The Three Rs of Talent Management

Jay Meschke, President CBIZ Human Capital Services & EFL Associates
August 2, 2011

The Three Rs of Talent Management

Retention Remuneration Recruiting . . . In a Modern World

Retention

Unemployment in an Improving Economy

 Recession ended in June 2009 (Newsweek)  Employment markets improved beginning Q4 2010

Flat in the last few months

 Unemployment rates, the truth behind the statistics

Unemployment in an Improving Economy

 Common perception, supported by monthly reports

from the U.S. Bureau of Labor Statistics

9.2% unemployment
 In reality, a strong negative correlation exists

between unemployment percentage and education

Bachelors degree or above Some college or an Associates degree High school graduate Less than high school diploma 4.4% 8.4% 9.5% 13.1%

Bureau of Labor Statistics Table A4: Employment status of the civilian population 25 years and over by educational attainment

Projected Turnover as the Economy Improves

 Per a recent WorldatWork survey, more than half of

employees intend to leave their current job as the economy improves

 The survey asked: Do you plan to pursue new job

opportunities as the economy improves? 60%: Yes, I intend to leave 21%: Maybe, so Im networking 6%: Not likely, but Ive updated my resume 13%: No, I intend to stay
www.worldatwork.org/waw/adimComment?id=35633

Retaining Top Employees

 Management Teams need to play defense as their

offense is gearing up
 Be warned: Corporate America is starting

to use search firms again (C-Suite) Why?

 Top performers are being courted

Talented executives are now susceptible to calls from your competitors or executive recruiters

Hidden Costs of Losing Tenured Employees

 Difficult to measure . . . soft versus hard dollars  Rule of Thumb: 33% to 150% percent of the annual

salary Salary costs Recruiting expenses Downtime and training time

 If true: The cost to replace a $100,000 position

ranges from $33,000 to $150,000, depending on the complexity of the position

Perks Making a comeback

 Challenger Gray survey - 42% of respondents

concerned about others poaching talent pools

 Companies are reinstating perks

41% have brought back all or some of perks that were cut during the recession
 Organizations are introducing new tools to retain

and attract the best and brightest 24% of have introduced entirely new perks

Tactics to Help Retention (or attraction)

 Money talks

Raises, including backdating previous cuts Long overdue bonuses or spot bonuses (when someone says it is not about the money think the opposite) Reinstituting employer 401(k) contributions
 Special cases attracting new employees

Financial incentives to encourage renting

Tactics to Help Retention . . . . continued

 Title enhancement (low cost but valued)  Recognition (enhances self esteem)  Flexible scheduling (telecommuting)  Executive coaching  Continuing education, tuition reimbursement (grad school, certifications, special training such as CCL, etc.)  Sales conferences (tangible, fun)  Team-building sessions (clears the air, brings frustrations into the open)  Vacation, personal time, flex time

Remuneration

Remuneration
 How are you paying vis--vis the market?

Now is not the time to take things for granted

 What tools are/should be at your disposal?

Internet surveys Industry surveys (check sample size) Compensation consulting firms
 Do you use a holistic performance management

system?

Remuneration
 FAQs & Stats

Base Salary Increase Percentages

Salary Increases All Organizations Central Region
Employee Group Hourly Professional Executive Actual 2010 2.4% 2.5% 2.5% Projected 2011 2.5% 2.9% 3.0%

Remuneration
 Average salary increase percentages

2000 - 2008 surveys - 4.0 to 4.5% 2010 surveys - 1.0 to 3.0% 2011 indicates that most organizations do not expect business to grow until well into 2011, or 2012 Many organizations are continuing a conservative approach, except for top performers HR executives should sound the warning signals

Remuneration: Potpourri
General Comments . . .  Majority of organizations plan to reverse salary cuts in 2011  Projected 2011 annual incentive payouts (STI) expected to be higher, and incentive pool funding is rising, accordingly  Refining performance management to align goals and incentive payouts (e.g., strict adherence to achieving hurdles)  LTI . . . restricted stock, stock appreciation rights and performance shares plans are gaining popularity again; but less number of participants

Remuneration: Potpourri
General Comments . . .
 Future of health care benefits is on the minds of most employers and employees  Health premiums are increasing dramatically since the passage of the health care reform legislation  Critical need: understanding how to design or revise plans to meet minimum essential coverage  Executive perquisites - a shifting environment  IRS continues to show interest in executive compensation among nonprofit organizations

Remuneration: Potpourri
General Comments . . .  Many non-profit organizations have had difficulty maintaining competitive pay for executives and nonexecutive employees  Unlike corporate counterparts, half of NFPs froze salaries, more than one-third underwent layoffs and 23% reduced employee benefits  For answers to detailed questions on this topic, please contact: CBIZ Compensation Consulting 800-844-4510 (erataj@cbiz.com)

Recruiting . . . In a Modern World

Recruiting in a Modern World: The Past

 Classified advertisements  Traditional job boards: Monster.com, Career

Builder
 Industry networking  Search firms

- Temporary help agencies - Employment agencies - Contingency headhunters - Retainer based executive search firms

Recruiting in a Modern World: The Present

 Social Networking

LinkedIn (e.g., Groups feature) Aggregators/Consolidators (Simply Hired, Indeed, Flipdog) Facebook, Twitter (need to be perceived progressively) Face-to-face networking with industry contacts

Recruiting in a Modern World: The Present

 Search Firm Dynamics Transparency (sharing of databases) Milestones Good candidates, fast Recruitment Process Outsourcing (RPO) Candidate Identification Firms / Name Generation Firms Off-shoring  Adhocracy Temp to perm Pros and Cons

Questions?

About Your Speaker

 Jay Meschke is President of CBIZ Human Capital

Services and EFL Associates with almost 19 years of experience in the human capital space Meschke is routinely sought after as a subject matter expert in the field of executive search, recruiting, career management, and human capital services Has been quoted in numerous publications such as US News & World Report, MSNBC.com, CNN.com, The Wall Street Journal, Employee Benefit News, Entrepreneur Magazine, Business Week, TheStreet.com, Kansas City Business Journal, and Kennedy Publications

Contact Information
EFL Associates, a CBIZ Company 11440 Tomahawk Creek Parkway, Leawood, Kansas 66211 Phone: 913-234-1560 - Fax: 913-458-5522 CBIZ Human Capital Services One City Place Drive, St. Louis, Missouri 63141 Phone: 314-692-2249 - Fax: 314-692-4222 EFL Associates, a CBIZ Company 8181 E. Tufts Avenue, Denver, Colorado 80237 Phone: 720-200-7000 - Fax: 720-200-7002