Talent Tuneup

Retaining your best talent and grooming talent from within take on added importance during an economic slowdown. Workforce planning, leadership development, succession planning, and a host of other talent-management strategies can not only strengthen competitive advantage but also are critical to preserving an institution’s capacity to maintain its teaching, research, and service missions in the face of budgetary constraints.

While tough economic times may translate into more employees staying put for fear of the risks entailed in switching jobs, more are apt to look elsewhere once the economy improves if they don’t feel there are real opportunities to grow or advance in their current workplaces. A recent study released by Hewitt Associates and Human Capital Institute included feedback from nearly 700 senior-level business and human resource leaders about the talent-management practices in their organizations. According to the October 2008 report “The State of Talent Management: Today’s Challenges, Tomorrow’s Opportunities,” significant talent-management struggles include consistency in executing practices and programs throughout the organization, addressing shortages in depth of management and leadership talent, and retention of high-performance workers. A key first step in turning around lackluster talent-development initiatives is recognition by senior leaders that they must become involved in their organization’s talent-management strategies and held accountable for growing talent down the line.

The study identified common challenges to successfully executing talent-management programs. Among them:

• Inability to develop people within their current jobs.
• Failure to align talent needs with business strategy.
• Lack of meaningful metrics used to evaluate the effectiveness of talent-development programs throughout the organization.

Conversely, organizations effectively managing their talent needs tend to apply programs more deeply and broadly in their organizations and to view talent management as a shared business and HR responsibility. As more colleges and universities are taking serious aim at developing talent from within their institutions (see “Building Talent Internally” in this issue), the concept of talent calibration could serve institution leaders well by introducing consistency and accountability into talent-development efforts.

Talent Calibration
“Calibration is the sharing and adjusting of decisions across a group of managers, rather than allowing each manager to make decisions on his or her own,” writes Jim Kochanski, a Sibson Consulting senior vice president and coauthor of “Harnessing the Power of the Group: The Case for Talent Calibration” published in Sibson’s June 2008 Perspectives newsletter.

According to the article, which includes tips for how to introduce calibration methods into management decision making, primary applications of talent calibration include:

• Setting and aligning performance goals.
• Assessing performance and establishing ratings.
• Formulating development feedback and action plans.
• Developing job assignments and succession plans.
• Deciding base-pay increases, annual bonus awards, and long-term incentives.

Among the benefits:

• Talent becomes more visible organizationwide, at an earlier point, and with a greater degree of input.
• Errors in decision making are reduced because managers’ ideas are tested and they know they will be held accountable for executing their plans.
• Feedback to employees is more consistent as a result of managers first sharing and refining their messages with their peers.
• Employees typically feel that performance evaluations and career-development and compensation decisions are more equitable and transparent because decisions are reviewed by peer managers and other senior leaders.

Exchanging thoughts about employee performance and goals helps managers standardize ratings and injects reliability and consistency into the process, notes Kochanski. “When sharing criteria for evaluation among pools of managers and administrators, leaders can also offer critical feedback on whether goals seem specific enough, have enough or too much stretch, and whether they are complimentary with institutional goals.” Some managers are critical of calibration because they may think it reduces freedom in decision making, acknowledges Kochanski. “In many ways, decisions about talent are far too important to leave to the discretion of individual managers operating in isolation and without comparison to what others are doing.”

Karen Hutcheson, a senior vice president at Sibson Consulting, believes talent calibration has great applicability for various functions in higher education because of the high levels of interactivity among departments and large staffs with similar job positions reporting to a number of different supervisors. For instance, calibration ensures that high-performance employees get greater exposure. “Especially at small institutions, career opportunities are not always in your department. With the kind of cross-departmental conversations that take place through calibration, the best employees have more opportunity to shine in front of a broader audience,” notes Hutcheson. Calibration not only levels the playing field for employees, but also focuses everyone on realistic goal-setting, adds Hutcheson. “You want to make sure that a manager setting high-stretch goals in the development area gets input from other leaders whose departments and divisions must support those development efforts.”

Performance calibration can be as effective in small institutions as in large institutions, notes Hutcheson. At Caldwell College, a small Catholic institution in New Jersey, leadership and HR have held “norming sessions” for many years. Sheila O’Rourke, executive director of human resources, joined Caldwell 16 years ago from a major retailer, bringing programs and principles not commonly found in higher education. She initiated these sessions as a way to get her leadership grounded on the same page. During the sessions, vice presidents and senior administrators review performance of the people who work for them within the context of the college’s strategy, needs, and expectations. The goal has been to make sure that expectations are realistic, performance evaluations are anchored in similar interpretations, and messages about performance are fair, appropriate, and consistent across the board, says O’Rourke. The process has the added benefit of raising awareness of talented staff and administrators from all areas of the college.

Testing Talent Initiatives
The demand to grow talent is constantly on the agenda at Johns Hopkins University. A little more than a year ago, JHU launched a new compensation system that encourages employees to develop within their current jobs. (See “Compensation System Overhaul” in the January 2007 issue of HR Horizons.) The new system provides a means for employees to be recognized and rewarded for increased skills and competencies in their current job over and above the normal annual salary increases.

“As part of revamping our compensation system, we developed universitywide core competencies and incorporated them into our new system. These competencies serve as a foundation for broader performance-management initiatives,” says Charlene Hayes, JHU’s vice president for human resources. “These include creativity and innovation, and the ability to manage change and work as a team.”

With the university’s compensation system fully rolled out, Hayes and her staff have turned attention to broad-scale talent development, encompassing competency development, performance management, and succession planning. JHU is working on all three simultaneously, with pilot programs in different areas of the university to develop guidelines and templates. “We ultimately want to have a universitywide approach to all processes, but we also recognize there will be different needs by school, department, and career family,” says Hayes.

For instance, a succession planning pilot is currently underway in JHU’s school of nursing to identify core competencies and qualities for leaders and future workforce needs. Other pilots include identifying functional competencies for development officers, HR staff, and finance positions at every level as a basis to create a blueprint for development initiatives for divisions, job families, and individual employees.

As part of the nursing school succession-management pilot, the leaders in each division or group were encouraged to get together to talk openly about talent needs and to identify the specific strengths of current employees and existing talent gaps. “Something that surprised me is how difficult it was to get leadership to engage in this kind of review. Especially for faculty who may manage a lot of people but who often are not completely comfortable in that role, they tended to feel they were talking inappropriately about employees behind their backs,” says Hayes. Ultimately, the School of Nursing leaders reported that the planning conversations were very rich and fruitful. They were able to use the competencies and succession management process effectively to think about individual development for both faculty and staff in new and creative ways.

After Hayes shared the results of eventual successes of the nursing school pilot with JHU’s council of deans and vice presidents, the provost has charged the group to consider how university leaders can begin a larger conversation to identify and develop talent across the institution, says Hayes. “Especially in light of the nation’s current economic crisis, it becomes even more critical that we focus managers on high-potential employees, including better management of salary increases to ensure we are doing whatever we can to retain our best performers,” says Hayes. “While we talk about merit increases, we typically have not been allocating increases based on true merit pay. These pilot programs are laying a foundation to help us really focus on high-potential employees and to build a system that rewards top talent.”

The pilot programs are likewise producing valuable tools that will assist the entire university in future talent-management initiatives. A new interactive performance-management system allows managers to complete evaluations electronically and get input from others about an employee’s performance. Employees can also add comments to their e-records. The system will help identify performance gaps in skills and competencies that employees and their managers can use to create a personal development plan. Employees will be able to pursue these development plans using a series of options offered through a newly installed software system to be rolled out in late January. Using a software portal called myLearning@JohnsHopkins, individuals will be able to register for online and instructor-led courses needed to fill any gaps in skills and competencies in their current positions or to build skills for promotion opportunities. This learning management system will be complemented by a knowledge network, another portal-based system, that will provide access to need-to-know information at the time of need. A third component of the learning system includes regular webinars called FastFacts that are intended to provide employees with timely information that will allow them to perform their jobs effectively.

“Another surprising outcome of our pilots is the recognition of how little business intelligence we previously had access to for decision making,” says Hayes. When her division reorganized in July 2008, she made the development of HR metrics and analytics a high priority. Since then, a group of HR and HR Information System staff has been working on developing these in collaboration with stakeholders within and outside of human resources. “So far, they’ve identified 73 metrics that we will use to create a dashboard so that we can compare one school to another or universitywide with regard to demographics, retention, recruitment, compensation, and so forth.”

Significant progress has been made in the creation of a web-based online HR metrics and analytics system that will give JHU leadership direct access to these metrics, including the ability for individual leaders to customize reporting instantaneously, says Hayes. “When available, the system will also allow us to pull in data from outside groups such as the U.S. Bureau of Labor Statistics and our peer institutions, for example, so that leaders can also benchmark their divisions against relevant groups outside JHU,” says Hayes. “This will provide our leadership with the information they need for better decision making about compensation, retention efforts, and a host of other talent-management initiatives going forward.”

Karla Hignite, principal of KH Communication, is editor of NACUBO's HR Horizons. E-mail: karlahignite@msn.com.