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METRICS TO HELP IMPROVE YOUR WORKFORCE PRODUCTIVITYKEY RESULTS FROM MERCER 2013-2014 WORKFORCE METRICSDATABASE

Tom Jacob, MercerEphraim Spehrer-Patrick, MercerMilan Taylor, Mercer

MERCER WEBCAST

MERCER WEBCAST

TODAY’S PRESENTERS

Tom JacobSenior Partner

Talent Information SolutionsPhiladelphia, United States

[email protected]

+1 215 982 4254

1

Ephraim Spehrer-PatrickPrincipal

Practice Leader, WorkforcePlanning and Analytics, Pacificand Growth MarketsSydney, Australia

[email protected]

+ 61 2 8864 6463

Milan TaylorPartner

Talent Information SolutionsLondon, United Kingdom

[email protected]

+ 44 20 7178 5404

MERCER WEBCAST

AGENDA

2

1 INTRODUCTIONS

2 WHAT’S DRIVING DEMAND FOR METRICS, ANALYTICS,AND WORKFORCE PLANNING

3 WORKFORCE METRICS BENCHMARK DATA REPORTS

4

5

HIGHLIGHTS OF KEY FINDINGS — ORGANIZATIONAL DESIGN

HIGHLIGHTS OF KEY FINDINGS — TURNOVER

Q&A67 RESOURCES

3February 14, 2014

WHAT’S DRIVING DEMAND FOR METRICS,ANALYTICS, AND WORKFORCE PLANNING

MERCER WEBCAST

LABOR SHORTAGES

WHAT EVERYONE IS TALKING ABOUT

WAR FOR TALENT

PRODUCTIVITYPREDICTIVE ANALYTICS

SUPPLYDEMAND

BIG DATA

OFFSHORING

OUTSOURCING

4

MERCER WEBCAST 5

THE ANALYTICS JOURNEYMERCER’S POINT OF VIEW

Anecdotes

Realitychecks

On-goingreports

WORKFORCEMETRICSBENCHMARKDATA

Correlations

Simulations &forecasting

Predictive &causalmodeling

MERCER WEBCAST 6

Source: Mercer’s Workforce Productivity Framework

MERCER PRODUCTIVITY DRIVERS FRAMEWORKORGANIZATIONS ARE INCREASINGLY FOCUSED ON WORKFORCEPRODUCTIVITY TO DRIVE ORGANIZATIONAL OUTCOMES

INPUTS PROCESSES OUTPUTS

ORGANISATION• Organisation design

• Spans/Layers• Job Design

• Roles and responsibilities

COST & CAPACITY• Headcount• Labour costs• Reward &

recognition

LEADERSHIP• Vision / Mission• Strategy / Objectives• Communication & connection• Style

PROCESS EFFICIENCY• Processes• Activities/ tasks• Time required• Agility• Reliability & rework

UTILISATION• Productive time• Total time• Lost time• Workflow

CONSISTENCY• Performance standards• Standardization• Variation

ENGAGEMENT & CULTURE• Motivation• Ownership• Pride• Challenge

PRODUCTION• Output / unit• Loss / unit e.g. shrinkage,

leakage• Delivered In Full On Time

(DIFOT)

SALES• Sales Volume / unit• Sales Revenue / unit• Market share• Cost of sales

SERVICE• Quality / unit• Satisfaction / unit• Customer satisfaction index• Customer retention rate• Customer turnover rate

PROFIT• Margin / unit• Profitability by customer• ROI• NPAT• Cost to income ratio

• Workforceprofile

• Supply /demand

• Available time

WORKFORCE STRUCTURE• Organization design• Span of control• Job design• Roles, responsibilities,

accountability

CAPABILITIES & SOURCING• Skills• Competencies• Behaviours• Training• Experience

• Build/ buy• Hire rate• Age/ tenure/

turnover

MERCER WEBCAST 7

Do less or the samewith more

CAPACITY

OUTPUT(volume, revenue, margin, etc.)

Do less or the samewith less Do more with less

Do more with more

DO MOREWITH THE

SAME

WORKFORCE METRICS AND BENCHMARKSDIFFERENT PRODUCTIVITY SITUATIONS / PROFILE

What are theimplications for ourorganization?

How do we compareto others?

More

Same

Less

Less Same More

8February 14, 2014

WORKFORCE METRICS BENCHMARK DATAREPORTS

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WORKFORCE METRICS BENCHMARK REPORTSOVERVIEW

WORKFORCE METRICSBENCHMARK REPORTS

• Helps you make fact-based HRdecisions

• Provides the data points on keyfinancial, workforce compositionand retention metrics

• Enable direct comparison toindustry and size cuts across theglobe

• Reports are available for purchaseonline: www.imercer.com/wmrs

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MERCER WEBCAST

WORKFORCE METRICS BENCHMARK REPORTS66 COUNTRIES AND 6,358 PARTICIPANTS

37%

10%

Regional Year OverYear Increase

Expanded Coverage

66%

58%

10

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WORKFORCE METRICS BENCHMARK REPORTSPARTICIPANTS BY INDUSTRY AND REGION

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1,2771,232

686 674590

559

470

375

272

13191

Dur

able

Life

Scie

nces

Serv

ices

Hig

h-Te

ch

Insu

ranc

e

Ret

ail

Who

lesa

le

Ener

gy

Fina

nce

Bank

ing

Oth

er

Non

dura

ble

Con

sum

erG

oods

11MERCER WEBCAST

MERCER WEBCAST 12

LOW PRODUCTIVITY COMPANIESRevenue less than USD 400,000 per FTE

HIGH PRODUCTIVITY COMPANIESRevenue between USD 700,000 andUSD 1,000,000 per FTE

WORKFORCE METRICS BENCHMARK REPORTSPRODUCTIVITY PROFILE

• The workforce composition of high and low productivity companies are notsignificantly different when looking at industry, size, and geographical spread

• Productivity per Full-Time Employee (FTE) — known as the human capital revenuefactor — measures an organization’s top-line financial productivity by revenue andquantifies the value of the workforce as a revenue generator

vs.

MERCER WEBCAST 13February 14, 2014

HIGHLIGHTS OF KEY FINDINGSORGANIZATIONAL DESIGN

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HIGHLIGHTS OF KEY FINDINGS – ORGANIZATIONAL DESIGNPRODUCTIVITY AND SPANS OF CONTROL

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LOW PRODUCTIVITY HIGH PRODUCTIVITY

14

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HIGHLIGHTS OF KEY FINDINGS – ORGANIZATIONAL DESIGNPRODUCTIVITY AND SUPPORT FUNCTIONS

5%8%

5%

4%

2%2%

6%

5%

3%3%

5% 6%

4%5%

2% 3%

2% 3%

5%8%

15

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HIGHLIGHTS OF KEY FINDINGS – ORGANIZATIONAL DESIGNPRODUCTIVITY AND CORE FUNCTIONS

25%37%

45%34%

8%

10%

25%

45%

10%4%

13%

8%

37%

34%

4%

12%

16

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HIGHLIGHTS OF KEY FINDINGS – ORGANIZATIONAL DESIGNPERCENT IN THE SALES AND MARKETING FUNCTION ACROSSINDUSTRIES

ConsumerGoods

High Tech

Non Durable

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HIGHLIGHTS OF KEY FINDINGSTURNOVER

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OVERVIEW OF FINDINGSGLOBAL VOLUNTARY TURNOVER

5% to 8%

2% to 5% 8% to 12%

12% to 15%

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OVERVIEW OF FINDINGSGLOBAL TURNOVER, ALL FUNCTIONS

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11%

8%

5%

4%

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OVERVIEW OF FINDINGSGLOBAL INVOLUNTARY TURNOVER


9%

7%

9%

10%

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OVERVIEW OF FINDINGSGLOBAL VOLUNTARY TURNOVER


14%

12%

14%

15%

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Data suggests a weak relationship between the percentage of theworkforce in support functions and productivity.

In some industries, companies with high productivity have a higherpercentage of the workforce in marketing and sales and less in operations.

Voluntary turnover is lower at more productive companies.

An inverse relationship exists between productivity and span of control.

SUMMARY OF KEY FINDINGS

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MERCER WEBCAST

NEXT STEPS

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1

2

3

4

USE THE PRODUCTIVITY FRAMEWORK TO CLARIFY WHATYOU WILL MEASURE

INDUSTRY MATTERS. WHEREVER POSSIBLE, LOOK AT ITFROM THIS PERSPECTIVE

UNDERSTAND WHAT THE MOST PRODUCTIVE COMPANIESARE DOING

REMEMBER: BENCHMARKS ARE A SOURCE TO INFORM, NOTTHE SOURCE TO DECIDE


Q&A

MERCER WEBCAST

Q&A

26

To ask a question, click on the Q&A button on the bottom right-hand side of your screen.


RESOURCES

MERCER WEBCAST 28

WHAT’S NEXTWORKFORCE ANALYTICS WEBCASTS, WORKSHOPSAND RESOURCES

www.mercer.com/mercer-workshopsSingapore – March 12Zurich – March 13 & 14New York – April 22 & 23Chicago – May 12 & 13

Webcast Serieswww.mercer.com/webcastseriesFeb 13 – Mercer Workforce MetricsFeb 20 – ExperianMarch 5 – John DeereMarch 20 – UMass Memorial Health CareApril 9 – Johnson ControlsJune 4 – Diversity & AnalyticsJune 25 – Mobility & Analytics

Mercer’s Workforce MetricsBenchmark Reportswww.imercer.com/wmrs• Workforce composition and retention

metrics• 66 countries• 6,000+ participants• Regional and custom editions available

The Human Capital Reportwww.mercer.com/hcindex

www.mercer.com/talent-impact-technology-conference

MERCER WEBCAST 29

SPEAKER BIOGRAPHIESTOM JACOB

Tom Jacob, Senior [email protected]

• Tom is a Senior Partner in Mercer’s Talent business segment. Heis the Product Leader for Research & Intelligence products.

• He joined Mercer in 2003 and is based in Philadelphia. Tom hasserved in a number of roles at Mercer all having in common theinnovation and launch of new products and services.

• Prior to joining Mercer, Tom was associated with the Hay Group,Inc., DRI/McGraw Hill’s Energy Services Division and GPU ServiceCorporation. He has spoken on topics such as Pay forCompetencies, the ROI on Human Capital investments and the HRImplications of economic developments and forecasts.

• Tom holds a BA in Economics from LaSalle University and an MA inEconomics from Temple University.

MERCER WEBCAST 30

SPEAKER BIOGRAPHIESEPHRAIM SPEHRER-PATRICK

Ephraim [email protected]+ 61 2 8864 6463

• Ephraim Spehrer-Patrick is a Principal and leads the workforcestrategy, planning & analytics practice for Europe / Pacific. He hasdeveloped and implemented workforce strategies with HR andBusiness Executives in various industries across Europe, theMiddle East , Africa and Asia.

• He has 15+ years experience in HR management and consultingcovering people strategy development, workforce architecture andplanning, organizational design, as well as post merger integration -on local, regional and global level.

• Before joining Mercer Ephraim worked in international HRmanagement roles.

• Ephraim holds an Executive MBA from Henley Business School(UK) as well as a degree in business administration and socialsciences, University of Heidelberg and Landau (Germany).

MERCER WEBCAST 31

SPEAKER BIOGRAPHIESMILAN TAYLOR

Milan Taylor, [email protected] 20 7178 5404

• Milan is a Partner and leads Mercer’s Global Energy Centre ofExcellence as well as Mercer’s EMEA Compensation & BenefitsCentre of Excellence.

• The Energy Centre of Excellence provides energy specific surveysand information consulting solutions across the energy chain toboth national and international energy concerns.

• This includes a range of industry forums including the North Africaand Middle East Energy Forum, African Energy Forum and theAfrica Mining Forum.

• The EMEA Compensation & Benefits Centre of Excellence teamsare responsible for the product management and strategy forMercer’s EMEA reward surveys, benefits information product andservices, Africa & Middle East Compensation and Benefits as wellas driving product and services in the key industry segments ofenergy, consumer goods, life sciences, high tech and financialservices.

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