Preserving Key Employees and Avoiding Talent Drain to Win the Human Capital Fight
Peter WatsonHR Director - AstraZeneca
5 March 2011HR Summit – Gold Coast Australia
Topics
• Framework for the Talent Retention Challenge
• What drives retention
• The role of the Manager
• Case Studies:
• AZ Managers’ Program
• Flexibility with Accountability
• Targeted Retention
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What Drives Retention?
Quality of Manager
Work Challenge
Career Development
Work/Life Flexibility
Remuneration
Talents
Source: CLC April 2004| Title of presentation | 00 Month Year (Go Header & Footer to edit this text)
Driver impact on employee performance
50.0
25.0
0.0
Driver impact on employee intent to stay
50.0
25.0
0.0
Managers Control a Majority of the Most Effective Drivers of Employee Performance & Retention
Impact of top performance drivers Impact of top retention drivers
Manager activitiesNon-manager activities
Line managers directly influence a disproportionate share of the most effective drivers of performance. The two strongest manager-influenced drivers, for example, are:• Providing fair and accurate informal
feedback: 39% impact on performance• Clarifying employee performance
expectations: 36% impact on performance
Line managers also control a majority of the most powerful drivers of employee intent to stay with the organization. The two strongest manager-influenced drivers, for instance, are:• Facilitating internal communication:38% impact on intent to stay• Advising on career development:37% impact on intent to stay
Source: Corporate Leadership Council research.
The Role of a Manager as a “Connector”
Two commitment types Four points of commitment
The results of commitment:Discretionary Effort & Intent to Leave
Rational Commitment
Emotional Commitment
While employees can rationally and emotionally commit to 4 different points of the organisation…
1. Day to day work2. Teams
3. Line manager4. The organisation
…the unique role as ‘connector’ enables managers to strengthen employee commitment in all 4 directions.
JobJobTeamTeam
EmployeeEmployee
OrgOrgMgrMgr
Discretionary EffortAn employee’s willingness to go ‘above & beyond’ the call of duty
Intent to StayAn employee’s desire to stay with the organisation
PerformancePerformance
RetentionRetention
Source: Corporate Leadership Council research.
The 5 Top Retention Levers in the Hands of a Manager
Role 2Managing the employee’s relationship / engagement with the organisation
1. Amplify the good, filter the bad
2. Connect employees with the organisation and its success
3. Instill a performance culture
4. Connect employees with talented co-workers
5. Demonstrate a ‘credible commitment’ to employee development
Source: CLC
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Case Study 1
AZ Managers’ Programme
Managers’ Programme Overview
How to help managers’ reframe their role?
How to help managers see both formal and informal opportunities to engage their employees?
Move beyond theoretical concepts?
The answer….
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Raw unedited anecdotes from employees describing good, great and poor experiences of work life with AZ
Anecdotes – an example of the impact a manager can have
“at around nine months of being in and I got the conversation with my
manager where she said, now where do you want to go. And I said, hey, are
you trying to chuck me out already. I’d rather like to keep this job if you don’t
mind. But the conversation was tuned to the fact of, okay, well you are
getting close to the first year. Where do you see yourself being? Where do
you want to develop to? How can I help you develop that?” Well, it was an
amazing vote of confidence because it was, okay now I feel like I’m part of
this and I can develop. And she said, okay, whatever you want to do, I’ll
help you in any way I could possibly help you to get to that goal. And that’s
was an amazing statement; particularly so early on and that was a real
endorsement.”
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Feedback from Managers after the Programme
Anecdotes had strong impact on managers, and gave them insight into the power of everyday interactions
Anecdotes / real stories not ‘case studies’ – added realism to course and allowed group members to easily relate and take home learnings
Every interaction with an employee is either a chance to motivate or de-motivate
Quote from a participant, “The most ‘real’ management training course I have been on”
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Case Study 2
Flexibility with Accountability
The Challenge & The Opportunity
Uncompetitive in the external
market
Inconsistency of flexibility across
the business
Feedback from employees that we’re
“inflexible”
Clear need to change how flexibility is managed at
AZA
Flexibility with Accountability
Principles of Flexibility
Employees are not entitled to flexibility*
Equity does not guarantee
employees the same outcome
Flexibility is a two-way street
Employee – manager
collaboration is critical
Performance matters
Meeting business goals is the company’s top priority
Performance is not defined by physical
presence
Flexible Working Arrangements
You daysWorking From Home – Ad hoc
Flexible start Finish timesWorking outside business hours
Lifestyle Friendly Leave
Toolkit
* Legal requirements exist to provide flexibility
Key challenge: balance flexibility with accountability
Principles
• Performance matters
• Meeting business goals is AZA’s top priority
• Performance is not defined by physical presence
• Equity does not guarantee employees the same outcome
• Flexibility must be a two-way street
• Employees are not entitled to flexibility*
• Employee-manager collaboration is critical
* Exceptions apply in case of legal requirements
Description
• Only employees with “meets expectations” performance reviews may request flexible scheduling
• The needs of our customers and teams must be fully addressed when designing flexible work arrangements
• Acknowledges that from time to time, employees can and do perform work activities from remote locations eg. Home
• A flexible scheduling solution need not and will not be the same for all employees
• Established flexible work arrangements must themselves remain flexible
• Flexible scheduling is not appropriate for all employees or positions within the company*
• Open dialogue between managers and employees is crucial
AZA’s Flexible Work Arrangements
Each of the offerings are designed to provide flexibility with accountability consistently across the business
• You Days (Formally RDO’s)• Recognising evening
business activity• Work from home (adhoc) • Flexible start & finish times• Lifestyle Friendly Leave
Flexible Working Arrangements at AZA
Vacation Care Programme
Offered 5 weeks per year
Children aged 4 – 13 yrs
Run by YMCA – qualified staff, excellent programs
On-site – AZ catering
Flexible booking – single days OK
Fantastic Feedback from staff
Flexible Work Proposal Toolkit
The toolkit is designed to help managers discuss and explore flexible work arrangements with their staff. It provides guidelines for managers and staff on:
• how to plan, • implement, and • communicate a flexible work arrangement. The toolkit provides guidance for managers to
assess requests on a case by case basis.
Flexible Working Arrangements on the HR website
FWA Overview
FWA Guide
FWA FAQ
FWA Toolkit
Posters, emails, AZTV, stress puzzle, brochure
5 weeks February to March, 2010
Average Tenure has Increased by 50%
Tenure Profiles(YTD 2007)
Percent
0
20
40
60
80
100
Sales Rep Territories* PCAM Sales Manager
1-2 yrs
3-5 yrs
>5 yrs
2-3 yrs
<1 yr
181 5 29
2.6 12.3
7.3Average Tenure
25
2.2
Note: * Excludes 3 staff with tenure > 20 yrs; ** New roles due to introduction of xxxxxx
<1 yr**
Today average
tenure is 3.9 years
Summing Up
Build a Brand• Alignment with EVP
Create a Supportive Culture• Manager engagement• Principles, Mindset & Behaviours
Get the Mechanics in Place• Policies• Guides• FAQs• Toolkits
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Case Study 3
Targeted Retention of Talents
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Determining the Need for a Targetted Retention Plan – Assessing Departure Impact and Risk
Departure Risk*
De
pa
rtu
re I
mp
ac
t
Low High
High
• Possesses highly sought after or scarce skills
• Ready for a job move now – actively seeking
• Impacted by recent organisational change
• Unsuccessful in internal selection process
• Dissatisfied with aspects of employment
• Business critical project or initiative would be negatively impacted
• Business performance would be adversely impacted
• No suitable replacement/succession candidates exist
• Very tight labour market, skills required in short supply – expensive to replace
• Corporate knowledge and experience very difficult to replace
Understand individual’s preferred financial and non-financial incentives and critical employment factors.
Openly engage individual with possible retention actions – create Retention Plan.
Identify potential successors
Understand individual’s preferred non-financial incentives and critical employment factors.
Review questions on Risk Assessment Tool and act to strengthen assessment.
Work to help individual produce greater value e.g. stretch assignments, coaching feedback, performance objectives, learning and development opportunities.
Identify potential successors and make contingency plans to replace if necessary.
Redeploy to position where he/she can have greater impact and add greater value to AZA and decrease probability of departure.
* Refer Talent Risk Assessment Tool
Targeting Retention of Talents
1. Make an assessment of ‘departure risk’
2. Consider individual retention drivers
3. Formalise in a Retention Plan
4. Communicate with the Employee
5. Follow up and ensure action
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Targeted Retention Plan
1. Personal Information
Name Line Manager
Current Role Years in Current Role
Previous Role Years in Company
Date of Assessment
3. Action Plan
Retention Objective Retention Activity Timing Accountable
4. Other Comments
Authorisation Divisional Director Managing Director Date Date
2. Compensation & Bonuses
Salary Actual Increase Q2 Q3
Bonuses
5. Tracking
Name Comments Date
Name Comments Date
Name Comments Date
26 | Introducing AZengage| Octoberl 2010