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Why CEOs are turning to HR to Lead the Organization Through

Today’s Top 5 Threats. Why CEOs are turning to HR to Lead the Organization Through. Jack Smalley, SPHR. Express Employment Professionals jack.smalley@expresspros.com. June 24, 2014. Old Economy Stable Large company kept competitors at bay New Economy is Competition

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Why CEOs are turning to HR to Lead the Organization Through

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  1. Today’s Top 5 Threats Why CEOs are turning to HR to Lead the Organization Through Jack Smalley, SPHR Express Employment Professionals jack.smalley@expresspros.com June 24, 2014

  2. Old Economy Stable • Large company kept competitors at bay New Economy is Competition • Ability to anticipate, respond and adapt to threats • Eliminate bureaucratic structures • Prepare for organizational change in a minute’s notice • Or become EXTINCT! • Old business model vs. progressive business model Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  3. The #1 Movie of 1967 Live in a Different World • 75% of U.S. lives online - autos/farmers • From industrial revolution to dataknowledge revolution • Fromsocial media totwittertoselfies • Tom Friedman-”The New Average” Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats There is a big shift to a Digital Economy

  4. “The topple rate” at which companies lose their leadership positions has more thandoubled. Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats From: “The BIG eats the Small” To: “The Fast Eats the Slow”

  5. Engine of Innovation Getting suppliers to move fast Owning competitive advantage Institutionalizing innovation Business process management system Fast to Market Establishing guiding principles Financial flexibility Fast Decision- Making Sustaining Speed Constantly reassessing Adaptability Fast Thinking Forecasting & road mapping Letting the best idea win Source: Jason Jennings and Laurence Haughton, “It’s Not the Big that Eats the Small … It’s the Fast that Eats the Slow”

  6. Microsoft executives were asked how they would break down the $450 billion market capitalization value of their company. “The stuff in people’s heads.” Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  7. Threat 1: Inability to Innovate Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • If you do not have the best talent, you will not survive today. • HR must lead the organization to attract and retain the best talent.

  8. Where’s your weakest link? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats 80% • of surveyed respondents who are currently employed • “would consider leaving their current job if presented with other opportunities.” • 40% will succeed

  9. Cyber Prowlers Not only is your competition watching your corporate actions on social networks, they are stalking your talent. Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  10. Cyber Prowlers Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Of the 2,600 North American hiring managers surveyed, 45% use social-networking sites to research job candidates . Not a war for people/war for talent 12/10 more quit vs. “rif’d”

  11. Beware of Hiring in Haste Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats only • Halo Effect • One candidate – multiple resumes • Was it a great hire or a polished applicant? • To easy to focus on wrong thing • Arrow vs. Indian 31% of average firms feel they selected their best pick. Look before you leap. 46%of resumes are falsified Don’t be distracted by the schoolcolors. Schools attended are not a guarantee. “It’s not the degree, it’s what you can do with it”-T. Friedman

  12. Threat 2: Losing Your Competitive Advantage Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • HR must lead to increase employee engagement.

  13. Do you have an army of sleepwalkers? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats The Opposite of Employee Engagement Employees who don’t leave – the under-performing and disengaged The “quit-and- stay” phenomenon There are 9-to-5er’s who show up to work everyday but who have “checked out” mentally.

  14. $300 billion Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Employee disengagement costs businesses in lost productivity every year. Over 13 million employees & over 32,000 business units surveyed show Are your profits melting away, employee after employee? 67% of employees in most companies are not engaged in their work. Customer retention vs. employee retention

  15. Many companies underestimate the importance of their front line. Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats 50% leave before they have been on Approximately 60% the job for six months. Script the first 90 days. of the workforce are non-exempt. Disengaged stay for what they GET… Engaged plan to stay for what they GIVE!

  16. Threat 3: High Costs of Reckless Hiring HR must allow supervisors to participate in the hiring process then hold them accountable for retention. Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  17. Managers are not experts in hiring It is not essential to the job function Halovs. Devileffect Biggest failure Lack of preparation Experience over “fit” Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • 80% of turnover cost is related to bad hiring.

  18. Ask yourself: How much can we afford to lose? Most conservative estimates of turnover show costs anywhere from 50% to 150% times annual salary. For a professional making $50,000 How many $75,000 mistakes can you afford? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • Departure Costs • 85% of salary not uncommon • Hiring Costs • 7-20% of salary • New Hire Training Costs • 13% of salary • New Hire Productivity • 32% base salary

  19. Beware of turnover fever It leads to job sniffing To close the back door Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats I’m leaving! Why am I staying? Maybe I should start looking…

  20. Threat 4: Poor Leadership & Communication HR’s greatest contribution to organizational success-”Leadership thru Influence” -Betty Francis, SHRM Board Chair Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  21. The organizations that exit the recession early and stronger. Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • To the employee, the Leader is the company • The messenger is as important as the message. Influence is earned. • Relationships –Trust-Information-Success Pre-recession ~ Employers not loyal Post-recession ~ Employees not loyal

  22. What’s on your dashboard? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Only 45% satisfied “I quit!” One in two employees is looking to leave or has checked out on the job. Two-thirds of companies are more concerned about retention now than they were before the economic crisis. Worker satisfaction is at its lowest level since the Conference Board began measuring it in 1987.

  23. Toxic Work Environment Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Do you know what it’s like to work for you? Just because you have talent in your field doesn’t mean you’re a great leader. • Ask yourself these three questions: • Do you know how to push without being rude or obnoxious? • After someone talks to you, do they feel like they have more or less energy? • Do employees feel like you have their backs?

  24. Leadership is the #1reason talent leaves Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Managers and Leaders influence each… 17% Mis- management 32% Need for advancement 22% Pay and Benefits 20% Lack of job fit

  25. Continuous Learning Is Crucial to Maintaining and Managing Talent Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats ….according to Jim Collins The mismanagement of human resources is one of the main reasons many “Good” companies never become “Great.” 51% 50% of organizations surveyed feel their executives have a gap of leadership level skills. from the same surveyed organizations feel the skills of their current workforce do not match today’s market challenges.

  26. Remember! Employees don’t quit companies, They quit bosses! Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  27. Threat 5: Regulatory Nightmares HR must lead through the regulating minefield Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats This country has come to feel the same when Congress is in session as when the baby gets hold of a hammer.” ~ Will Rogers

  28. Top Business Risk Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats Growth of economy is small businesses • Fear of growing The total cost of federal regulations to employers has increased over $1.75 trillion.

  29. Regulatory Nightmares Document Gettysburg Address Declaration of Independence U.S. Government Regulations on The Sale of Cabbage H.R. 3962 – The Affordable Healthcare for America Act (AHCAA)  Written by Lawyers Words 286 1,332 26,911 363,086 1,990 pages

  30. What’s keeping HR up at night? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats • Federal, state, and local restrictions • Background checks • Hiring, firing, and employment regulations • NLRB’s self-imposed muscle • Social media protections • Healthcare Reform • Legalization and medical use of marijuana • Class Actions

  31. Department of Labor (DOL) 2013 25,628 charges $250M in back wages 269,000 employees receiving back wages 91% class action lawsuits involve wage/hour claims Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  32. Department of Labor (DOL) cont. Website instructs on filing claims iPhone app tracking hours worked Going after misclassified exempts Volunteer work Independent contractors Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  33. EEOC Discrimination and retaliation cases at highest level since Title VII became law in 1965 93,727 charges Less employees Retaliation charges new #1 $372.1M paid by employers Record number of million dollar settlements Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  34. Light at the End of the Tunnel? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  35. Why are the Best CEO's turning to HR to solve the Top 5 Threats? Why the Best CEOs are Turning to HR to Lead the Organization Through Today's Top 5 Threats

  36. Jack F. Smalley, SPHR Director, HR Learning and Development jack.smalley@expresspros.com

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