High Performance HR

Confidentional

High Performance HRMaximizing People for Profits

September 1, 2011

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The People Profit Connection The People Profit Connection

Did you know…..

The average dealership spends$2.5 Million on payroll (NADA)

That the cost of a bad hire is 1.5 to 2 x the annual salary?

That companies spend on average $1700 per employee to comply with workplace regulations?

That harassment cases cost on average– Pre-trial settlements: $300,000.– Litigation judgments: $1.8 Million

– KPA CONFIDENTIAL –

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The People Profit Connection The People Profit Connection

Did you know…..

That on average 35% of operating expense is attributed to employee compensation and benefits?

The average implemented employee suggestions saves a company $6,224 in operational expenses according to the Employee Involvement Association

The typical worker wastes about 2 hours a day- and the cost is a staggering $759 billion a year nationwide! (SHRM)


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Hire, Retain, EngageHire, Retain, Engage


Engage

Retain

HireSelect the best because you have a choice

Keep the best with a good working environment

Engage to maximize productivity

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Hire the right person for the right jobHire the right person for the right job

• Dealerships report they spend less than 4 hours in the hiring process*

• Cost of bad hire is 2 to 3 times the annual salary

• 95% of a managers time is spent on 5% of the employees

Bad hires cost you money, and even worse they keep you up at night!

*survey of 268 dealerships


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Are you using the right tools for the jobAre you using the right tools for the job

• Effective job application form• Conduct a behavioral interview• Personally conduct references• Perform background check • Use a scorecard to make objective decision

If the answer to any of these questions is anything but yes- then you are taking on more risk than is necessary and increasing your chance of making a bad hire


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The Five ToolsThe Five Tools

Effective Application

Behavioral Interview

Reference Checking

Background Checking

Candidate Scorecard


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The Five HabitsThe Five Habits

Follow a defined process

Use the five tools

Always be recruiting

Include others in the process

Never talk yourself into saying yes


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Hire the right person for the right jobHire the right person for the right job

• Using the five habits and the five tools will:– Establish a proven method to reduce the risk

of making a bad hire- do what works!– Save time by using the five tools to screen out

poor fit early in the process- don’t waste your time!

– Reduce the time you spend on management by hiring the right person in the first place- spend your time on your top employees!

Time is money, can you afford to make poor hiring decisions?


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Retaining EmployeesRetaining Employees

• Spending time on retention is good business

– Reduces training– Improved productivity– Creates an attractive workplace

• Retaining poor employees is bad business– Performance reviews– Disciplinary action plans

Remember that 95% of a manager’s time is spent on 5% of the employees, but your goal is to reverse this equation in your dealership


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The Engaged Organization The Engaged Organization

Employees

ManagersExecutives


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EmployeesEmployees

Employees align what they want — and what the business needs— and then take action to achieve both


Ownership

Clarity

Action

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ManagersManagers

Managers understand each employees talents and skills and match to the businesses objectives — while at the same time creating personal, trusting relationships


Coaching

Relationships

Dialague

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ExecutivesExecutives

Executives demonstrate consistency in words and actions, communicate a lot, and align business practices and behaviors throughout the organization to drive results and engagement.


Trust

Communication

Culture

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Cultivate an Ownership MentalityCultivate an Ownership Mentality

• Education– How does the company make money– How can do I impact or take away value

• Measure– Key Performance Indicators– High Visibility/High Accountability

• Incent– Self funding incentive plans– Align behavior to financial objectives


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Four Key Performance IndicatorsFour Key Performance Indicators

• Employee Costs• Employee

Turnover/Retention• Employee

Engagement/Satisfaction• Workplace Compliance


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Employee CostsEmployee Costs

• Average Costs of an Employee– Salary– Benefits

• Percentage of Revenue by Employee

• Employment Costs as a % of Operating Expenses

• % of time lost to absences

• Average overtime per employee


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Employee Turnover/ RetentionEmployee Turnover/ Retention

• Total replacement hires per year

• Total cost to hire

• % of new hires achieving 6 months

• % of new hires achieving 12 months

• % of new hires achieving satisfactory appraisals

• Cost of training per employee


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Employee Engagement/SatisfactionEmployee Engagement/Satisfaction

Annual measurements on attitudes and beliefs…

Compensation and benefits Co-workers, managers Promotion opportunities Training Work Tasks


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Workplace ComplianceWorkplace Compliance

• Total number of complaints

• Total number of lawsuits/audits– cost of defense as a % of revenue

• Lost time to accidents

• Training– Measure impact of training year to year against

lawsuits and complaints


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Maximizing the People Profit ConnectionMaximizing the People Profit Connection

• What makes a company attractive to candidates makes it easy to retain employees

• Use the five tools and five habits to hire the right person for the right job

• Spend time upfront to hire the right person, it is a good use of your time

• Don’t spend your time on the bottom 5%, spend your time on the top 25%

• Measure KPIs for HR annually, can’t measure, can’t improve

• Ownership mentality makes all the difference


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Questions and AnswersQuestions and Answers


QUESTIONS?

Contact InformationContact Information

23– KPA CONFIDENTIAL –

Kathryn Carlson

[email protected]

303-228-8765

Business

High Performance HR