hcmi intro solvepro demo deck aug 2016e
TRANSCRIPT
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HCMI Introduction and Demo -
Aug, 2016
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About Human Capital Management Institute
HCMI Background: Specialized in HR analysis & measurement
Deep expertise in Workforce Analytics & Planning
Board made up of CFOs and HR heads
Over 40 years of experience
What We Do: Measure the immeasurable in human
capital
Transform workforce data into business intelligence
Provide Tools and Training so HR can Partner with Finance
Workforce Assessment w Strategic Consulting w Training
Best Practices w Workforce Analytics and Planning w Benchmarking
The Human Capital Management Institute (HCMI) was founded on the belief that organizations can, and must, find better ways of measuring their investments in human capital. Our vision of the future is one in which human capital measurement and information is as integral to business decision making as financial information is today.
We Bring Financial Discipline, Standards and Rigor to the HR Function
Have You Found Your Analytics Pot of Gold?
Human Capital Metrics HandbookTraining and Advisory Support• Workforce Analytics Training• Workforce Planning Training• Custom onsite training
HCMI Products & Services
© Human Capital Management Institute 3
620+ Metrics and Detailed Definitions
Data Integration Blueprint
Workforce Analytics Assessment
Analytic Consulting On-Demand
Analytics COE and Roadmap Design
Statistical Prediction
Correlation Coefficient ( 0-1)
Factors Leading to Increased Turnover
Job Title or Position
Dissatisfaction With Compensation
High vs. Low Turnover Manager
Commute Distance
Driv er #3
Driv er #2
Driv er #1
.50
.33
.27
.02
Low Turnover Impact
High Turnover Impact
Some Turnover Impact
.11
Work Location
Number of Jobs in Last 3 Years .70
Hired Through Employee Referral .19
Init ial Rep orts & Analysis
Data Gat hering
First Good Metrics
HR D ata WarehouseDrill-down, standard reports
Sc enario Analys is
Exter nal Benc hmarking
Context f or decisions
Data Driven Decision
Maki ng!
Turnover, Headc ount, Hiring
HRIS s ystem data
COE Formation
D ata Erro rs
HR Analyti cs M andate
HR Sta ndards Est ablish edLost HR
Credibility
H R d ata/systems Ass essed
HR Data Cle ansed historical data scrubbed
Bus. Units Reject
Analysis
D ata Erro rs Histor ical data
still bad
1st Analytic s Study
Advanc ed Analytic Studies
HR Analysis Vali dated
Integrated H R Database s
COE Lau nches Training Courses
Bus. Uni ts Demand
more
Analytics journey steps
Se tb acks a long the way
Jou rney path and goal
CONSULTING SERVICES
Integrated Dashboard
DASHBOARDS
PRO
TECHNOLOGY SOLUTIONS
Human Capital Financial Statements• Human Capital Impact Statement• Human Capital Asset Statement• Human Capital Flow Statement
Workforce Quantifier™ ROI Calculator• ROI of Workforce Decisions• Cost of Turnover, Cost per Hire
Workforce Planning• Link Workforce and Financial Metrics• Forecast Skills, Costs, Talent and
Productivity
Job Framework Mapping• Integrated Taxonomy 15,000+ jobs• Map Critical Job Roles
Span of Control Optimizer™ Tool• Benchmark and Optimize Spans • Optimize Management Layers
Career Path Quantifier• ROI of Career Path• Build, Buy or Lease Talent Analysis
$$$ Financial Impact
Metrics
Data Blueprint
Predictive Modeling
TRAINING &
SUPPORT
Clients Include…
CONFIDENTIAL, DO NOT COPY OR REDISTRIBUTE
Asking the Right Questions
© Human Capital Management Institute 5
What If you could answer the following?
1. What is our workforce productivity? Is it improving? How do we rank?
2. Where do our stars come from in Sales? In Operations? In leaders?
3. Is it better to build, buy or rent talent? What is the right workforce cost?
4. What is the ROI of our training investment in the workforce?
5. Which are the strategic critical roles (game winners) vs. operational critical roles (keep us in the game)?
6. Do we know drivers of employee turnover? What about employee engagement and retention drivers?
7. Are leaders effectively managing human capital? Do leaders correlate to employee engagement, retention and performance?
1. Is our workforce headcount the optimal size and shape? What about our workforce Cost?
2. What percent of our workforce is customer-facing or revenue-generating? What is the trend?
3. Is the organization building, buying or renting its’ critical and core talent?
4. What is our workforce productivity?
5. Is workforce productivity increasing, decreasing or static? How are we performing versus peers?
6. What is the marginal return of a dollar invested in the workforce?
7. Is the ROI on Human Capital higher than other investments?
8 Are leaders effectively managing human capital? Do leaders link to engagement, retention, performance?
9 Where does our best talent come from? Which managers are the best talent scouts and coaches?
10.What percent of our workforce is highly engaged? Is it increasing or decreasing?
11.Is there a link between engagement, performance and productivity?
12.What is our leadership and critical role bench strength?
13.Can we forecast our workforce to optimize cost, profit and productivity?
25 Key Human Capital Questions14. What business areas/positions/leaders have the highest
turnover? How do we compare to peers?
15.Are we losing the right people(low performers) or the wrong people(high performers or critical roles/skills)?
16. What is our regrettable turnover rate? Why is talent leaving? Is by design or accident?
17. Is the quality and cultural fit of new hires improving? Can we measure it?
18. Is attracting/recruiting talent impacting growth? What recruiting source yields the best cultural fit?
19. What is the size and cost of our contingent workforce? Is it by accident or by design?
20. What part of our workforce costs are increasing the most? Can we control it better?
21. What is our Total Cost of Workforce as a percent of revenue? Of expenses? How do we compare to peers?
22. Are we investing the right amount in training? Could training improve productivity & profitability?
23. If talent is critical is the training investment adqaute to support the business strategy?
24.Is internal mobility a source of value or not? What percent of the workforce moves internally each year?
25.What percent of open positions are filled internally? What percent of management roles?
© Human Capital Management Institute6
Key Differentiators
© Human Capital Management Institute 7
• Human Capital Financial Statements(HCF$™) (adopted by Institutional investors)
• SOLVE Metrics online metrics handbook
• Workforce productivity benchmark database (7,000 companies)
3 Layers of IP1. Powerful software (predictive scenario modeling of future workforce)
2. Proprietary data integration “Blueprint” (HR, financial, operational data)
3. Experience, 100’s of successful project insights in SOLVE
Have You Found Your Analytics Pot of Gold? $1.0 Million ROI Guarantee!
SHOW ME THE MONEY!
© Human Capital Management Institute 8
• 15% productivity gain and lower costs ($55.0 Billion Package Delivery Co. )
• Predicting sales stars pre hire {$1.0 Billion Bank}
• ROI of sales training {$2.0 Billion Retail Co.}
• Location optimization for talent growth {US Regional Bank}
• Employee engagement to revenue impact {$1.0 Billion public Airline}
• 40% voluntary turnover reduction {public, financial services co.}
• ROI of internal vs. external hires {public bank}
$1.1 Billion Annual
$264 Million Annual$1.1 million per sales person
$250 Million Annual $250k per Salesperson
$200 Million 10 years
$96 Million Annual $5 per flight premium
$12 Million Annual
$6 Million Annual
Evolution of a New Ecosystem
© Human Capital Management Institute 2010 9
What if someone owned “financial statements” in financial reporting?
Would this help public companies?
Would this help software technology firms?
Would this help accounting firms?
Would this help HR ! YES !
Human Capital Disclosure Statement™
DashboardsHuman Capital ROI Dashboards
Human Capital Financial
Statements HCFS ™
ProAutomated Analytics
Ecosystem
© Human Capital Management Institute 10
Evidence-based Human Capital Management
> QUANTIFY > ANALYZE > OPTIMIZEQuantify not just financial info but also the impact of human capital to business outcomes.
Analyze past operations, historical change rate and forecasted performance and benchmark them against the industry average.
Optimize workforce strategy by selecting the interventions that yield the highest ROI impact,
Linking Human Capital to Financial Performance
From Theory to Practice
SOLVE combines Human Capital data with Finance and Operations to quantify hard-to-measure areas, analyze them and ultimately optimize the workforce.
OPERATIONS
FINANCE
WORKFORCE
© Human Capital Management Institute 11
SOLVE in Action: Workforce Productivity
> QUANTIFY
> ANALYZE
> OPTIMIZE
• Model and Forecast Productivity• Analyze Productivity, Total Cost of Workforce and Profit change rate• Analyze Workforce Cost relative to Revenue and Total Expenses• Benchmarks: Peer Comparison
Use analysis tools to answer the following questions:• What is your workforce productivity? Is it higher than peers? • What is the marginal return of one dollar invested in workforce? • Is the ROI on Human Capital higher than other investments? • Is workforce productivity increasing, decreasing or static?
Analysis Examples:
• Total Cost of Workforce• Return on Human Capital Investment• Human Capital Investment ROI ratio
© Human Capital Management Institute 12
How SOLVE Helps Users Discover Insights > Validate, Configure and Standardize Data
> Identify Trends & Conduct Initial Analysis
> Build Workforce Scenarios & Conduct Advanced Modeling
> Optimize Workforce Interventions with Quantified Impacts, Cost Savings & Project ROI
2015 2016 2017 2018 2019 2020 $-
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
$1,400,000,000
$1,600,000,000
$1,800,000,000
$2,000,000,000
TCOW* Calculated vs Strategic Plan
Calculated Strategic Plan
2016 2017 2018 2019 20200%
5%
10%
15%
20%
25%
22.0%
10.0%
TCOW* % Change
Calculated Strategic Plan
Variables Status Quo Controlled Growth
Workforce Headcount 12%
Average Employee Salary 8%
Bonus & Incentive Pay (Average) 5%
Total HR Costs 11%
$X,XXX,XXX below calculated data$627M GAP v
Calculated Data
© Human Capital Management Institute 13
Example: Forecast Total Cost of Workforce
Status quoGAP=Labor Cost
growth 22% v 10% Planned
* TCOW= Total Cost of Workforce, aka Total Labor Cost
2015 2016 2017 2018 2019 2020 $-
$200,000,000
$400,000,000
$600,000,000
$800,000,000
$1,000,000,000
$1,200,000,000
$1,400,000,000
TCOW Calculated vs Strategic Plan
Calculated Strategic Plan
2016 2017 2018 2019 20200%
2%
4%
6%
8%
10%
12%
10.0%
10.5%
TCOW % Change
Strategic Plan Calculated
Variables Status Quo Controlled Growth
Workforce Headcount 12% 5%
Average Employee Salary 8% 4%
Bonus & Incentive Pay (Average) 5% 2%
Total HR Costs 11% 5%
GAP closed Strategic Plan Bottoms up fit
© Human Capital Management Institute 14
Example: Forecast Total Cost of Workforce
Controlled Growth=Labor Cost
growing at Plan 10% Rate
Changes
SOLVE Demo
© Human Capital Management Institute
Workforce Productivity
© Human Capital Management Institute 16
© Human Capital Management Institute 17
SOLVE – Productivity Dashboard Example
Index Metric ScoreOne score that summarizes how your organization is doing along with its quantified impacts.
Index Metric in GraphAnalyze the change rate of your index metric and the industry average and plan with SOLVE’s built-in predictive tools.
Scenario ManagerDetailed scores and benchmarks of the components that made up the index metric.
Critical Insights & PredictionsControl workforce dynamics that impact the business down to the job-level details.
Benefits of Using SOLVE Pro – Functional/Financial1. Dedicated HCMI analyst for analytics and planning (1 FTE)
2. External benchmarks for Productivity, Recruiting, Learning, Turnover + more
3. Unlimited “What-If” Scenario Modeling capability for “Forecast” metrics
4. Easily Quantify $1.0M+ future “ROI” impacts (i.e. business case)
5. Link HR and Workforce metrics and data to financial results
6. Low Total Cost of ownership with SaaS (1/2 or lower vs. on-premise solutions)
7. Online version of HCMI’s Human Capital Metrics Handbook;
8. Powerful drill down across multiple dimensions for root cause analysis/ reporting
9. Automated preparation of Human Capital Financial Statements
10. On-demand workforce planning for rapid completion of workforce planning
11. Guaranteed pricing at contract rates
© Human Capital Management Institute 18
The Human Capital Disclosure Statement
© Human Capital Management Institute 20
HCMI Background
Jeff Higgins, Founder & CEO Human Capital Management InstituteJeff is a driving force in Workforce analytics at leading companies who transform workforce data into a source of value creation via planning and predictive modeling.
With his unique combination of experience as both a senior HR executive and former CFO, Jeff helps organizations around the world rapidly advance their analytics & workforce planning journey.
He is a regular speaker at HR events, a member of the Human Capital Institute National Advisory Council on Talent Leadership and a founding member of the PwC Saratoga Institute advisory council on metrics.
• HCMI has been focused on workforce productivity since 2009. In 2010 a client asked if human capital data could be presented in reports like financial statements. Thus began a journey to Human Capital Financial Statements (HCFS™).
• After 5 years, working with over 100 organizations, and creating the world’s largest workforce productivity database, we have distilled the complexity of human capital reporting into a single document called a “Human Capital Disclosure Statement.”
Why Should we Bother with Workforce Productivity
© Human Capital Management Institute21
• Institutional Investors are demanding it
• Being utilized by a growing number of forward looking S&P 500 organizations
• Dow Jones Sustainability Index adopted Human Capital ROI Ratio in 2014 (over 900 companies submitted for 2014)
Dow Jones Sustainability Index (DJSI)
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Introduction to Productivity
© Human Capital Management Institute
…and Human Capital ROI ratio is downright awful.
+21.8%
(19.0%)
REVENUE
Great Revenue per FTE growth!
Do you know your workforce
productivity?
But Return on Human Capital Investment is bad…
(29.2%)
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Example: Investment Banking Sector, 1996-2012
The Workforce Productivity Paradox
3
MetricsProfit per FTE
Revenue per FTE
Human Capital ROI Ratio
Return on Human Capital Investment
Total Cost of Workforce Percent of Operating Expense
Total Cost of Workforce Percent of Revenue
Human Capital Metrics Drive Stock Price
© Human Capital Management Institute 24
The top 25% of companies improved HC metrics by 51%, driving 4.0% average annual stock price
gains (CAGR) and 66.0% overall
Low-Performers Mid-Performers Top Performers-10%
-5%
0%
5%
10%
15%
20%
25%
30%
-7.0%
0.4%
9.8%
-2.7%
5.7%
25.4%
10.9%12.9%
26.2%
14.8%
19.9%
28.0%
Human Capital ROI Ratio Return on Human Capital Investment Stock PriceMarket Value (Capitalization)
Human Capital Metrics and Market Performance
© Human Capital Management Institute 25
Top quartile companies improved workforce productivity 9.8% & 25.4% annually, seeing 26.2% annual stock price gains, double the market average improvement
Top Quartile Bottom Quartile 25th to 75th Percentile
Human Capital and Market Capitalization, Financial Services, October, 2015
Financial Services Industry Change Rates (CAGR) 2012-2014
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What is in the Human Capital Disclosure Statement
© Human Capital Management Institute
1. Human Capital Impact
1. Income Statement
2. Cash Flow Statement
3. Balance Sheet
Traditional Financial Statements
Human Capital Disclosure Statement
3. Human Capital Cost
2. Human Capital Flow
Examples: • Total Cost of Workforce (TCOW)• Productivity Impact• Human Capital ROI Ratio
Examples: Inflows, Outflows, number of Contingent Staff, Transfers and Promotions
Examples: Employee Salary Cost, Contingent Workforce Cost, Recruiting Cost
Dat
a
#3
#2
#1
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#44. Management Discussion
Examples: Overall workforce growth, critical and non-critical job roles, etc.
Key Step: Align Human Capital to Finance
27
Human Capital Disclosure Statement
© Human Capital Management Institute
A B
C
A. Human Capital Impact• Integrates Financial and People Metrics• Shows Return on People & workforce productivity
B. Human Capital Flow • Employee + contingent workforce (hires, terms, internal hires)
C. Human Capital Cost• Breakdown Total cost of workforce (TCOW) • Breakdown of HR & training investments
D. Management Discussion • Explanation of significant workforce changes and talent strategy
Stories of changes in talent performance metrics and strategic directionD
Prior Year Current Year % ChgRevenueNet Operating Revenue 1,400,000,000$ 1,540,000,000$ 10.0%Total Headcount (FTE) 15,000 16,400 9.3%Revenue per FTE 93,333$ 93,902$ 0.6%
CostsTotal Operating Expenses* 1,170,000,000$ 1,285,000,000$ 9.8% Total Cost of Workforce (TCOW) 779,950,000$ 861,000,000$ 10.4% TCOW per FTE 51,997$ 52,500$ 1.0% TCOW % of Revenue 55.7% 55.9% 0.4%
ProfitNet Operating Profit 143,750,000$ 159,375,000$ 10.9% Profit per FTE 9,583$ 9,718$ 1.4%
Workforce Productivity Hunan Capital ROI Ratio 1.29 1.30 0.1% Return on Human Capital Investment 18.4% 18.5% 0.4%
Human Capital ROI per FTE 15,333$ 15,549$ % 1.4%
Total Cost of Workforce (TCOW) increasing more than RevenueTCOW was up year-over-year 10.4% above the 10.0% Revenue increase,
negatively affecting workforce productivity.
Workforce ProductivityBoth workforce productivity metrics
improved, however the rate of growth is minimal and well below the 3%
productivity gains of competitors.
Profit per FTEOperating Profit increased 10.9%, and profit per FTE 1.4%, partly offsetting the negative impact of higher TCOW. Further profit gains vs. peers seem
unsustainable without further productivity gains.
Revenue per FTE is upRevenue increased 10.0% while
headcount increased 9.3%, resulting in a revenue per FTE increase of .6%
25© Human Capital Management Institute
A. Human Capital Impact
29
B. Human Capital Flow
© Human Capital Management Institute
Increases in Support StaffWhat is driving increased support
staff? Is this why TCOW is increasing faster than revenue?
Contingent Workforce Is contingent workforce a feeder group for critical roles? A low cost workforce strategy or a gap filler? How does contingent
workforce fit in the strategic company direction?
Management Internal Hire Rate75 Internal Staff were promoted into mgmt however 115 were hired externally or only
39% of internal staff was considered ready for management
Critical Job Roles - SalesWhile 860 sales people were
hired, (450) departed. Why? Are they high or low performers, new hires or veterans? Co. Growth and success is heavily reliant on this
group.
Buy Build
Rent
30
C. Human Capital Cost
© Human Capital Management Institute
Absence Lost Days and CostThese costs are increasing rapidly, was this due
to one time events or longer term trends?
Benefit Costs The largest rapidly rising cost is benefit costs for employees. What is the plan to
better manage these costs? How does the organization compare to peers in this area?
Are Training & Development costs aligned with the company growth strategy? Is the organization “Building, Buying or Renting” its
best current and future talent?
Total Cost of Workforce is increasing as a higher rate than revenue, a long term predictor of declining workforce productivity. How will
the company better manage these costs as they execute on their growth plans?
Research on Human Capital Reporting
32
What To Include in Human Capital Reporting
© Human Capital Management Institute
Source: http://ww2.cfo.com/people/2012/04/proposed-standard-calls-for-human-capital-disclosure/ by David McCann
HR Reporting Standards Recommended by American National Standards Institute (ANSI)
© Human Capital Management Institute 33
Human Capital Disclosure Requirements MatrixI = Included in Management's Human Capital Discussion
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Workforce Composition
Workforce Headcount 10
Workforce Cost 9
Workforce Productivity 9
Return on Workforce or People 9
Workforce Composition-Breakdown 9
- Contingent Labor Cost 6
- Contingent Labor Force Size 6
- Benefits (i.e. full-time v part-time) 6
- Geographic-Global Workforce Distribution 5
- Revenue per Employee or FTE 4
- Demographics, Diversity (i.e. Age, Gender) 3 I - EBITDA per employee or FTE 3
- Full-time v part-time 3
- Job Level 3
- Talent Efficiency/Effectiveness 2
- Proportion Professional qualified employees 2
- Work Hours 1
Workforce Skills and Capabilities
- Total Training Investment 9
- Leadership Depth/Career devpmt/Succession 8
- Talent Management 6
- Competencies and Skills 6
- Internal Hire Rate 6
- Average training hours per employee 3
- Leadership Quality/ Effectiveness 3
- Training Types (formal/informal, technical, apprentice) 2 I - Training by Job Group 2 I - Number of Courses Taken 1 I - Number of PhD's (or total # of Patents) 1 I
Overarching HC Disclosure Objectives
Human Capital Performance, Productivity 11
Comparable across entities/industries 11
Transparancy (clear, complete, reliable, simple) 10
Validity (Useful, link to financial results) 10
Material, Auditable Information 9
Sustainabiltiy of Human Capital 8
Business and Management Governance 8
Human Capital Risks 7
Strategic, Future Directional Focus 7
Connectivity of Information 6
Superior Human Capital Talent Decisions 5
Workforce Stability
Workforce Turnover (i.e. terminations) 8
- Regrettable or Voluntary turnover 7
- Pay policies & ratios (mgmt, gender equiity) 7
- Turnover by Category or level (EEO) 2
- Recruitment Costs 2
- Applicants per position/ Brand Awareness 2 I - Offer/acceptance statistics 2 I - Retention rates (demographic) 2 I - Levels of skill shortages 2 I - Pension/Retirement program (cost, % eligible) 1 I - Industrial relations issues 1 I - New Hire Retention Rate (12 month retention) 1 I
Workforce Culture
Other - Human capital discussion & analysis 2
- HR Cost or Investment 1
- HR Return on Investment 1
TOTAL RECOMMENDATIONS 12 12 14 15 20 20 25 25 31 31 48 50 59 46
% of Requirements Met 78%
Category, Element, Metric or Dimension
Human Capital Disclosure Requirements Matrix
I = included in Management’s Human Capital Discussion
© Human Capital Management Institute 34
Human Capital Disclosure Requirements Matrix - continued
I = included in Management’s Human Capital Discussion
Case Studies
36© Human Capital Management Institute
Case Study: BroadTek CommunicationsRevenue Prior Year Current Year Variance % ChgNet Operating Revenue $4,114,540,000 $4,444,560,000 $330,020,000 8.0%Total Workforce Headcount (FTE) 4,645 4,750 105 2.3%Revenue per FTE $885,800 $935,697 $49,897 5.6%
CostsTotal Expenses $2,788,752,921 $2,809,406,376 $20,653,455 0.7%Total Operating Expense $2,262,997,000 $2,377,839,600 $114,842,600 5.1%Total Cost of Workforce (TCOW) $447,661,952 $467,567,712 $19,905,760 4.4%TCOW Percent of Revenue 10.9% 10.5% -0.4% -3.3%TCOW Percent of Expenses 16.1% 16.6% 0.6% 3.7%TCOW Percent of Operating Expenses 19.8% 19.7% -0.1% -0.6%
ProfitEBITDA(1) $1,316,652,800 $1,511,150,400 $194,497,600 14.8%Net Operating Profit $573,155,422 $680,017,680 $106,862,258 18.6%Profit per FTE $123,392 $143,162 $19,770 16.0%
Productivity and ROI of Human CapitalTotal Market Capitalization (2) $6,304,709,642 $6,800,176,800 $495,467,158 7.9%Average Market Capitalization Value per FTE $1,357,311 $1,431,616 $74,305 5.5%
Human Capital ROI Ratio 3.96 4.50 0.54 13.5%Return on Human Capital Investment 128.0% 145.4% 17.4% 13.6%
TOTAL WORKFORCE PRODUCTIVITY IMPACT: $355,630,545 $700,578,523 $344,947,978 97.0%
1
1
2
2
2
33
Key Findings: TCOW growing slower than Revenue and Profit per FTE Positive HC ROI Ratio and Return on HC Investment
Case Study: BroadTek Communications
Case Study: BroadTek Communications
37
ClearTel RayFi BroadTek$0
$200$400$600$800
$1,000$1,200$1,400
Revenue per FTEProfit per FTETotal Cost of Workforce per FTEProductivity Gain(Loss) per FTE
Note: All Dollars in Thousands KPI = Key Performance Indicator FTE = Full Time Equivalents
ClearTel RayFi BroadTek0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Revenue per FTE Profit per FTE
Total Cost of Workforce per FTE
Human Capital ROI Ratio Return on Human Capital Investment
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
ClearTel RayFi BroadTek
Current Financial KPIs Prior-Current Year KPI Variance
Prior-Current Year Productivity Variance
1Poor
Performance Relative to
Competitors
AveragePerformance
Relative to Competitors
StrongPerformance
Relative to Competitors
2
3 3
© Human Capital Management Institute
Case Study: BroadTek Communications
© Human Capital Management Institute 38
The Human Capital Asset Statement
Human Capital Headcount Deployed Prior PeriodPercent of Total Current Period
Percent of Total Variance
Employees 4,395 94.6% 4,535 95.5% 3.2% - Management & Senior Leadership 610 13.1% 615 12.9% 0.8% - Professional Staff 1,310 28.2% 1,405 29.6% 7.3% - Sales Staff 730 15.7% 805 16.9% 10.3% - Specialists and Technicians 515 11.1% 530 11.2% 2.9% - Skilled Trade Staff 115 2.5% 105 2.2% -8.7% - Operations Staff 210 4.5% 210 4.4% 0.0% - Service Staff 550 11.8% 560 11.8% 1.8% - Administrative Support Staff 250 5.4% 220 4.6% -12.0% - Laborers and Helpers 105 2.3% 85 1.8% -19.0%
Contingent Staff 250 5.4% 215 4.5% -14.0%Total Workforce 4,645 100.0% 4,750 100.0% 2.3%
Step #1: Measure Changes in Workforce Headcount• Total Employees• Sales Staff and Service Staff = Core Workforce• Administrative + Laborers and Helpers = Non-Core Workforce
Step #2: Quantify Differential Value of High vs. Low Value Add Roles• Core Job Roles add Greater Value• Critical Job Roles add Greater Value
39
Case Study: BroadTek Communications
© Human Capital Management Institute
Optimizing The Workforce by Measuring Job Roles
Talent Management Impact Findings
40
$ ROI from Change in Average Days to Start
Scofield reduced Average Days to Start by (-5) for critical revenue generating roles, with savings of
$1.5 million due to 1,250 productive days saved at $1,200 in lost
productivity per day.
Internal vs. External Cost per Hire Differential
Scofield saves $4,500 in recruiting costs on positions filled internally. NOTE: professional
or manager positions filled may have larger savings while low level positions may lower or
$0. (see Asset Statement for details)
Internal vs. External Hire Compensation Cost Impact Scofield saves $1,000 in total compensation,
a part of Total Cost of Workforce (TCOW), on average, for every role
filled internally. NOTE: Professional or mgmt
positions filled may have larger savings while low level positions may have $0 or negative savings (see Asset
Statement for details)
Span of Control ImpactScofield increased overall management span of control from 12 to 12.6, saving
the need to hire over 100 new managers, a Total Cost of Workforce
productivity savings of $10.06 million.
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HCMI Analytics and Planning Vision
© Human Capital Management Institute
• Allow organizations to measure workforce value creation
• Link metrics to business results & drive company business strategies
• Create a bridge between the Workforce and Traditional Financial Measures