Korn Ferry asked onboarding related questions to their global panel of executives. They found that only 30% of executives are satisfied with their onboarding process.

The question has always been: How much is at stake? Is it a big deal?

It is always hard to get an accurate answer for the cost of bad onboarding. We created a model in our research (Onboarding: Speeding the Way to Productivity) to explain it as shown below.

The key view takeaway from the Korn Ferry survey is that executives count the time it takes not in weeks or days—but years. 87% said it was more than one year and 54% said it takes more than three years to be fully productive!

Onboarding is a big deal!

SHRM has just released their 2006 Job Satisfaction study.

Satisfaction is an important goal for organizations to reach as it has been shown that profitability, productivity, employee retention, and customer satisfaction are linked to employee satisfaction.

Often the debate is centered on what are the top five reasons to achieve superior satisfaction among our employees. This is often the wrong debate. The way to impact employees satisfaction lies within a variety of programs. The most interesting question for us is to understand the disconnect of perception of what is important for the employee versus what HR believes is important. This is the key as HR owns the organization of programs to improve employee satisfaction. It’s also where the slips will happen.

The gap analysis we performed on the SHRM data is normalized to take into account the relative importance of the different factors. The analysis shows some very interesting disconnects.

The absolute top five factors for the employees were compensation/pay, benefits, job security, flexibility to balance life and work issues, and feeling safe in the work environment.

The story is different when we put them in the light of the gap in perceptions.
Meaningfulness of work and job variety are the two areas that employees value way more than HR can even imagine. In absolute terms, the difference is above 20%. On the other side, HR overemphasized the relationship with the supervisor and the recognition that management gives regarding job performance.

So maybe HR should stop sponsoring employee of the month programs and increase job rotation and contextualize the job meaning for their employees instead?

Sometimes people wonder why software as a service (SaaS) took off so quickly in the HR world. One of the key reasons I believe is the fact that strategic HR is a mission critical function, but is rarely supported enough by IT.

In the latest Taleo Research paper, “The Gap between IT and Strategic HR in the UK (free download)” this disparity is shown very clearly. Of course payroll and administrative HR are covered for the most part. But when you look at workforce planning, performance management, recruitment, and internal mobility; only less than a third of organizations estimate that they are adequately supported.

But it is not new to have a long laundry list of things that we want to improve. The question is most often: Which one will we tackle first? To the question of priorities, most respondents selected Employee Communications. And Talent Management was in second place, way above any others!

A recent survey by HR Executive magazine of 156 HR people showed the often obvious flaws in the performance rating process as it is done today.

Everyone but 7% in the organizations responding to the study met or exceeded expectations!

We all agree that positive feedback is more motivating than a negative performance report, but to say that 93% of the employees at these organizations are exactly on track or performing better than average seems a little unrealistic to me.

The major flaws reside in the fact that we link performance ratings to compensation. Nobody want to hear about their weaknesses if it means they are to be paid less! The second reason is the fact that we don’t like confrontation and presenting negatives in front of colleagues.

With 72% of performance management not yet automated, we see this as an opportunity to improve and integrate a tool into the talent process that could deliver much more business value.

A recent survey of 502 HR people by Spherion showed that over the past five years, usage of screening and assessment have been increasing by over 50% on average.

Recently, the reasons for increased use have been believed to be security issues—and of course they have played a role. But even as the scarcity of quality workers becomes more acute, the productivity of hiring managers comes under increased pressure. Any time spent on administrative activity is becoming more costly. The true reason we believe for the increased use of screening and assessment is quality.

But it is also simple ROI: What is the point of spending several extra expensive hours of management time in the interview process if you have to reject a majority of those applicants anyway for lack of compliance to your screening standards? Maybe the process should be revisited and you should use automated assessment and screening tools that will pay for themselves by increasing manager productivity!

The companies listed in the Deloitte Fast 500, which annually ranks the fastest growing companies, came with a report of what their CEOs called “2006 Technology Fast 500 CEO Survey Results”. Taleo has been part of the Deloitte Fast 500 for a few years now and the results are music to our ears.

High-quality employees is the main mantra for this year with 66% of CEOs listing this as the most important factor to contribute to the growth of their company by far. Last year, only 24% cited this factor!!

As a consequence, 41% say the most important operational challenge had been to find and retain qualified employees (up from 27% last year). This is clearly the #1 issue and far ahead of any other!

Did we say that leading organizations are using Taleo to solve this challenge?

We recommended using Return On Workforce (ROW) in our previous posting. Now let’s focus specifically on the “People Business”.

We looked in the past at the good work that the BCG did on the workonomics of the “People Business”. Here again is a great approach to help leaders to think of what to tackle first when they think of people productivity.

The value added to an organization by people is obviously the difference between their output and their pay. But what really optimizes the output? The answer: a competent and motivated workforce that has assets in support and optimal utilization.

At Taleo, we focused first on optimizing the long term impact that some decisions make around competence and capacity, such as skills and talent, hiring, attrition, and promotion. Talent management is part of people management and we could even say it precedes it!

What should talent management really care about? Cost of labor, time to fill positions, job fill ratio, alignment with target, time to productivity, performance rating?

In short, all of those metrics are important. But at its simplest expression, it all boils down to one key metric: Return On Workforce (ROW). As noted below: it is the ratio of operating income divided by total labor costs (all costs including salary and overhead as well as all contingent labor).

As a generic metric, many factors will influence the calculation, so it is crucial to know how talent management affects ROW. On the cost side, we see all the main topical discussion points: offshoring, downsizing, and compensation alignment. On the productivity side, we see that skills, utilizations, and motivations are crucial.

But if you have only one metric to discuss with your C-level executives, we would go with ROW! If you want more details on this topic, you can read our article published by Accenture and called Key Metrics for Today’s Talent Economy (available online – free subscription).

We all know that talent is the fuel of business performance, but what can you do to optimize it? We’ve showed in the past that the Taleo index demonstrated stronger financial performance among companies that take talent management processes seriously. We have found similar results as well in the Cedar Crestone survey, providing more proof.

As you can see, the operating income growth is positively impacted by a full adoption of talent management applications and some examples of them are listed in table 2.

We recently read the latest Cedar Crestone report, HCM Benchmark Study. Lexy Martin did a very fine job of outlining many interesting findings in this 92-page report.

We especially liked the way she created a simple view called the HCM Blueprint:

Making the distinction is important between administrative applications (HRMS in red) and service delivery and performance focus (Talent Management in green).

In view of all of those components, the major HRMS ERP vendors (SAP, Oracle, PeopleSoft) have been making the case for years that it is way cheaper to have one unique solution to provide it all. Many organizations today, especially under the pressure of the CTO, are still under that belief. In fact, this survey shows exactly the opposite: It is cheaper to have a mix of best of breed applications than to have a huge ERP system as shown below!

Cost is one thing. But what about ROI? So we quote the last sentence of the report: “that it is those organizations with a mixed application environment that more frequently have achieved ROI than those that stay with a primarily ERP-based set of applications.”