People Management by Leela Ramdhani Chief Learning Officer – Nedbank (LeelaR@Nedbank.co.za)

1. People Managementby Leela RamdhaniChief Learning Officer – Nedbank(LeelaR@Nedbank.co.za) 15th September 2008

2. Agenda • Introduction • People Management Paradigm • People Management Equation • What qualifies me to talk to you about People Management? • South African Context • People Trends • Attraction, Development and Retention • Lump of Coal = Diamond Video Clip • Points to Ponder • Books/Articles to Read

3. Introduction • Leela Ramdhani – Nedbank : Chief Learning Officer (B.Comm-UKZN, MBA-U Pretoria) • Worked in a number of organisations and sectors • Anglo American Properties, • KPMG, • AECI, • Self Employed (own catering company for 2.5 years) • Nedbank (12 years in November) • Joined Nedbank as a Junior Financial Officer , ran Technology projects = R1billion in cash flow, Human Resources(3 years) , CLO for 14 months. • Basic Life Philosophy: “Its never about you or the end, its about the people you touch during your journey.” • Personal:Live with my partner Sobrick, Kaiden (chronologically 4 – soul is probably about 400), a dog named Chilli and another boy expected on 26th December. Durbanite at heart and still miss the sea. • Who am I:Mother, activist and non conformist

4. What qualifies me to talk to you about People Management? HR Professional Employee Manager – currently of 40 people Mother

5. People Management Paradigm Disconnect 1 Line Disconnect 2 Disconnect 2 HR Employee

6. HR High Performance Culture Employer of Choice Talent Management Knowledge Economy Generational theory – Baby boomer manager recruiting generation Y Employee Engagement People Management Paradigm

7. Line XYZ has resigned – find me a replacement in a month? My fabulous new COO has not been paid – whats wrong with you people? I’m not following that increase guideline, I’ll pay my people what I can afford. I need to meet my targets – how am I going to do that in this economic cycle? How do I get service delivery right? People Management Paradigm

8. People Management Paradigm Employee • My boss is an autocrat – can’t talk to her • I don’t know what to do – what is my job contributing to ? • Where do I find the IR policies? • I don’t trust HR • Hr don’t know what they are doing anyway?

9. New People Management Paradigm “In rejecting Western values, therefore, we are rejecting those things that are not only foreign to us but that seek to destroy the most cherished of our beliefs – that the corner stone of our society is man himself – not just his welfare, not his material well being but just man himself with all his ramifications. We reject the power based society of the Westerner that seems to be ever concerned with perfecting their technological know how while losing out on their spiritual dimension. We believe in the long run the special contribution to the world by Africa will be in the field of human relationship. The great powers of the world may have done wonders in giving the world an industrial and military look, but the great gift still has to come from Africa – giving the world a more human face. Steve Biko 1971 in Edendale KZN – Ecumenical Training Centre- at a conference called by IDAMASA – Interdenominational Association of African Ministers of Religion

10. People Management • People Management is a higher calling- vocation • People Management requires your full engagement – IQ, EQ and SQ • People Management is a choice • People Management will contribute to building this nation • This generation has to serve that calling!!!! • Joint accountability between line and HR (like parents) to bring an employee to their full potential.

11. People Management Equation

12. South African Context

13. ..and many changes in South Africa impacting our future • Events of Polokwane – an outcry for “A better life for all” • Change in economic policy • Drive for positive change in government delivery • Zuma trial and leadership issues • Higher oil and food prices • Debt burden from 500 basis point rise in prime (and more to come) • Higher energy costs to be passed on to the consumer • Evidence of higher levels of emigration • Continued skills shortages • Poor education system Political uncertainty Higher costs/ inflation Skills shortage and emigration A more uncertain SA, with a risk of losing our “Premier League” status Signs of social unrest Economic downturn Continued infrastructural Investment & SME growth • Xenophobic clashes • Food price marches • Poor service delivery strikes • GDP at 3% in 2008 (Q1: 2.1%) • High-levels of inflation and higher interest rates • Current account deficit • Depreciating rand • Commodity super-cycle benefits • Increased levels of infrastructural spend from 2010, Government initiatives, Eskom etc • Opportunity in the SME sector

14. ...with signs of SA slowly slipping down the world competitiveness rankings IMD - World Competitiveness Scoreboard 2008 WEF - Global Competitiveness Index Rankings Although there are differences between the two rankings, overall South Africa is retreating in both. Source: WEF, IMD

15. What they said • “We apply social values more noble that monetary profit” Franklin D Roosevelt 1933 • “… that some principle must overlay the invisible hand of the market” Barack Obama 2008 • Events are overcoming us which require human engagement to resolve • Organisations have become the single biggest place of influence to create leaders for the future

16. It is important to understand the new global scenarios of a continued “Long-Boom” or “Hard Times” Globalisation Hard Times Long-boom • Evident during short periods • Possible US recession • Evident of recent times with global growth >3.5% since 1980s • Driven by influence of technology, globalisation and newcomers from the East Low Economic Growth High Economic Growth Perfect Storm Divided world • Triggered by sequence of negative events including nuclear terrorism, Chinese meltdown • 1930’s recession • Religious competition • Creates winners and losers – Losers become failed states Fragmentation Source: Mind of a Fox C Sunter

17. There are local scenarios that could lead to South Africa’s relegation to the 2nd division... Highly Competitive X Premier League Competitive in the international environment Relegation Zone Internal Harmony Internal Conflict Failed State 2nd division Iraq Zimbabwe Poor but peaceful countries Not Competitive Source: Mind of a Fox C Sunter

18. People Trends • Developing an adaptable workforce • Only 14% people their workforce is very capable of adapting to change • Organisations must be • capable of predicting future skills requirements • Effectively identify and locate experts • Collaborate across their organisations, connecting individuals and groups • Revealing the leadership gap – future growth at risk • Deliver today’s results while building for the future • Cracking the code for talent • Focused on overcoming their inability to rapidly develop employee skills & align those skills to future business requirements • Impact of generation Y • Driving growth through workforce analytics • Inability to link information across applications to develop insights and formulate business cases for investment Source: The Global Human Capital Survey 2008 IBM

19. The War for Talent The Context: The war for talent has worsened globally, being exacerbated by tougher economic conditions, and increasing competition for limited resources by emerging economies. Locally, the uncertainty of polarised political loyalties and the power shift to a working class base, the expectations of organised labour from the potential governing authority, the rising cost of fuel, credit, electricity and food, and the recent xenophobic outbreaks has made the SA situation significantly worse than 12 months ago. The ability to compete with developed nations for limited resources, either locally or internationally, has been made considerably more difficult by these prevailing conditions. Real and potential threats • The talent pool is shrinking locally and internationally, resulting in intense competition and higher prices for talent in demand. • SA’s ability to compete for resources is hampered by political uncertainty, electricity load shedding, xenophobia and other socio-economic concerns. • The rate of emigration and queries of emigration have increased significantly post Polokwane and since electricity load shedding commenced in January 2008. Opportunities • The necessity of developing home grown talent to satisfy the growing demand for key and critical skills • The opportunity to harness the rich store of expertise and experience in older generations and previously advantaged South Africans • To enhance people management skills in all levels of management to meet the pressures of the war for talent • Creating a culture that reflects the aspirations of the talent market we want to attract • Integrating attraction, development and retention strategies into a comprehensive value chain for current and potential employees

20. Transformation The Context: The demographics of the SA workforce is not representative of the economically active population, and increasing the speed of race and gender transformation is a high priority for big business and government. The focus has been on quantitative measures to achieve parity between the races and genders, but there is an increasing need to shift to more qualitative measures to ensure that transformation is meaningful for all South Africans and sustainable into the future. To this end, the challenges facing organisations are enormous. Challenges • The cost of Black talent has intensified the war for talent • The success of transformation is dependent on a conducive culture that is ready for large scale change • The SA education system is inadequate to meet the demands created by the war for talent and transformation imperatives • Being inclusive to all races, genders, generations, ethnic groups and nationalities, to reduce feelings of marginalisation Opportunities • An opportunity to align efforts to meet legislative requirements as a first step to full qualitative transformation • Creating a culture that is conducive to successful transformation beyond the numbers • Leveraging learning and development opportunities to close the gap in skills and knowledge • Creating partnerships with educational institutions to secure the future pipeline of talent • Contributing to the greater good for change in SA on various levels, primarily economic and educational.

21. Skills Development The Context: The decrease in the quality of education and the declining number of suitable graduates is a common factor internationally, and this is intensifying the war for talent. Graduates are selecting fields of study and later careers that will not largely meet the demands of the 21st century global business environment. The number of tertiary qualified candidates in the local workforce is declining. There were marginally fewer workers with a degree in the SA workforce in 2006 as compared to 2001, but in both instances, the total was less than 5%. Outcomes based education has increased the number of learners, but not improved the overall quality of education. Challenges • A traditional SA education system which is wholly inadequate to meet the demands of a globalised economy • The sheer volumes and cost of training necessary to produce the required levels of output for success • Competing with developed nations and other developing nations to offer career growth and learning opportunities Opportunities • Leveraging learning and development opportunities to close the gap in skills and knowledge • Creating partnerships with educational institutions to secure the future pipeline of talent • Creating frameworks for the transfer of knowledge from skilled and experience employees to new entrants • Improving the employee value proposition and talent management with opportunities for lifelong learning • Embedding learning opportunities into job activities to complement acquisition of skills over time

22. Model for discussion DEVELOP Retain Retain Attract Attract

23. Attraction • Inability to attract qualified candidates by sector • Financial Services (40%) • Public Sector(40%) • What do you believe are the most important characteristics that attract candidates to your organisation? • Positive corporate reputation(53%) • Co has a track record of transforming itself and continuing its success in the market (48%) • New/challenging responsibilities (42%) • Employer Value Proposition the compelling and unique value proposition that the employer offers the employee • Generation Y implications Source: The Global Human Capital Survey 2008 IBM

24. Development • South African Skills Pipeline • Decrease in Grade 1 intake over a five year period • Grade 1 entrants – 1.5m = Matric pass rate 12 years later = 475 000 • Graduating with Commerce and science degrees ¾ years later = 32000 • Private and Public sector battling over 32000 graduates!!!! Source: State of Skills in South Africa 2006/2007 National Skills Strategy

25. Nedbank People Management Model KNOW WHY THEY DO THEIR JOB KNOW WHAT THEIR JOB IS KNOW HOW TO DO THEIR JOB BE EMPOWERED TO DO THEIR JOB A GOOD MANAGER (The 9th Right) KNOW THAT THEY ARE BEING EQUITABLY REWARDED KNOW WHAT THEIR CAREER OPPORTUNITIES ARE KNOW HOW THEIR PERFORMANCE IS GOING TO BE MEASURED BE PERFORMANCE MANAGED

26. Comfort Zone Fear Zone Learning Zone How am I doing?

27. The Success Triangle Clarity Capability Willingness

28. Adult Learning Model This is a great opportunity, but what now? Will I get it right? How long will it take me to master? Unconsciously skilled Consciously skilled Consciously unskilled Practice Unconsciously unskilled Choice • Manager constantly practices their • coaching skill • On-the-job observation, practice and • feedback • Regular facilitated embedding • discussions • Application to work situations • Safe environment to practice • You can not force choice but you • can remove the barriers to people • making a choice • Create an environment where • people can openly express their • concerns & fears • Create a collaborative relationship • between the Managers & their staff • Create the boundary conditions and • share information openly Insights Source: McKinsey client experience, team analysis

29. Retention • Banking Sector Turnover – 11%/12% per annum • Public Sector turnover ? • Marcus Buckingham : “People leave managers not organisations” • 10 reasons why people leave • Poor management • Lack of career growth and advancement • Poor communication • Pay • Lack of recognition • Poor senior leadership • Lack of training • Excessive workload • Lack of tools and resources • Lack of teamwork Source: The 7 hidden reasons why employees leave by Leigh Branham

30. Lump of Coal = Diamond

31. Points for you to Ponder • Opportunities to build skill e.g. exchange programmes with private sector? • What if we accept that we can’t retain people and build organisations to where both people and organisations can extract maximum value from each other? • Management of people is a calling/vocation – don’t do it unless you are as committed as a parent to their child on the outcome.

32. Books/Articles to Read • The Strategic Management of Talent – William J.Rothwell & H.C.Kazanas • The Workforce Scorecard – Mark A. Huselid, Brian E.Becker, Richard W. Beatty • People & Performance – Peter F. Drucker • Survey of Global HR Challenges – Price, Waterhouse Coopers • IBM – The Global Human Capital Survey 2008 • The World is Flat – Thomas L.Friedman • The Audacity of Hope – Barack Obama • I write what I like – Steve Biko

33. Questions