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Copyright © 2015 Deloitte Development LLC. All rights reserved. 1 Global Human Capital Trends 2015 Copyright © 2015 Deloitte Development LLC. All rights reserved.
2015 ISA Conference
Leading in the new world of work
Josh Bersin Principal and Founder Bersin by Deloitte March 2015
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 2 Global Human Capital Trends 2015
Leading in the New World of Work
• The New World of Work
• Trends Facing HR, Learning, and Business Leaders
• The Bersin Experience: Growing a content and services business
Agenda
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 3 Global Human Capital Trends 2015 Copyright © 2015 Deloitte Development LLC. All rights reserved. 3 Global Human Capital Trends 2015
Barriers between
work and life dissolve
Talent in high
demand
Millennials make up 50% of
workforce
Global transparency
in job market
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 4 Global Human Capital Trends 2015
3,300+ Business and HR leaders
106 countries
One of the largest-ever longitudinal global talent studies
Unless otherwise cited, all data referenced in this presentation is from the Global Human Capital Trends 2015 survey.
Global Human Capital Trends 2015
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Global Human Capital Trends 2015
LEADERSHIP Why a perennial issue?
LEARNING AND DEVELOPMENT Into the spotlight
CULTURE AND ENGAGEMENT The naked organization
PERFORMANCE MANAGEMENT The secret ingredient
WORKFORCE ON DEMAND Are you ready?
SIMPLIFICATION OF WORK The coming revolution
REINVENTING HR An extreme makeover
HR AND PEOPLE ANALYTICS Stuck in neutral
PEOPLE DATA EVERYWHERE Bringing the outside in
MACHINES AS TALENT Collaboration, not competition
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Culture and engagement
Leadership gaps
Learning and development
HR Skills and capability
87%
86%
86%
80%
% VERY IMPORTANT
50%
51%
40%
39%
35%
34%
29%
26%
20%
14%
Importance of Trends to Business Percent Rating Trend Important
Workforce capability
Performance management
HR and people analytics
Simplifying work
Machines as talent
People data everywhere
71%
57%
52%
80%
75%
75%
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CULTURE AND ENGAGEMENT
The naked organization
talent issue
Create meaningful work, deep engagement, and job fit
#1global say the problem is “very important”– double the 2014 percentage
50%
60% of HR and business leaders do not have an
adequate program to measure and improve engagement.
Only 12% have a program in place to define and improve
culture.
Only 7% rate themselves excellent and driving and
improving retention
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Careers Have Changed and So Have People
• “Our candidates today are not looking for a career…”
• “They’re looking for an Experience.”
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Millennials Also …
80% Want to give performance
appraisals to the boss
60% think 7 months of work means they’re
“loyal”
2/3 Want to be “creative” at work
in their job
Their “team mates” are the most
important people at work
Expect feedback weekly and progression
annually
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Companies with “soul” had a
return from 1996 through 2006,
8x higher than S&P 400 firms
1026% Companies with “soul” experience:
• Higher engagement and retention
• Better customer service
• Long-term profitability
Source: Simply Irresistible: Engaging the 21st Century Workforce, Bersin by Deloitte, 2014
Importance of Mission and Purpose
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 13 Global Human Capital Trends 2015
Culture is The New Black
95% of candidates believe culture is more
important than compensation
<5% of candidates value compensation over
culture
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 14 Global Human Capital Trends 2015
The Global Engagement Challenge Glassdoor Ratings of Employer (Recommended to friends), 20,000+ respondents
Average 3.1
What are these
companies doing??
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The Simply Irresistible Organization®
What we have learned: An Integrated Approach is Needed
Meaningful Work Great Management Fantastic Environment
Growth Opportunity
Trust in Leadership
Autonomy Agile Goal Setting (i.e. OKR)
Flexible, humane work environment
Facilitated talent mobility
Mission and purpose
Selection to Fit Coaching & feedback Recognition rich culture Career growth in many paths
Investment in people, trust
Small Teams Leadership Development
Open flexible work spaces
Self and formal development
Transparency and communication
Time for Slack Modernized Performance Mgt.
Inclusive, diverse culture
High impact learning culture
Inspiration
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LEADERSHIP
Why a perennial issue?
see leadership shortfalls as a top-3 issue
Need to focus on developing leaders at all levels
Treat as short-term training instead of a strategic initiative
86%
Leadership “capabilities” in 2015 are no higher than in
2014, despite the fact that this was the #1 issue in 2014.
Leadership spending
increased by 14% in 2014 with no real impact on results.
Only 6% rate themselves excellent in developing
Millennial leaders and 66% rate themselves “weak”
Only 8% feel strong in
developing global leaders and 57% feel weak
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Leadership creates shareholder value Analysts place a 35% spread on stock price based on how they view leadership
+15.7% Equity premium on organizations
perceived to have effective
leadership
-19.8% Equity discount on organizations perceived to have ineffective leadership
$2.4 billion Premium as 15.7% of Company Market capitalization
$3.0 billion Discount as 19.8% of Company Market capitalization
consider their leadership development programs very effective, and… 4.3% 2%
And yet, companies aren’t getting the investment right…
Believe that their succession management is where it needs to be
* Source = Talent Edge 2020
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Bersin Leadership Development Maturity Model
Inconsistent Management Training Content Available • No Development Process • Benefit to Employees
Level 1
Structured Leadership Training Core Competencies • Well-Defined Curriculum • Developing Individuals
Level 2
Focused Leadership Development Culture-Setting • Future-Focused • Developing Organization
Level 3
Strategic Leadership Development Championed by Executives • Talent Management Integration
Level 4
Be
rsin
by
De
loit
te
25%
38%
28%
10%
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10%
19%
26%
36%
First-level
Mid-level
Senior-level
Executives
Source: Leadership Development Factbook Survey, Bersin by Deloitte, 2014, n=288
% of Positions with Successors Identified (Large organizations)
Does Succession Management Even Work?
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• The average tenure at work is <4 years, so “lifetime employment” strategies are out of date
• 55 Million people (32%) in the US work part-time, contingent, or as contractors
• 30% of Tech workers believe they could get a better job within 60 days if they looked (Dice)
• 50% of Millennials will change jobs within two years
• If you don’t have a facilitated talent mobility strategy good people will leave
New Models for Talent: No Longer for Life
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The Talent Mobility Formula Bringing the Talent System Together
DESIRED COMPETENCIES (KNOWLEDGE,
BEHAVIOR, SKILLS)
OPEN POSITIONS & OPPORTUNITIES
INDIVIDUAL NEEDS/DESIRES
INDIVIDUAL DEVELOPMENT PLAN
(IDP)
VISION
STRATEGIC INITIATIVES
DESIRED BUSINESS
OUTCOMES
VALUES
MISSION
ORGANIZATION NEEDS
MOBILITY
STRENGTHS
DEVELOPMENT NEEDS
CAREER ASPIRATIONS
ANNUAL GOALS
Succession Management
Career Development
Individual Development
Plan (IDP)
Strategic Competencies Workforce
Planning
Performance Management
Development Planning
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Talent Mobility takes a Complete Commitment Only 11% of companies have a clear strategy for career development
• Identify
Career Goals
• Maintain Profiles • Demonstrate
Values • Socialize
Interests • Create Internal
Network • Share Expertise
Employee • Define Job
Profiles • Provide Coaching • Assess Potential • Identify
Development Opportunities
• Provide Candid Feedback
• Share Talent Openly
Manager • Provides Tools &
Resources • Develop Career
Models • Facilitate
Process • Offer Career
Coaching • Career
Development Training
• Integrate with Talent Mgmt
HR • Infrastructure –
Process, Technology, People
• Create Culture of Mobility
• Communicate Expectations
• Create Transparent Marketplace
Company
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 23 Global Human Capital Trends 2015
What Millennials Want (and Need)
• Companies are desperately looking for ways to build leaders from Millennials
• Mentors and mentor programs are among the hottest programs to build new leadership
• When asked “how would you like to learn to lead,” more than 60% of Millennials say “I’d like a mentor.”
The Mentor Next Door
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 24 Global Human Capital Trends 2015
LEARNING AND DEVELOPMENT
Into the spotlight
Need to reinvent the learning experience
Skill shortage is holding back strategy execution
see L&D as a top-3 issue; up from #8 last year
84%
Learning moved from #8 to #3 in priority this year.
The capability gap tripled from
2014 to 2015.
Only 24% feel capable of using advanced media in learning (76% are weak)
30% now feel they have
capability to use MOOCs, yet only 12% feel they have
mastered L&D operations
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We are Here E-Learning & Blended
Talent Management
Experiential Learning
Continuous Embedded
2001 2005 2015
Evolution of Corporate L&D From Content-Centric to Continuous and Experience-Centric
2010
E-Learning Get Materials Online
Social, Collaborative Corporate University
Blended Programs
Content Management Taxonomy
Learning Paths Role-Based
Self-Authored Extreme Blended
Gaming, Embedded, On-Demand
Rich Catalog University
2020
Learning Everywhere
All The Time
Intelligent Learning
Instructional Design Kirkpatrick
Career Curricula
Content Community
70-20-10
Job Relevant Classroom
LMS as E-Learning Platform
LMS as Talent Platform
LMS as Data (Where is the LMS?)
LMS as Experience Platform
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What People Want
Rated 7th
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We Have A “Learning Engagement” Problem
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Learning Environment at TELUS
EXPERT DIRECTORY LEARNING
PORTAL CAREER SOCIAL
KNOWLEDGE BASE
SOCIAL SERIOUS GAMES
COLLAB PROJECTS ONBOARDING FOLLOWING VIDEO
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Many Disruptors Coming Self-Authored Content Catalogs, Adaptive Learning, Analytics, and MOOCs
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Corporate Capability Development Weak
14%
14%
9%
9%
5%
76% Rate Current Workforce Capabilities an Urgent Problem … Yet Only 13% Feel Fully Ready
% Excellent
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 31 Global Human Capital Trends 2015
of organizations have a senior leader running
the training function
Only 49% of organizations have a written business plan
for learning
<45%
70% 64% 43%
26% 48%
29%
HILO Overall
Competencies & Profiles
Development Planning
Career Paths
L&D Organization and Governance Continues to be Challenging
Bersin High-Impact Learning Organization Model
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 32 Global Human Capital Trends 2015
REINVENTING HR
An extreme makeover
Align HR capabilities with business goals
HR is being redefined as an enabler and builder of talent
see an urgent need to reskill the HR function
39%
HR skills are the fourth highest priority in all areas with almost
40% rating the problem “urgent.”
Only 11% have strong
programs to develop HR professionals internally.
Despite a 4% increase in HR
spending, almost all talent capabilities this year have
dropped
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 33 Global Human Capital Trends 2015
HR is not keeping up
HR capabilities
Simplifying Work
Learning and
development
Performance Management
Reinventing HR
HR & people Analytics
Culture and Engagement
Leadership
-26 -28 -29
-30 -31
-31
-36
Business needs
Global Economic Growth
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Global Capability Gaps Percent Rating Trend Important
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HR is Under the Gun by Business Leadership
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PERFORMANCE MANAGEMENT
The secret ingredient
Emphasize coaching and feedback
Less emphasis on evaluation; more on agile goal setting
have changed performance management processes or plan to change it in the next 18 months
89%
Today 10% of companies believe their performance
management process is an effective use of time (up from
8% last year)
35% believe the process drives no value at all
45% believe it hurts
engagement and only 10% believe it helps engagement.
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Burdensome,
Fixed
Flexible,
Agile, Simple
Ongoing,
Continuous
Assumption
Based
Annual,
One-Time
Data Driven
Centralized,
Deferred
Local,
Real-Time
Appraisal
Focused
Development
Focused
Remediation Strengths
Future Outlook
Investments in development
planning reduce voluntary and high
performer turnover while increasing
the average revenue by employee1
1 Bersin: High Impact Performance Management (2011) [n=200+] 2 Gallup Organization Research (1998 – present)
The defining characteristic of high
performing teams is that each
member feels that their role
repeatedly calls upon their strengths2
* Additional research can be found in the appendix
Time for a Shift in PM Principles
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 38 Global Human Capital Trends 2015
Clarifying the Purpose of PM
Coaching for Development
Talent Decisions
Performance Improvement
Legal Documents
Employee Motivation
Compensation
Performance Feedback
PERFORMANCE MANAGEMENT
Coaching for Development
Talent Decisions
Performance Improvement
Legal Documents
Employee Motivation
Compensation
Performance Feedback
PERFORMANCE MANAGEMENT
Kelly Services
Source: “Getting Away from the Score: Creating Better Ongoing Performance Feedback,” Bersin & Associates, 2012.
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1. High Performers are Disappointed
2. Mid-level Performers can Lay Back
3. Low Performers can Hide
4. Managers rate Themselves
5. Compensation is a separate, distinct process from evaluation and rating
The Myth of the Bell Curve
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 40 Global Human Capital Trends 2015
Within the pilot/test population, increased Check-in frequency maps to increased engagement
3.2
3.4
3.6
3.8
4.0
4.2
4.4
Control Group
1
0-59%
Control Group Top Quartile Check-In Frequency* Bottom Quartile Check-In Frequency*
*By total opportunities to Check-In
1. I am really enthusiastic about the mission of the firm
2. At work, I clearly know what is expected of me
3. In my team, I am surrounded by people who share my values
4. At work, I have the chance to use my strengths every day
5. My teammates have my back 6. I know I will be recognized for
excellent work 7. I have great confidence in the firm's
future 8. In my work, I am always challenged
to grow
1
2
3
4
7
6
8
5
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HR AND PEOPLE ANALYTICS
Stuck in neutral
Need a long-term commitment to analytics
No year- over-year improvement in analytics capabilities
rate analytics important; only 8% are “strong”
75%
Year over year there has been almost no improvement in
analytics maturity and capability around the world.
2/3 of companies have little or no capability to correlate HR
data to business data
Only 28% use HR data to predict workforce performance and only 4% feel expert today
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What is People Analytics Bring HR & Business Data Together
Recruiting and Workforce Planning
Comp and Benefits
Performance Succession Engagement
Learning & Leadership
HRMS Employee
Data
Engagement & Assessment
+ Sales Revenue
Productivity
Customer Retention Product
Mix
Accidents Errors Fraud
Quality Downtime
Losses
Groundbreaking New Insights & Tools for Managers to Make Better Decisions
= Data management, analytics, IT, and business consulting expertise
+
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Copyright © 2015 Deloitte Development LLC. All rights reserved. 43 Global Human Capital Trends 2015
What Our Research Discovered
• Bersin by Deloitte Talent Analytics Maturity Model
Be
rs
in b
y D
elo
itte
Operational Reporting Reactive Reporting of Operational & Compliance Measures •
Focus on Data Accuracy, Consistency & Timeliness
Level 1
Advanced Reporting Proactive Reporting for Decision-Making • Analysis of Trends
& Benchmarks • Customizable, Self-Service Dashboards
Level 2
Advanced Analytics Statistical Analysis to Solve Business Problems • Identification of Issues
& Actionable Solutions • Centralized Staffing & Integrated Data
Level 3
Predictive Analytics Development of Predictive Models • Scenario Planning •
Integration with Business & Workforce Planning • Data Governance Model
Level 4
56%
30%
10%
4%
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Value is High
Today, 14% of HR ORGANIZATIONS believe they “regularly use data to make talent and HR strategy decisions”… …and these organizations, are…
2X as likely to
believe they are excellent at
selecting the right
candidates
2X as likely to
believe they are delivering a
strong leadership
pipeline
Generating
30% higher stock
returns than the S&P 500 over the last three
years
3X as likely to
believe they are efficiently
operating HR
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SIMPLIFICATION OF WORK
The coming revolution
Redesign work to focus on what matters
Technology and globalization creating overwhelmed employees
see need to simplify work; 25% say need is very important
75%
Believe it or not, 63% of companies have some
program in place to “simplify work” but only 12% feel it is
driving significant value today.
74% say their work environment is “highly
complex” or complex, and only 4% say it is “simple”
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New Solutions: Design Thinking
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Growing Your Business
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Learning and Leadership Markets
• Is it the Chief Learning Officer? • Is it the Chief HR Officer? • Is it the Line of Business Leader?
Who is the buyer?
CEO – “I have problem X”
CHRO - ”Are you any good? Have I heard of you?”
CLO - ”How does your product work and how does it compare with alternatives?
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ISA Conference
• Positioning – where do you fit?
• Uniqueness -- How are you really different?
• Scale – what is your real product and can you scale up?
• People and Culture – customer intimacy, support, and hiring?
• Leadership – are you a founder, manager, or leader?
• Focus – how to avoid distractions but stay innovative?
• Energy – can you keep it up?
What I Have Learned
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Thank You