Performance Improvement 2006 ASTD Int’l Conference

Performance Improvement2006 ASTD Int’l Conference

2006/5/10 서울대학교 이 찬 교수

ASTD 2006 이 찬 교수2

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Contents

Introduction

How Top Companies Invest In H.C. (TU110)

HPI & the Balance Scorecard (TU Performance RM)

Q & A

11

22

33

44


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HOW TOP COMPANIES INVEST IN HUMAN CAPITAL:

Three New Models

일류 기업이 인적 자본에 투자하는 방법 :세가지 새로운 모형

Jac Fitz-enz, Ph.D.Founder & CEO

Human Capital Source


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- AGENDA -

It’s All About Human Capital Investment인적자본 투자에 관한 모든 것

Working from a HC Planning Model인적자본 모형으로부터의 작업

Linking Human Capital Investments To Operations, Sales and Service인적자본투자와 경영 , 세일즈 , 서비스로의 연계

Knowing Where to Invest to Solve HC Problems인적 자본 문제를 위해 어디에 투자해야 하는가


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U.S. Companies lose: 미국 회사들이 잃는 것

½ their investors 투자자 in 1 year½ their employees 직원 in 4 years½ their customers 고객 in 5 years

BUSINESS ISPEOPLE

5% Gain in Customer Retention CanAdd Up to 25% Growth in Earnings *고객유지 5% 획득으로 수익 성장 25% 추가 가능 *

*Fred Reichheld, The Loyalty Effect


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CFO’S CATCHING ON

72% Believe HC Impacts Innovation 혁신

92% Believe HC Impacts Customer Service

82% Believe HC Impacts Profitability 수익성

AHA!


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FUNCTIONAL UNITS

Design & Production & Sales & Customer Development Distribution Marketing Service

RESOURCE MANAGERS

Human Finance & Information Security & Resources Accounting Technology Maintenance

CURRENT STATE

설계 & 개발 생산 & 물류 영업 & 마케팅 고객서비스

인사 재무 & 회계 정보기술 경비 & 시설


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MOTOROLA BOOKINGS & HC - WORLD,3/12 ROCCORPORATE STRATEGY OFFICE

TOTAL MOTOROLA WORLD BOOKINGS & HEADCOUNT(3/12 ROC)

LATEST PLOT: JANUARY 2001 TOMW HEADCOUNT - BLUE, BOOKINGS - GREEN

-40

-20

0

20

40

60

80

1/94 7/94 1/95 7/95 1/96 7/96 1/97 7/97 1/98 7/98 1/99 7/99 1/00 7/00 1/01

BOOKINGS

-40

-20

0

20

40

60

80

HEADCOUNT

P1

P1 P2

P2

P3

P3P4

T1 T1

T2 T2

T3

T4?

HIRING (Blue) NOT COORDINATED WITH BOOKINGS (Green)MISALIGNMENT COST: $1.500,000,000


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“If everybody concerned is absolutely clear about the goals and directives and

far purposes of the organization practicallyall other questions then become simple

technical questions of fitting means to ends”

Abraham Maslow Eupsychian Management

21st CENTURY INTELLIGENCE


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3 HUMAN CAPITAL MODELS3 인적자본 모형

Mental정신

Talent재능

Structural구조


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Human CapitalSkills - Attitudes

Compensation - Culture

Relational Capital Customer - CompetitorsVendors - Government

Structural Capital Facilities - Equipment Processes - Material

1. NONLINEAR UN-ALIGNING 비선형 비정렬

Workforce IntelligenceAnalytics Assessment Benchmarks


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Leadership DevelopmentRecruitment Management

CONVERGENCE 집중성

WORKFORCE

PLANNING

RetentionPerformance

인력 기획

채용 관리 리더쉽 개발

성과 유지


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2. TALENT MODEL 재능 모형

C-Level has Balanced Scorecard

TMI

TMI

Finance has Accounting

Production has Quality

S - M - CS have CRM

NowHuman Resources

has TMI


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Employee Customer Profit 5% 2% 1%

HR INVESTMENT RESEARCH: HR 투자 연구

Saratoga Institute: HR Metrics & BenchmarksHuselid & Becker: HR Practices Productivity/TurnoverWatson Wyatt: HCM & Consistent Shareholder ValueGallup: Managerial Behavior & Employee Performance

Sears:


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WHAT IS TMI?

StaffingBusinessIntelligenceApplied To

Human Resources’ ManagementofHuman Capital

Leadership Development

Training & Education

Workforce Planning

Performance Management

Retention


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2003 Intelligence - TMI

NEXT GENERATION 차세대

Pre-1980: Data - Feelings

1980 – 1985: Information - Metrics

1985-2002: Knowledge - Benchmarks


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Staffing

TMI FRAMEWORK

OperationsSales

Service

Retention

Planning

Leadership

Performance

Development


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HR MANAGEMENT&

TALENT MANAGEMENT INVESTMENT

HR: Internal Efficiency내적 효율

&

TM: External Effectiveness외적 효과

HR


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Efficiency vs. Effectiveness

Efficiency : Does one approach achieve the outcomes faster, and is the cost less than the value of the HR outcomes?

Effectiveness : Does one approach result in superior work outcomes, and is the cost less than the value of the work outcomes?


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Factor

Measure

Cost

Time

Quantity

Quality

Reaction

HR EFFICIENCY MEASURES

Staffing Pay & Ben Training & Retention Admin Develop.


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Factor

Service

Hiring

Paying

Supporting

Developing

Retaining

TM EFFECTS ON BUSINESS

Operations Sales Service


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VALUE REPORTING CHAIN

TM Action Immediate Result Business Effects

Hire . . . . . . Fit = Stay & Perform . . < People Cost = > Margins

Pay . . . . . . Incent = Innovate . . . New Product = > Market Share

Support . . Focus = Productive . . > Output = > Rev

Develop . . Skilled = Quality . . . . Retain Cust. = < Marketing

Retain . . . Commit = Stay . . . . . . < T cost = > Income

재능관리 행동 즉각적인 결과 경영 효과


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PREVIEW

3 Capitals as Viewed

Structural

FacilitiesTechnologyProcessesPatents

Relational

PatientsFamiliesRegulatorsSuppliersCompetitors

Human

ExecutivesManagersProfessionalsTechnicians

External

AnticipatedMarketChanges &AssociatedCosts

Key Position Requirements By YearAnalysis of Sources and Methods

Executives – Managers – Professionals - Technicians

FUTURECASTFuture Sources and Methods

Executives – Managers – Professionals - Technicians

Recruitment Management Leadership Development

PERFORMANCE MEASUREMENTMeasures of Business Effects

Internal

VisionBrandCultureStrategyPlan

1. 2.3.

4.

5.

6.

3. STRUCTURAL MODEL


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4. KEY POSITION REQUIREMENTS

Analysis of Recruitment Sources and Methods채용 자원과 방법 분석

Sourcing Media

AdvertisingAgenciesReferrals

Events

Workforce Performance

ExecutivesManagers

ProfessionalsTechnicians


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5. FUTURECAST

Future Sources and Methods 미래 원천과 방법Executives – Managers – Professionals - Technicians

Recruitment Management Source Analysis &Selection Assessment - Fit - Capability - Tenure - Lost Time Vacancy Projections

Leadership Development Requirements Analysis - Job Assignments - Projects - Training - Mentoring - Education Readiness Projections


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TM LINKAGE

COMPANY RESULTS

FINANCIALS RevenueGross ProfitOperating IncomeEarnings per ShareReturn on Assets

MARKET POSITIONMarket ShareShare Growth RateCustomer Retention

OPERATIONSIT SpendR&D SpendMarketing Spend

HC INVESTMENTS

Cost to Manage Contingent Percent HR spend per Employee

LABOR COSTS Labor cost as % of revenue Labor cost per employee Benefits cost as % of revenue Benefits cost per employee

TM INVESTMENTS Staffing Leadership Development Performance Management Workforce Planning Training & Education Retention


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TM LINKAGE

HC INVESTMENTS




COMPANY RESULTS

FINANCIALS Revenue Gross Profit Operating Income Earnings per Share Return on Assets

MARKET POSITION Market Share Share Growth Rate Customer Retention

OPERATIONS IT Spend R&D Spend Marketing Spend


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TMI ANALYSIS

RESULTS COMPANY

FINANCIALS RevenueGross ProfitSG&A ExpenseOperating IncomeNet Income Earnings per ShareReturn on AssetsPreTax Profit Margin

MARKET POSITIONMarket ShareGrowth RateCustomer RetentionCustomer Net Gain

OPERATIONSIT Spend as % of RevenueR&D Spend as % of RevenueMarketing Spend as % of Rev

HC INVESTMENTS





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EARLY RESULTS

PLANNING & LEADERSHIP DEVELOPMENT Big Pharma Found How to Link P & D for Accelerated Leader Development, Improved Manager Retention

STAFFING Assessment Pays Off in Retail and Telephone Sales (+25% time to standard and + 6%) in hourly sales) and Retention (+40%)

PERFORMANCE MEASUREMENT Logistics Service Uses Restructuring, Pay Redesign and Employee Survey to Support 20% Gain in Profits


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EARLY RESULTS

Training & Development Medical Center Linked Training to Competency Models for All Staff andMeasured Results Against Financials and Patient Care

Retention International Supply Chain Manager Studied Turnover in Warehouses and Found PeopleJoin, Stay and Leave for Different Reasons: Dropped Turnover 50% Reducing Operating Expense

Productivity Distribution Center Pickers Turnover 3x Norm - Cost $2.25M. Applied Training & Comp Saving $1.85M in Productivity Loss due to Turnover


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HPI & the Balance Scorecard (TU Performance RM) 1/4


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HPI & the Balance Scorecard 2/4

Line of Sight: problem, gaps, root causes, solutions, and evaluation

Problem:

(who) sales associates in the (where) central region are (what) $360,000 below Product Y sales goals in

the (when) 1st quarter potentially impacting ABC

Company’s (worth) net profitability.


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Gaps Individual Team__________ Quantitative

Expected 3.0 sales/person/day$3K 300 sales assoc=$900KActual 1.7 1.8K =$360K

Gap 1.3 1.2K =$540K

QualitativeExpected mystery shop:9.0/10.0 Customer Sat 4.7/5.0Actual 6.5 3.2

Gap 2.5 1.5


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Root Causes:1. Product push for higher net value of sale rather than

based on customer needs2. Workload and staffing: number of customer accounts

assigned to fewer sales associates3. Lack of skills and knowledge on needs based sales and

service

Recommend Solutions:1. Implement sales and service process aligned with

selection and performance management2. Workload, workflow, structure, and staffing models

analysis and revision3. Targeted needs based sales and service skills training

and job aids followed by OJT coaching


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Q & A

Dr. Chan Lee

[email protected]

Tel. (02) 880 - 4838

Documents

Performance Improvement 2006 ASTD Int’l Conference