilities 80 0% 7%-9% 9%-11%
and compa ratio
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 140

70
One-Time Bonuses

 A one-time bonus is a one-time payment that


does not become part of the employee‘s base
pay

 Can be used to reward employees for


contributing new ideas, coping with critical
challenges, acquring new skills

 Bonuses usually recognize performance of both


the employer and the company

 Bonuses provide great flexibility in rewarding


valued behaviors at particular situations

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 141

Target Bonus

 Employee and
Target
supervisor agree on Bonus (%)
– Individual targets
– Relationship between
140
target achievement and B
target bonus
120
A
 Employees can choose
from different options 100

reflecting different risk


levels (see picture) 80

 Primarily used for 60

managers
60 80 100 120 140
Target Achievement (%)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 142

71
Group Incentive Plans

 Application of variable pay plans on group level

 All variable pay plans can be adopted

Chances Risks

 Shows a clear  Individuals may rely


management on others‘
commitment to performance (social
teamwork loafing)

 Supports building  Team bonus don‘t


team culture and reflect individual
encourages team- contribution, which
members to might be perceived
cooperate as unfair

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 143

Conditions for Successful Variable Pay Plans

 Variable pay is consistent with organizational culture


and philosophy (e.g. requires sufficient autonomy)

 Variable pay plan recognize individual differences


(e.g. avoids “”rate busting”)

 Employees can impact their performance results on


which they are measured according to their different
levels of responsibility

 Employee see a direct relationship between their


efforts and their financial rewards

 Employees value performance-related types of reward

 Variable pay plan is clear, understandable, current and


updated

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 144

72
Pay for Organizational Performance

 Profit Sharing
– Proportions of organizational profits are distributed to
employees
– Portions of profits are distributed either at the end of
the year or deferred, placed in a fund, and made
available at a later point of time
– Can be allocated equally or according to employees
earning, years of service, contribution etc.

 Employee Stock Ownership


– Giving employees stock ownership of the organization
or the right to acquire stocks at a price below market
– The intention is to increase commitment, loyalty, effort
and awareness of company success

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 145

Employee Stock Options

 The right to buy Stock Price

(excercise) a certain
number of shares of
stocks at a specific
13€
price (e.g. 10€; see
picture) 3€

10€ Option
 Traditionally used for
executives. However,
Trends indicate a 6€

broader usage 6€

4€

Time t

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 146

73
Types of Benefits

 Security  Financial
– Workers‘ compensation – Interest-free building lown
– Unemployment – Company credits
compensation – Financial counselling
– Life insurance
– Disability insurance  Offerings
– Early retirement options – Company car
– Disability retirement benefits – Private cell phone, laptop
– Pension Plans usage
– Free lunch
 Health – Cafeteria and food services
– Health-Care INsurance – Child-Care; Company
– Sabbatical Kindergarten
– Free tennis courts, fitness – Cost advantages for
center usage company products
– Medical care – Company accommodations
– Psychiatric counselling

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 147

Reasons why Companies offer Benefits

 Benefits attempt to employees and their


dependents from financial risks accociated with
illness, disability, and unemployment
 Most benefits are not taxed as income to
employees. For this reason, they might represent
a more valuable reward to employees than an
equivalent cash payment
 Benefits may contribute attracting, motivating
and retaining human resources
 Some benefits add value to the employee without
additional costs for the employer. As such,
benefits might serve as substitutes for
compensation
 Some benefits are required by law
Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 148

74
Flexible Benefits (Cafeteria System)

 Flexible Benefit Plan


A plan that allows employees to select the benefits they
prefer from groups of benefits established by the employer

 Reasons for using “Flex Plans”


– Perceived value of benefits depend on employees’ age,
family status etc.
– By tailoring the right benefit package employees gain
maximum value without additional costs on employer’s side
– Flex plan heighten employees awareness of the costs and
value of benefits offered

 Problems with Flexible Plans


– Inappropriate benefits package choices
– Adverse use of specific benefits by higher-risk employees
– Administrative and communication efforts
– Benefit requests are hard to predict

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 149

Training & Development

Prof. Dr. Armin Trost

75
Overview

 Chances and limitations of employee training

 The planned approach: competence management

 Types of training measures

 Training development: from needs assessment


to training evaluation

 Nature of employee development

 Talent review (high-potential identification)

 Career development measures

 Succession planning

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 151

Talents, Skills & Competencies and Knowledge

Can be learned
 Knowledge
Memory of contents Training
procedures, theory
etc.

 Skills and
Competencies
Behavioral capabilities
such as language and
teamwork

 Cognitive Abilities
and Personality
Stable and life-long
attributes of human
beings

 Talent
Long-term potential to
excel in specific areas Development

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 152

76
Types of Trainings
Unique Training Needs

Training as part of a Customized training


large-scale change adressing special
initiative (e.g. IT- development needs for
implementation, teams and individuals
cultural change) (e.g. expatriate training)
Planned, Demanded
Strategically by Employees/
Decided Managers

Regular training for Training for employees


specific target groups offerred on demand at
(e.g. newly appointed high volume (e.g. group
managers, new hires) conflict training)

Standard Training Needs

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 153

Standard Training Content

 Communication  Language

 Presenting  Office Application

 Group Facilitation  Office Management

 Working Techniques  Business Fundamentals

 Project Management  Interviewing Candidates

 Conflict Management  Performance Management

 Leading Teams

 Intercultural Collaboration

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 154

77
Phases of Training Design

 Define target audience


Needs Assessment  Determine learning needs of target group
 Determine learning motivation of target group

 Define learning objectives


Design  Create content, methods and media to be used
 Define budget and scope of training operation

 Engage training conductor


Implementation  Arrange required infrastructure
 Conduct training

 Examine quality and impact


Evaluation  Identify rooms for improvements and implement
required measures

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 155

Exercise: Onboarding newly hired Graduates

Every year 100 graduates are newly hired


into different functions of a company.
There are some indications, about new
hires not feeling satisfied with the way
how they are introduced

How would you concretly conduct a


needs assessment?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 156

78
Needs Assessment Data Collection Methods

 Structured interviews  Critical Incidents


on individual or group Techniques
level
 Participated or non-
 Self-administered participated observation
assessment tools (e.g.
tests)  Off-side needs
assessment workshops
 Ratings from peers,
supervisors,  Professional auditing by
subordinates (external) experts

 Shadowing, diaries,

 Coaching

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 157

Approaches of Training and Development

Along the Job


Assistance
Substitute

Into the Job On the Job Out of the Job


Education Job Rotation Outplacement
New Hire Integration Coaching; Mentoring
Trainee Programs Project Work

Near the Job


Task Forces
Work Groups

Off the Job


Congresses
Outdoor-Training
Off-side-Training
Source: Holtbrügge (2004): Personalmanagement

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 158

79
Advantages of Major Development Approaches

On-the-Job Off-the-Job
 Natural and job-related  Expertise and experience
of training conductor
 Lower costs of
development measure  Professional learning
environment
 Immediate application of
newly acquired knowledge  Focus on training, limited
job-related disruptions
 Immediate Feedback
 Networking among
 Opportunity to monitor participants out of
development advances different functions and
countries
 Motivation to learn

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 159

Training Media and Methods

 Classroom training  Simulation, role playing

 Computerbased  Outdoor Training


Training (CBT)
 Classroom Training
 Webbased Training
(WBT)  Case Studies

 Coaching  Readings

Blended Learning
Combination of different media

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 160

80
Training Schedule
(Example: Project Management Course)

Day # Time Topic Objective Method Material


1 1 9am Introduction Understand the Presentation Course Handout
attributes of a project Slides 1-8
and the key challenges
to manage projects
2 10am Critical Factors Understand which Group Flip-Chart
factors drive success of Discussion & Pin Board
projects in the
participants' business
context
3 11am Break
4 11:30am Project Planning Participants become Presentation Course Handout
familiar with gant-chart Slides 9-16
technique to schedule a
project
7 1pm Lunch
6 1-2pm Project Planning Participants learn how to Group Work Case Study 1;
Excercice apply gant-chart Pin Board
technique

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 161

Training Administration

; Communicate with ; Test equipment that will be


Employees used during the
instructions
; Enroll employees in
courses and programs ; Provide support during
instruction
; Engage trainer and provide
briefing ; Distribute material for
evaluation the course and
; Prepare and process conduct analysis
pretests to be
administered ; Provide for communication
between training and
; Offer material to be read trainees
before
; Maintain records of course
; Arrange training facility completion, prepare
and equipment certificates
; Manage training
accounting

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 162

81
Summary of e-Learning Functionalities

 Content management systems to offer


modular learning units worldwide

 Online-tests to determine the learner‘s current


knowledge

 Documentation of personal learning histories


and automatic suggestions of future learning
units

 Live and recorded virtual classroom sessions

 Interfaces to other systems such as skills


databases

 Webbased booking and accounting of


trainings

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 163

Transfer of Training

Attributes of Participant
 Cognitive ability to acquire
learning content
 Learning motivation, perceived
relevance of learning content
 Readiness to change behavior

Attributes of Training
 Quality of learning content
 Usage of the right media and
methods Learning Generalization
 Perceived competence of training
conductor
 Link to daily work

Work Environment
 Support of direct supervisor and
colleagues
 Opportunity to apply newly
acquired knowlege
 Feedback

Source: According to Baldwin & Ford (2004): Transfer of Training

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 164

82
Levels of Training Evaluation
(According to Kikpatrick)

 Results Did the training impact achievements


of organizational goals? → KPIs

 Behavior Did the training lead to changing


behavior at the participant‘s daily
work? → Behavior Evaluation

 Learning Have the participants acquired


knowledge as it was intended? →
Tests

 Reaction What are the immediate reactions of


the participants after the training? →
Questionnaire

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 165

Learning Curve

Maturity Level

Maximum Level

Potential

Peak

Age
Career Step

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 166

83
How Did these Guys Let their Talent Grow?

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 167

Factors driving Talent Development

Internal Factors External Factors


 Ambitions and fun to  The opportunity to practice
practice talent-related talent-related tasks
tasks
 A personal long-term
 A realistic understanding mentor-relationship
of one‘s potential characterized by mutual
trust
 A personal vision about
ones future being  The right point of time to
leverage talent
 Active search for
opportunities and  Cooperation with
supporters complementary talented
people
 Building network
relationships  Training and support
 One‘s ability to present  Early successes
him-/herself positively
 Strong networks

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 168

84
Factors that drive Development

Job Assignments
1 Promote high performers quickly
2 Build skills to boost career prospects
3 Fast rotation and advancement
4 Roles with P&L responsibility
5 Special project opportunities
6 On-the-job training

Coaching Feedback
7 Told my strengths and weaknesses
8 360°feedback
9 Candid, insightful feedback
10 Informal coaching from boss

Mentoring
11 Great mentor
12 Great senior role models
13 Mentoring advice on development

Training
14 Traditional classroom training

Source: Michaels, E; Handfield-Jones, H; Axelrod, B. 2001,


The war for talent, Boston, Harvard Business School Press.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 169

Talent Review as an essential Part in the


Performance Management Cycle

 During April to August


cascaded Talent Review
Meetings take place at
all business units

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 170

85
Performance/Potential Grid

A1 A2
High Plan next move Apply multiple
Provide extra development and
C1 coaching retention measures
Performance
Improvement
Measures A3
Potential Identifiy next
development
opportunity
B
Keep in Place
Low C2
Manage Out

Low Performance High

Source: Adapted from McKinsey: The War for Talent (2001)

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 171

Talent Review Meeting Structure

Executive Peers from


Review Meeting above Business other business
Participants Head units

Facilitator
(Business Unit Business
HR Director) Unit Head

Direct
Reports

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 172

86
Objectives of Talent Review

 All employees in a business are ranked area


according to predefined criteria such as
performance and potential

 Future development measures are agreed for all


A Players

 Succession plans for all key positions are agreed

 Common performance and talent mindset among


managers participating in talent reviews

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 173

Stretch Role Attributes

 Acceptable Developmental  Appropriate Content


Risk Exposure
Position must provide Position must offer the
developmental challenges opportunity to develop the
without endangering business or technical
business unit performance. expertise:.

 Appropriate Tenure  Management


Stretch role must be Responsibilities
structured to permit Position must provide
remaining in the role for an leadership experience as
appropriate amount of time. well as team-based work.
 Acceptable Internal  Significant Exposure to
Turnover Pressure
Position must allow for Position must have
frequent internal turnover significant performance
without harming demands.
organizational interests.
 Employee Support
 Broad Company Exposure Position must provide the
Position must provide broad employee with access to
exposure to company developmental resources
business practices. and organizational support.

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 174

87
Career Counseling at Deloitte Consulting

 Deloitte Consulting senior-management team


assigns senior line managers as counselors

 Counselors role consists of three elements


– Developmental Guidance
– Advising Employee Movement
– Reviewing Talent

 HR provides training in coaching skills and the


developmental resources available to employees

 Counselors’ preparation and accessibility is


evaluated via counselees’ upward feedback,
which figures in manager reviews

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 175

Career Paths

 Predefined job sequences Division


Manager
with growing responsibility
District Technical
 Provide transparency to Manager Project Lead
employees regarding
– Job Requirements Unit Project
– How to move to higher level Manager Engineer
positions
Management
Unit Engineer
 Require distinct and Assistant

homogeneous job
Management Technical
categories Trainee Engineer

 May reduce flexibility of a


Junior
natural internal labor Entry Level
Engineer
market
Management Expert

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 176

88
Junior Executive Board

Kickoff Top-Management Presentation

Workshops

1* 6 1 6 1 6 1

Project work

 Strategic topics  Combination of workshops


and project work
 Project coaching
 Benchmarking
 Top-management sponsorship
 Networking
 Multiple members per topic
 Presentation of concepts to
top-management

* weeks

Prof. Dr. Armin Trost Human Resource Management, Hochschule Furtwangen, Copyright © 2006 www.armintrost.de 177

89