1 Maximizing Your Human Capital Presented at: Plastics News Executive Forum Phoenix, Arizona March 1, 2005 Joe Barto, Training Modernization Group & Sue.

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Maximizing Your Human Capital

Presented at: Plastics News Executive ForumPhoenix, Arizona

March 1, 2005

Joe Barto, Training Modernization Group &

Sue Braun, Bemis Manufacturing

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Or

People are Better Than Plastic!

People are Important!

Easy to say; Hard to do…

Do your daily actions prove it?

Rule #1: You can only take care of people 1 person at a time!

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Today’s Learning Objectives

1. Provide Senior Executives a Human Capital Management Program assessment framework

2. Demonstrate how improved Human Capital Programs can improve your business

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Strategic Assessment

1. What are the top three business issues human resources has helped you solve the past quarter/year?

2. What impact did these solutions have on your unit’s profitability, quality, cycle time or ability to respond to customers?

3. Do you have a good labor resource management strategy Human Capital Management Plan or Strategy that directly supports your business plan or strategy?

4. Who is responsible for development and execution of your Human Capital Management Plan or Strategy?

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Fundamentals

“Managing today is about finding great PEOPLE, linking them with ideas, processes, and resources, and ENABLING them to

produce something remarkable that leads to VALUE!”

• Leaders are Responsible for—– Clear Goal Definition and the plan.– Providing sufficient resources– Ensuring people have the correct knowledge and skills– Continually developing, refining and adding to those skills

• Employees are Responsible for—– Accomplishing goals and objectives– performance– Contributing to Team Improvement

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Seeing the Problem

Production Workforce by Machine

Supervisors

SeniorManagement

1st Line Leaders

P & L Responsible Leaders

Production Metrics

People Metrics

Machine 1 Machine 2 Machine 3 Machine 4 Machine 5

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Molding is a Team Sport

MachineCustomer Order and Materials

Finished Productsand Satisfied Client

Sales Representative

Material Handler

Process Technician

Packer

Mold/Part Designer

Quality Control

Mold Maker &Maintenance

Press Maintenance Technician

Mold Setter

Machine Operator

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Generate Labor

RequirementRecruit Interview Orientation

Initial Assignment

•Probationary On the Job

Training

•In Service Training

•Specialized Training

•New Job Required Training

Track/Assign/

Determine Proficiencies

Promotion Reqs Met

Human Capital “End to End”

Initial EntryCommonTraining

Business Focus:Labor Cost

HiringDecision

Increase Cost Decrease Cost

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Tactical Self Assessment

1. What % of your cost is associated with labor vs. material? Are you looking at your SG&A costs as well?

2. Is labor resource management strategy it part of your Leader Development Program?

3. How or when do you decide to hire a new person? 4. Do you have a “Best Athlete” or “Best Player” Policy?5. How do you attract, recruit, and retain talent: hourly and

management?6. Do you have an established career path for hourly and

management? 7. Do you know the story of the “best employee” you have

hired in the last 5 years?

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Human Capital ManagementSuccess Principles

1. Business Focus (People, Process, + Material = Products)

2. Senior Leaders Must Personally Engage (can’t sit in your ivory tower)

3. Plan as a team, but execute within the functional areas

4. 1st Line Managers are Primary Trainers and responsible for performance

5. Fix responsibility, establish accountability, and empower leaders with authority to meet Return on Investment Goals.

6. Start with the end in mind: Big Picture Thinking

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Supporting the BusinessThe Mission:

Provide employees in the right numbers in the right skills at the right time to meet business needs.

The Goal: An agile, competent workforce capable to move at the speed of business.

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Are you forecasting your labor as you forecast your

business?• Production needs drive labor

requirements…• How far out are you looking?• What skills will you require? Current or

New• Lead Time from labor requirement to

competency?• Who is responsible for managing it?• What models do they use? • What options do you have?

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REQUIRED Level of Performance

CURRENT Level of Performance

Options:• Re-allocate Current Employees• Hire Experience • Hire New People• Work Overtime• Hire Temporary Labor• Outsource• Increase Productivity• Change the Process (Lean)• Increase Capacity (Automate)

Performance

Gap

Measu

res

of

Perf

orm

an

ce

Senior Management Team Labor Resource Strategy Development

and Human Capital Management Program

ResourcesRequired

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Options

Re-allocate Current Employees:

a. Requires a Skills Map, look at your bench “depth” for best moves

b. Increases overall skills of workforcec. Requires focused training for new tasks

or refresher training as requiredd. Shows commitment to current workforcee. Requires high level of 2 way

communication – a good mentoring program

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OptionsHire Experience:

a. Requires Skills Competency Assessment to accurately assess level of competency vs. years of experience

b. Must assess skills and attitudes – will they “fit” in your company culture?

c. Most “experience” is unique to that particular function

d. Consider the “value” of experience, short-term and long-term

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OptionsHire New People:

a. Best Athlete or Best Player Policy – go for potential!

b. Understand your most valuable pipelinesc. Use Skills Based Interviews at all levelsd. Delegate the Hiring Decision to the person

responsible for their performancee. Orient prior to hiringf. Create a World-Class First Day on the Jobg. Train for early success… Success breeds success!h. Train the “lowest level” to implement the training

plan and monitor results

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OptionsWork Overtime:

a. Short term reward for current workforce

b. Good option for temporary production surges, cyclical or seasonal business

c. Long-term potential negative impactd. Maintain awareness of shift work

and length of shift impact

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Options

Hire Temporary Labor:

a. Low skills, high turnoverb. Short train-up periodc. May serve as a source for permanent

employees

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OptionsOutsource:

a. Cheaper to buy than to buildb. Temporary needc. Not a part of your core businessd. Requires savvy Human Capital Leaders to

write Statements of Work and Request for Proposals and manage vendors

e. Must be able to evaluate skills and outcomes clearly

f. Look for Strategic Partners to create Win – Win!

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OptionsIncrease Productivity:

a. Same headcount but increase skills and efficiency to increase capacity

b. Reduces headcount through increased capacity

c. Combine skills and increase pay ratesd. Create incentives to individually motivate –

ie., Master Molder Program e. Increases agility to react to production

needs

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Options

Change the Process (Lean):

a. Process not people is limiting capacityb. Combine skill setsc. Supports continuous improvementd. All employees are responsible for

eliminating waste and re-engineering the process

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Options

Increase Capacity (Automate):

a. Automation can allow better utilization of your human capital

b. Apply same rigor to human capital as we do on new equipment

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Strategy Development“A Systems Engineering Approach”

Strategy is aligning Goals to Resources—or developing and growing the Human Resources to achieve Goals:

• What is the current process and cost? (Current State Map)

• What does the perfect system look like? (Perfect State Map)

• How do we get from here to there? Plan of Action and Milestones with Resources Required and Return on Investment Prediction

• What does the future system(s) look like and how will we measure progress? Future State Map(s)

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1st Principles

• Create a system that enables both the company and the applicant to make a “Win-Win” commitment… – First day should be a “commitment” day;

not a “let’s see how this goes day”

• It is Management’s responsibility to create an environment for our employees to be successful– Process and organization should focus on

making new employees successful not an environment that encourages them to fail.

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Right Person/Right Job Move the Employee in the Right

Direction

High QuantityLow Quality

Qu

anti

ty o

f W

ork

Quality of Work

Low QuantityHigh Quality

Low QuantityLow Quality

High QuantityHigh Quality

New Person

Go To Person

What is our plan to move our people along the correct developmental path?

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8421

4631

3331

1046

430

1000

2000

3000

4000

5000

6000

7000

8000

9000

X Depts E Depts O Depts M Depts K Depts

Labor Distribution

What are our core competencies?Where is our risk?What is our focus?

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Human Capital Managers Goals

• Be the Plant Managers best resource for support• Provide the processes and programs for 1st Line

Supervisors to do their jobs• Get out of the interview/job description business;

let the experts do it • Do not be a part of the problem• Link the Corporate Strategy to the Human Capital

Management Program• Must be long range thinkers… Human Capital is

an on-going program

Training Goals• Decrease the cost of training by reducing

the time to train—are you measuring competency? Are you using the most effective methods?

• Decrease time to competency (improve the quality of training) – provide an early success

• Decrease HR Risk (Safety, Litigation, etc.) • Empower the most effective and efficient

training environment possible… and Expert and a Novice on the job.

• Improve support to 1st Line Supervisors—our client

• Align training capacity with Human Resources Labor Resource and Hiring Plan

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Understand the Cost of Training

0 10 20 30 40 50

Admin Labor & Other

Classroom InstructionTime

Materials

Instructor ContactTime

Student Labor

%

Overwhelming Cost of Training is Employee Labor

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Your Take Away

Get Out of the Box… Big Picture Thinking!

Let us HELP…

Joe Barto, Training Modernization Group757-218-8444

[email protected]