Fight for Talent

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March 2014 Time for a more holistic approach to talent risk #Fight4Talent

description

KPMG’s Fight For Talent Breakfast Seminar with panelists Maureen Berry, Debbie Fischer, Kate Humphries, John Stockwell and our National Lead, People and Change Services, Laura Croucher. The session provided a unique opportunity to hear the latest perspectives on talent risk and successful talent management. Some of the topics covered included: why organizations are downplaying talent risks, why does retention continue to be an issue and why is there a difference of opinion between HR and line Managers in regards to talent needs and priorities.

Transcript of Fight for Talent

Page 1: Fight for Talent

March 2014

Time for a moreholistic approach to talent risk

#Fight4Talent

Page 2: Fight for Talent

2© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Presented By

LAURA CROUCHERPartner, Advisory Services National Lead People & Change (Canada)KPMG LLP

Follow the conversation:

#Fight4Talent@KPMG_Canada

[email protected]

@croucher_laura

Laura Croucher KPMG

+1 416-777-3417

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3© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Agenda

7:30 – Breakfast and Networking

8:00 – Talent Risk Presentation - Laura Croucher

8:45 – Industry Panel

8:50 – Introductions

John Stockwell - VP HR, Open Text Corporation Maureen Berry - Corporate HR Executive, Canada Health Infoway Debbie Fischer - KPMG Associate and former EVP Strategy & Org Development, Mount Sinai Kate Humphries – Sr. Manager, Resource Planning & Succession Management at TD Bank Group

9:00 – Moderator Questions

9:25 – Audience Questions

9:55 – Final Remarks

#Fight4Talent

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4© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

About this research

Organizations are competing for talent on an unprecedented scale

In this context, how effectively are

organizations identifying talent risks to their current

and future business growth?

And how effectively are they mitigating against

talent risks?

KPMG International commissioned the

Brandon Hall Group to conduct a global study of

talent-related risks

1,200 Human Resources (HR), talent, learning and business executives

54 countries

Government and 15 different industries represented

Just over a quarter of respondents work in companies with 30,000+ employees

Series of qualitative interviews

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5 Cs: Talent Risk Categories

#Fight4Talent

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6© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The survey focused on five critical talent risk categories …

How concerned is your business?To what degree are you managing that concern?

Capability.

Capacity

Cost

Compliance

Connection

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Key Findings: Capability & Capacity Risks

#Fight4Talent

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8© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Global Talent Risk Profile

and

Highest Ranked

Capacity and Capability risks dominated both in terms of perception and mitigation of risk

Least likely to be ranked

Compliance talent risks was the most likely risk category to be listed as no risk at all by about 38% of the survey population

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9© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

An insufficient budget for managing and developing talent Cost

Salary expectations of candidates with critical skills become too high Cost

Difficulties in recruiting top talent Capability

Salary expectations of candidates with critical skills become too high Capability

Skills and capabilities required by the business in the near future are not developed Capability

A lack of compelling development opportunities for top talent Capability

A lack of depth of internal candidates for critical roles Capacity

An insufficient pipeline of future leaders Capacity

What talent risks were respondents most worried about?

1

2

3

4

5

6

7

8Business leaders’ inability to engage with, motivate and nurture business critical talent 9 Connection

Managers view performance management, talent reviews et c as a process to comply with rather than as business critical activities 10 Compliance

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10© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

21%

18%

32%

20%

6% 3%

We do not have succession plans

Not at all effective, lists with no action

Somewhat effective, lists with regular action

Very effective, succession planning discussions

Extremely effective, actively work with succors

I don’t know

‘An insufficient pipeline of future leaders’ ranks as #1 talent risk and yet few organizations have effective succession planning in place...

Effectiveness of Succession Planning

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11© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

26% of organizations filled less than 25% of their Critical Roles with internal candidates

26%

22%20%

13%

10%

9%

Less than 25%26% to 50%51% to 75%76% to 90&More than 90%I don’t know

Percentage of Critical Roles filled with Internal Candidates in last year

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12© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Which talent risks were respondents actively managing?

A lack of depth of internal candidates for critical roles 1 Capacity

An insufficient pipeline of future leaders 2 Capacity

Difficulties in retaining key people 3 Capability

A lack of clarify over which roles are ‘critical’ to deliver business value 4 Cost

The total cost of the workforce becomes unsustainable in relation to current revenues 5 Cost

Skills and capabilities required by the business in the near future are not developed 6 Capability

A lack of compelling development opportunities for top talent 7 Capability

Difficulties in retaining to talent 8 Capability

The cost of retaining top talent becomes unsustainable 9 Cost

Salary expectations of candidates with critical skills become too high 10 Cost

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13© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

8%

22%

35%

25%

7%4%

No strategic workforce planning

Basic approach

Simple approachDetailed approach

Complex approach

I don't know

Respondents were not optimistic about their approach to strategic workforce planning ....

Approach to strategic workforce planning.

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14© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The two big challenges for talent management

Organizations take a narrow view of talent management 1

2

3

■ There is a strong focus on the ‘traditional’ areas of talent management – capability and capacity

■ This is coupled with a relative lack of concern about connecting and engaging with talent as well as enabling and encouraging collaboration

Insufficient focus on total cost of workforce 2

■ There are a number of talent risks which appear in the list of top 10 risks identified but do not feature in the list of top 10 risks actively being managed:

■ Managers view performance management and talent review processes merely as something to comply with, rather than a business critical activity

■ Business leaders’ inability to engage with, motivate and nurture business critical talent

■ An insufficient budget for managing and developing talent ■ Maintaining employee engagement in the face of a less committed, more flexible workforce

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Key Findings: Connection-related talent risks

#Fight4Talent

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16© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The top 10 list of risks respondents were least worried about featured a number of Connections risks…

Talent management processes become non-compliant with local regulation, for example data protection 1 Compliance

International mobility policies and processes make it difficult to transfer talent between countries 2 Connection

Employee relations hinder rather than help talent management processes 3 Compliance

A lack of workforce diversity 4 Capacity

An inability to define the new skills or capabilities that will be needed by the business in the near future 5 Capability

Business leaders’ reluctance to share talent across the organization 6 Connection

Business leaders’ and HR/talent team’s inability to work effectively together to manage talent 7 Connection

A lack of clarity over which roles are ‘critical’ to deliver business value 8 Capacity

The total cost of the workforce becomes unsustainable in relation to current revenues 9 Cost

The cost of retaining top talent becomes unsustainable 10 Cost

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17© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

In addition, effort does not appear to be expended consistently in such a way as to address the top 10 risks identified…

Bottom of the list

Respondents ranked the risks of their ‘business leaders inability to engage with, motivate, and nurture business critical talent’ as a top ten critical risk – yet awarded it fell to almost the bottom of the list of risks that were least actively managed

33% Only 33 percent of respondents felt their business unit leaders were ‘incentivized to share talent across organizations for the benefit of the business and the talent – seemingly at odds with the inclusion of development, retention and several other risks within the top 10 risks.

and

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18© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Talent Review Processes are also not used effectively as an engagement driver...

Do your organization’s formal talent review meetings result in development plans for which leaders take responsibility?

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Key Findings: Cost-related talent risks

#Fight4Talent

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20© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Cost related risks featured at the bottom of the top 10 list of risks respondents were least worried about featured …

Talent management processes become non-compliant with local regulation, for example data protection 1 Compliance

International mobility policies and processes make it difficult to transfer talent between countries 2 Connection

Employee relations hinder rather than help talent management processes 3 Compliance

A lack of workforce diversity 4 Capacity

An inability to define the new skills or capabilities that will be needed by the business in the near future 5 Capability

Business leaders’ reluctance to share talent across the organization 6 Connection

Business leaders’ and HR/talent team’s inability to work effectively together to manage talent 7 Connection

A lack of clarity over which roles are ‘critical’ to deliver business value 8 Capacity

The total cost of the workforce becomes unsustainable in relation to current revenues 9 Cost

The cost of retaining top talent becomes unsustainable 10 Cost

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21© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

24%

38%

27%

11%

NoYes, in a limited scopeYes, extensivelyI don’t know

Over 60% of organizations do not track total cost of workforce at all, or use it only in a limited scope...

Does your organization use 'Total Cost of Workforce' as a key metric?

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Additional Insights

#Fight4Talent

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23© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Clear differences emerge when it comes to attitudes and perceptions of HR leaders, and executives and front-line managers...

■ Executives and frontline managers were most concerned about cost-related talent risks – while HR leaders were even more concerned about capacity risks

■ Overall, HR felt that all areas were being mitigated more effectively than both executives and managers, except workforce cost

Perceived level of risk impact by roles

Capacity Capability Cost Connection Compliance

2.0

2.5

3.0

3.5

4.0

3.093.17

2.95

2.67

2.48

3.09 3.13.2

2.57

2.44

3.293.21

3.142.98

2.69

Scale:

1= Not managing2= Identified, no plans

to manage3= Plans to manage4= Managing and

seeing progress5= Managing and

mitigating risk:

Perceived level of risk mitigation by roles

Scale:

1= Not managing2= Identified, no plans

to manage3= Plans to manage4= Managing and

seeing progress5= Managing and

mitigating risk

Capacity Capability Cost Connection Compliance2.5

3.0

3.5

4.03.85 3.83

3.63

3.353.23

3.56 3.55

3.7

3.133.04

3.54 3.5

3.35

3.17

2.91

HR Executives Business leaders

Note: this data is based on the averages of the survey respondents to a five point scale. Half a point difference is equivalent to a 10 – 20% difference in perception, given the sample size

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24© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

HR’s confidence in talent risk mitigation not matched by executives and frontline managers

■ This mismatch between HR and executives and frontline managers brings into focus that the business is struggling to feel a positive return from talent management efforts

Note: this data is based on the averages of the survey respondents to a five point scale. Half a point difference is equivalent to a 10 – 20% difference in perception, given the sample size

Perceived average talent of risk mitigation level

Scale:

1= Not managing2= Identified, no plans

to manage3= Plans to manage4= Managing and

seeing progress5= Managing and

mitigating risk

Perceived average talent risk mitigation level3.15

3.20

3.25

3.30

3.35

3.40

3.45

3.50

3.55

3.60

3.65

3.58

3.38

3.3

HR Executives Business leaders

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What does this mean for Canadian companies?

#Fight4Talent

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26© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

What does this mean for Canadian companies?

■ Retention continues to be a key concern consistent with last year’s KPMG’s global survey – Canada rated this the #1 Challenge in the Rethinking Human Resources in Changing World Survey

■ Survey reports organizations are downplaying talent risks in the areas of connection, diversity and performance management

■ Lack of emphasis on “connection” is a concern given the nature of work today as well as the entry of younger generations into the workforce

■ In Canada, downplaying Diversity has increasing importance with the recent announcement from the Ontario Securities Commission requiring companies to annually publish a description of their diversity policies.   This new standard is the first of its kind in Canada and will likely be the catalyst for change in diversity in many organizations.

■ Cost as a driver/concern is best considered a more balanced view of talent needs and challenges

■ The survey points to a difference of opinion between HR and line Managers about talent needs and priorities

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Call to Action

#Fight4Talent

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28© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

Build a talent strategy based on an

understanding of what the organizations

needs to win in the future

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29© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

Pause to consider whether all major

talent risks have been identified & prioritized – does the business

agree?

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30© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

Work with leadership to connect and

engage with talent across the

organization

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31© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Embed strategic & holistic talent planning into

business planning – it’s not a standalone

exercise

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

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32© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Seek to understand and track the total

cost of workforce

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

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33© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Evaluate talent-related decisions

for return on investment

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

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34© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Hardwire talent risk into wider enterprise

risk management frameworks

Final Thoughts: Organizations must embrace a more holistic approach to talent management

Holistic Approach

Page 35: Fight for Talent

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

© 2014 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International.

Visit us at kpmg.ca/talentrisk

LAURA CROUCHERPartner, Advisory Services National Lead People & Change (Canada)KPMG LLP

[email protected]

@croucher_lauraLaura Croucher KPMG+1 416-777-3417#Fight4Talent