Engaging, Motivating and Developing Finance Talent to Deliver Business Value

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Engaging, Motivating and Developing Finance Talent to Deliver Business ValueAsk, Share, Learn Within the Largest Community of Corporate Finance ProfessionalsAnnouncing Proformative Academy: LMS with on-demand video courses taught by senior practitionersOver 170 finance and accounting courses - adding a course every day!CPE for CPA, CMA, CTP, FP&A, CRMA and CIAWelcome to Proformative

Proformative is the leading professional development resource for every member of the Office of the CFOCheck it out at www.ProformativeAcademy.com 2Engaging, Motivating and Developing Finance Talent to Deliver Business ValueJeff Higgins, CEO & President, Human Capital Management InstituteAsk, Share, Learn Within the Largest Community of Corporate Finance Professionals15% productivity gain and lower costs ($55.0 Billion Package Delivery Co. )

Predicting sales stars pre-hire{$1.0 Billion Bank}

ROI of sales training {$2.0 Billion Retail Co.}

Location optimization for talent growth {large Regional Bank}

Employee engagement service level revenue impact {$1.0 Billion public Airline}

40% voluntary turnover reduction {public, financial services co.}

ROI of internal vs. external hires {public bank}

$1.1 Billion Annual

$264 Million Annual$1.1 million per sales person

$250 Million Annual $250k per Salesperson

$200 Million 10 years

$96 Million Annual $5 per flight premium

$12 Million Annual majority sales + operations positions

$6 Million Annual

Examples: Talent Analytics ROI

4 Keys to Success:Formalize Workforce StrategyShared Strategy across HR

Find the Right Key Metric Indicators

Create Data/Reporting Standards

Build Analytics Skills, Create Focus

Integrate Disparate Datasets (BI or HRIS systems)

Strong Processes and ToolsGovernance/OversightBuild/buy analysis tools

Analytic Answers to Key QuestionsChange Management/AdoptionWorkforce StrategyData IntegrationRepeatable ProcessCapabilityKnowledgeA Strategic Approach to Analytics

5Cost of the problemCost of the SolutionROI of the SolutionTargeted Training InterventionKey Assumptions:Cost of Training vs. cost of doing nothing = small short term savings vs. big long term costROI of Training = Productivity Gain + Career Path + Skills Gain + Talent Bench Talent Shortages No Successors Time to Productivity Turnover Lost skills Deep Talent Bench Ready Successors Productivity Gains Skills TransferA VERY Simple Training Business Case


How do we know our training $$$ are well used?

What do we measure?

Do employees value training?

Does training drive productivity?Engagement = Measure pre/post training engagementProductivity = Measure pre/post training productivity Retention = Measure pre/post training retention (i.e. critical roles or High Performers)Bench Strength + Career Path = ROI of internal DevelopmentMeasure by Job Category and Critical RoleMeasure each Training Course or SeriesNOTE: Training ROI drives Productivity, Career Mobility, Engagement and Retention123Total Cost of Workforce = Lower workforce cost vs. outside replacement costMeasuring Training Effectiveness How Training Adds Value

Base Data - No MetricsTraining Course #1, Skills 20% QualifiedBasic QualificationsSteps on the Career PathStrong Performance and ExperienceTechnical Training Course #2, Skills 40% QualifiedProject Management Certification Courses #3-5, Skills 80% QualifiedProven Performance and Skills, 100% QualifiedPromoted to next level/grade BACK TO STARTING POINT!The Learning ROI Journey

8Promotion Cost (12% of $90k Salary)ROI of Training for Finance Manager RoleCost of Training($15k employee cost per yr.)-($30,000) over 2 Years$33,000 $$$k = US Dollars in 000s(+$125,000 + 33,000 + 20,000 - $30,000 - $11,000) = $97,000Engagement Productivity Gain: Finance Dept. (10% engagement gain = see case study)$125,000 Compensation Hard Cost Savings*: Lower Total Cost of Workforce ($25,000 per yr. * 5 yrs.)Hard Cost Savings: Replacement Cost of Hire (30% agency fee on $110k replacement hire salary)Investment CostReturn on Investment -($11k) Retention Savings: Cost of Turnover Cost Avoidance (1-2% for Finance Dept. = ($10k Turnover cost * 2 positions per yr.)$20,000 * May require use of discounted net present value (NPV) analysis on $25k savings 5 yrs. at 12% discount rate or roughly $100,000Example Training ROI: Finance Manager Grown Internally

Staff AccountantMgr., AccountingDir., AccountingAccountantSr. AccountantCAGR: Compound Annual Growth Rate

The ten-year cost savings is the area between the cost of External Hires compared to the career path of an Internal Staff Accountant Note: Make sure to select the period which will provide the most accurate forecast. In some cases, a run rate based on the current or last year is optimal, but in others an average of several years or a custom time period is best to use.Case Study: Real Estate TrustQuantifying an Appreciating Asset

EngineersLack of mobility in first 3 years of tenure = high turnoverCase Study: Diversified Oil CompanyVisuals with the Right Metrics

Thank you for your interest in this presentation. View the on-demand webinar or download the full presentation at:www.Proformative.comEngaging, Motivating and Developing Finance Talent to Deliver Business Value12