managing human capital in changing times edward b. yost ph.d., sphr august, 2013 ohio university

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Ohio University College of Business Executive Education Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

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Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University. BEM VINDO A OHIO UNIVERSITY. Our Task Today – Three Levels of Analysis and Human Capital. - PowerPoint PPT Presentation

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Page 1: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Managing Human Capital in Changing Times

Edward B. Yost Ph.D., SPHR

August, 2013Ohio University

Page 2: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

BEM VINDO A OHIO UNIVERSITY

Page 3: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Our Task Today – Three Levels of Analysis and Human Capital

#1 MACRO: Sustainability, Strategy, and the Business Model – Competent managers understand how value is created

#2 MESO: Talent Management, maximizing returns through human capital architectures – Talent pools, pivotal positions, differentiated human capital architecture that adds value

#3 MICRO: Employee Engagement – Crafting and leading for individual performance

Ohio University College of Business Executive Education

Page 4: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Level 1 MACRO: Sustainability, Strategy, and

the Business Model

Ohio University College of Business Executive Education

Page 5: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

What is Strategic Success?

Delivering high value results to significant stakeholders

Financial SuccessOperational SuccessCustomer Success Workforce (People) Success

Page 6: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Industry

Firm/Company

Business Unit/Function

Position

Person

Ohio University College of Business Executive Education

Page 7: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Executive Education College of Business Ohio Universaity

Strategy Execution

Competitive Advantage

Sustainability

Strategic Success Chain

Page 8: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Defining the Business Strategy

Strategy is:The central, integrated,

externally oriented concept of how we will achieve our objectives. (Hambrick & Fredrickson)

Page 9: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sharing our ExperiencesWhat is your

organization’s “STRATEGY”?

Ohio University College of Business Executive Education

Page 10: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Pharmaceuticals

Firm/Business

Business Unit/Function

Position

Person

Ohio University College of Business Executive Education

Page 11: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Pharmaceuticals

Ach’e

Business Unit/Function

Position

Person

Ohio University College of Business Executive Education

Page 12: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Executive Education College of Business Ohio Universaity

Strategy Execution

Competitive Advantage

Sustainability

Strategic Success Chain

Page 13: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Executive Education College of Business Ohio Universaity

What is “Strategic Competitive Advantage?”

Enacted or Utilized Distinctive Competency that:

1. Allows the organization to differentiate itself from competitors

2. Cannot be readily duplicated or imitated

3. Provides a positive economic benefit(s) – KPIs

Page 14: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

3 Roads to Strategy Execution & Competitive Advantage

Managers can select a path to follow1. Betting on the incompetence of competitors

– blind ambition2. Acquiring and utilizing the competencies of

others – merger, acquisition3. Using existing resources & competencies

efficiently, effectively and differently – resource based

Page 15: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

The Secret Revealed!

What is the SECRET of obtaining a Strategic Competitive Advantage?

Not just having a strategy and competencies but

executing the strategy.

Page 16: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Executive Education College of Business Ohio Universaity

Competitive Advantage

Sustainability

Strategic Success Chain

Page 17: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sustainability

Pursuit of LONG TERM business success focusing on a triple bottom line:1. Economics - Profits2. Social - People3. Environmental - Planet

Ohio University College of Business Executive Education

Page 18: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sustainability Defined

“The commitment by an organization to balance financial performance with contributions to the quality of life of their employees, the society at large and environmentally sensitive initiatives” SHRM

Ohio University College of Business Executive Education

Page 19: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Top 5 positive ($) outcomes from sustainability initiatives for stakeholders

1) Improved employee morale, 2) More efficient business processes, 3) Stronger public image, 4) Increased employee loyalty, 5) Increased brand recognition.Source: Advancing Sustainability: HR’s Role (SHRM, 2011)

Ohio University College of Business Executive Education

Page 20: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

WHAT IS HUMAN CAPITAL?

Developing Human Capital in Changing

Times

Ohio University College of Business Executive Education

Page 21: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Human Capital Defined

The collective sum of the attributes, life experience, knowledge, inventiveness, energy, and enthusiasm that people choose to invest in their work. Weatherly 2003

Page 22: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Attributes of Human Capital Markets

Various levels of valueAppreciates and depreciatesTraded in markets and regulatedIndividually owned but

collectively realized

Page 23: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Human Capital: The Invisible Resource

• It is vested in the human resources often in the form of intellectual and social capital.

• It is acquired, developed, utilized, and sustained through the management practices.

• Being invisible it is harder to duplicate.

Page 24: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Human Capital

Value inherent in the form of individuals collectively interacting in the context of formal and informal systems

Individuals are the repository for human capital

Systems, process, culture and context extract the value of individuals

Page 25: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Human Capital Has Value“People are our most valuable asset”

PROVE IT! Must be demonstrated by management practices and actions that compose the Human Capital Architecture

Page 26: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sharing our Experiences

What do organizations you know value?

Ohio University College of Business Executive Education

Page 27: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Expectativas de Todos que Possuem Interesse Direto ou Indireto na

Organização• Acionistas(proprietários) desejam um retorno que

consideram justo no investimento feito.• Clientes desejam um alto valor agregado ao produto ou

serviço que consomem, e uma manutenção(garantia) que mantenha seu valor.

• Empregados desejam uma relação de emprego que forneça compensações intrínsicas e extrínsicas em contrapartida às contribuiçoes que fazem.

• Publico espera que a organização tenha responsabilidade social e se preocupe também com o bem estar dos cidadãos (cidadania corporative)

Ohio University College of Business Executive Education

Page 28: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Escolher as partes interessadas em cada par que a sua organização iria considerar como a mais importante em termos de tempo e outras atribuições de recursos. 1. Cliente ___ Proprietário(acionista) ____ 2. Empregado ___ Cliente ___ 3. Empregado ___ Publico ___ 4. Proprietário(Acionista) ___ Empregado___ 5. Cliente ___ Publico ___ 6. Proprietário(Acionista) ___ Publico ___  

Page 29: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Instruções para o preenchimento das questões

Pense em uma organização com a qual você está familiarizado. Talvez a organização que você trabalha agora. Para cada par de partes interessadas selecionar o que você sente é mais importante para a organização que você escolheu. Pense sobre os recursos dedicados ou as políticas que afetam o grupo de partes interessadas. Quando você completar você irá gravar o número de vezes que você selecionou o grupo de partes interessadas e escrever o número no espaço fornecido.

Ohio University College of Business Executive Education

Page 30: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Stakeholder Importance

Vamos Compartilhar - Qual dos 4 stakeholders (clientes, proprietários, público e empregados) a sua organização seria mais provável em atender:Em primeiro lugar?Última?

Ohio University College of Business Executive Education

Page 31: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Importância das partes interessadas

Ohio University College of Business Executive Education

Stakeholder Pesquisa

Em primeiro lugar Última

proprietários

clientes

público

empregados

Page 32: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Perception – Reality Gap

Closing the Engagement Gap“Only 1 in 10 of the 88,000 respondents in our Global Workforce Study agreed that their organization’s senior leaders treat employees as vital corporate assets. A larger percentage reported that their leaders act as if employee don’t matter.” Gebauer ad Lowman, 2008

Ohio University College of Business Executive Education

Page 33: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

STRATEGY EXECUTION AND HUMAN CAPITAL

Developing Human Capital in Changing

Times

Ohio University College of Business Executive Education

Page 34: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

The Challenge for Managers

Human Capital and the Triple Bottom Line

To create value through Human Capital requires a fundamental change in how it is recognized and managed in most organizations.

Page 35: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

What is Strategy Execution?

• Value Creation – Enables the Value Proposition for all stakeholders

• The aggregated combination of the firm’s resources applied by the strategic business units

• Results from managerial decisions for resource allocations and tradeoffs

Ohio University College of Business Executive Education

Page 36: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategy ExecutionEnables the Value Proposition for Stakeholders

Application: Focus on a Strategic Business Unit -Primary Pharmaceutical Industry

Production

Marketing

Research & Development

Human Resources

Ohio University College of Business Executive Education

Page 37: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Pharmaceuticals

Ach’e

Research/Development

Position

Person

Ohio University College of Business Executive Education

Page 38: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Critical Outcomes for Strategy Execution

Research & Development Group in Primary Pharmaceuticals

1. New Product Applications 2. Reduce Time to Market

Ohio University College of Business Executive Education

Page 39: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Level 2 #2 MESO: Talent management,

maximizing returns through human capital architectures

Ohio University College of Business Executive Education

Page 40: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

MANAGING TALENT FOR STRATEGIC SUCCESS

Developing Human Capital in Changing

Times

Ohio University College of Business Executive Education

Page 41: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Talent Management

• Talentship requires a redefinition of the traditional service role of HR managers in organizations.

• This involves a managerial focus on the process of "talent segmentation" and the need to focus managerial attention on "pivotal talent pools".

Ohio University College of Business Executive Education

Page 42: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Human Capital (Pivotal Talent Pools)

Strategy Execution

Competitive Advantage

SustainabilityOhio University College of Business

Executive Education

Page 43: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Talent Segmentation

• Talent segmentation is as vital to strategic success as customer segmentation.

• Talent segmentation involves identifying pivotal talent pools where human capital makes the biggest difference to strategy execution

Ohio University College of Business Executive Education

Page 44: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sharing our Experiences

How do organizations you know use segmentation?

Ohio University College of Business Executive Education

Page 45: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Customer Segmentation

1. Does your organization segment customers?

2. What are these customer segments?

3. How are they treated differently?

Ohio University College of Business Executive Education

Page 46: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Talent Segmentation

1. Does your organization identify specific talent pools?

2. What are these talent pools?3. How are the management practices

different for these talent pools?

Ohio University College of Business Executive Education

Page 47: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Executive Education College of Business Ohio Universaity

Drilling Down in Human Capital

Pivotal Talent Pools

Pivotal PositionsDetermine the Pivotal Positions

to Deliver Strategy Execution

Page 48: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

What is a Pivotal Position?

• Not necessarily the highest paid/ranked position

• Not necessarily most critical• Not necessarily the most common/number• Not necessarily the most visible• Not necessarily the most obvious• Not ever a person

Ohio University College of Business Executive Education

Page 49: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Cast Members at Disney

Ohio University College of Business Executive Education

Page 50: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sharing our Experiences

Which position, Characters or Sweepers

are most pivotal?Ohio University College of Business

Executive Education

Page 51: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Finding the Pivotal PositionYield Curve - understanding where

differences in quality or quantity of talent and organization have the greatest impact on strategy execution (steepness, elasticity, D, slope)

Ohio University College of Business Executive Education

Page 52: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Yield Curves = Pivotal Positions

Ohio University College of Business Executive Education

Page 53: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Providing a Delightful

Guest Experience

Being The Happiest Place on

Earth!

Ohio University College of Business Executive Education

Page 54: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Pivotal Positions in the R & D Talent Pool of Primary Pharmaceuticals

• What is the Pivotal Position for executing strategy?

• Provides the most significant (relative to others in the pivotal talent pool – R&D) improvement in strategy execution

• Research Scientist

Ohio University College of Business Executive Education

Page 55: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Pharmaceuticals

Ach’e

Research/Development

Research Scientist

Person

Ohio University College of Business Executive Education

Page 56: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Yield Curve Primary Pharmaceuticals

Best Sales Rep

Worst Sales Rep

Stra

tegy

Exe

cutio

n

Investment in Human Capital

Best RS

Worst RS

Sales Representative

Research Scientist

Ohio University College of Business Executive Education

Page 57: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Yield Curve Primary Pharmaceuticals

Investment in Human Capital

Research Scientist

Best Sales RepWorst Sales

Rep

Stra

tegy

Exe

cutio

n

Best RS

Worst RS

Sales Representative

20%

Ohio University College of Business Executive Education

Page 58: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Yield Curve Primary Pharmaceuticals

Investment in Human Capital

Research Scientist

Best Sales RepWorst Sales

Rep

Stra

tegy

Exe

cutio

n

Best RS

Worst RS

Sales Representative

20%

Ohio University College of Business Executive Education

Page 59: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Same Industry - Different Business Model

Primary• High Margins• Sell to Physicians• Time to Market• New

Applications

Generic• Low Margins• Sell in Bulk• Low Cost• Manage

Distribution Channels

Ohio University College of Business Executive Education

Page 60: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Yield Curve Generic Pharmaceuticals

Investment in Human Capital

Sales Representative

Best RSWorst RS

Stra

tegy

Exe

cutio

n

Best Sales Rep

Worst Sales Rep

Research Scientist

20%

Ohio University College of Business Executive Education

Page 61: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

FINDING PERFORMANCE DRIVERS

Developing Human Capital in Changing Times

Ohio University College of Business Executive Education

Page 62: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Performance Drivers Support Strategy Execution

Performance Drivers identify the most critical capabilities, the required behaviors and define the culture necessary for support of strategy execution by pivotal positionsVertical Alignment; Congruence

Ohio University College of Business Executive Education

Page 63: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Performance Drivers

Strategy Execution

Culture

BehaviorCapability

Ohio University College of Business Executive Education

Page 64: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Definitions of Performance Drivers

Capability = knowledge, skill, ability or competency inherent in a unit of human capital

Behavior = Actions, reactions, interactions exhibited by a unit of human capital

Culture = a system of shared values, understandings and affect that distinguishes the unit that contains human capital

Ohio University College of Business Executive Education

Page 65: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Human Capital (Pivotal Positions)

Strategy Execution

Competitive Advantage

Sustainability

Human Capital CapabilitiesHuman Capital BehaviorsWorkforce Culture(Performance Drivers)

Ohio University College of Business Executive Education

Page 66: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Finding Performance Drivers

1. Starting with the critical talent pools focus down to pivotal positions

2. Within that position look for the pivotal role challenges

3. Identify the performance drivers; specific capabilities, behaviors and culture necessary to succeed at the pivotal role challenge.

Pools Positions Challenges Drivers

Ohio University College of Business Executive Education

Page 67: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

New Product Applications; Research Scientist at Primary Pharmaceuticals

Capabilities: 1. Deep knowledge of specific products, 2. Creativity and Innovation Skills,

Behaviors: 1. Scans multiple sources for potential applications beyond present uses, 2. Share tacit knowledge with the team

Culture: 1. Innovation and risk taking, 2. Team orientation

Ohio University College of Business Executive Education

Page 68: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Reduce Time to Market; Research Scientist at Primary Pharmaceuticals

Capabilities: 1. Project management skills, 2. Current on regulatory requirements

Behaviors: 1. Deal with regulatory agencies effectively, 2. Design efficient processes

Culture: 1. Outcome oriented, 2. Attention to detail

Ohio University College of Business Executive Education

Page 69: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

CREATING AND MANAGING HUMAN CAPITAL ARCHITECTURE

Developing Human Capital in Changing Times

Ohio University College of Business Executive Education

Page 70: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Human Capital Architecture

• Depicted in the “Blue Print” of the combined human resource practices of the organization (portfolio of practices).

• To be effective and efficient in delivering strategy execution the HCA must be designed, constructed and maintained with the environmental requirements in mind - SWOT

Ohio University College of Business Executive Education

Page 71: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Procurement & Retention

Compensation & Rewards

Knowledge Management

Performance Management

Human Capital Architecture

Ohio University College of Business Executive Education

Page 72: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Why is Human Capital Architecture Critical for Success?

• Provide a basis for strategy execution and sustained competitive advantage

• Things like financial structure operational processes and technology can be easily copied or purchased

Page 73: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Why Support a Human Capital Oriented Strategy?

Because…...The organization can leverage

human capital by managing the architecture to achieve a higher return for owners

Page 74: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

The Power Of Human Capital Architecture

Share Holder Returns

Invested Resources & Capital

Human Capital Architecture

Page 75: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

The Power Of Human Capital Architecture

Share Holder Returns

Invested Resources & Capital

Human Capital Architecture

Page 76: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Human Capital (Pivotal Positions)

Human Capital Architecture components (Enablers)

Human Capital Architecture components alignment (Vertical & Horizontal)

Strategy ExecutionCompetitive AdvantageSustainability

Human Capital CapabilitiesHuman Capital BehaviorsWorkforce Culture(Performance Drivers)

Human Capital Architecture

Ohio University College of Business Executive Education

Page 77: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Level 3 #3 MICRO: Individual differentiation

and Employee engagement

Ohio University College of Business Executive Education

Page 78: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

MANAGING THE INDIVIDUAL DIFFERENTIATION AND

ENGAGEMENT

Developing Human Capital in Changing Times

Ohio University College of Business Executive Education

Page 79: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Managing Human Capital the Person

While the human capital architecture is designed to support the highest level of performance for pivotal positions it must ultimately be differentiated at the level of the person

Ohio University College of Business Executive Education

Page 80: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Strategic Success Hierarchy

Pharmaceuticals

Ach’e

Research/Development

Research Scientist

Richard or Mary

Ohio University College of Business Executive Education

Page 81: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Three Challenges to Leaders

1. The changing Employment Relationship (contract)

2. Individual positions in the Employment Lifecycle

3. Developing and supporting Employee Engagement

Ohio University College of Business Executive Education

Page 82: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Challenges of Managing People

Shifting Employment Relationship• The employer/employee relationship is

shifting to a contractual relationship that is more a partnership than economic exchange.

• Larger spans of control, fewer employees delivering more output.

• Decline in traditional communications increase in cyber communications.

Ohio University College of Business Executive Education

Page 83: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

The Employee Lifecycle

1. Recruitment2. Hiring3. Onboarding4. Training5. Career development

6. Compensation7. Retention8. Promotion9. Separation

Savitz, 2013

Ohio University College of Business Executive Education

Page 84: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Employee Engagement – 3 Challenges for Managers

1. Recognize the significance of the employment relationship.

2. Understand and adjust to the individual in their employee life cycle

3. Design & implement systems to fully engage the human capital (individuals) in the organization.

Ohio University College of Business Executive Education

Page 85: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Employee Engagement: Examples in Practice

• “Engagement describes how an employee thinks and feels about, and acts toward his or her job, the work experience and the company.” Intuit

• “Employee engagement is the involvement with and enthusiasm for work.” Gallup

Ohio University College of Business Executive Education

Page 86: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Employee Engagement: Examples in Practice

• “Engagement is the extent of employees’ commitment, work effort, and desire to stay in an organization.” Caterpillar

• “Engagement: To compete today, companies need to win over the MINDS (rational commitment) and the HEARTS (emotional commitment) of employees in ways that lead to extraordinary effort.” Dell

Ohio University College of Business Executive Education

Page 87: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Three Levels of Engagement

1. Cognitive Engagement – Employee beliefs about the company the leaders and the culture

2. Emotional Engagement – Employee affect for the organization, leaders, colleagues

3. Behavioral Engagement – the value added component of effort exerted above required minimum.

Ohio University College of Business Executive Education

Page 88: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Three Key Behaviors of Engagement

1. Say: Employees speak positively about the Company to coworkers,potential coworkers, and current and future customers.

2. Stay: Employees strongly desire to continue working for the Company.

3. Serve: Employees exert extra effort and are dedicated to doing the best job to contribute to business success.

Ohio University College of Business Executive Education

Page 89: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Impacts of Employee Engagement

• The extent to which employees are committed to something or someone in the organization, how hard they work and how long they stay as a result of that commitment.

• Employees with high level of engagement are 87% less likely to leave and 20% more productive.

Ohio University College of Business Executive Education

Page 90: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Levels of Employee Engagement

• Engaged Employees (28%) – work with passion and exuberance, feel a profound connection to the organization can’t wait to contribute more – OCB organizational citizenship behaviors

Ohio University College of Business Executive Education

Page 91: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Levels of Employee Engagement

• Not Engaged (53%) – “checked out” of the organization, effort put forth is minimal and barely acceptable, lack passion and do not identify with the organization – often the majority of employees

Ohio University College of Business Executive Education

Page 92: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Levels of Employee Engagement

• Actively Disengaged (19%) – not just disconnect but unhappy, the behaviors are counterproductive and at times destructive, degenerates the culture and based on cognitive dissonance Fosters TIMJ and DGMGE

Ohio University College of Business Executive Education

Page 93: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

More Bad News from a Global Survey

Only 1 in 5 Workers are delivering their full potential!

41% are “enrolled” - capable and ready but not inspired30% are disenchanted 8% are disengagedGraber & Lowman, 2008

Ohio University College of Business Executive Education

Page 94: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

What is your organization's ratio?

• In world-class organizations, the ratio of engaged to actively disengaged employees is 9.57 engaged to 1 actively disengaged.

• In average organizations, the ratio of engaged to actively disengaged employees is 1.83 to 1.

Ohio University College of Business Executive Education

Page 95: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

A Model of Employee Engagement

Serve

Stay

Say

EmployeeEngagement

OrganizationCulture/Purpose

TotalCompensation

Relationships

Quality of Work Life

CareerOpportunity

OrganizationLeadership

WorkActivities

Model used consistently over time to assess and track engagement

Page 96: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Sharing our Experiences

Is Your Job Engaging?Take the Gallup survey

Ohio University College of Business Executive Education

Page 97: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Engagement Survey Respond Yes or No

1. Do you know what is expected of you at work?

2. At work do you have the opportunity to do what you do best every day?

3. In the past month have you received recognition or praise for doing good work?

4. Does your supervisor or someone in authority seem to care about you as a person?

5. At work do your opinions seem to count?

1. Voce sabe o que é esperado de voce no trabalho?

2. No trabalho lhe é dada a oportunidade de fazer o seu melhor todo dia?

3. No mês passado você recebeu reconhecimento ou elogios por fazer um bom trabalho?

4. O seu supervisor, ou alguém a quem se reporta, parece se importar com voce como pessoa?

5. No trabalho as suas opiniões parecem contar?

Ohio University College of Business Executive Education

Page 98: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Engagement Drivers by Country

Brazil1. Organization rewards outstanding customer service2. Improved my skills over last year3. Senior management sincerely interested in employee well being

USA1. Senior management sincerely interested in employee well being2. Improved my skills over last year3. Organization’s reputation for social responsibility

Ohio University College of Business Executive Education

Page 99: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Engagement Drivers by Country

Brazil4. Enjoy challenging work assignments that broaden skills5. Organization invests in innovative products and services

USA4. Input into decision making in my department5. Organization quickly resolves customer concerns

Ohio University College of Business Executive Education

Page 100: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Practicing & Managing Employee Engagement

Ohio University College of Business Executive Education

How Mary sees Mary

How Richard

sees Richard

Richard and Mary:

The “Real” Story

Page 101: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

How Would Mary Respond?How Would Richard Respond?

1. Do you know what is expected of you at work?

2. At work do you have the opportunity to do what you do best every day?

3. In the past month have you received recognition or praise for doing good work?

4. Does your supervisor or someone in authority seem to care about you as a person?

5. At work do your opinions seem to count?

1. Voce sabe o que é esperado de voce no trabalho?

2. No trabalho lhe é dada a oportunidade de fazer o seu melhor todo dia?

3. No mês passado você recebeu reconhecimento ou elogios por fazer um bom trabalho?

4. O seu supervisor, ou alguém a quem se reporta, parece se importar com voce como pessoa?

5. No trabalho as suas opiniões parecem contar?

Ohio University College of Business Executive Education

Page 102: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Impact of Bosses on Engagement

• 40% of workers in the business world think they work for bad bosses.

• 39% said their managers failed to keep promises.

• 37% said their bosses did not give them the credit they deserved.

• 31% indicated their supervisor gave them "the silent treatment."

Ohio University College of Business Executive Education

Page 103: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Impact of Bosses on Engagement

• 27 % reported negative comments from their management.

• 24% claimed their bosses invaded their privacy.

• 23% stated that their supervisor blamed them or other workers to cover up personal mistakes.

Ohio University College of Business Executive Education

Page 104: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

3 Most Important for Richard? For Mary?

Serve

Stay

Say

EmployeeEngagement

1. OrganizationCulture/Purpose

7. TotalCompensation

2. Relationships

4. Quality of Work Life

5. CareerOpportunity

6. OrganizationLeadership

3. WorkActivities

Model used consistently over time to assess and track engagement

Page 105: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Performance Feedback

Ohio University College of Business Executive Education

Mary, What do you want to tell

Richard?

Richard, What do you want to tell

Mary?

Page 106: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Richard and Mary:Differentiators for Engagement

Ohio University College of Business Executive Education

Rated in the top 3 itemsITEM Richard Mary1 2 3 4 5 6 7

Page 107: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

How Richard sees Mary

How Mary sees Richard

Your Team’s Creation Please

Page 108: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Richard and Mary “Engaged???”

Ohio University College of Business Executive Education

Page 109: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Performance Drivers

Strategy Execution

Culture

BehaviorCapability

Ohio University College of Business Executive Education

Page 110: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Isn’t it COMMON SENSE?

Managers know that they should create functional Human Capital

Architecturesbut

They have elaborate excuses why they can’t

Page 111: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Its Only Common Sense!

Half will never see the connection between Human Capital and Profits

Half will embrace the potential of the connection between Human Capital and Profit

Page 112: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Its Only Common Sense!

Half will never see the connection between Human Capital and Profits

Half will engage minimal change

Half will engage comprehensive change

Page 113: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Its Only Common Sense!

Half will never see the connection between Human Capital and Profits

Half will engage minimal change

Half won’t stay the course

Half will succeed

J

Page 114: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

It is Difficult to ImitateOnly about 1 in 8 even come close!Implementation of a viable human capital

architecture requires deep change and a commitment to “stay the course”.

It is often slow and paybacks are a long time coming

Most of the requirements defy “Conventional Wisdom”

Page 115: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Your AssignmentWhen you return to Brazil:

A. Identify at least one pivotal talent pool, and then at least one pivotal position in your immediate work environment

B. Identify at least one human capital architecture component that is ineffective for required performance drivers for the position

C. Suggest a change to the current process and justify it to your superiors in “REAL” terms

Ohio University College of Business Executive Education

Page 116: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Just Do It?Managers to succeed in the new

normal must rely on a human capital architecture that defies

traditional practices and conventional wisdom

Page 117: Managing Human Capital in Changing Times Edward B. Yost Ph.D., SPHR August, 2013 Ohio University

Ohio University College of Business Executive Education

Obrigado pela sua atenção amável