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Balancing Customer Satisfaction and Productivity

Your staff members complain about having too much work. The proportion of people on short-term sick-leave is consistently above average. And, the turnover rate is disturbingly high. Do these symptoms indicate that you need to increase your staffing? However, the average number of daily transactions processed shows that your staff should be able to easily handle the volume. Comparing takt time and processing time does not lead to any obvious issue. So, what is the problem?

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Excuse Me, Why Should HR Know About Six Sigma?

A friend recently spoke at an HR Conference on a competency development roadmap for Six Sigma professionals. During the break, a few participants went up to him and asked him what Six Sigma is. Only then it occurred to him that not every HR person is familiar with well known basic principles and management practices contributing to business performance and leadership development.

Succession Planning: Is Your Organisation Ready For The Future?

Thinking ahead is a cardinal rule of business. In addition to monitoring the daily operations of your business, you need to think about the future. And, as difficult as it may be, it’s important to envision the day when you no longer will be in charge. For successful organisations faced with demanding leadership requirements in a changing and competitive business environment, a succession planning process may be the most important human resource management investment the company can make.

The New Challenge

The defining characteristic of a successful organisation is increasingly recognised as human, rather than financial, geographical or production-based. This, together with the increased competition for management talent, is presenting human resources departments with new and challenging issues.

HR teams must attract, recruit and retain knowledge and skills, not just fill jobs with generic people. They need to track knowledge and competencies even more effectively and identify where gaps arise between current and future requirements. They have to work closely with business managers to understand how business strategy translates into the skills and knowledge needed. And they must have the confidence to retain both senior management and other employees.

A critical HR activity will be to develop a culture of continuous learning and growth for both individuals and the company as a whole. This is where a company-wide succession planning process will become an essential organisational asset. This process, which may or may not need to be supported by a computerised succession planning information system, can provide benefits that go beyond the traditional reason for succession planning, which has always been to assure the continuity of leadership at the top.

What is Succession Planning?

Succession planning is often described as “career planning at the top”, an extension of the principles and procedures that the company uses to merge the career aspirations of individual managers with organisational goals and management needs. Both career planning and succession planning are (or should be) “developmentally oriented”, that is focused on the long-term development of managers for future positions, as well as specific activities such as training, education and job-development.

However, because succession planning typically focuses on a few key leadership positions that are considered critical, and because these positions often have different requirements than other management jobs, succession planning usually requires a separate or additional set of “position requirements”. The skills and talents required to lead key function, business units or the organisation as a whole are not necessarily the same as those needed at intermediate or specialised management levels. For example, the job descriptions of data procession managers seldom call for a understanding of global economics or competitive marketing strategies.

Does Your Organisation Need Succession Planning?

Consider the following questions:

  • Is turnover in key positions high?
  • Are employees trained after they have been promoted?
  • Do you consistently fill positions with external replacements?
  • Does staff feel that advancement is based on personal or subjective criteria rather than them being best qualified?

If you answered yes to any of these questions, then you need to think seriously about implementing succession planning

Defining The Process

Effective succession planning and leadership development has to be based on clear understanding of the business strategy. This in turn determines the kind of people you need for effective leadership both now and in the future.

A Typical Succession Planning Process

Figure 1: A Typical Succession Planning Process

These requirements must then be mapped against information about individual employees. In addition to biographical detail, technical and professional skills, you should look at track core competencies – fundamental human skills and attitudes – and knowledge. This will be particularly powerful if you can also identify which competencies are required for current and future positions.

Figure 2 below illustrates the Succession Management Process developed for Aon Singapore and Asia.

The process distinctly illustrates three important components. Position Requirements are one of the three components that define a succession planning process and may require extensive data that is applicable only to key positions in the organisation. In the case of Aon, the key positions and position holders are recorded in a database, named RED book.

Like most organisations, Aon use competency models to assess employees (Figure 2) by using a set of criteria to identify internal candidates who match a position but may not have been nominated as a successor. Once candidates have been identified, information is recorded in the database, named BLUE Book. The potential successors will be assessed using the Competency Profiler tool to augment the competency with executive profiles, educational background, performance ratings, and other relevant information to assist in determining who to include in the succession pool.

Typical Succession Planning Steps

Figure 2: Typical Succession Planning Steps

“People Data” are the second component of succession planning. This step is usually more extensive than career planning because upper-level positions are more critical to business success and more should be known about managers who may ascend to these positions. For example, a career planning system might incorporate performance appraisal data that rates a manager’s performance on a scale of one to five. Data on potential company leaders should be more extensive and detailed, explaining the reasons for the rating and providing an overall context for the appraisal.

The third component in defining succession planning is Development Activities. They link people and their qualifications with the requirements of key positions. Developmental activities are also likely to include different, and sometimes unique, types of information and activities beyond those in a career planning process. For example, a career plan targeted at domestic marketing positions may not need to include education or experience with foreign governments or offshore production. However, a CEO candidate or Regional  Marketing vice president would need this experience and/or knowledge.

Benefits of Succession Planning

An effective succession plan enables a company to identify and prepare the right people for the right positions at the right time and to identify, secure and grow a company’s knowledge base. In addition to building and securing company’s knowledge base, succession planning helps organisations to:

  • engage senior management in a disciplined review of leadership talent
  • ensure effective development plans are in place for key executives
  • align management development, selection and reward with business requirements
  • assure continuity of experience and leadership
  • avoid premature or belated promotion
  • retain and motivate management and key contributors
  • ensure training budgets are spent effectively

Critical Success Factors

  • The succession planning process must be supported by top management
  • Line managers need to understand the benefits of succession planning
  • Start small – focus on your most important people and positions first and establish a clearly defined  process before addressing a wider population
  • Take into account both the current and future strategic direction of management  and organisational structures and culture
  • Focus on development opportunities with the greatest impact for the business – cross-functional /cross sector assignments, mentoring, etc
  • Aim to develop leadership team – not just functional skills in isolation
  • Link organisational values and cultures to employee development
  • Ensure the consistent data standards are used across the organisation whenever possible
  • Choose a specialised succession planning software solution to manage the process.

 

My Opinion: It’s About the Process

Discussing workforce planning with an HR professional of a government entity in Singapore we explained our approach that starts from customer and strategy, goes via processes and concludes in workforce needs, in short. The answer I got from my client was “Why do you look into operations in order to do workforce planning. We want to do this without dealing too much with processes.”

I was surprised to get this reaction from an HR professional.

INSPIRE – Seven Essential Steps to Building A Coaching Culture

I absolutely believe that people, unless coached,
never reach their maximum potential. Bob Nardelli

Coaching is “Expanding a person’s capacity to take quicker, more effective actions.” Robert Hargrove. In a coaching culture people continually discover how they create their own reality and how they can change it. Everyone understands the goals of the organisation and the personal contributions necessary to achieve them. Organisational resources are maximised.

Take Care of Your Talent – Or Someone Else Will

Your Lean Six Sigma initiative has taken off well, project teams led by Belts have done a nice work and results are in. Good job so far?! However, this is the rather easy part of your journey. The more difficult part is about retaining and accelerating the trained Black Belts and Green Belts (Belts).

Lean Six Sigma Deployments need Green Belts or Black Belts

Green Belts or Black Belts are the Project Leaders for Lean Six Sigma Projects

Talking to both, Lean Six Sigma consultants as well as their clients, paints a surprisingly consistent picture. Nearly half of the companies who kick-off a Lean Six Sigma initiative lose some of their Belts shortly after certification. Another tendency is alarming. We are not talking about one or two Belts who resign at that point in time. A considerable 20 – 30% of the first batch of trainees may decide to leave.

So, what went wrong?

The answer to that question lies in the approaches companies choose to run their Lean Six Sigma initiative and human capital development. In some companies like Microsoft or General Electric, Lean Six Sigma education and development is part of the management development programme for their staff. Employees see such development as reward and potential for growth within the company. These companies have included Lean Six Sigma as one of the core programmes in their management and leadership development initiative, where staff undergoes action learning by carrying out real business projects with application of Lean Six Sigma tools & methodologies.

For some companies, the most urgent driver to engage the Belts with the business operations agenda is process optimisation or streamlining. Companies fail to look beyond, i.e. career development opportunities for their Belts, or even to recognise some of them as their key talent who are potentially future leaders for their companies. Unfortunately, this reality hits at a time when demand exceeds supply.

General Electric’s Management Development Programme includes a compulsory module about Lean Six Sigma. Without having a “Belt” no one has a chance to be promoted into the upper management in GE.

The pressing question, then, is how to retain our Belts, our talents. And, how can we accelerate the process of nurturing and maturing leaders so that absence of talent is never an impediment to business goals. As with all change initiatives, it only has a chance when the top management sets the tone and invests time and energy so that the talent development is internalised by the entire organisation and truly shapes the company for the future[i].

Excellence in Talent Management

In most companies, the process and tools around identifying potential and accelerating the development of top leadership talent are facilitated by HR. In the best companies, however, strong sense of personal responsibility to spot, nurture and retain talent is deeply embedded in every leader’s agenda, and is evident in how they spend their time. This stems from a perception that the senior management sees talent as a strategic priority, and is a constant champion of those initiatives that drive it.

In this article, we list some ideas on excellence in talent management and on supporting strategies as well as steps for managing talent that truly benefits the business.

Step 1: Begin with the End in Mind – Your Current and Future Business Needs

Effective talent management delivers real competitive advantage when business goals and strategies are the starting point for determining the quality and quantity of the Black Belts or Green Belts you need. It is important to intertwine Belt requirements with the business needs – which means that business and Belt planning process need to happen in sync. The challenge organisations often wrestle with at this point is identifying and selecting the right people to become Belts. Here are two examples for consideration:

We need a robust and systematic tool to select and train future leaders for our company. What I’ve read about Six Sigma so far was about focusing on customer requirements, managing and improving processes, changing the company’s culture, encouraging people and, last but not least, making money. This is exactly the job of our leaders. Therefore, we want to use Lean Six Sigma as part of the management development programme to select and develop the next generation of leaders, the president of an Asian multi-national company responded when asked why he wanted to kick-off Lean Six Sigma[ii].

We are a government regulatory agency. There have been consistently unpleasant feedback and complaints in newspapers by our customers about our service and process turn-around time. Who will be suitable to bring up our customers’ experience by optimising our processes?, was the explanation of a director in a government agency on the question what they want to use Lean Six Sigma for.

As strategic plans and forecasts are prepared for business units or functions, questions about leaders or talent need to be addressed: Who will execute each part of the plan? What skills do they need to possess? What skills do they need to develop to enable them to be successful?

This involves translating requirements into concrete descriptions of the type and quality of talent you need. This means determining critical success profiles for the role (Black Belt, Green Belt), sizing up both the quantity and quality of your leadership bench in relation to current and future business needs.

Step 2: Selecting Belts – What Kind of Talent Does The Business Need?

Our experience over the last decade with Belts who succeed and those who could not make it has led us believe that the performance is linked to the following traits:

  • Personal Interest in the programme is one of the most important factors. It is much easier to teach methodology and tools to people with the right mindset than making a disbeliever (typically low interest) a Lean Six Sigma evangelist.
  • Organisational Knowledge And Business Acumen provide focus for individual’s energy and drive key business initiatives & priorities that will expand business, increase market share or improve profitability.
  • Competencies are the broad challenge to which the Belts must step up, to drive successful execution of the strategic priorities (e.g. driving change, generating ideas, controlling costs, developing others, etc).
  • Personal Attributes – such as customer orientation, be it external or internal customers – is essential for succeeding in Lean Six Sigma and a major step from process improvement towards customer satisfaction. Self motivation and risk taking are other key personal attributes to ensure success in this role. People management skills comprise of a list of key strengths that are fundamentals to win.

Against the common belief, statistical knowledge is not a criterion for selecting your Belts. However, the capability to acquire new technical skills, to apply these skills successfully is an important prerequisite. More important is the aptitude to involve, motivate, coach and train people, to lead and manage teams towards delivering results and to communicate effectively with different levels in the organisation.

A Belt candidate with the right mindset and with the latter strong point will be able to overcome a technical weakness easily by building on the strength of his team members, whereas a technically competent candidate without “People Skills” will most likely fail. Hence, selecting Belts with less people skills needs special development steps in order to avoid frustration and ultimately resignation. Moreover, traditional Lean Six Sigma training focuses on building and enriching technical skills and is typically very weak in developing people skills. Adequate training and development measures need to be considered.

All these traits provide the foundation needed to drive subsequent steps in the talent management process, and other HR systems such as on-boarding and performance management[iii]. Our experience is that such attributes are most essential to measure Lean Six Sigma Belt candidates’ potential or potential derailleurs. At the same time they are critical for selecting staff into other critical jobs or assignments.

Step 3: Developing the Potential of Belts

Consequently, talent management is not about putting the Belts through the Lean Six Sigma training and getting them to deliver a couple of business projects, but is about enhancing them to support organisational leadership capability on a broader scale. This important step acts as screening mechanism for those most likely to become tomorrow’s leaders, providing a basis for a flexible pool, which individual – for any number of good reasons – move in and out of as years go by.

Many common mistakes companies have made at developing the Belts include:

  • Selection without subsequent diagnosis of additional development needs
  • Focus on current performance alone
  • Inconsistent assessment criteria
  • Only focus on strengths (no consideration of leadership potential derailleurs)

We see three components as key to optimising the potential of Belts:

a)  Evaluating Current Performance

Assessing the effectiveness of Belt’s performance and behaviour in their current role should be done before evaluating potential. We believe that sustained high performance in the current role is a pre-requisite for potential.

It is important for the managers to define clear performance expectations and measures; commit time to managing performance by observing, coaching and giving feedback; and balancing consideration of results with behaviours.

Tanya used to be a team leader responsible for renewal of policies in an insurance company. The senior management team wanted to use Lean Six Sigma for improving the relatively low renewal rate. Because Tanya was the only person in sight who knew the process good enough she was hesitantly selected to become a Green Belt and “to fix the renewal rate problem”.

It was an uphill task for her as she was a rank & file manager without any prior management or leadership development. However, Tanya has the key personal traits, her desire to learn and developing others. This and her hard work with her team – Lean Six Sigma work was additional work for her – had made her a successful individual in the organisation.

She delivered excellent business results; the management team was amazed by her hidden leadership qualities and business understanding. Tanya was promoted twice within four years subsequent to her excellent performance.

Today, Tanya is one of the members in the senior management team of that company.

b) Identifying Leadership Potential

Determining individuals with the most growth promise is often done superficially. Uncover the hidden potential of the individual by leveraging on the individual’s strength. And provide space and confidence for the individual to grow. The behaviours of such individuals are:

  • taking best advantage of and
  • responding positively to differential development opportunities,
  • supporting the organisation’s values, as well as
  • being able to apply what is learned productively within the organisation.

If you can identify the potential effectively, you can focus your investment on these individuals who will generate the highest ROI in terms of their ability to grow quickly and broadly.

c)  Creating Opportunities For Acceleration

Once you have screened for leadership potential among the Belts you have developed, those meeting criteria are admitted to the “talent pool”. More accurately, they are target for rapid development – an “acceleration pool”. The beauty of such a pool is that it provides flexibility and eventually greater organisational self-sufficiency for current and future talent needs. The pool becomes the first in mind when high-value roles need to be filled and special assignments emerge.

Senior Management supported by HR take personal ownership of the “talent pool”. I.e. they request  realistic assessment of readiness and focused development for pool members. And, they keep regular, thoughtful communication with the pool. The communication should make clear that being part of this pool is an opportunity but not a guarantee for promotion.

Step 4: Assessing the Readiness of Belts for Leadership Transitions

How do you minimise the risk of promotions when the pace of business means that you often need to test people in untried roles with new responsibilities? Using Lean Six Sigma projects provide assessment information of your potential leaders and hence helps in the selection decisions. Additionally, the following approaches may be considered:

a)  Individual Readiness

There are many assessment tools available. They have different strengths and need to be applied appropriately to help you and other stakeholders make better talent decisions. Tools such as Performance Feedback, Personality Inventories, etc.

COE’s approach to assessment using 360 Degree Survey (360ELP) complement with coaching/mentoring, focus on others’ perceptions of performance in a current role is a powerful diagnostic for development.

b)  Organisational Readiness or “Talent Pulse-Rate”

Increasingly, decisions about strategic direction and organisational structure (or restructuring), mean decisions about talent. Which talent ‘you want on the bus’ (Jim Collins: Good to Great) impacts not only your ability to execute but also your stakeholders’ confidence in that ability, which can amount to the same thing. A thorough review or audit of what you’ve got and how far it’s likely to be able to take you in your chosen direction – the Talent Pulse Rate[v] brings visible assurance to stakeholders. It provides a solid basis for decisions on restructuring, talent redeployment and development, whatever might ensure decisions around placement.

Step 5: Developing and Driving Performance

After the assessment, it is essential that the participant is given thoughtful feedback and has the opportunity to buy-in and agree on development priorities. They focus on individual growth areas or strengths that match what the business needs of its leaders, their own role requirements, personal goals, aspirations and objectives.

Besides undertaking real business projects that require using Lean Six Sigma methodologies, development can be in the context of a new job assignment, or in structured training for fundamental leadership skills.

Set of Belt Competencies

Set of Belt Competencies

Executive Development will likely be more individualised, where action learning can meet the needs. The figure shows COE’s perspective on the set of Process Excellence Leader Competencies. There are four roles process excellence leaders will grow into over time: Business Advocate, Process Excellence Expert, Integrator and Change Agent. However, this cannot be achieved by doing one project and leading a team to successful completion.

In any context, though you need rigor in how development is executed. Effective development requires a blend of activities including mentoring, classroom learning, coaching, action learning, etc.

Conclusion

Belt selection is a critical step in ensuring a Lean Six Sigma initiative contributes to the business as intended. Belts are your talent pool, who has proven to be able to perform in their job and whom you would like to see growing in your organisation. They need to have interest – or you need to enkindle this interest respectively. Additionally, they need to have some basic people skills. And, they need to be open for discovering new ways of looking at problems. All these requirements are basics for leaders.

Use Lean Six Sigma to develop your next generation of leaders – and communicate this carefully. If someone fails to deliver, give him/her another chance. If this person fails again, you know that he/she may be in the wrong place at the wrong time.

 

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HR Optimisation and Re-Engineering

Today, organisations must change their priorities from a traditional focus on planning and control to emphasising speed, innovation, flexibility, quality, service and cost. The HR team has to demonstrate their commitment to meet these key business drivers.

A major problem confronting HR managers today is to increase line management and employee productivity, provide higher more value-adding levels of HR service and internal customer responsiveness and at the same time reduce costs. What is needed is an HR team that is customer-focused and market-driven in its external relations with customer and process-focused and team-oriented in its internal operations.

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