Implementation of Performance Management Systems Yields Positive Business Impact, Says Bersin Studies

Bersin & Associates, a research and advisory firm focused on enterprise learning and talent management, recently announced the release of two new studies that analyze employee performance management systems. The Essentials of Performance Management Practices: Part 1 delves into the practices of performance management in corporations today, with a specific focus on their business impact.  The Essentials of Performance Management Systems: Part 2 takes a critical look at the rapidly growing market for performance management systems, examines implementation and adoption trends, and compares and contrasts offerings from 25 solution providers.

 “Once viewed as a standalone employee appraisal process designed to feed compensation and promotion decisions, performance management has now become the cornerstone of modern talent management,” said Leighanne Levensaler, director of talent management research and the study’s primary author.  “Our research found that this seemingly simple process is undergoing significant transformation as organizations embark on automating goal alignment, assessment, coaching, development, and succession processes.”

According to Josh Bersin the study demonstrates two significant findings:  “First, effective employee management practices are different from those in the past and focus on alignment, coaching, development, and measurement.  Second, the red-hot market for performance management software is paying off for buyers.  More than 85 percent of the organizations we studied are seeing demonstrable positive business impact from implementation.  This is one area of software truly generating high returns on investment.”

Other key findings:

·         Managers and supervisors are the front line for all employee performance practices and, ultimately, drive the success or failure of any talent management strategy.  However, 45 percent of respondents believe managers in their organizations currently have difficulty in differentiating between high and low performers.  Almost 40 percent of line managers do not believe they have the training and skills needed to be effectively manage employee performance.  Management coaching and development is an integral component of adoption and success. 

·         Performance management based on coaching and development has stronger positive outcomes overall than performance management based primarily on competitive assessment.  Only one third of responding organizations today exclusively use competitive assessments for performance management and these organizations see far less return than those with a coaching and development model.

·         While enterprise-wide standardization is appealing, high-impact organizations do not adopt the “one size fits all” approach to performance management.  To maximize business value, high performing organizations tailor practices according to operating functions, geography and culture, legal requirements, and unique needs of different workforce segments.  Companies that localize key practices report higher employee retention rates.

·         The performance management systems market is the fastest growing segment in the human capital management market and will soon be the biggest.  The market is estimated to reach $520 million by end of 2008, a 35 percent increase from 2007. The market is growing more than twice as fast as the markets for recruitment and learning management.  The market has tremendous potential for growth, with only 12 percent penetration in the United States and less than 9 percent globally.

·         Organizations with integrated talent management suites cite two to three times the return on investment than organizations implementing point solutions.  Performance management is at the heart of today’s integrated talent management suites, which also support succession planning, career development, compensation management, and other talent management processes.

·         User experience is the key differentiator in a crowded field of approximately 30 suppliers.  In the last year, several leading providers have undergone major development efforts to significantly improve their systems’ user experiences.  These solutions now incorporate “next-generation” features, such as decision and performance support, collaboration, and contextual or smart content. 

These studies are based on multiple research initiatives conducted over the last seven months.  In August 2008, Bersin & Associates conducted an extensive, quantitative survey capturing responses from more than 700 HR, learning and development, and information technology professionals to identify the key drivers, adoption levels, business challenges and trends in corporate performance management and the implementation of performance management systems.  

Thirty percent of the respondents are employed by companies listed in the top 100 of the Fortune 500; 28 percent are employed by companies appearing in the “100 Best Companies to Work For” list. Over 40 percent of respondents represent multinational organizations; 13 percent are from companies based outside of the United States. Bersin & Associates analysts also conducted in-depth interviews with 47 HR executives to get a detailed perspective of performance management.  From these interviews, the company identified 10 organizations with performance management practices and processes that yield significant business impact.   These organizations represent a variety of industry segments and range in size from 5,000 to 250,000 employees. 

Finally, Bersin & Associates analysts conducted three-hour briefings with 25 selected providers of performance management systems.  The briefings included system demonstrations that focused on use cases and presentations on company backgrounds and product roadmaps. The following technology providers are covered in the research study:  ACS, Authoria, Business Decisions, CornerstoneOnDemand, Cytiva, Halogen Software, HRsmart, ICIMS, Kenexa, Learn.com, Oracle (Enterprise Business Solutions), Oracle (PeopleSoft), Organization Metrics, Pilat HR Solutions, Plateau, Saba, Salary.com, SAP, Silkroad, Softscape, Stepstone, SuccessFactors, SumTotal Systems, Taleo, and Technomedia.

Expertus Survey Reveals Bleak State of Marketing in Training Organizations

Expertus has released the findings from its recent study, "Internal Marketing for Corporate Training Programs." There were 73 qualified respondents, all internal corporate training and development professionals whose organizations widely varied in size, scope of resources, budget and other applicable factors. Expertus found that while some organizations use marketing to improve training utilization, others do not place any emphasis on marketing. In fact, the lack of budget dedicated to marketing was shockingly low. The average budget was $6,660, which is around 43 cents per employee, per year – about the price of a postage stamp. Compare this to a typical training supplier, who can spend as much as $1,000 just to get one person to register for a class. In fact, 62 percent of these training departments allocated $0 to marketing.

“Although organizations everywhere are watching budgets closely, we found it interesting that promoting internal programs is such a low priority,” said Ramesh Ramani, founder and CEO of Expertus. “This survey revealed quite a bit of interesting information about the lack of a formal presence of marketing in training organizations.”

Other key findings:

• Only 15 percent of respondents have a formal marketing plan.
• Regarding staffing, respondents did allocate an average of 60 percent of one full-time person to marketing training and 10 percent of an outsourced position. However, 38 percent of companies had no one at all working on marketing.
• While half of the respondents use different marketing activities for different types of training, 45 percent market all training programs alike. The remaining five percent do not market individual training programs.
• The responses indicate that regardless of the technique (email blasts, posters, internal website updates, and so forth), HR or training departments are responsible for conducting the majority of marketing activities, and external vendors are used less than five percent of the time. To varying degrees, internal marketing departments sometimes help support these marketing activities.
• Sixty percent of organizations that take the initiative to market programs measure the effectiveness of the marketing campaigns. For those that do measure the effectiveness of marketing activities, surveys are a prevalent source of information.
• Seventy-three percent use no incentives or rewards for participating in internal training programs.

“Training organizations are most effective when run like a full-service business,” added Ramani. “The fact that marketing is a weak link in the organization could explain why program participation and company-wide knowledge about training resources are lacking in many companies.”

To view the full results of the study and comprehensive charts, visit http://www.trainingefficiency.com/system/files/Survey+Results_Marketing+Training+Internally_Expertus.pdf.

Organizations Spend More on Training Sales Partners than Employees, Reports T+D

A large pharmaceutical company planned to use a robot to dispense medication at retail outlets. To cut costs the company decided to forgo formal training and provide stores with a simple user’s guide. The plan backfired. Six months later, Doug Harward spoke with panicked executives from the pharmaceuticals company whose customers were unhappy with the product, being unsure how to use it. The company decided to reverse course and send a professional for three days to a large retailer to train employees.

Customer training—offering training outside a company’s walls to representatives of partner companies or to buyers of a product or service—is distinct from employee training, which refers to a company’s own employees. Organizations that sell technology products or services are more likely to emphasize customer training for reasons of complexity, according to Harward, CEO of Training Industry. “One of the problems in the industry is we don’t talk about customer training, we talk about employee training,” he says.

Statistics support that contention, as recent research indicates companies spend 52 to 58 percent of training dollars on customers, according to Harward. Training Industry and Expertus completed a recent survey regarding customer training efforts. Most survey respondents expect the budget for customer training to stay the same with slightly more reporting that the budget will increase versus those who anticipate it will decrease in the next year.        “In a recession economy, customer training is going up while employee training is going down,” says Gordon Johnson, vice president of marketing for Expertus.

A lot of companies spend more on training channel partners, entities that sell the company’s products than on employee training. A classic example is auto manufacturers, Johnson says, who focus their training on dealers and not on buyers whom they reach only indirectly. Analysts are aware that as corporations are clutching their pocketbooks, increased training even for departments that generate revenue does not guarantee greater results. “If the economy is in the tank, the question is: how much value do you get out of every dollar for sales training?” says Tom Kelly, a California training consultant. “You’ll have trouble selling in this market no matter how good your sales force is. Organizations won’t stop training, but they’re not going to invest heavily.”

As a preferred means of training delivery, webinar technology has far outpaced any other form of training delivery. The only caveat with webinars is that they cannot hold participants’ attention longer than one hour. Beyond that point Johnson says viewers may get distracted or disinterested. “Every training department uses webinars now,” Johnson says. “It’s an incredibly cheap way to reach a lot of people.”

Two-thirds of survey respondents are in the technology sector. The next highest participants were business services such as banking and telecommunications. Company size ranged from 100 to more than 5,000 employees. Another distinction in the field is how organizations categorize their training departments. Among respondents, 42 percent operate training as a cost center while 58 operate it as a profit center.

Kelly views customer training as a branch of marketing and customer loyalty and not a direct source of revenue. Oftentimes, organizations hope to reduce customer calls regarding a product or service with increased training. Kelly says such aims are difficult to measure. Customer training might help customers become more independent, eliminating the basic service calls, but more complex calls often continue to rise. “I don’t know of any organization whose number of calls is going down,” he says.

Harward identified a crucial benefit of customer training aside from the obvious as reduced sales calls and increased customer satisfaction: liability. Companies want protection from liability claims by customers that they did not prepare or train them on a product in the event of a failure. “It comes down to the cost of failure to use my product is greater than the cost of success,” Harward says. “It doesn’t show up in advertisements, but it is being talked about in boardrooms.”

There are other mechanisms for offering training to customers. When Oracle sells its software to a client, the package includes training credits, for example. “All CLOs want to make money off training, but the revenue from it is not important as generating future sales,” Kelly says. As might be expected, much of the customer training is handled through the marketing or sales departments and not through training departments.

—Michael Laff is senior associate editor for T+D.

Get Ready for Employee Learning Week 2008

Employee Learning Week is an awareness campaign highlighting the important connection between learning and achieving organizational results. This year, it  takes place December 8-12, but learning is a year-round event!

Employee Learning Week is getting bigger and better each year thanks to your help! Here are some helpful tips and ideas for making your 2008 ELW efforts as successful as possible. 

·         Work with members of your ASTD chapter to pilot a PR campaign targeted to business leaders and learning professionals in your community.

·         Institute an employee development recognition event for individuals and departments in your organization.

·         Introduce new learning opportunities during the week.

·         Work with government officials to pass a proclamation recognizing Employee Learning Week.

·         Communicate learning and development tips to your workforce each day of the week.

·         Host a press briefing with the local media.

·         Host a program with a local university or community college.

·         Help employees create individual development plans to increase and enhance their skills.

·         Submit an article about your company’s learning efforts to a local newspaper.

For more on Employee Learning Week, go to http://www.employeelearningweek.org.

October 8, 2008  

ASTD Announces 40 Winners in Its Sixth Annual BEST Awards

The American Society for Training & Development (ASTD) announces that 40 organizations from Hong Kong, India, and the United States are winners in the 2008 ASTD BEST Awards competition. The BEST Awards recognize organizations that demonstrate enterprise-wide success through employee learning and development. According to Tony Bingham, ASTD’s president and CEO, “The BEST Award winners set the standard for exceptional learning and performance. They excel at aligning learning with business needs, demonstrating business impact, and providing a broad range of learning opportunities for employees. And, senior leaders in BEST organizations provide deep support for learning and model leaders as teachers.”

The 2008 BEST Awards program received entries from 95 organizations in seven countries through an online application process. These organizations submitted quantitative and qualitative information to ASTD about their learning and development practices and programs. Their applications were assessed by members of the BEST Awards advisory committee, a group of experts in the learning and performance field.

The 2008 ASTD BEST Award winners and rankings:

1. Janus Capital Group, Denver, Colorado
2. BB&T, Winston-Salem, North Carolina
3. American Infrastructure, Worcester, Pennsylvania
4. LQ Management LLC, Irving, Texas
5. OhioHeath, Columbus, Ohio
6. Sisters of Charity Providence Hospital, Columbia, South Carolina
7. Perkins+Will, Chicago, Illinois
8. Robert W. Baird & Co., Milwaukee, Wisconsin
9. Scottrade, St. Louis, Missouri
10. WakeMed Health & Hospitals, Raleigh, North Carolina
11. Constellation Energy, Baltimore, Maryland
12. Datatel, Fairfax, Virginia
13. Reliance Industries Limited-Nagothane Manufacturing Division, Nagothane, Maharashtra, India
14. Air Products, Allentown, Pennsylvania
15. CheckFree, now a part of Fiserv, Norcross, Georgia
16. CSC, Falls Church, Virginia
17. The Schwan Food Company, Marshall, Minnesota
18. Infosys Technologies Limited, Bangalore, India
19. Carter & Burgess, Fort Worth, Texas
20. Farmers Insurance Exchange, Agoura Hills, California
21. UPS, Atlanta, Georgia
22. B&W Pantex, Amarillo, Texas
23. Shangri-La Hotels and Resorts, Hong Kong SAR, China
24. Toshiba America Business Solutions, Irvine, California
25. T. Rowe Price, Baltimore, Maryland
26. Grant Thornton LLP, Chicago, Illinois
27. UT-Battelle LLC – Oak Ridge National Laboratory, Oak Ridge, Tennessee
28. ETS, Princeton, New Jersey
29. Wipro Limited, Bangalore, India
30. CIGNA Corporation, Philadelphia, Pennsylvania
31. ICICI Bank Limited, Mumbai, India
32. Sun Microsystems, Menlo Park, California
33. IKON Office Solutions, Malvern, Pennsylvania
34. Gables Residential, Atlanta, Georgia
35. Marvin Windows and Doors of Tennessee, Warroad, Minnesota
36. North Mississippi Health Services, Tupelo, Mississippi
37. FORUM Credit Union, Fishers, Indiana
38. Clarkston Consulting, Durham, North Carolina
39. Wachovia, Charlotte, North Carolina
40. AlliedBarton Security Services, Conshohocken, Pennsylvania

More information about the 2008 ASTD BEST Award winners may be found in the October 2008 issue of T+D magazine and online at www.astd.org/best. Details about the 2009 program will be available next February.

Social Software Research Released

Bersin & Associates recently released its latest research study, “Enterprise Social Software 2009: Facts, Practical Analysis, Trends and Provider Profiles.” The study is based on an in-depth analysis of the corporate social networking software market, highly detailed surveys of 18 cooperating solution providers, customer interviews and survey data from more than 800 corporations.

Research found that the most popular business applications for social networking currently are customer communities for loyalty marketing and self-service, corporate intranets (sometimes replacing traditional intranet portals), internal corporate communications, employee directories (with emphasis on areas of expertise and skills), project or process collaboration and support, knowledge sharing, on-boarding, recruiting, support of formal training, corporate alumni and retiree relations, and succession planning.

“The most startling finding of this research is the explosive growth of this new market, which is dominated by small, innovative providers,” said David Mallon, principal analyst and primary author of the study. “Last year, providers of corporate social software had revenues of about $277 million. We see revenue increasing by 72 percent to over $420 million by end of this year. Approximately 100 vendors offer some kind of solution today, with new companies entering the market on a weekly basis.

“However, our research also shows that the use of social software is still in the early stages within most companies. Typically, most purchases are being made at the departmental and workgroup levels; fewer than 5 percent of organizations have an enterprise strategy for social networking,” said Mallon.

“This is a very exciting market,” said Josh Bersin, president of Bersin and Associates. “In addition to rapid revenue growth, which could reach $2.5 billion by 2012, the space is characterized by innovation in collaboration, search and tagging, presence awareness, content management, mobile access, and integration with the consumer web. "Soon we expect to see maturing strategies from established players such as Oracle, Microsoft, IBM and SAP, as well as from application providers in the areas of corporate talent and learning management systems. Today there is a land-grab going on, with almost all players experiencing significant growth.” The study shows that current market leaders, in terms of software revenue, are Atlassian, Jive Software, LiveWorld, Mzinga and Telligent.

Those interested in learning more can register for the upcoming webinar, “Social Software: Using the Latest Tools to Support Learning and Talent Management,” scheduled for October 29 at noon ET (register at www.bersin.com/News/EventDetails.aspx?id=7612).

New Standard Being Created for Certificate Programs

A new standard for certificate programs is being created by ASTM International, one of the largest voluntary standards development organizations and an American National Standards Institute approved developer of American National Standards. The committee will be accepting comments through October 26 2008.

Certificate programs are typically offered by community colleges and universities, government agencies, employers, independent for-profit training organizations and professional and trade associations like yours. Currently there is no nationwide regulation or monitoring consistently applied to these bodies that issue certificates or to the certificate programs they offer. This standard aims to change that, and is being developed to

• form the basis of an accreditation system that enables consumers, employers, government agencies and others who rely upon a skilled workforce to distinguish between qualified workers and those with fraudulent or less-than-quality credentials
• assist certificate program developers and issuers guidelines for quality program development and administration
• assist stakeholders in differentiating between certificate programs from certification
• assist stakeholders in differentiating certificate programs from certificates of attendance or certificates of participation. 

Currently, it is challenging to distinguish a certificate earned through the focused learning and assessment offered through a certificate program from one granted through other means. The word “certificate” is used generally as a document awarded to designate the attainment or completion of something. A certificate of attendance or certificate of participation may be issued by an education or training provider to verify an individual has attended a learning event or program, or it may be issued to verify an individual has actively participated in the learning event or program’s established learning experiences.

The learning events or programs may or may not have pre-determined learning outcomes and do not include an assessment of the learner’s achievement of the intended learning outcomes. In contrast, as defined in this standard, a certificate program is a non-degree-granting structured learning event or program that is designed to meet specific and pre-determined learning outcomes and for which individual achievement of intended learning outcomes is measured.

Only after the learners demonstrate their achievement of the intended learning outcomes is a certificate issued. So a key distinction between certificates of attendance or participation and a certificate program is the certificate program’s measurement of individual achievement of intended learning outcomes. It is also important to distinguish certificate programs from the certification of individuals. Certification is a process through which a non-governmental entity grants a time-limited recognition to an individual after verifying that he or she has met predetermined and standardized criteria for proficiency or competency, usually through an application and assessment. A key distinction between certification and certificate programs is in the focus of each. In certification, the focus is on assessing and recognizing current proficiency or competency. In a certificate program, the focus is on educating/training individuals to achieve certain intended learning outcomes and then measuring their attainment of them.

While certification criteria may specify a certain type or amount of education or training, no specific learning events or programs are provided by the certifying body nor are any linked to the certification’s assessment. In contrast, the foundation of the certificate program is the learning event or program developed and administered by the certificate issuer, and there is an essential link between that learning event or program’s intended learning outcomes and the assessment. Also, certifications have ongoing requirements for maintaining proficiency/competency and can be revoked for not meeting these ongoing requirements. In contrast, certificates do not have ongoing maintenance or renewal requirements.

Many associations offer certificates of attendance or participation, certificate programs, and/or certification programs. If yours does or may in the future, you are encouraged to review and provide feedback on the standard. To obtain a copy, contact Rick Lake at ASTM International by emailing rlake@astm.org. Please respond with your comments prior to October 26 2008.

Training Outsourcing on the Decline Reports CLO Magazine

Every other month, IDC surveys Chief Learning Officer magazine’s Business Intelligence Board (BIB) on a variety of topics to measure the attitudes, issues and interests of senior training executives. September’s topic was training outsourcing, and 393 BIB members participated in the survey.

CLO reports that more than 56 percent of the enterprises surveyed use outside providers to fulfill some aspect of their training functions, primarily outsourcing content development, training delivery, and their LMSs. Only about 2 percent outsource the entire training function. This percentage has remained relatively steady, even though the number of enterprises outsourcing some or all of their training function has declined.

Spending on outsourcing as a percent of overall training budgets reveals a bell curve skewed toward the left. The majority of companies spend less than 40 percent of their training budget on training outsourcing, with about half spending between 10 percent and 40 percent of their training budget. Conversely, only 20 percent spend more than 40 percent of their budget, and the 3 percent who spend more than 80 percent are probably mostly organizations that outsource the entire training function.

For 2009, 85 percent of companies expect spending on training outsourcing to increase or remain the same. This indicates that while the number of companies that are outsourcing have declined this year, the companies that are outsourcing are satisfied with their use of external training providers. Only 15 percent of companies indicated their training outsourcing budgets will decrease next year.

The survey also asked managers to identify the top five most important overall training functions. These, in order of importance, were custom content design/development, training delivery, strategy development, program oversight and learning technology management. Reporting and measurement was a not-too-distant sixth choice.

In addition the survey uncovered the top two reasons to outsource, which by a clear majority of companies, were 1) to deliver more training than internal resources can provide and 2) to access expertise. Reducing costs was the third most popular reason.

For more results from this survey, go to www.clomedia.com.

In Search of Network Experts

When the network crashes and workers helplessly stand by, only then will organizations realize the gravity of the talent shortage in the IT field. The need for skilled IT workers is expected to increase by 30 percent in the next four years, comprising a total of 780,000 workers, according to the results of a Cisco Learning Institute study.

The study, “Networking Skills in North America: Trends, Gaps and Strategies,” evaluates the overall trend for Internet protocol (IP) networking professionals, who currently make up 14 percent of the IT workforce. The data for the study was collected from 500 telephone interviews with network managers across a range of industries and correlated with projections from the Census Bureau, the Bureau of Labor Statistics, and the Bureau of Economic Analysis.

The declining number of graduates who enter the networking profession may be attributed to a lack of interest in the field or a belief that outsourcing limits the long-term prospects in the field. “A perception that was created after the dot-com bust was ‘Don't go into these jobs because they're going away,’” says Fred Weiller, director of marketing for Learning@Cisco.

“It may be true for some IT support or software design jobs, but you need networking jobs, and you need people to install and design these networks. Many of these networking jobs are and will remain local.”  Graduates mistakenly believe that such jobs are being outsourced or are not available to local candidates, according to Weiller.

The research also found that there is more of an emphasis on specialty skills among current IT professionals. The competencies required of the average IT worker are expanding to meet greater demands on their networks. For example, 73 percent of respondents indicated they needed new or extra network security skills in the future, and 59 percent are planning for additional wireless networking skills.

For many specialty skills, nearly three-quarters of businesses think that possessing certifications reflects the credibility and capability of a job applicant for a networking position. “Training is a way to develop knowledge, information, and skills, but if you don't have certification to validate these skills, it's tough for managers to extend those jobs in the marketplace,” adds Weiller. Because all organizations have a network, many of which are evolving with the business, it is crucial to groom enough network-capable professionals for the company’s future needs.

Aparna Nancherla is an associate editor for T+D.

September 2, 2008 

Randstad Report Reveals Lack of Generational Workplace Interaction

There is increasing debate about the changing economy, shifting workforce demographics and, of course, over the reality of a future skilled worker shortage. Randstad USA’s annual 2008 World of Work survey, however, uncovers a critical factor that will contribute to a very real talent shortage. According to Randstad, the four generations of workers that comprise the U.S. workforce, Gen X, Gen Y, Baby Boomers, and Matures, rarely interact with one another and often do not recognize each other’s skills or work ethic.

As a result, U.S. businesses risk a shortage of skilled labor—not because of the lack of manpower in the wake of retiring Baby Boomers, but because of the limited transfer of knowledge. In fact, according to the U.S. Census Bureau, Gen Ys in today’s workforce (79.8 million) outnumber Boomers (78.5 million) who are perceived as retaining the bulk of working America’s institutional brain trust. 

With this pending generational shift in the workplace, businesses need to focus on building professional relationships with their employees while developing employees’ skills, something Randstad calls “employership.” Central to successful employership is encouraging employee collaboration to achieve company goals, which relies, in part, on employers recognizing employee value, cultivating mutual respect and generating trust throughout the organization.  Randstad’s 2008 World of Work survey suggests that companies which maintain an ongoing focus on employership, regardless of demographic or economic changes that impact the workplace, are better able to successfully meet employee expectations and achieve business goals.

Generational divide

Although Boomers and Matures have much to offer Gen Y in regards to knowledge and experience, 51 percent of Boomers and 66 percent of Matures report little to no interaction with their Gen Y colleagues. And three of the four generations say they have little to no interaction with the most experienced workers, or Matures (Gen Y, 71 percent; Gen X, 67 percent; Boomers, 58 percent). 

“The workplace is on the verge of real change,” said Eric Buntin, managing director, marketing and operations for Randstad USA.  “At Randstad, we believe companies that enact a culture of ‘employership’ can successfully navigate the changing workplace, regardless of economic and demographic shifts. By focusing on and encouraging the professional contributions of all employees, employers can help close the knowledge gap by instituting ways for each generation to recognize their strengths and value to all colleagues.”    

Softening expectations

Despite being perceived as the overly-demanding generation, Gen Y, along with all employees, is lowering expectations. Specifically, Gen Y is establishing more realistic views of the workplace, and their once idealistic job expectations are maturing. “The declines among Gen Y’s expectations regarding hard and soft benefits are, on average, more dramatic than among employees as a whole, perhaps because Gen Y’s expectations started out higher and more out of reach,” said Buntin.  “In fact, Gen X and Boomers are actually somewhat more interested in soft benefits than younger generations.”

According to the survey, when it comes to staying in current jobs, employees from each generation associate varying levels of importance toward soft benefits.

Closing the gap

The survey shows that each generation sees itself as playing a distinct role in the workplace and, for the most part, employees describe the personality of coworkers’ in their same generation with fondness.  It is their view of colleagues’ work ethic and abilities that is in question.  For example, traits such as makes personal friends at work (49 percent), sociable (48 percent) and friendly (35 percent) are among those which Gen Y workers are most likely to use to describe coworkers in their generation.  However, only 29 percent of Gen Y workers rate their generation as competent. 

Gen X workers describe coworkers in their cohort as capable of interacting well with all age groups.   “Based on their self-described generation personality, Gen X has the potential to bridge the generational gap between the youngest and oldest generations of workers,” said Buntin.  “Leveraging this knowledge about generational strengths and value is part of employership, and something employers should act on to be a great place to work.” 

For more information or for a copy of Randstad’s 2008 World of Work survey results, please visit www.us.randstad.com/2008WorldofWork.pdf.

Pat a Techie on the Back

If you’re waiting for an IT troubleshooter to help jumpstart a sluggish desktop, you are not alone. Many organizations are experiencing the same problem. The challenge of attracting and retaining IT workers is just as tough as it was in the past. Recruiters continue to say that there is a shortage of qualified IT talent.

A recent survey conducted by Robert Half Technology found that 22 percent of CIOs believe that finding qualified IT workers is somewhat or even more challenging compared with one year ago. The pipeline is running dry, as 52 percent of. CIOs cited a real shortage of qualified workers.

Demographic shifts and the changing demands of the technology field are transforming the roles of IT workers. In the past they may have been viewed as skilled craftsmen, but now they are peers with financial officers and marketing officials. “The demand is there but not for the traditional worker,” says Nina Buik, president of Encompass.

Technology specialists are being asked to play a significant role in launching a new product or service, marketing the organization and offering ideas about how to leverage technology in future initiatives, according to Buik. In short, IT workers can no longer hide under the hood. They must be prepared to give presentations and be comfortable among their peers in the boardroom. 

In recent years, the interest in IT in the U.S. has declined, but interest in IT project management has increased. Managers are much younger than in years past. “The fear of outsourcing has people asking, ‘Why should I pursue a degree in this field,’” Buik says.

IT workers need to be able to integrate social media tools with customer relationship management. Podcasts were once considered toys, but they are now standard marketing tools for many organizations with a media arm. IT employees need to be able to think creatively about how to leverage new technologies with the organization as a whole.

Given the expanded expectations of tech workers, organizations need to show appreciation for emerging talent beyond the paycheck. Too often, IT employees are taken for granted. “IT people are like artists,” Buik says. “Recognition means more than compensation. If they are responsible for an innovation, you should demonstrate that to the whole company.”

Is it more or less challenging to find qualified candidates for IT jobs compared to 12 months ago?  

·         Much more challenging: 10 percent

·         Somewhat more challenging: 12 percent

·         Just as challenging: 55 percent

·         Somewhat less challenging: 9 percent

·         Much less challenging: 7 percent

·         Don’t know/no answer: 7 percent

What is the primary cause behind the challenge in finding workers for IT jobs within your company?

·         A shortage of qualified IT workers: 52 percent

·         Inability to offer competitive compensation: 28 percent

·         Inability to offer career advancement opportunities: 10 percent

·         Other: 4 percent

·         Don’t know/no answer: 6 percent

—Michael Laff is senior associate editor for T+D.

Awards Submission Deadline Approaching

ASTD awards recognize individuals for their impact on the workplace learning and performance profession and for contributions to ASTD. The awards also provide organizations with an opportunity to showcase best practices and results achieved through learning and performance.

Winners are honored at an awards ceremony and profiled in articles for ASTD’s publications and on ASTD’s website.

Applications for the awards in these categories are due September 22, 2008:

• Advancing ASTD Awards
• Advancing Workplace Learning & Performance Awards
• Excellence in Practice Awards

The deadline for the Research Article Award is October 31, 2008.

For more information, go to www.astd.org/ASTD/aboutus/AwardsandBestPractices.

Workplace Ethics Programs Lack Sufficient Attention

The emergence of the next big corporate scandal seems commonplace these days. We live in an era of uproar surrounding business giants including Adelphia Communications, AOL-Time Warner, Enron, Merck, WorldCom, and Xerox, and that was just during the early 2000s.

The minimum take-away lesson from these cases would be for companies to mandate an increased focus on business ethics and compliance programs. Shockingly, evidence cites that very few companies have a strong ethics program in place, if at all.

“The Ethics Landscape in American Business”, a recently released joint study by the Society for Human Resource Management (SHRM) and the Ethics Resource Center (ERC), found that only 23 percent of HR professionals say that their organizations have a comprehensive ethics and compliance program in place. In contrast, 7 percent say they have no ethics program in place at all. Forty-three percent say that ethical conduct is included as part of employee performance reviews. Pat Harned, president of the ERC, notes, “HR professionals are not a part of the policy process for making ethics regulations, but are frequently called in to arbitrate ethics infractions.”

Many HR professionals reported that they are the primary resource for ethics-related problems and inquiries for their respective organizations. Eighty-two percent said that they reported ethical misconduct when it was observed, with the misconduct mainly consisting of abusive and intimidating behavior between colleagues and inappropriate use of email and Internet privileges. “Organizations can benefit by bringing HR professionals into the early conversations when planning ethics-related programs,” says Susan R. Meisinger, former president and CEO of SHRM.

Only 61 percent of employees reported ethical misconduct, they observed, with these violations mainly being employees calling in sick inappropriately or taking credit for someone else’s work. To emphasize the importance of ethics programs within organizations, Harned advises, “It’s essential to communicate that employees will be held accountable for not upholding certain standards, as well as if they personally observe some kind of wrongdoing, what they should do and what will happen when they report misconduct.”

Another telling statistic is that only 77 percent of HR professionals think senior management would be held accountable if found violating ethics standards as compared with 86 percent for supervisors and 91 percent for nonmanagement employees. In addition, 19 percent of HR professionals and 11 percent of U.S. employees said they felt pressured from others (both internal and external to the organization) to compromise ethics standards, company policy, or the law. HR professionals also said they withheld knowledge about ethics violations when they could not remain anonymous in reporting them, or when they did not think the violators would be disciplined. “The single biggest thing that influences ethics conduct in the workplace is a good culture. Culture trumps every other thing,” adds Harned.

The study, which interviewed 513 HR professionals on six business ethics themes, has been conducted three times since 1997. Results of the study were benchmarked with the ERC’s 2007 “National Workplace Ethics” survey, which polled 3,452 employees.

—Aparna Nancherla is an associate editor of T+D.

Higher Skill Jobs at Risk for Offshoring

Rick Gregory for the IT Training Community reports that a recent study by Career Builder and the Wharton School found that higher skill jobs are becoming more at risk for offshoring. IT jobs that companies in the survey were planning to offshore include programmers (32 percent), software developers (32 percent) and systems analysts (16 percent). Sixty-nine percent of employers believed that higher skill, and thus higher pay, jobs were at equal or greater risk of being offshored than low-skill jobs. Other jobs at risk for offshoring include customer service, sales managers, graphic designers, HR personnel, general managers and marketing personnel.

Outsourcing consultant EquaTerra's "Service Provider Pulse Survey 2Q08" found that IT Outsourcing represented the majority of outsourcing contracts, at 51 percent of the total. The top three IT segments that are being outsourced are ADM, infrastructure/operations, and desktop services. They predict that outsourcing will grow 8 percent over 2007 levels this year.

The Career Builder study, "Jobs Beyond Borders," surveyed more than 3,000 hiring managers and HR professionals, and over 6,700 workers in the U.S. Thirteen percent of employers reported outsourcing work to foreign vendors in 2007 and an equal number said they would do so in 2008. Seven percent of employers offshored job functions in 2007 while nine percent plan to offshore job functions in 2008.

The Wharton research detected a systematic pattern in the types of positions that are likely candidates for offshoring. It indicates that services that can be delivered electronically and don't require much face to face interaction are at higher risk of being displaced.

Impact on workers

Although admitting that U.S. workers have lost jobs as a result of offshoring, companies argue that offshoring ultimately benefits the American workforce. Twenty-eight percent of employers who sent jobs offshore said it enabled them to create a greater number of better jobs in the United States.

However, of all workers displaced by offshoring, only 7 percent reported that they benefited from a promotion or higher compensation. Seventy-one percent were let go and twenty-one percent received a lateral reassignment. Of those who were let go, 81 percent went to another company that was not aggressively outsourcing.

Where do the jobs go?

Most IT offshoring goes to India and China. India is by far the largest player with 44 percent of the market. However, that may not continue indefinitely. Although NASSCOM projects annual growth in the Indian IT services sector at 25 percent per year, Sramana Mitra writing in Forbes predicts Indian offshore business will decline. The advantage for offshoring to India, formerly at least 1:6, is now down to 1:3, and with average wage increases in India's IT sector of over 15 percent % per year, the advantage will continue to shrink.

That won't stop offshoring, but it will mean a shift to other low cost markets like China and Eastern Europe. Other top offshoring destinations include

• China, 24 percent
• Mexico, 12 percent
• Canada, 9 percent
• Germany, 8 percent
• Philippines, 7 percent
• United Kingdom, 7 percent.

For the full story, go to www.trainingindustry.com/it/TO_Article.asp?ID=8653.

 August 18, 2008

Study Finds Most Firms Provide Tuition Assistance But Don't Track the ROI

Going back to school is cool in most companies, but despite the large sums spent by corporations to fund tuition reimbursement, the whopping majority has no idea if it's worth it. While employees view tuition reimbursement as almost an entitlement in large organizations, they shouldn't expect much advice about the process, nor should they count on a graduation bash upon completion.

According to Taking the Pulse: Tuition Assistance survey, a recent study by the Institute for Corporate Productivity (i4cp), 81 percent of organizations provide tuition assistance programs for employees with a bent for bettering themselves. However, quite surprising in today's economy, only 5 percent of organizations actually track program effectiveness. In addition, most (79 percent) have no plans to change their programs in the near term.

"A lot of companies seem to feel that tuition assistance programs are a staple of employee benefits, one that is likely to influence future productivity, engagement and retention," says Jay Jamrog, i4cp SVP of Research. "Which is what makes the total lack of measuring the return on these programs such a shock. While companies look at layoffs and other cost-cutting measures, they better focus their attention on measuring the effectiveness of programs where large sums of money are dedicated, like tuition reimbursement."

When it comes to tuition reimbursement, it seems that an out-of-sight, out-of-mind approach is the norm. Just 26 percent of companies track retention rates as part of their assistance programs, followed by graduation rates (23 percent) and professional advancement (15 percent). While a mere 5 percent measure return-on-investment (ROI) as part of their tuition assistance programs, of those companies that do measure their programs, the majority (63 percent) do so in very rudimentary ways, such as through Excel spreadsheets.

For students in programs, this hands-off attitude is also quite common. Nearly two-thirds of polled companies said they do not provide advice about career, program selection or school choices prior to an employee embarking on an educational voyage. Less than four in 10 offer recognition or reward once a degree is obtained, and just 20 percent of respondents said they offer cash advances to offset up-front costs of continuing education.

"Many of the best and brightest like it when their organization or boss pays attention to them and shows a willingness to invest in their skills, knowledge and abilities," adds Jamrog. "It's interesting that only a minority of firms recognize achievement. This feels like a lost opportunity."

Who owns these programs may be to blame. Administration of tuition assistance programs is split evenly between the benefits function in organizations (34 percent) and training and development, at 33 percent. The general HR function is also heavily relied on for program administration. Very few organizations—less than two percent—have opted to outsource administration of their tuition assistance programs.

Eligibility requirements also are split among companies. A third (33 percent) of polled companies requires the employee to wait for a year. Twenty percent require only a six-month waiting period. Another 30 percent of companies make the option available to employees immediately after they are hired.

The regulations around programs vary by company as well. More than 43 percent of companies do not require an employee to reimburse the cost of school if they leave the company, while 30 percent of respondents said the employee must repay if he or she leaves the company within a year of completing the course. In addition to tuition fees, other items most likely to be covered under tuition assistance programs include the cost of coursework books, with 53 percent of companies saying they cover the cost, followed by lab fees (43 percent), administrative fees (39 percent), and tests (30 percent).

The Taking the Pulse: Tuition Assistance survey was conducted by i4cp, in conjunction with HR.com, in July 2008. There were a total of 493 respondents. The full results of the survey are available exclusively for all i4cp corporate members.

Training the Leaders Who Follow

Onboarding a new employee or transferring an old one into a new position involves a barrage of steps. She must be trained on the organization’s practices and policies, while gradually adjusting to her job function. Making sure the employee understands her role in regard to her co-workers is also crucial. Now factor in that the employee is in an executive position. The transitional process should be structurally conscientious to ensure the smooth and favorable future of the organization. Unfortunately, that is not always the case.

According to the “Executive Transitions” study from the Institute of Executive Development and the Alexcel Group, 30 percent of senior leaders who transfer into new companies, and 21 percent of leaders who transfer within the same company, are not successful in their new positions after a period of two years.

Scott Saslow, executive director at the Insitute of Executive Development, notes, “The assumption is that for the internal transfers, they already know how the organization works. Companies have subcultures. The politics are different, the players are different, and how you get things done is different.”

Another key finding was that rampup time (time needed to perform the job as expected) for internal and external hires was not substantially different. According to 36 percent of respondents, ramp-up time for external hires ranges from six to nine months, while 26 percent reported that it is longer than nine months. For internal hires, 47 percent of respondents reported that ramp-up time ran from three to six months, but 25 percent reported that it took longer than six months.

Patricia Wheeler is managing director of the Alexcel Group. “[Ramp-up time] does take longer than 90 days,” she reports. “If people take their eye off the ball at that point, they may be setting themselves up for less success, and potentially failure.” The main component to solving this issue is managing expectations. “Our results suggest that a relatively small amount of time, if invested correctly, will help senior executives assimilate in their new roles and may prevent the loss of hundreds of thousands of dollars and work-hours,” says Wheeler.

Some of the methods suggested include revisiting the hiring process to include evaluating interpersonal skills and situational behavior; making relevant onboarding plans that communicate expectations for new roles and responsibilities; finding mistakes early; and using tools like coaching, mentoring, and 360-degree feedback to track progress and chart growth. Additionally, Saslow notes that the talent development units within companies need to reach out to recruiting firms and headhunters because all the information collected on a new employee, “needs to be part of the person’s portfolio on the day they start.”

The study, which was released in May, collected data from 150 executives and talent professionals across 11 countries and 18 different industries. Companies surveyed included Booz Allen Hamilton, Credit Suisse, Deloitte & Touche, HP, ING Canada, Saudi Aramco, Symantec, Wachovia Corporation, Wells Fargo, and Wyeth Pharmaceuticals.

—Aparna Nancherla, T+D Associate Editor

Continuing Education Courses Going Strong

Continuing education programs are growing in popularity as employees in a variety of industries work to keep up with new technologies and business strategies. According to a report released last week by the U.S. Department of Education’s National Center for Education Statistics, nearly 27 percent of the American workforce participated in a work-related continuing education course during 2004-05.

The National Center for Education Statistics within the Institute of Education Sciences released the report "Career and Technical Education in the United States: 1990-2005," the fourth volume to describe trends in career and technical education (CTE, formerly known as vocational education). The compendium looks over time at CTE offerings, who participates in CTE, what types of CTE students take, who teaches CTE, and the labor market and further education outcomes attained by CTE participants. The report documents that between 1990 and 2005, the number of CTE credits earned by public high school graduates remained steady, despite the national trend of increased academic course-taking in high school. The report also found that at both the high school and college level, student participation increased in the occupational areas of health care and computer science, and decreased in business.

To view, download and print the report as a PDF file, please visit http://nces.ed.gov/pubsearch/pubsinfo.asp?pubid=2008035.

Managers Encounter Difficulty With New Roles

For employees who are promoted into management, many anticipate new avenues for professional growth and leadership. But an increasing number of managers—both new and experienced—report a number of obstacles in making a complete transition into their new roles. A five-year study conducted by ConceptReserve, a Colorado-based training agency, reported that among 1,200 managers, 86 percent have trouble moving beyond working as individual contributors and into their management roles.

Although this issue is not a novel one, the current increase demonstrates that the slow transition is at least three to four time worse than it was in the late 1990s. The reasons behind the snag are rooted in several obstacles as well as invalid assumptions held by managers about their success, their teams, and themselves.

Managers differed greatly in terms of tenure responsibilities. John Davis, CEO of ConceptReserve, says new managers compose 25 percent or less of the participants. Senior managers were excluded. Survey results indicated five areas as major sources of frustration for managers. By far the most difficult task was transitioning from doing work to managing and delegating work. The issue is not whether managers understand delegation techniques, but their inability to let go of their comfort and expertise. Many managers believe their jobs had in fact become two-fold—performing as well as overseeing the workload. Davis observes that often managers tend to “do” instead of manage. “These are very competent individual contributors who got promoted. Now they’re in the manager ranks and they’re just trying to do a good job,” Davis says.

Some managers are uncomfortable taking on a leadership role among former colleagues. This becomes manifest when leaders must assign work, offer direction, and hold team members accountable. Managers are also apprehensive when balancing their current roles with the skills and capabilities that earned them a promotion. “They’ve got to leave their expertise behind, and learn how to deal with broader issues—the business, process, and personal and relationship issues both at the group and the organizational levels,” Davis says.

Because many managers believe that their roles are double-sided, they have difficulty managing their time when faced with competing demands such as meetings and broader business issues on one hand and completing the work they handled previously on the other.

To become more effective, managers must learn to rely on their team members to complete tasks independently. This proved to be another rough transition for managers, and it is rooted in their inability to delegate and step away from day to day tasks. To transition more effectively and overcome these obstacles, Davis asserts that managers need to shift their focus in terms of previous assumptions and the work that they do. To surmount the roadblocks, it is important that those who are stuck adopt different approaches to their work and rethink flawed assumptions.

Davis cites five elements that are necessary to make a complete transition into management. First, managers need to make an accurate assessment of where they are in their careers and how it relates to the team goals and the larger business. Second, training should be utilized to help managers understand new approaches, the implications of past assumptions, and plans for changing behaviors. Third, managers should consistently apply this understanding to their work as soon as possible. Fourth, while it is important for managers to adopt their own leadership style, they should receive coaching along the way. Lastly, the assessment of a manager’s transition should be ongoing to ensure that managers are progressing and to account for their steps toward accepting broader business and technical responsibilities.

Managers who begin to make the shift can achieve full transition, possibly within 12 months, according to Davis. And the importance of assessing where they are and what is expected of them is an essential first step.

—Juana Llorens, T+D Managing Editor

July 23, 2008

Use of Video Game Technology in the Workplace Increasing

Seventy percent of major employers utilize interactive software and games to train employees according to a new study released today by the Entertainment Software Association (ESA). The study data also showed that more than 75 percent of businesses and non-profits already offering video game-based training plan to expand their usage in the next three to five years. And more than three-quarters (78 percent) of organizations not utilizing this technology today are likely to offer it in the next five years.

“Businesses across the spectrum, from automobile manufacturers to financial service providers, are utilizing entertainment software to help educate their employees to better serve their customers and improve their bottom lines,” said Michael D. Gallagher, CEO of the ESA, the U.S. association representing computer and video game publishers. “Interactive technology is a valuable tool in workforce development and this study underscores the fact that video games have become a mass medium helping Americans live, work and of course play.”

The top uses of video game-based training by major American employers include: compliance training; training for specific job functions; IT training; management training and customer service training. Seventy-seven percent of these training programs tested employee knowledge and 55 percent included interactive role playing.

The survey found a vast majority of organizations offering video game-based training were satisfied with the results and sophistication of the training. Respondents said the biggest advantages of video game-based training are

§       a reduction in costs

§       more efficient and faster training

§       the ability to apply consistent training across all parts of an organization

§       the ease of measuring employee participation

§       better information retention.

Managers of three in four companies also said their employees like video game-based training more or the same as traditional training and their employees found the convenience and ability to learn at their own speed particularly attractive.

"The demand for training games is definitely rising as managers look for new ways to train their employees that are both effective and more compelling than the standard eLearning fare," said Marc Prensky, founder of Games2train, a company created in 1999 to serve the growing demand for corporate game-based training. "In my experience, computer, video and, increasingly, cell phone based training games are more successful than traditional training methods, because employees find them more engaging, thereby increasing the likelihood of completion of the training and retention of the required information and concepts. In addition, simulation-based games allow employees to learn and practice needed physical and mental skills, and thus be more effective when they get on the job."

Games2train (www.games2train.com) created more than 50 software games for companies such as American Express, Bank of America, Charles Schwab & Co., Estée Lauder Companies, Inc., JP Morgan Chase & Co., Nokia Corporation and Pfizer Inc., as well as training games for the US military.

Canon U.S.A., for example, uses a video game to train new copier technicians. To play, technicians must drag and drop parts into the right spot on a virtual copier. IBM developed “Innov8,” a role playing game that is said to teach graduate students a combination of business and IT skills. The Hilton Garden Inn, meanwhile, introduced the first training game for the hospitality industry, which places employees in a virtual hotel, interfacing with customers and fielding typical guest requests.

The national poll, conducted for the ESA by KRC Research, surveyed the management of 150 large U.S. companies and non-profits between March 17 and April 2, 2008.