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N A T I O N A L S E C U R I T Y • E N E R G Y & E N V I R O N M E N T • H E A L T H • C Y B E R S E C U R I T Y
© SAIC. All rights reserved.
Smart People Solving Hard Problems
Organizational Leadership Capability – Knowing What
Leadership Investments You Need
J. Keith Dunbar, Asst. Vice President, Learning and Talent Development Director
June 6, 2012
S A IC .c om
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Welcome
• Ground Rules
– Multi-directional conversation and engagement
• The VUCA Environment
• Elephant in the Room
• Key Differentiators
• World-Class Leadership Development in the Future
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Our Company
SAIC is a FORTUNE 500® scientific, engineering, and technology
applications company that uses its deep domain knowledge to
solve problems of vital importance to the nation and the world in
national security, energy & environment, health and cybersecurity.
Our Successes
– Approximately $10.6 billion in annual revenues
for fiscal year 2012
– FORTUNE 500 company – No. 245
– Superb staff of qualified professionals
• Approximately 41,000 personnel worldwide
• Approximately 10,000 employees with advanced
degrees
• Over 20,000 employees with security clearances
– Leading provider of contracted R&D services
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Me
• U.S. Navy Veteran
– Submarines, Aviation and Surface
– North Pole
– Korea
– Bahrain
– Mediterranean Vacation Cruise
– Pentagon
• U.S. Government Civilian
– Defense Intelligence Agency
• Global Learning Solutions
• Leadership Academy
• Doctoral candidate at University of Pennsylvania Chief Learning Officer (PennCLO) program
• SAIC
– Intelligence, Surveillance and
Reconnaissance Group
• Director of Learning & Talent Development
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Keith’s Callsign in the Navy was…
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1 2
50%50%1. Gomer
2. Goober
N A T I O N A L S E C U R I T Y • E N E R G Y & E N V I R O N M E N T • H E A L T H • C Y B E R S E C U R I T Y
© SAIC. All rights reserved.
Polling Questions – Group Demographics
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I work in the following sector …
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1 2 3
33% 33%33%1. Private
2. Public
3. Academia
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I have been in the learning & development
profession for …
8
1 2 3 4 5 6 7
14% 14% 14% 14%14%14%14%
1.<1 year
2. 1-3 years
3. 4-5 years
4. 6-10 years
5. 11-15 years
6. 16-20 years
7. >20 years
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As far as leadership development
is concerned … I …
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1 2 3
33% 33%33%
1. Do it everyday
2. Am interested in the
topic
3. Am not
interested…just
killing time…heard
you talk funny.
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Competitive Advantage
- Understanding Profit Drivers
- Differentiation/Cost
- Market Structure
- Supply Chain
- Skills
- Resources
- Dedicated Systems
- Learning
- Competitor Capabilities
- Nature of the
Competitive Game
- Role of Partners
Focused, Stretch, Actionable
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Major Change
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Employee Engagement
and Motivation
Merger &
Acquisition
Global
Workforce
Generational
Workforce
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The VUCA Environment
• Volatility
– Rate of change
• Uncertainty
– Unclear about the present situation and future outcomes
• Complexity
– Multiplicity of key decision factors
• Ambiguity
– Lack of clarity about the meaning of an event
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I think leaders face more VUCA today than even
one year ago …
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1 2 3 4 5
20% 20% 20%20%20%
1. Strongly Disagree
2. Disagree
3. Neutral
4. Agree
5. Strongly Agree
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Key Drivers of Attraction and Commitment
Development Opportunities
Future Career Opportunities
Respect
Manager Quality
Collegial Work Environment Compensation
Organizational Stability
Attraction Commitment SOURCE: CLC Human Resources, Attracting and Retaining
Critical Talent Segments-Identifying Drivers of Attraction
and Commitment in the Global Labor Market,
Washington, D.C.: Corporate Executive Board, 2006. 15
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We Need Talent Champions
31% 19%
50%
Poor Talent
Outcomes
Superior Talent
Outcomes
Average Talent
Outcomes
Characteristics
• 18% of business leaders have a
successor that will be ready within 24
months
•Employees effort levels are 20% lower
than average
•32% of employees are at risk of
turnover
•Business unit profits are 6% lower than
average
•Business unit revenue is 7% less than
average
Characteristics
• 76% of Talent Champions have a
successor that will be ready within 24
months
•Employees effort levels are 25%
greater than average
•6% of employees are at risk of turnover
•Business unit profits are 6% greater
than average
•Business unit revenue is 7% greater
than average
SOURCE: Corporate Leadership Council 2008, “Creating Talent Champions” – CLC Talent Management Effectiveness Survey
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Why Collective Leadership Capability?
• Organizations with Top-Tier Leadership Teams Outperform Competitors
– Number of Leaders Substantially Outperforming Revenue Expectations
– Number of Leaders Substantially Outperforming Profit Expectations
Leaders with Poor
Leadership Skills
Leaders with Top
Leadership Skills
1.0x
1.8x
Leaders with Poor
Leadership Skills Leaders with Top
Leadership Skills
1.0x
1.5x
SOURCE: CLC Human Resources, Improving
Business Leader Effectiveness Survey,
Washington, D.C.: Corporate Executive Board,
2008.
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Why Collective Leadership Capability?
• Leaders Impact on Employees
Employees Reporting
To Manager A
Employees Reporting
To Manager B
1.0x
1.52x
Employees Reporting
To Manager A Employees Reporting
To Manager B
1.0x
1.25x
Employee
Performance Intent to Stay Emotional
Commitment
Employees Reporting
To Manager A
Employees Reporting
To Manager B
1.0x
1.40x
SOURCE: CLC Human Resources, Improving
Business Leader Effectiveness Survey,
Washington, D.C.: Corporate Executive Board,
2008.
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Leadership Capability Drives Growth
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SOURCE: "Return on Leadership" – joint study by Egon Zehnder International and McKinsey & Company
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The Cost of Turnover – Case Study
Research estimates
75%-150%
of base salary
Chief Systems Engineer
@$200K
New Chief Systems Engineer
~$150K-$300K
SOURCE: Chasing Stars– Boris Groysberg, Harvard Business School
Turnover Planning Factors
-~35 days to fill vacancy
- Average bill rate ~ $150/hour
- 1500 voluntary turnover in FY12
- 70% billable (1050)
~ $44.1M in lost revenue
Does not include:
-Overhead costs
(Source/recruit/interview)
- Lost performance
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Internal Promotes versus External Hires
SOURCE: Promote or Hire? Paying More to Get Less – Matthew Bidwell, Wharton School
Comparison
of 7,000
employees
(2003-2009)
internal
promotes vs.
external hires
- Performance
Rank
- Competence
- Results
Promotes
outperform
hires
Three years
for hires to
catch-up to
promotes
Small, but
significant
increase in
compensation
for colleagues
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• What is keeping us from being successful and achieving our goals in leadership
development?
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Elephant in the Room
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Developing future leaders is important to my
organization
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1 2 3 4 5
20% 20% 20%20%20%1. Strongly Disagree
2. Disagree
3. Neutral
4. Agree
5. Strongly Agree
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My organization is effective at developing future leaders
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1 2 3 4 5
20% 20% 20%20%20%1. Strongly Disagree
2. Disagree
3. Neutral
4. Agree
5. Strongly Agree
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Group Discussion
• Five minutes
• Why the disparity between importance-effectiveness?
• Identify #1 reason by consensus
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Key Differentiators
• Challenges in realizing leadership development investments
– Disconnected strategy
– Misaligned outcomes
– Uncoordinated HR activities
*Corporate Leadership Council – Improving Returns on Leadership Investments
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Center for Creative Leadership and
Leadership Strategy
• Five Key Components of Leadership Strategy
– Quantity
– Qualities
– Skills and behaviors
– Collective leadership capabilities of leaders
– Desired leadership culture
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* Developing a Leadership Strategy– Center for Creative Leadership
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Recent Penn CLO Program Research
• Leadership strategy = the kind of leaders organization needs explicitly
• Organizations focus on skills and behaviors in strategy
• Leadership strategy = increased leadership development funding
• Business needs drive the leadership strategy
• Leadership strategy must be dynamic
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Does my organization have a leadership strategy
aligned to the business/mission strategy?
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1 2 3 4
25% 25%25%25%
1. Yes
2. No
3. No clue
4. What is a strategy?
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IBM 2012 Global CEO Study
• Customer-obsessed leaders will drive the organization toward deeper, more contextual
customer insights.
• Inspirational leaders will engage, motivate and guide employees with values and shared
purpose rather than tight control.
• Leaders who team will model collaboration for their organizations. They’ll be coalition
builders, internally and externally.
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Human Capital Development: A Systemic Approach
Capacity
Assessment
Individual Assessment
& Group
Assessment
Impact
Capabilities Solution Portfolio (CSP)
Business Impact Measurement (BIM)
Hire
Top Performers
Strategic
Thinkers
Challenges
To
Business
Desired
Behaviors
Organizational, Behavioral, & Capability
Requirements Definition (BRD)
Recruit, Hire, & Deploy
Workforce Capability
Develop
Outsource Partners & Contractors
LEVERAGE
BUILD
BUY
Perceived
Value
Workforce
Learning
Impact
Transfer
of
Learning
to individual
to organization
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Best Practice Leadership Practices
• Job rotations
• High potential programs
• Management training programs
• Management and functional leadership tracks
• Executive recruiting
• Peer assessments
• Executive candidate assessment
• Action learning
• Execution education programs
• Coaching
• Mentoring
• Run line organization
* “What’s Old is New Again: Managerial “Talent” in a Historical Context” – Peter Cappelli
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Center for Creative Leadership and
Leadership Development
• More focus on vertical development
• Transfer of greater developmental ownership to the individual
• Greater focus on collective rather than individual leadership
• Much greater focus on innovation in leadership development methods
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*SOURCE: Future Trends in Leadership Development – Center for Creative Leadership
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My organization, with respect to leadership
development , focuses on …
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1 2 3 4
25% 25%25%25%1. The What
2. The What and How
3. The How
4. None of it
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My organization with respect to leadership
development is focused on …
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1 2
50%50%
1. Individual leadership
capability
2. Collective leadership
capability
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Leadership Capability Measurement
• Difficult nut to crack
• Academic research indicates wide variance in role of leadership in organizational
performance
• * Measurement should include financial and non-financial metrics to understand
performance effects
– Financial
– Customer satisfaction
– Employee engagement
• Collective leadership metrics
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*SOURCE: Missing Links in Understanding the Relationship between Leadership and Organizational
Performance - Fenwick Feng Jing and Gayle C. Avery
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Leadership Capability Portfolio Management
3.5
4.5
4.0
Capability Assessment by High Potential Cohort
Capability Assessment by Business Unit
Capability Assessment by Management Level
Emerging
Talent
The 15
ISRG
HiPo
Red Flag
Red Flag
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STRATEGIC
PLANNING
• Business Strategy
• Talent Strategy
• HR Systems Strategy
• Metrics & Measurement
• Process Governance & Policy CAPABILITY
MANAGEMENT
• Business Values
• Organizational Competencies
• Leadership Competencies
• Functional Competencies
• Job Profiles & Design
STAFFING &
RETENTION
• Sourcing
• Social Networking
• Candidate Pools
• Employer Brand
• Assessments
• Selection
• Compensation LEARNING & KNOWLEDGE
DEVELOPMENT
• On-boarding
• Learning Needs Assessment
• Organizational Culture
• Role-Based Curricula
• E-Learning Strategy
• Informal and Formal Learning
• Certification Programs
• HR Information Systems
PERFORMANCE
MANAGEMENT
• Goal/Objective Setting
• Self-Assessment
• Manager Assessment
• 360 Assessment
• Development Planning
• Competency Assessment
• Short- & Long-term Assessment
LEADERSHIP & SUCCESSION
PLANNING
• Leadership Development
• Talent Reviews
• Hi-Potential/Hi-Performer ID
• Career Planning
• Talent Mobility Plan
• Re-deployment & Retirement
Talent Management Life Cycle
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Final Thoughts
• Everything , and in particular leadership, must
enable the business/mission strategy
• Identify and create people capabilities … Leadership
capability is #1
• Best-in-class leadership capability is a competitive
advantage
“An organization’s ability to learn, and
translate that learning into action
rapidly, is the ultimate competitive
advantage.”
- Jack Welch
“The illiterate of the future are not
those that cannot read or write. They
are those that cannot learn, unlearn,
and relearn.”
- Alvin Toffler
“If you dislike change, you're going to
dislike irrelevance even more.”
- Gen. Eric Shinseki
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Thank You
• SAIC: [email protected]
• LinkedIn: J. Keith Dunbar
• Twitter: @JKeithDunbar
• Google+: J. Keith Dunbar
• Blog: DNA of Human Capital - http://dna-of-humancapital.blogspot.com/
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