Employee Focus Groups Improving performance management

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1 Employee Focus Groups Improving performance management AUGUST 29, 2014 JUSTIN CARUTHERS

2 Hay Group overview Established in 1943 in Philadelphia 87 offices in 49 countries 18 North America locations 2,600+ employees 7,000 clients globally 35 of the 50 Globally Most Admired 479 of U.S. Fortune

3 Hay Group Transforming Learning: online diagnostics How we organize our business Our purpose Helping organizations work Our practice clusters Building effective organizations Leadership and talent Reward services Our service lines BEO solutions Leadership transformation Executive rewards Performance management Capability assessment Talent management Job evaluation Reward Information Services Reward strategies Hay Group Insight: employee and customer surveys 3

4 Compensation program - LCCC Past Lorain County Community College has always tried to make sure that the level of compensation reflected both the marketplace and provided internal equity for staff. The College contracted with the Hay Group in 2006 and 2010 to review our compensation plan and to perform desk audits. The resulting recommendations were implemented over time. Present Since the last study was performed during the depths of the recession, we feel it is time to begin the process again to make certain our compensation plan reflects the current marketplace. During this process we are reviewing the performance management process Future The College will again contract with the Hay Group to evaluate the compensation for staff positions on campus. This engagement will include a market analysis, a review of internal equity and individual desk audits as needed. 4

5 Performance management - LCCC Future + Since our existing performance evaluation instrument has not been updated in some time, questions have persisted about the quality and validity of the instrument. As important as the instrument itself, concerns have been raised about the training offered to supervisory staff to prepare them to evaluate staff in a way that results in an opportunity to resolve differences and develop staff potential. In an effort to address this issue, we will be building on the previous efforts by Staff Council and work with Hay Group to develop an evaluation tool with the following goals: Develop an evaluation instrument that is automated, easy to use, and is focused on staff development more than discipline. Train supervisors to treat the evaluation as an on-going conversation with periodic updates throughout the year to draw out staff potential rather than an annual obligation. Consider a tool that allows staff to formulate long-term individual development plans to help them achieve their professional goals regardless of where they work in the future. Since the evaluation process is also used as the basis for compensation increases, make certain that the instrument is valid, tested and accepted by staff as a fair way to measure performance. 5

6 Today s agenda Job Evaluation Overview External Competitiveness & Internal Equity Performance Management Group Discussion Wrap-up 6

7 01 Job Evaluation

8 Hay Group s job evaluation methodology World s most widely-used job measurement system Over two-third s of the world s largest 50 organizations use our job evaluation system. Of the world s 10 largest organizations, eight use our job evaluation system Many of the world s most admired organizations (e.g.,ge, Home Depot, Wal-Mart, Toyota, Caterpillar, Procter & Gamble) use Hay Group job evaluation systems Many public sector and quasi-governmental entities in the U.S. and around the world use this methodology Relative worth of duties and responsibilities The factors used measure the skill required to do the job, the effort made in the job and the responsibility for the end results Relative to standards/benchmarks Both internal and external 8

9 Basic premise Jobs exist to achieve an end result To achieve this end result, jobholders must address problems, create, analyze, and apply judgment The jobholder requires knowledge and experience consistent with the scale and complexity of the result to be achieved Accountability Problem Solving + Accountability Know-How The Hay Group method uses three universal compensable elements to measure the relative size of jobs + Problem Solving + Accountability 9

10 Why should you evaluate jobs? Job evaluation principles form the basis for: Clarifying organization structure and job accountabilities Ensuring market comparisons and reward are based on organization established job content and size Understanding the job-related skills, competencies, and key performance indicators necessary to ensure job incumbents are successful Work alignment The power to align your people to deliver your business strategy Work value The power to know the value of work and how it links to business performance Work fit The power to create roles that unlock the potential of your people Work measurement The power to understand how and where work is done 10

11 02 External Competitiveness & Internal Equity

12 Pay philosophy External Competitiveness and Internal Equity Both factors must be considered when establishing and administering pay guidelines: 12

13 TWO > ONE Utilize a balanced approach when pricing jobs in the marketplace since neither approach is as effective by itself Market Pricing Job Evaluation Strengths Shortfalls Strengths Shortfalls Preserves competitiveness with other organizations. Reflects economic issues such as supply and demand of labor faced by management. Tests the feasibility of compensation decisions that emphasize internal priorities. The market does not reflect the value of work for your organization. Direct title matching may not capture same qualifications, activities, or results. Jobs designed to meet the unique needs of your organization are likely not similar to jobs in other organizations. Expresses the organization s culture and values. Increases the accuracy and reliability of market pricing. Reflects the value of the role or assignment according to your organizational priorities, and guides valuing of nonbenchmark jobs/roles. Does not take in to account what competitors pay. Internal comparisons may not reflect realities of the labor market. Broad role descriptions may be difficult to match to external competitors. 13

14 03 Performance Management

15 Dialogue Performance management four basic components Components of Performance Management An effective performance management process has four basic components: Dialogue 15

16 Performance management Characteristics of Effective Performance Management Processes A performance management process needs to ensure: Alignment. That teams and individuals understand broader organizational goals and strategies, and understand how what they do contributes to achieving those goals and strategies Agreement. Individuals and team members understand and are in agreement about each other s responsibilities and accountabilities, and processes are in place to ensure that teams and/or individuals are not duplicating each others efforts Accountability. Individuals and teams understand that they are responsible for accomplishing the agreed upon results and activities, and that they will be held accountable for accomplishing them Adjustment. Employees and teams monitor their progress against expected results and take action to ensure that the expected results are achieved. This does not mean changing the goals or adjusting them down. It means doing what it takes, given the situation, to ensure that the goals are met 16

17 04 Group Discussion

18 We need your honest opinion

19 Performance management Sharing ideas What does good performance look like in your part of the organization? How should performance be measured? Does the current performance management system provide a fair and accurate method of evaluating your performance? If you were in control, how would you differentiate between varying levels of performance? Do you have any past experience with performance management programs that worked well or didn t work well? How can the performance management process motivate you to grow, develop, and ultimately achieve greater on the job performance? 19

20 05 Wrap-up

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