Wednesday April 24, 2019
 

Top 5 most popular employee perks: How does your company stack up?

What are your employees’ favorite perks?

If your workforce is anything like the 1,227 participants in a recent Unum survey, the answer is time away from the workplace.

Leave, flexibility carry the day

The company gave survey participants a list of 15 perks (non-insurance or retirement benefits) and here’s what they chose as their top five options:

1. Paid family leave (58%): It’s the most highly coveted benefit, and it seems employers are listening. Unum, citing a SHRM report from last summer, said firms offering paid parental leave increased significantly between 2016 and 2018 for every type of parental leave. The percentage of employers offering paid maternity leave increased from 26% in 2016 to 35% in 2018 and paid paternity leave increased from 21% to 29% over the same period. A number of large companies, such as TD Bank and Dollar General, have added or enhanced paid parental leave in the past year.

2. Flexible or remote work options (55%): Quoting SHRM again, Unum said more than two-thirds (70%) of organizations now offer some type of telecommuting, either on a full-time, part-time or ad-hoc basis, up from 62% last year and 59% in 2014.

3. Professional development (39%): This trend recognizes employees’ desire to “learn and grow in their careers,” according to Unum. And employers benefit with increased retention.

4. Paid sabbatical leave (38%): Despite its popularity with poll participants, not many employers offer such a program – just 5%, according to SHRM.

5. Gym membership or on-site fitness center (36%): Unum said such offerings can help mental health, improving mood and morale as well as productivity.

Student loan repayment (35%) came in 6th, as a growing number of employers have added this perk.

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Drafting a remote work policy: 5 legal pitfalls to watch for

The ability to work from home has morphed into a highly valued perk.

In response, many companies are implementing work-from-home-benefits for employees in an effort to attract and retain top talent, and to stay competitive.

As these benefits become more popular, and more customized, employers are wise to take caution: It’s possible that without a legally sound remote work policy, your well-intended efforts to improve working conditions can unexpectedly create big legal problems for you.

Creating an airtight policy

Not only will sound work-from-home policies keep employees on track while working offsite, but they’ll help avoid potential legal problems that can arise from remote work.

Here are five legal pitfalls you’ll want to look out for when drafting a remote work policy.

1. FLSA violations. One of the most obvious problems with remote employees is it’s hard to know how many hours they’re actually working out of the office.

If your workers are salaried and exempt from overtime, this isn’t a big deal: they’ll get paid the same regardless of how many hours they put in at home. But if your employees are paid by the hour and are eligible for overtime, FLSA violations could be one punch of the time clock away.

Even if you instruct your employees to not exceed 40 hours a week, they still must be paid overtime if they do. And keeping tabs on their activity is significantly more difficult when they’re out of the office.

But there are ways you can keep them on track. At the start of each remote day, ask what the employee will be working on, with whom, and what hours they’re active.

Another good idea is setting hours when no employee should be checking email or logging onto their computers, or doing any other common, work-related activities.

2. Discrimination/Disability-related issues. Remote workers can easily become “out of sight, out of mind” employees. But this undesirable management habit can have serious fallout.

For example, say your remote workers are primarily women caring for their children and disabled employees who need to work from home as their ADA accommodation.

If you don’t offer these remote workers the same support and opportunities for advancement as your in-office workers, you could be faced with sex discrimination and disability discrimination lawsuits.

To avoid this, your policy should discuss remote workers’ right to training, promotions and visibility.

3. Work environment obligations. Just because an employee isn’t working in the office doesn’t mean an employer isn’t responsible for their health and safety.

Before granting an employee permission to work from home, an employer should determine remote workers’ environments are suitable for getting the job done and don’t pose any undue risk.

Remember: If an employee gets hurt on the job, even if they aren’t in the office, the employer could still face legal consequences.

4. Data security concerns. When employees start doing business outside the office and on mobile devices, a whole host of new security concerns pop up.

To help control potential breaches, it’s best to restrict remote employees’ ability to print or download confidential documents.

It’s also a good idea to remind remote workers of the security dangers of working in public spaces.

5. Worksite closures. Something else you’ll want spelled out in your policy is what remote worker are supposed to do when the company or worksite is closed, for instance, from a weather event or power outage.

If some employees end up working when the company isn’t open, those employees are most likely owed wages. It’s important to clarify what’s expected of remote workers in this situation.

A big concern with allows employees to work from home is that others will want to do so, as well.

Just that topic was raised at a recent Labor & Employment Law Advanced Practices symposium. An attendee asked:

One of our managers has begun working from home more frequently. We don’t approve, but what can we do about it?”

Attorney Dan Kaplan, of Foley & Lardner LLC in Madison, WI, offered this unique carrot-and-stick approach.

“Tell him most people like to get away from barking dogs and crying children by coming into the office occasionally,” Kaplan suggested. “But if things don’t turn around, discipline is in order – especially if the job isn’t designated for off-site work.”

8 General Rules

While these are the five areas that tend to get employers into legal trouble, here are eight general-rule-areas every good policy should cover.

 

  1. Eligibility: Determine what positions are eligible to work remotely, and state them in your policy. If you have no remote-compliant positions state that from the beginning, eliminating any future requests or inquiries about remote work.
  2. Availability: If you allow remote work, then availability expectations should be outlined in the policy. Whether it’s instating a blanket 9 a.m. to 5 p.m. work requirement,, or letting employees to set their own schedules, either should be put in a policy.
  3. Responsiveness: Define whether a remote employee is expected to respond to a co-worker immediately, and also specify what modes of communication should be used.
  4. Measuring productivity: Remote work policies should specify how an employee’s productivity will be measured.
  5. Equipment: Remote workers need the right tools to complete their work. Therefore, companies need to state what equipment they are willing to offer to these employees. If they expect employees to provide their own computers, for example, then they need to specify that.
  6. Tech support: Specify what tech support will be offered to remove workers. Outline what remote employees are expected to do when having technical difficulties, so there is a plan of action.
  7. Physical environment: For health and safety, some employers prefer or require an employee’s physical environment to be approved prior to working remotely.
  8. Security: When information is taken out of the office, security is not guaranteed. Employees need to be extremely careful when doing work in public and rules must be put in place to guarantee electronic security and proper disposal of paper.

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Creating a successful wellness program: Here’s what sets the best ones apart

In the past few years, there’s been an explosion of employers – of all sizes and from all business sectors – looking to start wellness programs to contain their long-term health costs. And when wellness programs are conceived and carried out properly, they’ve been proven to get results.

But here’s the key component for a successful wellness program: It will succeed or fail based on how thoroughly it’s planned and how well it’s communicated to employees on an ongoing basis.

Studies have shown about 75 cents of every dollar spent on healthcare is spent on treatment of a preventable illness. And that’s cause for optimism.

Why? Because if we can get our employees to think a little bit differently about the way they eat, exercise and, in general, manage their daily lives from a health perspective, there’s enormous potential for cost savings. That’s where a wellness program comes in.

Real-world wellness: A 600-employee pipe manufacturing company based in the Southeast has a wellness program that costs $145,000 per year, including the total cost of a $55 incentive for employees who undergo routine physicals. The program has detected eight breast cancer concerns, one possible prostate cancer, 16 cases of heart abnormalities and four potential liver problems. Early detection made medical intervention much more effective – and cheaper.

In order for a wellness investment to be money well spent, you have to know what’s driving your biggest claim costs on your healthcare plan and go from there.

Tailoring your program

So, what sets a successful wellness program apart from one that throws good money after bad? It’s tailoring the program to meet your company’s needs.

To have a chance at success, you can’t guess at the problems your employees are having. That means you – or a third-party your company hires – must have the capacity to drill down into your claim data.

A crucial first step for finding your health cost drivers (obesity, high blood pressure, etc.) is to have employees undergo a health risk assessment – one that is compliant with HIPAA, GINA and ADA. The results of these assessments help you get a feel for what your employees’ baseline physical problems are before you try to design a program around them.

Real-world wellness: A small employer in the computer industry gives a 10% discount off premiums for all employees who undergo health risk assessments. Four years into the program, the firm has seen its healthcare costs drop 27%. Its healthcare cost per employee is below average in most parts of the country.

To truly get to the root of employee’s health problems, you’ll need access to detailed data from a variety of areas:

  • your organization’s medical-claims breakdown for the past three years
  • prescription-drug claims
  • employee absence information
  • EAP use disability claims, and
  • employee demographics (your employees’ ethnic, gender and age breakdown points to greater – and lesser – health risks associated with each category).

Make no mistake: It takes some time and costs money to explore each of these avenues in addition to having employees undergo health risk assessments. But it’s worth it.

Here’s an example of the payoff: A company in Kansas City was approached by a health insurance carrier that offered – at a discounted cost of $75,000 a year – to roll out a four-pronged wellness program to deal with any employee with heart disease, diabetes, obesity, and/or smoking. But after the company dug into its healthcare plan claim data, it learned it already had claims that were below the national benchmarks in three of those four areas the wellness program would cover. The company avoided wasting $75,000 on a program that didn’t suit its needs.

Communicate, communicate, communicate

As you’re assessing employee health, it’s key that you communicate with employees about wellness before launching a program. Employee focus groups are a huge help. Ask what sorts of things concern them, and what kinds of tools and programs they would use. Some employers even form “wellness committees,” comprised of both managers and rank-and-file workers.

Without question, and without exception, the wellness initiatives that achieve the greatest success are those that are communicated aggressively early on and are consistently sustained. Repetition is your friend when doing employee wellness education.

The same need for open communication remains after the wellness program is in place. To paraphrase famous TV pitchman Ron Popeil, if you start a wellness program, “You can’t just set it and forget it.”

With wellness, you’ve got to constantly track your programs on an ongoing basis because cost-drivers might shift as employees come and go from the company.

Real-world wellness: A bank in the Midwest, which paid $100 to employees to take a health risk assessment, found that a full one-third of their employees were undiagnosed with having high blood pressure. It’s impossible to know how many employees would’ve suffered strokes or heart attacks if they hadn’t gone on blood pressure meds. But even if the bank prevented just one employee from having a stroke, the company far and away saved more than they spent on everyone’s health risk assessments.

Bottom line: There’s overwhelming evidence that wellness programs pay dividends if they’re done well and done right.

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Remote work: 5 legal pitfalls tripping up companies now

The freedom to work from home is one of the most highly sought after perks today.

And in order to attract and retain top talent, many companies are implementing a work from home benefit for their employees. 

But without a clear remote work policy, things can quickly spiral out of control.

Creating an airtight policy

Not only will policies keep employees on track while working from home, but they’ll help avoid potential legal problems that can arise from remote work.

Here are five legal pitfalls you’ll want to look out for when drafting a remote work policy, according to business expert Jo Faragher and employment law attorney Christine Hanley.

1. FLSA violations. One of the most obvious problems with remote employees is it’s impossible to know how many hours they’re actually working out of the office.

If your workers are salaried and exempt from overtime, this isn’t a big deal: They’ll get paid the same regardless of how many hours they put in at home. But if your employees are paid by the hour and eligible for overtime, major FLSA violations are lurking in remote work.

Even if you instruct your employees to not exceed 40 hours a week, they still must be paid overtime if they do. And keeping tabs on their activity is significantly more difficult when they’re out of the office.

But there are ways you can keep them on track. At the start of each remote day, ask what the employee will be working on, with whom and what hours they’re active.

Another good idea is setting hours when no employees should be checking email or logging onto their computers.

2. Discrimination/ADA issues. Remote employees can easily fall victim to “out of sight, out of mind.” But this bad management habit can quickly lead to something more serious.

For example, say your remote workers are primarily women caring for their children and disabled employees who need to work from home as their ADA accommodation.

If you don’t offer these remote workers the same support and opportunities for advancement as your in-office workers, you could be faced with sex discrimination and disability discrimination lawsuits.

To avoid this, your policy should discuss remote workers’ right to training, promotions and visibility.

3. Work environment obligations. Just because an employee isn’t working in the office doesn’t mean an employer isn’t responsible for their health and safety.

Before granting an employee permission to work from home, an employer should determine remote workers’ environments are suitable for getting the job done and don’t pose any undue risk.

Remember: If an employee gets hurt on the job, even if they aren’t in the office, the employer could still face legal consequences.

4. Data security concerns. When employees start doing business outside the office and on mobile devices, a whole host of new security concerns pop up.

To help control potential breaches, it’s best to restrict remote employees’ ability to print or download confidential documents.

It’s also a good idea to remind remote workers of the security dangers of working in public spaces.

5. Worksite closures. Something else you’ll want spelled out in your policy is what remote workers are supposed to do when the company or worksite is closed.

If they end up working when the company isn’t open, the employee is most likely still owed wages. It’s important to clarify what’s expected of remote workers in this situation.

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Walmart job changes create PR mess, draw EEOC attention

Walmart is already paying a heavy public relations price for its announced decision to eliminate the “Greeter” position at its U.S. stores, replacing those jobs with a new position it is calling “customer host.” Now it faces at least one lawsuit and numerous EEOC complaints alleging violations of the Americans with Disabilities Act.

The new customer host job description, scheduled to go into effect in April, includes a number of responsibilities that were not part of greeters’ jobs, including lifting up to 25 pounds, cleaning spills, collecting shopping carts, writing reports and standing for long periods of time.

Walmart is reported to have made the change for financial reasons as the retail giant contends with rapidly intensifying competition from Amazon, Target, and others.

While the changes were first made on a trial basis in 2015 and later expanded to all stores with a target implementation date of April 2019,  the job change attracted renewed attention and public outrage after a disabled employee’s mother wrote a Facebook post about her son losing his job. Many people Walmart employs as greeters are mentally or physically disabled or elderly.

After the intial backlash, the company announced that it was working to find new positions for its greeters and extended the 60-day notice period for those with disabilities. Those steps came too late to head off growing condemnation of the moves on social media and wasn’t enough to stave off legal action.

A former greeter in a Utah store filed a lawsuit in mid-March, and many other greeters with disabilities who lost their jobs have filed complaints against the company with the Equal Employment Opportunity Commission (EEOC). Experts say that the EEOC will likely look at whether Walmart should have explored accomodations that would enable more of its greeters to stay with the company even if they aren’t able to complete all of the tasks included in the new job descriptions

The decision to change the job description frrom Greeter to Customer Host likely makes some business sense for Walmart, but this situation is a good reminder that can’t be the only consideration when making a move that will impact disabled employees or other workers in a protected class. In addition to any damage that might happen to a brand, such moves will also create an opportunity for competitors in recruiting.

 

 

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7 ways HRMS can transform your HR department

A typical day in HR is… anything but typical. Whether you’re dealing with an employee suddenly leaving or your CEO demanding results, you’re constantly on the move and putting out new fires.

You’re busy, to say the least.

And on top of it all, you still have to answer questions about payroll and keep up with compliance reporting. That leaves little room for higher-level responsibilities like scouting for new talent or developing strategies to motivate employees.

No one needs to tell you that your time and energy are valuable. And your day shouldn’t be consumed with administrative or routine tasks. Whether you’re doing everything on pen and paper or using specialized software for recruiting or training, it’s time to consider a change.

If you haven’t heard about HRMS, now is the time to check out the technology that can streamline HR and help you take back your day.

What is HRMS?

A human resource management system (HRMS) integrates all of the core and strategic HR functions into one solution, improves recruiting, offers a self-service portal, automates data entry and administrative processes, streamlines information in a central database, reduces payroll and compliance errors, and facilitates data-driven strategies.

How is HRMS different from HRIS and HCM?

HRMS, HRIS and HCM are various acronyms used for comprehensive HR technology. It’s easy to get confused, because these terms are often used inconsistently and interchangeably. That said, it’s still a good idea to know how they are generally defined. Here’s a breakdown of which modules are included in each one:

  • Human resource information system (HRIS) – applicant tracking, employee self-service portal, central database, analytics, training, compensation and benefits
  • Human capital management (HCM) ­– HRIS modules, plus onboarding and talent management
  • Human resource management system (HRMS) – HCM modules, plus payroll, time and attendance, and performance tracking

HRMS has the most modules of any HR technology, but typically has fewer customizations and advanced features compared to specialized software that focuses on an individual module. What makes HRMS preferable, however, is that it’s an integrated system that can follow employees end-to-end from recruiting to exit interviews.

Consider these seven ways that HRMS can transform your HR department.

1. Manage the hiring process more efficiently

We’ve previously written about the insights that applicant tracking systems (ATS) can provide, including:

  • Finding and solving hiring bottlenecks
  • Discovering which hiring managers need help
  • Tracking your hiring team’s efficiency and effectiveness
  • Determining your best sources for hires

An HRMS solution won’t have as many specialized features as a dedicated ATS software, but it will have the benefit of retaining applicant information if they are hired and onboarded. You’ll also be able to analyze this data and generate reports on the types of candidates that ultimately become successful employees.

2. Engage employees with onboarding and training

Once you’ve hired the right candidate, it will be important for you to keep them engaged from the beginning. Employees that go through a structured onboarding program are 58% more likely to stay with an organization after three years.

With HRMS, onboarding can start even before the new employee reaches the office. Employees can sign administrative documents electronically, catch up on company news and business goals, and join virtual social networks of colleagues. On their first day, they’ll have more time to tour the facility, set up their equipment and hit the ground running.

HRMS solutions can also boost engagement through continuing education. For example, millennial employees ranked training and development as the most important benefit of working for a company, higher than cash bonuses, free health care and a pension.

Small businesses may find hiring speakers or holding physical classes too expensive. HRMS offers a cost-effective alternative with e-learning modules to help employees improve their skills and performance at their own pace.

This type of professional development not only promotes employee engagement, but also prepares future leaders within your company who might otherwise leave.

3. Save time with a self-service portal

Employees often have specific questions about their salaries, benefits and time off. Answering these vital yet routine questions, however, can take up a huge chunk of your day.

With a self-service portal, employees can access their information any time, from a remote site or on their mobile phone. The portal generally has a user-friendly interface and allows employees to:

  • View their salaries, benefits, 401K and taxes,
  • Update their employment and contact details,
  • Enter time and attendance,
  • Submit expense and reimbursement forms, and
  • Request paid time off and sick leave.

Managers can also approve and decline employee time off requests without your intervention.

In the end, your employees will be able to answer many of their own questions at their own convenience and you’ll have to do less data entry, giving you back valuable time to spend on more meaningful activities.

4. Reduce business errors with automated processes and a central database

You know how important it is to maintain accurate payroll and compliance records. Any mistake is not just a headache but also a potential lawsuit.

HRMS automates these processes, so that you can worry less about costly errors. It can calculate wages and salaries, deduct the correct amount of taxes and benefits, and print checks or execute direct deposits. It can also schedule reminders when compliance forms are due, require employees to digitally accept communications and deliver compliance training.

In addition, the system will consolidate information into a central database. You won’t have to go searching through multiple filing cabinets, spreadsheets or emails for various details about a single employee. This not only saves you time and energy, but can also keep you organized and reduce errors in transferring information.

5. Accelerate employee performance

Employees are more productive when they feel that business objectives are aligned with their skill sets and accomplishments are properly rewarded. Yet it may not be clear to you how employees are doing in their roles and whether or not they are succeeding.

HRMS solutions empower employees to take performance into their own hands. They can:

  • Monitor their own progress,
  • Seek help and make improvements between scheduled reviews, and
  • Develop their future goals.

In response, managers can:

  • Quantify employee performance,
  • Provide more relevant feedback,
  • Select appropriate assignments,
  • Recognize achievements, and
  • Create succession plans to promote exceptional employees.

Overall, everyone will have a better understanding of how employees are doing at their jobs. Managers can acknowledge progress and employees will have a clearer path going forward.

6. Understand why employees leave

When an employee leaves, you conduct an exit interview to understand why. The information you get, however, may not always be accurate. Perhaps there are strong emotions surrounding the departure or the employee doesn’t feel comfortable being honest in person.

HRMS solutions can communicate with employees even after they leave. Because they’ve had time to understand their reasoning and now have the space to be direct, their insight can be valuable. This information can be combined with other metrics previously collected by the software such as demographics, performance, promotion wait time and compensation ratio to create a more holistic analysis of employee turnover.

Fully examining why an employee leaves is important because it helps to develop a strategy for reducing turnover in the future. Without proper data, you’re left to wonder if your assessments are accurate.

7. Support your decisions with evidence

Businesses are increasingly looking to HR for more data-driven initiatives and strategies. Whether its recruiting more efficiently, increasing engagement or reducing turnover, senior management wants your decisions to be backed up with quantifiable metrics.

HRMS not only records information but can also generate reports and analyze real-time key performance indicators, such as duration-in-position or time-to-achieve goals. This data can help you develop evidence-based strategies that are more likely to get buy-in from senior management.

Some HRMS solutions even offer predictive analytics that can give you more certainty in your workforce decisions and insights for future recruitment and retention strategies.

Still undecided on HRMS?

With a self-service portal, automated processes and a central database, HRMS solutions can reduce the amount of time you spend on labor-intensive tasks and transform your HR department.

You’ll now be free to focus on data-driven strategy and higher-level initiatives that will ultimately benefit your greatest resource–your employees.

If you’re in the market for an HRMS solution, it’s important to do more research on implementation, cost, integration and training. For more info, here’s our definitive guide to HRMS.

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Starting a cross-training program

As the job market tightens, many companies turn to formal cross-training programs to make sure they’re operating at top efficiency.

Since not all workers will be excited about learning a new set of skills, the steps taken to prepare employees for a cross-training program go a long way toward making sure it’s a success.

Here are some strategies employers can use to start laying the groundwork for a successful program.

Ease into it

When it comes to cross-training employees, the best bet is to take it one step at a time, one department at a time.

Jumping into a mass training can cause a lot of unforeseen snags – not the least of which is a confused and intimidated workforce.

Overcome fear of change

Of course, sometimes the reason a message falls flat is because workers don’t want to hear it.

Fear of change caused by a misunderstanding – like cross-training is a forerunner of downsizing – can sabotage even the most well-crafted training sessions.

If workers don’t understand why cross-training is necessary, it can lead to a lot of ugly rumors circulating around the workplace.

The more information workers have early on as to why the company is cross-training (e.g., to offer learning opportunities, prepare for summer vacations), the more comfortable they’ll feel with the new program.

This way supervisors won’t have to worry about facing down a barrage of questions or skeptical looks, and instead will have a more open – and even eager – audience.

Get supervisors’ input

Frontline supervisors tend to have pretty good insight into what makes employees tick. Make it a point to get supervisors and team leaders to share some of that insight before the first cross-training session.

Ask the top brass to sit in

Nothing can hammer home the importance of cross-training like seeing a member of the company’s top brass sign off on it.

So invite some of the C-level executives to sit in on any meetings announcing the new training program.

It’ll show workers just how important having staff flexibility is to the company.

Tip: If no one from the top brass can make it to a meeting, ask one of them if they’d be willing to send out a company-wide email voicing their support for the initiative. It won’t carry as much weight as actually seeing them in the room, but it’s definitely the next best thing.

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United Parcel Service sued for racial bias

Nineteen United Parcel Service employees are suing the giant parcel distributor, saying they suffered repeated racial discrimination and the company did nothing to stop it, according to published reports.

Managers and supervisors enabled and even encouraged the hate at the distribution center in Maumee, Ohio, according to the lawsuit filed March 13.

The workers claim nooses were hung above the workstation of an African-American employee, that a monkey doll dressed as a UPS employee was placed near others and the N-word was frequently used.

The workers, many of whom have been at the company for more than two decades, argue the racist comments caused reactions ranging from “fear, anger and disgust to dismay” about the comments and lack of action from the company.

UPS has said it promptly investigated and took swift disciplinary action against those found to have engaged in inappropriate actions. UPS also said it has participated in remedial actions in cooperation with the Ohio Civil Rights Commission to ensure employees are trained and has also monitored its operations to ensure a positive and harassment-free environment.

Lawyers are asking a judge to award each worker at least $25,000 in damages, relief to address the company’s “pattern and practice of discrimination” as well as legal costs.

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Keys to effective succession planning: Talent management special report

Are changes in your market forcing a change in strategy that will demand new talent?

Have one or more of your long-time stars started thinking about moving to a competitor or retiring?

Or are you just trying to make sure the wheels keep turning for a few weeks or months if one of your top people gets sick or dies unexpectedly?

Succession planning is a talent management must-do for organizations of all sizes, whether a global corporation, a small non-profit, a mid-sized college or a family business with a dozen employees.

Long-term success depends on creating a plan for how you’ll keep your team moving forward when you lose a key player or encounter a skills gap that must be filled quickly.

It brings focus to the process of identifying top performers, employees with strong potential and the people that you need to push hard or push out.

For employees, the succession planning process translates into stretch opportunities that can help them learn new skills, advance their careers, increase their value to the team and boost earning power. All of those positives can translate into an increased commitment to your organization.

What are you planning for?

It’s important to differentiate succession planning from other strategic staffing plans, says William J. Rothwell in a Dale Carnegie white paper entitled The Nuts and Bolts of Succession Planning.

What it’s not is replacement planning, Rothwell says. That’s the process of identifying individuals within an organization, and often in the same division or department, who would be best-equipped to serve as backups for current employees.

While replacement planning is an important part of an organization’s overall operating strategy, succession planning takes a much broader viewpoint – it encompasses the total operation, rather than individual positions, departments or divisions.

As Robert E. Lewis and Robert J. Heckman put it in their oft-cited paper, Talent management: A critical review:

Consider the following question, If you were to begin the process of constructing a building how would you go about it? Would you assemble a group of the best professionals in each necessary craft (plumbing, electrical systems, carpentry, etc.) and let them define your building? Or, would you start with an analysis of the relationship between “construction practices” and some outcome you hope to achieve (building longevity or cost of operation)? Probably not. You probably would first meet with an architect to begin drawing a blueprint after considering a series of key questions such as, what do you hope to accomplish with this building? Will those goals appeal to the intended customers (tenants or shoppers)? What alternatives for orienting the building on its site best accomplish its purpose?

It is always important to be clear about the end-goal of any strategic planning effort and succession planning is no different.

The first thing to do is figure out your plan’s target and scope. To be effective, the succession planning process should be:

Formal. While a succession planning process needs to match an organization’s overall culture, whether buttoned down and hierarchical or more casual and egalitarian, everyone involved needs to understand that this is a well-defined process with support from top leadership and mission-critical outcomes at stake.

Comprehensive. It’s tempting to think of succession planning as applying only to senior leadership roles, but an effective plan will look at critical positions and people at every level of the organization.

Strategically Linked. Every aspect of your succession plan needs to support the organization’s overall strategy. That is the guiding star that will help to define the kinds of people and types of training you need to put in place as you build a talent pipeline to the future.

Linking Succession Planning to Your Strategic Plan

A paint-by-numbers succession planning effort is doomed to give you an uninspired and amateurish result. Only by matching your succession planning to your organization’s guiding strategy can you confidently identify the positions, skills and employees needed to succeed.

Whatever your organization’s size and your target, a succession plan should focus on four specific outcomes:

  1. Identify mission-critical positions and any current or impending talent gaps – based on the strategic opportunities you identify and how you create competitive advantage. Which jobs and skills are must-haves? Do those positions already exist or do we need to create them?
  2. Identify employees at every level who have the potential to assume greater responsibility advancing your organization’s strategic goals and how they fit together – what combination of A, B and C performers do we need and how do we attract and keep them?
  3. Encourage meaningful investment in a training and development program for high-potential employees – be ready to defend allocating resources to a given talent pool(s) or to talent in
    general rather than technology, marketing or other investments.
  4. What is the process for revisiting and revising your succession plan as conditions change?

With those factors in mind, how do you go about building and refining a succession plan? Here’s some help.

Building a team

You’ve committed to building a succession plan, now its time to think about who you need on the team who will do the work. You need to decide who will design the plan and also determine who will be responsible for implementing and evolving your plan when it’s in place.

You’ll want to include people with different skills and from a variety of functions when assembling the succession planning team.

Of course, in smaller organizations, team members are going to wear multiple hats.

Some of the needed skills include:

Organization and process-orientation. While the succession planning effort itself needs to focus on goals, you’ll want someone on the team who will keep things moving along during the plan development phase.

That person needs to have enough authority to give other members assignments and to get answers from various departments.

Organizational knowledge. The team needs to include someone with a solid handle on most of the organization’s existing job descriptions and insight into any new positions that might be needed to accomplish the goals you’ve set.

And at least one member of the team should have connections throughout the organization and know who they can approach to build support for the succession planning effort.

Effective communication. Like many other strategic initiatives, the information gathering phase of succession planning can create nervousness and give rise to rumors about job changes (often true) or massive job losses (often false).

Keeping the rest of your organization working productively while this is going on requires skillful communication to share enough information to keep a lid on any panic-button pushers.

If handled well, giving employees insight into the process can help reassure them that company leaders are preparing the organization for the long haul.

Identifying strengths and weaknesses

So, you’ve committed to building a succession plan and picked your team. What’s their next step?

It’s time to brainstorm. What are all the internal and external factors that your plan needs to account for? Here are some questions to consider:

  • Organizations face increasingly rapid changes in macroeconomic, industry and social trends — which ones can you anticipate and prepare for?
  • Competition can come from anywhere in the world. How will you keep an eye on — and respond to — new challenges?
  • Does your team have all the skills you’ll need? Can training fill the gaps or will you need to hire?
  • Boomers are retiring and the generational mix of your workforce will look very different soon. What do demographic changes mean for your organization?
  • The research is clear: companies with a diverse workforce outperform the competition. How will you leverage succession planning to increase diversity in your line organization and leadership team?
  •  Do you need to change your org structure and talent management processes to match these challenges?

Build or Buy? Finding the right people

The first phase of this part of the process is to identify key/critical positions, ideally at every level of the organization.  A position is determined to be key or critical under the following criteria:

  • Organizational structure — The position is a key contributor in achieving the organization’s mission
  • Key task — The position performs a critical task that would stop or hinder vital functions from being performed if it were left vacant
  • Specialized competencies — The position requires a specialized or unique skill set that is difficult to replace
  • Geography — The position is the only one of its kind in a particular location or it would be difficult for a similar position in another location to carry out its functions remotely,
  • Potential high turnover job classes — Positions in danger of “knowledge drain” due to impending retirements or high market demand for the skill set, and
  • Future needs — based on the SWOT analysis that launched the succession management project, positions that need to be created and defined.

Skillset analysis

Once critical positions and areas at risk of high turnover are identified, it’s time to look at the specific competencies required to do those jobs effectively.

The questions you need to ask during the skill set analysis are closely related to the strategic questions your team addressed in the first part of this process:

  • What are the external and internal factors affecting this specific position?
  • How will the position be used in the future?
  • What competencies or skillsets will be required?
  • What is the current bench strength?
  • How will you provide stretch opportunities to high-potential employees?
  • What is the path from where they are to where you need them to be?  and
  • What are the gaps (competencies or skillsets not possessed by current employees)?

At the end of this analysis you will have the answer to the most important succession planning question: “Can we develop our existing pool of internal candidates quickly enough or must we ramp up our search for strong outside candidates?”

The good news is you now have a clear idea of what you have and what you are still looking for and can move on to the next steps in the process, which we look at in other reports in our HR Morning talent management series:

  • designing the right training programs for each talent pool based on strategic importance, available resources and growth path
  • refining your recruiting plan to maximize your chances to get the most from your recruiting efforts, to use your time and energy wisely and effectively, and to pursue only the most likely paths to recruiting success and
  • retaining key personnel.

 

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Applicants getting more aggressive about negotiating salaries: Report

Another sign of a tightening job market: More than half of professionals (55%) participating in a recent survey said they tried to negotiate a higher salary with their last employment offer.

That’s a 16-point jump from a similar survey conducted last year, according to research from the staffing firm Robert Half.

And it looks as though employers are ready to deal with the new dynamic. In a separate survey:

  • 70% of senior managers said they expect some back-and-forth on salary, and
  • about six in 10 (62%) are more open to negotiating compensation than they were a year ago.

Houston, LA, Miami lead the way

Other key results of the Robert Half research:

  • 68% of male employees tried to negotiate pay vs. 45% of women.
  • More professionals ages 18 to 34 (65%) asked for higher compensation compared to those ages 35 to 54 (55%) and 55 and older (38%).
  • Boston (80%), Denver and Washington, DC (78% each) have the most managers who said they expect job seekers to negotiate salary.
  • Houston (73%), Los Angeles (72%) and Miami (71%) have the largest number of executives more willing to discuss pay than they were a year ago.
  • Managers in Washington, DC (71%), Houston and Los Angeles (70% each) are most open to negotiating nonmonetary perks and benefits compared to last year.

What’s the cause of the increased confidence in employees’ leverage?

Experts point to two factors:

  1. increased competition for highly skilled workers
  2. more access to salary info via the Internet

Bottom line: In order to remain competitive, companies are going to have to be vigilant about monitoring compensation trends.

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