workforce performance webinar

WORKFORCE DESIGNS Joe Davenport

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TheTheHigh PerformanceHigh Performance

WorkforceWorkforce

Your Competitive Edge:

Presented byJoe DavenportWORKFORCE DESIGNSWORKFORCE DESIGNS

Who is WORKFORCE DESIGNS?

Helps clients of all types build and retain a top performing workforce

Is an outgrowth of 40 years of business / management experience in a variety of industries

Was created to satisfy the need for better information to make workforce management decisions

Is a strategic business partner with the recognized world leader in employment evaluation and human resource management assessment tools – Profiles International, Inc.


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TodayToday’’s Objectivess Objectives

Learn how to:

Identify the characteristics of top performers

Select & retain the best people for your jobs

Maximize the performance of your current personnel

Make great people decisions!

Change companies from good to GREAT!

People are Key!People are Key!

Put the right people “on the bus”Get the wrong people “off the bus”Put the people in the right seats “on the bus”“The bus” will take you where you want to go

Jim Collins, author ofGood to Great says:

People are the key to the successof almost all endeavors . . .

Why should your business be any different?


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Yin alone cannot ariseYang alone cannot grow

Yin and Yang are divisible but inseparable.

- ‘The Yellow Emperor’s Canon of Internal Medicine’

People & Processes are the Yin & Yang of business, yet the ‘people’ component

receives little management attention compared to the ‘processes’ component.

Why? . . . .

People ChallengesPeople Challenges

Most difficult to fix– People are emotional

Hardest to isolate– No line item on the financial statement

Recruiting costTurnover cost

Most costly– Companies spend 50-80% of their gross revenue

on employee-related costs– Lost opportunity cost


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People ChallengesPeople Challenges

Most re-occurring– Peter Drucker says 66% of hiring decisions prove to be

wrong in 12 months and the people who are mis-hired seldom quit - they stay!

– 67% of employed people have positions in which they are not happy

Most time-consuming– Peter Drucker says 60% of management’s time is spent

fixing people problems and just 40% working to achieve corporate goals

Additional research shows that when you fix your people problems, your process problems will get fixed!

Have you ever hired or promoted someone who

was not what he/she appeared to be?


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Have you ever hired or promoted someone who greatly exceeded your

expectations?

What was differentabout the method

used to hire these people?


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Predicting superior performanceis all about having

enough of the right informationwhen you make people decisions

““If If onlyonly I had known that . . .I had known that . . .””

Why do we continue to put Why do we continue to put the wrong people in jobs?the wrong people in jobs?

We believe that poorly selected people are a normal part of doing business

Our hiring practices may be too “instinctive” and not scientific enough

We do not see our employees as the #1 asset in our company

We spend more time buying a computer than we do selecting people

We think we can change people once we hire them

We use the “traditional” approach to hiring

What is the definition of insanity?


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The The ‘‘TraditionalTraditional’’ Selection ProcessSelection Process

Company FitAttitudesValues

DemeanorAppearance

Integrity

Skill FitEducation

TrainingExperience

Skillsetc. PRESENT

Cultural fitInterview

PASTResumePast EmploymentBackground Check

The InterviewThe Interview

“63% of all hiring decisionsare made during

the first 4.3 minutes of an interview.”–– SHRM Study, reported in USA TodaySHRM Study, reported in USA Today


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Top 3 Reasons People FailTop 3 Reasons People Fail

IncompetenceIncompatibilityDishonesty

How do you determinethese qualities

in your job candidates now?

Interviews have only a14% success ratefor identifying superior people!

– Hunter & Hunter “Validity & utility of Alternative Predictors of Job Performance”. Psychological Bulletin, Vol. 96, No. 1. p90

Why?


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Here is what you seewhen you hire and promote.

Here is what you get!


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Many businesses just can’t afford this risk!

How can you minimize your risk?

”The appropriate use of professionally developed assessment tools on average enables organizations to make more effective employment-related decisions than the use of simple observation or random decision making.”

“Testing and Assessment: An Employer’s Guide to Good Practices”US Department of Labor - Employment and Training Administration

Using AssessmentsUsing Assessments


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The Step One Survey IIThe Step One Survey II

Use to determine cultural/company fitMeasures candidate attitudes– Integrity– Reliability– Work Ethic– Substance abuse

Provides valuable information about a candidate– Past employment – Employment-related problems– Illegal substance use– Theft of employer’s money, property, data, etc.– Computer/Internet/Email abuse

Provides suggested interview questions based on candidate’s assessment results


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The Selection ProcessThe Selection Process


DemeanorAppearance

Integrity

Skill FitEducation

TrainingExperience

Skillsetc. PRESENT

Cultural fitInterview


Step One Survey II

Interview

Information Resources for Hiring DecisionsInformation Resources for Hiring DecisionsSource: Psychological Bulletin Vol. 96, No. 1, August 1994, Professor Mike Smith, University of Manchester

14%

0102030405060708090

100

+ BackgroundCheck

26%

What other information might be useful?

Source: Psychological Bulletin Vol. 96, No. 1, August 1994, Professor Mike Smith, University of Manchester


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The right peopleThe right peoplecan be the difference between:can be the difference between:

Does that see like too big a statement?

Extinction & survival

Profit & loss

A good or a GREAT company

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‘Superior’Performers

Top 16%

‘Poor’Performers

Bottom 16%

‘Average’Performers

Middle 68%

- Studies by Frank L. Schmidt and John E. Hunter (well-respected personnel psychology researchers )

Bell Curve


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Why does this matter?Why does this matter?Unskilled / Semi-skilled

‘Average’ produce 19% more than ‘Poor’‘Superior’ produce 19% more than ‘Average’‘Superior’ produce 38% more than ‘Poor’

Skilled‘Average’ produce 32% more than ‘Poor’‘Superior’ produce 32% more than ‘Average’‘Superior’ produce 64% more than ‘Poor’

Management / Professional‘Average’ produce 48% more than ‘Poor’‘Superior’ produce 48% more than ‘Average’‘Superior’ produce 96% more than ‘Poor’

Source: “The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings”

Psychological Bulletin, Sept 1998, Vol. 124, No. 2, pp 262-274.

Example of Impact

Small Company with . . .50 Unskilled / Semi-skilled Workers25 Skilled Workers10 Managers


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Cost of ‘Average’vs. ‘Superior’ Performers

Total Exposure if all ‘average’ = $790,000

Percentage of salary investment at risk = 30%

X 0.19 =Unskilled

Estimated Salary

$20,000

Cost per ‘Average’Performer

$3,800

# People in this

Category

X 50 =

Cost if All are

‘Average’

$190,000

= $320,000Skilled X 0.32 = X$40,000 $12,800 25

= $280,000Management X 0.48 = X$28,000 10$60,000

Implications

These figures are not ‘worst case’. If any or all are below average the cost for that position is doubled – but so is the potential for improvement.

Unless all your people are ‘superior’ performers, you are incurring unnecessary costs.

Regardless how large or small your organization, the potential losses are relatively large.

Every time you move performance in any single job from ‘average’ to ‘superior’ you have a measurable financial impact.

This is the easiest strategy for making significant improvements to your bottom line.


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.


Top 16%

‘Poor’Performers

Bottom 16%


Middle 68%

OBJECTIVE #1: Move performers

from ‘Poor’ to ‘Average’

.


Top 16%


Bottom 84%

OBJECTIVE #2: Move performers from ‘Average’ to ‘Superior’


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.


100%

OBJECTIVE #3: Maintain ‘Superior’

performers in all positions

The The Challenge

“If only I had known that Joe…”

Predicting superior performance is all about having enough of the right information when you make ‘people’ decisions

Use effective processes to ensure that EVERY‘people’ decision - whether for hiring & selection, placement, promotion or development - is aimed at promoting ‘superior’performance


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When do people perform at a

‘superior’level?

“It’s not experience, or college degrees,

or other accepted factors…

…(it) hingeson fit with the job.”

Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching for Better Sales Performance,” Harvard Business Review,

Vol. 58, No. 5.


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Job Fit vs. TimeJob Fit vs. Time

Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching forBetter Sales Performance,” Harvard Business Review, Vol. 58, No. 5.

14 Months After Hire:

“… persons who had been matched, outperformed,to a statistically significant degree,

those who had not been matched…”

“Moreover, the differences widened after 14 months”

6 Months After 6 Months After Hire::

Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching forBetter Sales Performance,” Harvard Business Review, Vol. 58, No. 5.

WithJob

Match

24%28%

5%8%

WithoutJob

Match

Low Turnover Industry

High Turnover Industry% left / fired after 6 months 46%% left / fired after 14 months 57%

% left / fired after 6 months 25%% left / fired after 14 months 34%

They also stay longer– saving a fortune

on recruitment & training costs!


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“…companies will need to reorient their

recruitment and selection processes

by hiring “for fit”rather than mere

credentials…”

““Contented Cows Give Better MilkContented Cows Give Better Milk””Bill Catlette & Richard HaddenBill Catlette & Richard Hadden

Two Opportunities to Job MatchTwo Opportunities to Job Matchfor for SuperiorSuperior performanceperformance

Place the right people in the right job the first time

Evaluate existing employees to determine where they best fit


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Job MatchPersonality

AbilitiesInterestsFUTURE

The Selection ProcessThe Selection Process


DemeanorAppearance

Integrity

Skill FitEducation

TrainingExperience

Skillsetc.

PRESENTCultural fitInterview


Step One Survey II

… helps predict ‘superior’ performance

Interview + BackgroundCheck

Information Resources for Hiring DecisionsSource: Psychological Bulletin Vol. 96, No. 1, August 1994, Professor Mike Smith, University of Manchester

14%26%

0102030405060708090

100

+ Personality & Behavior

38%

+ MentalAbilities

54%

+ Interests & Motivators

66%

+ Job Matching

75%

Source: Psychological Bulletin Vol. 96, No. 1, August 1994, Professor Mike Smith, University of Manchester


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10% - Good But Limited Information:

90% - Essence of the Total Person:

Skills, Experience & Company Match

Thinking Style

Occupational Interests

Behavioral Traits

Job Fit

The Total PersonThe Total Person


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Can she cope with the mental demands?

Will she be comfortable in the job environment?

Is she motivated by this kind of work?

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Thinking Style


Behavioral Traits

Learning IndexVerbal Skill

Verbal ReasoningNumerical Ability

Numeric Reasoning

EnterprisingFinancial/Admin

People ServiceTechnical

MechanicalCreative

Energy LevelAssertiveness

SociabilityManageability

AttitudeDecisiveness

AccommodatingIndependence

Objective Judgment

1 2 3 4 5 6 7 8 9 10

Learning Index

Learning, reasoning and problem solving approach

ONEONEGALLONGALLON

ONEONEGALLONGALLON


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The Job Match

Pattern

Shaded areasindicate

the Job Match Pattern

Job Match Patternsshow requirements

for the jobsin your company

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Thinking Style


Behavioral Traits



Numeric Reasoning



MechanicalCreative





Objective Judgment

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Thinking Style


Behavioral Traits



Numeric Reasoning



MechanicalCreative





Objective Judgment

GoodJob Match


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Thinking Style


Behavioral Traits



Numeric Reasoning



MechanicalCreative





Objective Judgment

QuestionableJob Match


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Job MatchPersonality

AbilitiesInterestsFUTURE

Improved Selection ProcessImproved Selection Process


DemeanorAppearance

Integrity

Skill FitEducation

TrainingExperience

Skillsetc.

PRESENTCultural fitInterview


Step One Survey II

… helps predict ‘superior’ performance

The Profile XT

Two Opportunities to Job MatchTwo Opportunities to Job Matchfor for SuperiorSuperior performanceperformance

Place the right people in the right job the first time

Evaluate existing employees to determine where they best fit


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Talent Shortage is IncreasingTalent Shortage is Increasing

Recap

Unless you are confident all your people are ‘superior’performers you have great potential for bottom line gains

Regardless how large or small your organization, your potential for savings and productivity increases are great

Every time you move an employee’s performance from ‘average’ to ‘superior’ you enjoy a measurable financial impact

Questions?


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WORKFORCE DESIGNSEmployee Selection, Retention & Management Solutions

277 South High Street • Cortland, OH 44410

Tel: 330.638.1881 • Fax: 330.638.1882

Email: [email protected]

Web: www.workforcedesigns.com