Author: Jennifer Koch

Iat’s a business nightmare. What do you do when an employee’s total lack of customer-service skills results in the loss of hundreds of thousands of dollars? If you’re the head of human resources, you jump in and do something – and fast. That’s what Marc Shapiro, senior vice president of human resources for Quebecor World Inc., did when he made the decision in early 1998 to embark on the largest training initiative ever attempted in the organization.

    After extensive research, a yearlong assessment, and prompting by some sharp suggestions from management experts at New York City-based McKinsey & Co., Shapiro identified strategic, and pressing, business realities. The business climate for the printing industry had changed dramatically within a short time. Competitive advantage was being measured not in months and weeks, but in hours and minutes. The company would no longer be able to compete on price and quality alone.

“We asked ourselves, What’s going to differentiate this company from other companies in the printing market?” Shapiro recalls. “And we decided that customer service was going to be a huge differentiator.” Adds Wanda Breeden, president of Innovative Organizational Concepts Inc., based in Brooksville, Florida, who was hired to help lead the training effort: “We realized during the assessment process that this might be the competitive advantage for the company going forward.”

Based in Montreal, Quebec, Quebecor World Inc. is the world’s largest printing company. It encompasses 160 printing plants located in 14 countries and employs 43,000 people. Quebecor World is part of the $10 billion Quebecor Inc. empire, which also includes Quebecor Media Inc., a media property holder. Publicly traded Quebecor World prints periodicals and books including Time, Sports Illustrated, and Harry Potter and the Goblet of Fire.

For implementing a training program that has helped the firm achieve world-class customer-service skills that have increased customers’ satisfaction, decreased turnaround time and lowered the cost of errors, Workforce Magazine gives Quebecor World its 2001 Optimas Award in the Competitive Advantage category.

The Allstar Customer Service training program was one of the first major courses to be housed under the firm’s newly formed Quebecor World University, which combined and enhanced elements of each of the two merged firms’ former training programs. The classes are closely tied to the firm’s career-development program.

vFrom his office in Dallas, Shapiro explains that Quebecor had invested in other customer-service training initiatives over the years, starting in the 1990s. “Senior management commitment was there previously, but the resources weren’t there to really do the kind of job we wanted to do,” he says of the company’s former customer-service training programs. “So when we refocused, we started taking a look at what we wanted Allstar to improve: customer service.”

Shapiro’s overarching goal for this program, which started in April 1998, was to educate the firm’s customer-service and account representatives from its North American operations in world-class skills. “We were hearing from our customers that our people in the plants were so different that each plant was like a different company. We needed continuity,” says Jerry Tomczik, a customer-service manager at the firm’s facility in St. Cloud, Minnesota.

The program’s objectives and initiatives were set at several levels and included improving understanding of customers’ needs; improving account-management skills; and achieving a high-performance, team-based, customer-oriented culture.

When the firm merged in October 1999 with World Color Press to become Quebecor World, the HR team designed the training to address the additional need to blend those two cultures as well as those of many other acquisitions that had been brought on board in previous years.

In addition to measuring the impact of the training in increased customer satisfaction and cost containment, Shapiro’s HR team also determined that the training:

• Should be so unique and challenging that everyone would want to go.

• Ought to involve senior management to reinforce the goals of the training.

• Should give Quebecor World a unique competitive advantage through world-class service to its customers.

It was a mighty tall order for a single training initiative. However, because other initiatives hadn’t measured up to the challenge, and because customer service was identified as the single most important issue to focus on going forward, Shapiro decided that a higher-level, and more creative, approach was needed.

The HR team designed Allstar to be more like executive training than a boring, sit-down-in-a-cafeteria training session. When a senior manager or president from one of the company’s nine divisions kicks off a session, and outlines goals and expectations of the training investment, participants know the company means business.

“I have been in the training field for years, and this is the first time I’ve had the opportunity to work on such an exciting endeavor that takes all of the buzzwords of training and makes them reality,” Breeden says. “Senior management support? We’ve got it. Return on investment? We can show it. Support the business plan? You bet. And this is the first time I’ve seen group presidents make a training effort such a vital part of their future growth plans.”

Shapiro selected the Lake Forest Graduate School of Management in Chicago to partner with them in designing, conducting, housing, and bringing the program to life. Several weeks separate each three-day session. “We wanted to get people out of the workplace so they could concentrate 100 percent on learning,” Shapiro says.

Program leaders designed the training as three intensive sessions of three days each, during which no more than 25 participants would learn new skills. During one of the sessions, Quebecor employees participate in a team-building cooking exercise. The Team Banquet challenges customer-service representatives to design, prepare, and serve a banquet meal within two hours without any instruction. The team-building exercise makes participants work together to come up with focused solutions in a short time. It has been very effective in both building students’ self-esteem and helping bond the firm’s culture.

There are theatrical presentations of role-play situations between plant and customer partnerships. There’s a low-ropes course during which participants have to climb over a 15-foot wall and navigate other challenges.

During the last session, participants make presentations to senior managers covering what they’ve learned and how they’ll apply it back on the job. Students receive a certificate when they’ve completed the entire program, and people who miss a session don’t get a certificate until they complete it. “We want to make sure the training means something, that it’s an accomplishment,” says Shapiro. About 760 customer-service reps and managers will have completed the training by the end of the year.

An advisory team composed of representatives from all levels within the company helps ensure that training is always relevant and reflects current business trends. It also makes sure that case studies are accurate and reflect the real world of printing. Curriculum is continuously improved to reflect business trends.

Participants evaluate the program immediately after going through it. Alonzo Reese, an account manager for Quebecor World Printing in Dallas says the Allstar training “was incredibly serious, incredibly professional, and incredibly fun. It was the most intense, most fun, most knowledgeable training that I’ve been through in 30 years in this business.”

Workforce, March 2001, pp. 40-41 Subscribe Now!

The Container Stores are palaces of boxes and bags, racks and shelves that help you organize and store everything from shoes to spices. “Contain Yourself,” the company playfully entreats customers. But to its valued employees the mantra is quite the opposite: Think outside the box. The expression may be a maddening misnomer at many work places. At the Container Store, it’s real.

    The company has become so respected for its commitment to employees and their creative input that it has catapulted itself into a position of leadership in the HR field. The reason is simple. “A funny thing happens when you take the time to educate your employees, pay them well and treat them as equals,” company president and CEO Kip Tindell declares. “You end up with extremely motivated and enthusiastic people.”

    Sitting and talking with Beth Barrett, vice president of operations at the company’s Dallas headquarters, you quickly realize that the company isn’t like most old-economy retailers. And Barrett definitely isn’t a conventional head of human resources. Much about the organization and how it handles people management is unusual, but well suited to the company’s unique business mission: To sell products that save customers space and time.

    Just as no organizational product solution is ever the same for two different customers, The Container Store believes that people management should be the same way. Rather than filling positions as quickly as possible, Barrett would rather hold a job open for six weeks or more to make sure just the right person is hired.

    Barrett knows that her management style is definitely not straight out of HR 101. When she began working at The Container Store, she was just out of college, a French major with some work experience in sales. Perhaps her distinctive and creative take on HR is a direct result of having no preconceived notions about how to direct the people side of a business. What she didn’t know couldn’t become a stumbling block.

    Sitting back in her chair dressed in a white sweat suit with the distinctive blue company logo, she says that although she’s had no formal HR training, her 20 years of running HR at The Container Store has been her practical training ground. Working hand-in-hand with the organization’s founders, Garrett Boone, who serves as chairman, and Tindell, Barrett has used her own keen insight and business savvy to develop management strategies. It’s worked. Since it opened in 1978, the company now pulls in more than $214 million in annual revenue.

    As the original storage and organization goods retailer, the company attributes its success to accomplishments in several areas. In an industry where 100 percent turnover is common, The Container Store boasts a very low 15 to 20 percent . Forty-one percent of new hires come from employee referrals. But it’s the enthusiasm among workers that’s so palpable.

    It can be measured by taking a stroll through the organization’s headquarters, or the adjacent distribution center, or one of its 24 sites in the United States, or in its manufacturing facilities in Sweden. A stunning 97 percent of employees agree with the survey statement “People care about each other here.”

    In recent years, the firm has been praised as a leader in many business organizations. The Container Store received the Retail Innovator’s Award from the National Retail Federation based in Washington D.C. And the company has been ranked the best organization to work for in America by Fortunef magazine for the years 1999 and 2000 – the only time a company has won the honor two years in a row.

    The Container Store wins the Workforce magazine Optimas Award 2001 in the category of General Excellence for outstanding people-management strategies. These plans have resulted in the firm’s achievement of sustaining a 20 to 25 percent increase in annual sales each year.

    Sure, The Container Store set out to be a profitable business. But the question of how to reach that goal has always been the primary difference between The Container Store and many other retailers. The company’s founders never intended to grow for growth’s sake. Rather, they set out to adhere to certain business values centered around deliberate merchandising, superior customer service, and constant employee input.

    If you think of a start-up business as empty space around which you build boundaries – almost like taping up the six sides of a box – that’s exactly how company founders Boone and Tindell organized their ideas around building a strong company culture. It’s something few, if any, other retailers do.

    Not long after creating the company, Boone and Tindell created innovative parameters called foundation principles. They are a set of humanistic, spiritually based, do-unto-others philosophies. These principles are practiced internally among employees and are reflected in how they treat each other and how the company treats them. Ultimately this translates into a strong customer-service philosophy that allows all employees to take ownership of the company and make decisions based on their own intuition and discretion.

    The company strives to astonish its employees, which makes it an easy proposition for them, in turn, to astonish customers. “If we expect our employees to astonish customers, we have to first take care of them,” says Barbara Anderson, director of community services and staff development.

    “Because they’re going to treat customers the way we treat them. We can’t say, ‘Go be this wonderful person’ with a customer, but not treat them with respect. That’s where it all begins and that’s why we put so much time and energy into that. Someone needs to role-model how we treat each other.”

    True to its name, and its “Contain Yourself” slogan, the company approaches business with simplicity, straightforwardness, and a spirit of eagerness. By design, the company doesn’t contain creativity with rules. There’s no employee rulebook or manual. Instead, the company operates within a few uncomplicated but unwavering guidelines, such as always being flexible.

    When you’re the trailblazer in your own market niche, you start with a clean slate in designing business – including how you approach people management. Barrett doesn’t believe in a traditional HR structure, but instead has focused on a single concept: to support the business goals in the best way possible rather than to construct HR for HR’s sake.

    Like many small companies, The Container Store operated without a personnel department for several years. From the beginning, managers have been responsible for many of what are traditionally considered HR tasks because they’re closest to employees.

    “Many companies define HR as being almost solely responsible for attraction, motivation, and retention. Our approach has always been to entrust our great supervisors with that responsibility,” wrote Barrett in her memo to the company about the HR changes.

    “We know this helps in so many ways, from reduced turnover to clearer lines of communication, as well as a greater sense of trust and ownership in the company.” It also gives people who are ultimately responsible for HR functions more time to focus on strategic rather than tactical issues.

    In 1994, Barrett formalized the payroll and benefits functions into a semi-traditional human resources department. However, the recruitment and training activities were always distinct functions. More traditional HR activities such as compensation and payroll later followed under the HR umbrella.

    However, Barrett broke up the HR department last year into three separate functions, all still reporting to her. The recruiting and training departments have continued to operate as distinct areas, but the payroll, benefits, and workers’ compensation functions are now separate. “I spend a tremendous amount of my time really working with Garrett and Kip on building the structure, changing the structure, and looking at new areas of need,” Barrett says.

    Part of The Container Store’s unique management style is to give human resources managers responsibility for other areas of the company, such as store operations. This gives them a multifaceted view of the organization at all times.

    This year, as a get-back-to-basics effort, Barrett has directed HR managers and other senior staff members to take positions at the store level so they can even further reconnect with the company’s core purpose – to serve customers. Most employees start out working as salespeople, so this isn’t a new experience for them. Everyone in the company understands that the more they know about serving the core customer’s needs, the more successful they’ll be.

    The Container Store’s business is to solve customers’ one-of-a-kind storage and organization problems. Its people management practices also mirror this concept. The company has a focused people strategy: hire for fit; train comprehensively; and pay and support for longevity.

    Just as The Container Store finds storage solutions for its customers, it tailors jobs to people. The company customizes jobs to fit skills, abilities,and talents. The Container Store matches employees’ strengths with the needs of the company, focusing on talent rather than titles.

    From the beginning, the company’s operations team decided not to train employees by just dumping information into their heads. Instead, The Container Store decided early on to educate its workers using interactive techniques, and discussing the whys along with the whats and hows. “There’s a lot of philosophical discussion and education as opposed to just learning the keystrokes,” Barrett says.

    To achieve the company’s primary goal of providing extraordinary service, the firm invests in more than 235 hours of training for employees in their first year – an astonishing feat for a retailer in an industry that usually provides workers with an average of seven hours of training per year.

    Included in rookie training is a full week of orientation training, topped off with a session on learning the foundation principles, offered in an unscripted presentation delivered directly by new employees’ managers. But it isn’t just quantity that matters, quality is essential for The Container Store. It has achieved that end.

    Leonard Berry, a leading expert on service quality, profiled the company in his book, Discovering the Soul of Service: The Nine Drivers of Sustainable Business Success (Free Press, 1999). In his book, Berry concludes that the single most important factor in building a lasting service business isn’t a matter of savvy business practices but of humane values.

    After their first year at The Container Store, full-time employees receive an average of 160 hours of training annually. Although training has never fallen under HR at The Container Store, Barrett has provided leadership around all development activities, which includes measuring the direct impact of training on store sales. The company can prove that its substantial training investment has a measurable financial impact on the organization.

    “The impact of the training is long-term oriented,” Barrett says. “I mean, what we do today is going to impact the customer who comes in three months from now. So, it’s over time, and we’ve watched our dollar-per-customer grow from the late eighties when our average dollar-per-customer was in the low $20s. Our average dollar-per-customer now, depending on the market and the store, is headed for $50.”

    Looking beyond the minimum-wage concept, The Container Store has taken the bold move of paying employees two to three times the industry average, which cultivates fierce employee loyalty.

    “Kip and I worked for 18 years very closely on building the structure that allows us to pay more – to think out of the box and devote 10 percent of store sales to payroll,” Barrett says. The industry average is 3 to 4 percent. “I really don’t believe that [employees], especially at the store level are a focus in general for retail companies. Merchandise is their first focus and gross margin plays a huge role in determining payroll for a retail company.” This goes back to focusing on what the company considers its number one asset: employees.

    The company shares all financial information with everyone and offers benefits to all employees, both full- and “prime-timers” – people who work less than full time.

    The Container Store carefully cultivates a work environment that’s both fun and based on the company’s strong values. Many employees have left or retired from other careers where they’ve often experienced business cultures where trust and empowerment are only words on a mission statement. They aren’t lived daily by everyone from the top down.

    The company likes to hire its customers and usually employs college-educated people who are looking for a home at work. They want their quality of life at work to reflect their lifestyle, their beliefs, their values, and they’re usually seeing The Container Store philosophies as a good match for their value system,” Barrett says. “Often, it’s as simple as that.”

Workforce, March 2001, pp. 34-38 Subscribe Now!

Cost is a big part of the benefits decision. According to the Year 2000 Survey of Employee Benefits by Business & Legal Reports, Inc. (BLR), employers’ 1999 costs for health care alone rose to $3,681 per employee, nearly 12 percent higher than 1998. How are companies coping with rising health care costs while attracting and retaining a skilled workforce in the tightest labor market in more than a decade?

Typically, employers try to offset increased costs by passing some of the expense on to employees. Given the intense competition to get and keep skilled workers, however, there seems to be a real reluctance to do so. Two indicators from the survey of 3,051 employers, illuminate this trend:

1. When employers were asked what steps they’d taken this year to reduce employee health costs:

• 28 percent said they raised the employee premium
• 18 percent raised the co-pay
• 13 percent raised the deductible (31 percent of employees now pay more than $300 for health-care insurance deductibles, compared to 15 percent in 1996)
• 5 percent reduced other benefits

2. In 1998, most employers paid 100 percent of health care insurance premiums. This year, fewer offered 100 percent, with an equal number offering 81 to 99 percent.

SOURCE: BLR, Old Saybrook, CT.

Tuesday, April 4, 2000. 9:10 a.m.

When I arrive on CBS Corp.’s televsion City lot in Los Angeles, I already start to feel the excitement of the entertainment industry. And, shall I admit it? I’m a little wide-eyed and star-stuck that I get to spend a day immersed in the entertainment industry. From the outside, this industry seems so glamorous. But I have a feeling a lot goes on behind the scenes — with HR as a major player — and that it only looks that way.

Susan Kayl, director of human resources for CBS in Los Angeles, has given me great directions. However, when I arrive, I still go to the wrong door. The receptionist tells me to go back to the artists’ entrance — the first door I passed — where I’ll find the HR office. I fancy myself a huge TV star as I walk through the double doors and sign in at the security desk. But the feeling quickly fades as I stroll down the hall, where posters of the many CBS television shows, past and present, grace the walls. Lucille Ball of I Love Lucy, Whoopi Goldberg of Hollywood Squares, and Bob Barker of The Price Is Right — I begin to get the feeling of TV nostalgia blended with a sense of modern show biz.

I take a left, and Henry Nigos at the HR reception desk greets me with a warm smile and lets Kayl know I’ve arrived. As I wait a few moments, I catch a glimpse of the Martha Stewart Living show on TV in the lounge area. “Of course,” I think to myself. “This is one workplace where TV-watching isn’t only allowed, it’s encouraged.”

9:12 a.m.

Susan Kayl greets me with a smile and a handshake. She ushers me into her office and we go over the day’s schedule. We have time for only a couple of questions before going to our first meeting of the day.

I find out that the CBS headquarters are in New York City and this Los Angeles office is the other of its two main sites; but its affiliate television and radio stations are located throughout the United States. The company employs approximately 13,000 people.

Kayl is second in command of human resources for CBS on the West Coast, and reports to Lynn Heymont, vice president of HR, West Coast. In total, there are nine in the department providing HR services to approximately 2,600 employees.

“Lynn, who came from Sony Pictures Entertainment [also in Los Angeles] brought me in last year to assist her in reinventing the HR function here,” explains Kayl.

The HR West Coast department was not unlike other traditional HR departments — more transactional in function rather than operating as a strategic business partner to the organization. Kayl, a generalist whose background is in organization development, training, and change management, took this opportunity because she liked the idea of helping to create an HR department for the 21st century.

Kayl manages the recruitment function and is also involved in organizational redesign, employee relations, and compensation with Heymont. Since she’s been at CBS, she’s been working hard to show the hiring managers that HR can and will help them with their staffing needs. Previously, most hiring managers were “doing their own thing,” says Kayl.

Now, to her credit, they’re increasingly turning to her for help with staffing. Kayl and her team have streamlined the process down to a science with a total proactive recruitment strategy, utilizing the Internet and community outreach network resources.

9:35 a.m.

We’re off to a scheduling meeting upstairs. We walk through some long corridors to an elevator and ride up to the top level (about three floors). Kayl explains to me that since she started with CBS a year ago, she’s been going to this meeting every Tuesday — a move that’s helped her build credibility for her department and her own standing within the company as a can-do manager.

This is Charles Cappleman’s meeting. Cappleman (“Cappy”) is the senior vice president of operations for CBS Television City. After people grab coffee and bagels, the meeting gets started.

Represented at the meeting are execs from programming production, technical operations, client relations, facilities, stage operations, and financial planning. They begin by discussing show schedules and how that affects facilities and operations. For example, The Young and the Restless is making up some scenes for the week, which they missed last week, and The Price Is Right crew is off for the week.

They discuss the set and lighting and shooting schedule for the $64,000 Question show and how they’ll have to double-check whether the New York City headquarters has arranged for a different 800-number to be listed for the show in each time zone, since viewers will be able to call in during portions of the broadcast. The MIS manager talks about remodeling one space and wonders if it will affect anyone. David Strouse, the director of financial planning, talks about financials. Last up is Kayl.

“The remodeling [of the office space] in HR is done,” she says. “It looks great! It’s bright and modern, and there’s a much better utilization of space. It’s a great place for applicants now to come.”

She goes on to talk about the upcoming blood drive and discusses a sexual harassment video that everyone in the company will be viewing. At 11:05 a.m., the operations meeting ends and we head downstairs.

11:10 a.m.

Back at her office, Kayl begins returning phone calls. The first call concerns a candidate search. “I just wanted to let you know that we’re on it. We have three excellent candidates to present to you,” she says to the person.

After the first call, Kayl returns a call from HR’s affirmative-action plan outsource vendor. She explains that they review their plan yearly, and set goals that are in alignment with the organization’s diversity initiatives. She places another call about an employee who’s been let go from the company, and the final one is to someone about a sexual harassment video that they’re planning to show to the entire workforce. Shortly, the calls are finished, and we head to Cappy’s office upstairs.

11:30 a.m.

Cappy has consented to give us a tour of the facility. We meet in his office, which overlooks the very busy Beverly Boulevard. He begins by telling us about the new high-definition television. Many CBS shows are now being filmed and broadcast with this new technology. He also shows us a video that chronicles the history of the CBS studios, and the many shows and stars that have been filmed there over the years and at the present time. Next, he takes us on a tour, for a rare glimpse of the backstage production facilities. We visit several studios. At one studio, sure enough, the red light is on outside. Cappy turns to us, making the shhhhh gesture with his hand, and we enter the studio on tiptoe. They’re filming a scene for an upcoming The Young and the Restless. Kayl later explains that her office doesn’t staff talent for the TV shows or productions. They fill only staff positions.

I ask Cappy how long he’s been with CBS. “Forty-seven years,” he says proudly. “And this wasn’t even my first job.” Kayl says there are many CBS workers who’ve been here for many years. It’s a great mix of new faces and long-term employees. Thre is a group called “FROGS,” an active organization of retired CBSers who sometimes hold luncheons on-site at CBS.

Our last stop on the tour is to see one of the stages built when the facility was first erected. Cappy tells a story about how one of his first jobs as stage manager for CBS in 1952 was to ensure that Judy Garland was on stage on time for a live performance. It was nerve-racking for him, because she took her cue just before the curtain opened and the show went live. It was a great work story. I get all starry-eyed again.

Lunchtime

I come back to reality as Kayl and I hop in her car and drive to Rosti, a nearby Tuscan restaurant. At lunch, we have a lot to talk about. She has a 28-mile commute by car (one way). She usually gets up at 4:45 a.m. with her husband, and works out before coming to work, usually arriving by 8:15 a.m. After hearing about her background, I ask Kayl what her biggest challenges in HR are right now.
“We’ve had a big push on recruitment since last November,” she says.

When I ask why, she responds that CBS is committed to having a workforce that reflects the racial and ethnic mix of the diverse Los Angeles community. So they’re pushing information about job openings and career opportunities at CBS out to community outreach organizations and local colleges and universities, in addition to attending local job fairs.

She also talks about the merger of CBS and Viacom. Viacom acquired CBS on May 4 — a turnaround of sorts because CBS owned Viacom and now the shoe is on the other foot, you might say. “We are excited about the merger and the opportunities it will bring in the future,” says Kayl. The acquisition is the largest media merger to date.

“Once the actual sale happens, the real work is going to be the transition piece of it,” says Kayl. Before joining CBS, Kayl was with Blue Shield of California and had been the head of HR when the firm went through a merger. That experience will help her during the upcoming transition of CBS and Viacom.

2:30 p.m.

After lunch, Kayl heads into the HR conference room for an update meeting with five HR staff members who are involved in recruitment. “The goal is to have our HR team have a wide range of generalist skills,” says Kayl. The CBS HR department was composed of human resource specialists — and there was little crossover of skill sets. Next, Norah Eshelman, HR assistant, discusses checking references for some candidates for such positions as guest relations and technical operations. Each person updates the group on interviewees and job-placement status.

At one point, Lyn Sereno, an HR administrator, gives thanks to another HR administrator, a pat on the back and a little cheer for a new hire that just took place. The group discusses the job fairs they’ll be attending through the month of May and the summer internship program. Kayl suggests that the director of placement, Carol Wallock, and she get together to talk about the summer internship program and the job fairs that the recruitment team will attend through the end of the year.

3:22 p.m.

Kayl returns to her office in order to make more phone calls.

3:40 p.m.

Kayl meets with Wallock in Kayl’s office.
“The job fairs are a major push,” says Kayl. “We see it as a vehicle, not only for diversity initiatives, but really where the talent is.” She explains that there used to be a time when people were fighting to get into CBS. They came in droves and were turned away.

“It’s a very different world now,” she says. “We’ve got competition with the other networks and the other studios that have networks. We also have to compete with the dot-coms giving out huge stock options.”

Kayl explains that years ago, CBS had rolled out two stock option programs, Fund the Future and Share the Vision. They’ve had to become flexible and creative with job offers for some categories that are difficult to fill, such as IT and finance. Kayl and Wallock further discuss their recruitment strategy.

4:20 p.m.

Kayl spends the rest of the day making phone calls, and doing e-mail and paperwork. She heads out the door at 5:56 p.m.

Just the Facts Organization: CBS Television Studios Responsibility: Recruitment, employee relations, compensation, and organizational redesign for the West Coast site Headquarters: New York City, with a site in Los Angeles (Television City), as well as affiliates all over the United States Employees: Approximately 13,000 total, with 2,600 on the West Coast site HR Staff: There are nine people on the HR staff at Television City HR Challenges: Increasing the HR department’s involvement in staffing support for hiring managers. Pushing recruitment of an ethnically diverse staff that reflects the population of the Los Angeles community. Diversity has been a very controvertial issue for television studios; they’ve been accused by several organizations for being an all-white industry-both on and off screen. Merging with media conglomerate Viacom. While CBS had owned Viacom a while back, Viacom’s acquisition of CBS took place on May 4th of this year. Competing with Internet companies for talent. And, of course, changing from a transaction-based function to a strategic business partner. You should know: No celebrities have to pass a screen test with HR. Human resources is not the casting office, and it fills the studio’s staff positions. Many CBS staffmembers have had a long history with the studio, and hold luncheons onsite at the studio.

Today’s HR departments are outsourcing everything from background checks toexit interviews. Though it isn’t new for these types of services to be handedto outside firms on an as-needed basis, what is new is that more HRadministrators are taking a macroscopic view of staffing.

They’re figuring out what can — and should — be done in-house versus whatcan — and should — be done more effectively outside the organization.Realizing that much of the staffing function is not the core HR competency itonce was years ago, many senior HR professionals are no longer keeping suchactivities as résumé management and candidate sourcing under their dailyscrutiny.

“What we had seen in the past is that companies would outsource aportion of their hiring process — like reference checking or testing,”says Terry Terhark, senior vice president of Chicago-based Aon Consulting Corp.’sHR outsourcing practice. “What we’re seeing more of today is [thatcompanies are] outsourcing the entire process.” He adds: “Staffingoutsourcing is continuing to grow at a faster pace than what it was.” AndTerhark thinks this trend will continue to pick up speed in the coming years. By2001, it’s estimated that $319 billion in corporate resources will lie outsideof corporate boundaries.

Human resources represented 16 percent of all outsourcing expenditures in1997 (the most recent figures available), according to “The OutsourcingIndex,” compiled by Murray Hill, New Jersey-based Dun & BradstreetCorp. and The Outsourcing Institute, a professional association and executivenetwork. Although it isn’t known exactly how much of the HR outsourcing piegoes to staffing activities, anecdotal evidence suggests that it’s a largechunk.

HR has also turned to outsourcing because staffing — especially recruitment– has become more complicated. “In the past 12 months, the recruitmenthorizon has changed more than in the previous 10 years,” says Kim Shepherd,president and CEO of Decision Toolbox, a multi-service recruitment,Internet-based applications technology, and advertising agency based in LongBeach, California. “Every time you turn around there’s a new searchengine, and HR’s trying to figure out which one to use and how to keepup.” It seems much easier to pass the function along to someone else.

However, it’s important for human resources leaders not to get caught up inthe outsourcing trend without taking a serious look at their staffingobjectives. Now, more than ever, employees are companies’ most valuableassets, and staffing an organization is a strategic HR function. Becauserecruitment is so critical in today’s tight labor market, it’s important toask: Should your staffing function be performed outside the organization? Has itdrifted far enough away from HR that it can be considered “non-core”?And whom can you trust to fulfill your staffing needs?

What’s core? What isn’t?

Overseeing the staffing function is key. However, carrying out the day-to-dayelements of it, as in the case of in-house recruitment, may not be.”Recruitment capability is core,” says Edward Ferris, “but notin-house — at least not when your staffing needs are high or cyclical.”

Ferris spent many years as a senior human resources professional in a varietyof organizations before becoming a management consultant and president of PlusUltra Inc., a management-consulting firm based in Doylestown, Pennsylvania.Drawing from his many experiences in outsourcing the recruitment part ofstaffing, Ferris thinks the following competencies are key:

• Research capability to fill the candidate funnel
• Qualifying to reduce the funnel to those with a good fit
• Recruitment to convince good candidates to consider new opportunities
• Pre-selection to make sure job candidates are a good fit with client needs
• Process methodology to manage candidate inventory
• Having good scripts
• Having good data collection capability, reports generation, performancemetrics, and technology.

In addition, it’s important to have seamless communication links, datamanagement and knowledge repositories. “Few companies can, and should, pullall this off in-house,” says Ferris, but he admits: “Outsourcing ofrecruitment isn’t for everyone or all situations or companies. It certainlyhas worked for me. But it all hinges on finding the right partner who has theright mind-set, methodologies, and technologies.”

That’s exactly the position that Sue Hagen, vice president of humanresources for Dole Foods Inc., has taken on the issue of outsourcing thestaffing function. She has outsourced some recruitment tasks to DecisionToolbox, which has helped her with needs such as developing recruitment ad copy,recommending a recruitment ad strategy, placing ads, doing a first screen ofnetted résumés, and even making initial phone contact with potential jobcandidates.

In addition to outsourcing those services, Hagen says she prefers to usecontract recruiters for certain searches. “They’re helping not only toscreen and interview, but in some cases, flush through the job requirements withmanagers,” she says. And Dole also employs recruiters in-house. Right now,the balance between recruiters on staff and on contract is working well at Dole’sWestlake Village, California, headquarters.

But Hagen isn’t interested in outsourcing the entire staffing function.”We would keep open to looking at [doing that], but we consider people oneof the very strategic parts of our business,” she says. Dole, which employs53,500 people worldwide, hires approximately 30 to 50 new people at the company’sheadquarters each year. Adds Hagen: “I would be reluctant to [completely]outsource what I think is a very strategic part of running a business.”

Because the people on Hagen’s HR staff have lots of tenure with Dole, herteam has a good sense of what the open jobs entail, and what the Dole culture islike. “We wouldn’t necessarily be able to transfer that knowledge as wellto a third party if we were to completely outsource the function,” shesays. “I think if the demographics in my own department were such that wehad a lot of new people in HR, it would be a different situation.”

Which part of staffing should you outsource?

When deciding to outsource staffing functions, you should think about whichparts of the function are strategic, operational, or maintenance-oriented. Thendecide, of those pieces, whether you need to outsource the entire function orjust pieces of it, or to keep it all in-house.

The processes that most HR managers are tending toward outsourcing these daysare the more tactical ones, rather than the more strategic ones, such asworkforce planning. For example, activities such as résumé management andoffer-letter generation are tasks that don’t necessarily require internalexpertise to accomplish, and can be prime staffing-administration candidates foroutsourcing.

That’s exactly the tack that NCR Corp. has taken with regard to variousaspects of the staffing function. The Dayton, Ohio-based AT&T spin-offcompany, which deals with diversified computer products employs approximately33,000 employees, and hires about 3,000 to 4,000 new people each year worldwide.Because NCR has been transitioning to shared-services centers for the pastseveral years, the firm’s senior management team has recognized the benefitsof centralizing services. By gaining economies of scale, the firm can funnelresources — especially human resources — into other core business functions.

“Our decision to utilize an outsource vendor was linked to the fact that– and this is an across-the-company effort — we’ve taken a look at theactivities, processes, and functions that we have to perform inside the company,and we’ve decided which ones are core to our business and which ones we reallydon’t need to handle directly, that we could have an outsource vendor do forus,” says Dan Delano, director of HR operations for NCR. Delano manages NCR’sshared-services center in the United States. The center takes care of NCRpayroll, HR data management, and staffing administration.

Before NCR’s staffing function moved into the shared-services center, NCR’sHR staffing organization took care of all staffing activities. “It wasreally an issue of: How do we best utilize the resources that we have inside thecompany? We want to align the resources that we have as closely as we can tocustomer-facing, value-added roles around our core business,” Delanoexplains.

Now, NCR employs the Aon team to perform a variety of tasks: posting jobs toNCR’s internal job-posting board or externally through various Web sites,selecting good Web sites on which to post job requisitions, and managing theinflow of résumés from NCR’s recruiting activity with a Resumix system atits headquarters in Findlay, Ohio. Then, onsite at NCR, Aon manages theextraction of the résumés that are appropriate for the various job openingsand presents them electronically to the hiring managers. The managers take itfrom there.

But once a manager makes a hiring decision and wants to make an offer, theAon team gets involved again to generate the offer letter and coordinates allthe post-offer activity once the candidate accepts the job, such as initiatingdrug screening and background checks (which is taken care of by other vendors)and notifying the relation vendor if a relocation is necessary. They alsoprepare all the documentation required to put the new hire on NCR’s payroll.In addition, the Aon team sends out a welcome packet of information about thecompany. Aon also is responsible for responding to any unsolicited résumésthat come in over the Internet or by mail.

Although NCR has had this model in place for a few years, Delano says his HRteam is looking to update it. “In the staffing area, it’s very expensiveand in many cases inefficient to be looking to external recruiters. What we’relooking at in the future is perhaps redesigning our staffing model to havein-house recruiters and would also do a lot to automate the whole process. Forinstance, we’re looking at a lot of Web-based tools for recruitment in termsof résumé management and, in effect, moving away from paper-based résumés.As part of that process, we want to be able to implement a pre-assessment toolsthat would allow applicants online to assess themselves against the various jobsthat we have and determine whether or not they are right for the job.

“So, between the automation of the process, putting a lot of focus onthe Web and Web-based tools, and adding pre-assessment capabilities and in-houserecruiters, we can make the process a lot more efficient.” In addition,Delano says they would still look to outsourcing vendors for the kind of supportthey’re already using.

Finding the right vendor “fit” is critical.

Once you’ve decided which parts to outsource, perhaps the most importantdecision you’ll have to make is picking a vendor.

Here’s the ultimate nightmare: Your in-house recruiters or referencecheckers don’t understand the culture of the organization they represent,namely yours. “This happens all the time and can be very dysfunctional fromboth a process and an image point of view,” says Ferris of Plus Ultra.”It’s also one of the reasons that argues for outsourcing of staffing,because in outsourcing, by design, you’re creating an alliance and apartnership that builds closeness of understanding and relationship, andminimizes these issues. You collaboratively agree on standards and scripts andthe outsourcing company should act as your ambassador to the marketplace.”

The single most important aspect of the outsourcing vendor-selection processis finding a partner who intimately understands a company’s culture and itsgoals. In a word, the partner must fit with your company’s goals and culture.But first, you have to understand what your staffing and outsourcing goals are.

“We’ve learned some hard lessons in the past from some of our vendoroutsourcing, whether it’s staffing or other areas,” says NCR’s Delano.”You have to have a clear strategy of what you’re trying to accomplishand how you want to go about doing it. If you yourself don’t know what you’retrying to accomplish, whether it’s with an outsourcer or with in-houseresources, then you really are diminishing your potential for success.”

From there, figure out the processes that are needed to support those goals.”You can’t go out and ask a vendor to provide that support for youwithout a clear understanding of how it should be done,” Delano says. Thevendor also should be able to provide the customer with leadership around how toimprove the client’s processes. “The [vendor should] understand industrytrends and best practices and help the customer transition from a process they’vehad in place to a more effective outsource relationship,” says Delano.”We try to look at our vendors as partners — and when I say that, I meanwe’re looking for a two-way relationship.”

It’s just as important to find the right staffing outsourcing partners, asit is to finding the right employees. Here’s the skinny from consultants onhow to get the fit right. Do all of the following: establish clear criteria, setup a rigorous selection process, and involve line and staff in making thedecision based upon capability, systems methodologies, track record, financialstability, and culture.

Experts and HR managers who’ve been through the process suggest that HRmanagers put together an outsourcing “selection team” that comprises:

1. procurement officers who qualify major suppliers
2. subject matter experts to assure technical competence and quality
3. customers who check out the suppliers’ track records, references, andpersonnel.

“We’ve typically established a long list, [of vendors] which may be asmany as 30 to 40 companies, and quickly shrunk it to a four to six that weinterview. Then we narrow it down to two or three finalists,” says Ferris.Visit the companies’ sites, talk to their people, and call their references.

Once you’ve made your decision, it’s important to be clear with thevendor what services they’re going to provide, what their performance levelsare and how they’re going to be measured, and what technology they’rebringing to the table.

In other words, clearly define the critical components that define therelationship, and put them in writing in a well-outlined contract. “If thatisn’t defined on the front end, you will suffer a lot of pain later,”says Delano.

Staffing an organization is a serious endeavor in today’s tight labormarket. Having good outsourcing partners can help HR with either tactical orstrategic workforce staffing activities. Knowing how to choose these vendorswisely can make all the difference between success and failure.

Workforce, April 2000, Vol. 79, No. 4, pp. 56-60— Subscribenow!

Is there anyone in HR who believes that the transformation from administrative support function to strategic business partner is over? Odds are, the answer is “no.”

And how could it be, really? By definition, to be more strategic means to bring HR initiatives into greater alignment with overall business objectives.

But at the dawn of the new millennium, business objectives are more mercurial than ever. Workforce demographics are changing, globalization has accelerated, our competitive position seems to change almost daily, and evolving technology is still revolutionizing communication and data management.

In short, every aspect of business is changing around human resources, so how can HR be moving toward a fixed target—any fixed target?

Instead, HR will continue to balance the demands of several different roles: business partner, internal consultant, operational and administrative expert and both employee and employer advocate. That may sound like business as usual, which isn’t likely to elicit a rush toward the future with weapons at the ready.

In reality, however, it is new because, although the questions may be the same, the answers most assuredly will not be.

The ongoing challenge will be to establish new deliverables and to sustain strong partnerships with both internal and external customers. The ability to see the big picture—and to deploy the resources to address the big picture—will be more important than ever.

Be leaders, not followers.
Establishing deliverables. Sustaining partnerships. Grasping the big picture. Deploying resources. These all demand leadership. But what does that leadership look like?

Peter Firla, director of human resources for Infiltrator Systems Inc., based in Old Saybrook, Connecticut, defines leadership as “understanding the corporate mission, developing goals which support the mission, then using your personal and management skills to help build a stable, skillful, productive and satisfied workforce. Pretty simple.”

Simple? Perhaps. But achieving that goal requires seeing the difference between being an HR leader and an HR manager. According to Joseph E. Champoux, author of “Organizational Behavior: Essential Tenets for the Next Millennium” (South Western Publishing, 2000), “Managers and leaders play different roles in an organization. Managers sustain and control organizations; leaders try to change them. Organizations also have different needs for those roles at different levels and at different times in their history.”

The challenge is to figure out which areas of a company need HR leadership and which need HR management, and at what times. There’s a fine line between serving the company’s internal and external customers in response to what they say they need, and figuring out what they really need. It takes a bit of strategic thinking.

In 1991, the personnel department of Motorola’s Fort Lauderdale, Florida facility embarked on a multi-year effort to transform itself from an old-line personnel department to a strategic business partner. In doing so, it helped transform the larger 2,500-employee organization at that facility to become more customer- and employee-focused.

At the center of the transformation was an in-depth assessment of employee and organizational needs. Understanding the perspectives of both sides helped HR balance priorities. In response to the data, HR launched upward feedback, peer recognition and career planning initiatives.

“By using engineering and marketing disciplines, we in HR enhanced our credibility with line management,” says Don Grimme, president of Fort Lauderdale-based Grimme Human Resources Inc. and an HR professional at Motorola during the transformation. “They especially loved the hard data we were able to provide on soft issues. And our visibility extended far beyond our facility. For example, our team made presentations on these initiatives to both line and HR management throughout the Motorola worldwide corporation, including Motorola’s Corporate Quality Council and in Singapore and Malaysia.”

Similarly, when Janet Brady, vice president of human resources for The Clorox Co. in Oakland, California, took over the HR function in 1993, she completely revamped it. An HR director now supports each function within the organization such as sales, marketing and finance, as opposed to serving a division.

“And interestingly,” Brady told Workforce in late 1998, “it was the people running the businesses that were very supportive of the change. That’s what gave me this ‘a-ha’ feeling, because they were saying, ‘I don’t care how I get this stuff done, I just need it done. You go figure out the most efficient way to deliver it.”

Brady is an example of a phoenix leader. In their book, “Soaring With the Phoenix: Renewing the Vision, Reviving the Spirit, and Re-Creating the Success of Your Company” (Warner Books Inc., 1998), James A. Belasco and Jerre Stead describe the leaders needed during rapid change and uncertainty. They aren’t afraid of “reinvolution,” which is renewal through revolution or rapid evolution that looks a lot like revolution.

Phoenix leaders are defined by their ability to make five essential contributions: “They surface issues that confront the organization; engage the people in resolving those issues; prioritize/allocate resources to address those issues; unleash ownership so everyone accepts responsibility for dealing with those issues; and energize learning … These contributions enable the leader and the others to build a pyramid that provides a strong base for future success.”

Clearly, phoenix leaders rethink how HR’s work gets done. For example, some HR work is being pushed back to line managers. Technology allows employees to do some of it for themselves. Other options include outsourcing and consolidating services in call centers.

But rethinking work is complicated by one still unanswered question: How far will HR move away from being an employee advocate? Ensuring that employees have challenging jobs, with substantive pay and benefits, is one form of advocacy, of course. But advocacy takes many other forms in organizations today. Some of that inevitably must be sacrificed as HR works to meet the demands of other constituencies. How much must be sacrificed is a question that HR can’t answer alone.

Communication is key.
Finding the answer requires dialogue, which means that HR must continue to communicate. That communication must be equal parts listening and promotion. First, HR must listen carefully to what its customers need. Then it must promote what it has done and can do.

“For all the [talk] about contributing to the strategic missions of organizations, employees for the most part still see HR as ‘those folks who handle benefits and do interviewing,’” says Linda M. Konstan, president of LMKAssociates, an HR consulting firm in Denver. “I’d like to see a PR effort on the part of every HR practitioner in this country—starting with their own employees. We’re terrible at selling ourselves. Why not think of ourselves as a product and do some smart marketing?”

Why not, indeed? During the past few years, HR has worked hard at breaking into the senior executive suite and educating senior management on the value HR adds to an organization. Managers and employees are less familiar with HR’s new role as business partner. Increasingly, these internal constituents will need to embrace the importance of the HR function. It won’t be easy, but ongoing communication will help HR earn respect throughout the organization.

Ongoing dialogue has been critical in the reinvention of several high-profile organizations, Sears, IBM and Chrysler, among them. Each of them had to come to grips with the fact they would no longer be a viable entity if they continued down the same business path. They had to own up to where they stood in their industry and market, and launch a massive revitalization effort to stay afloat. Each of these companies is again a success because of their courage to remake themselves with a new focus and a new energy.

In each case, HR’s role was to listen carefully to the business issues and then construct responses. The responses are quite different from one organization to another, and should be. The more effective HR becomes, the more different it will be from one organization to another.

That forging of unique functions within the HR profession may be the hallmark of HR in the new century. Every HR professional can craft initiatives using the same toolbox. The best will try new things, challenge conventional wisdom, and ask more questions more often.

Workforce, January 2000, Vol. 79, No. 1, pp. 52-56.

At the threshold of a new millennium, employees should be viewing benefits as a part of their total compensation package, but they rarely do.

And it’s easy to see why. Though they can find salary information, tax withholding and more down to the penny on their paycheck stubs, few employees know the dollar value of the benefits they earn.

Without knowing the cost of their benefits, they also don’t know that many of those costs are rising. While employees directly feel the pinch of higher gasoline prices or more expensive movie tickets, they’re largely protected from price hikes in the benefits they increasingly take for granted.

But those realities are merely symptoms of a much larger phenomenon. Large organizations have eliminated hundreds of thousands of jobs over the last decade, and still are cutting jobs in record numbers. However, the job cuts aren’t dominating headlines because these people are finding new jobs. The new jobs, increasingly, are at smaller organizations.

Employees who have become more accustomed to generous benefit packages, however, go to their new employers with the expectation that the benefits will still be there. Few stop to consider the difference between one organization’s ability to provide those benefits and another’s.

At the same time, the job market has become more competitive than at any time in a generation. In an effort to attract and retain top talent, employers of all sizes have increasingly relied on benefits; it’s almost impossible for a company without benefits to hire the people it needs. The result of these circumstances is that employees now feel entitled to the benefits they receive.

It’s because of this attitude that there are a lot of forces working to preserve the status quo. It isn’t surprising that benefit plans have proven stubbornly resistant to the dramatic changes that have been made in compensation plans over the past few years.

Yet leading organizations have worked hard to move past the entitlement mentality. Instead, they offer pay plans linked to results and, as much as possible, rewarding top performers.

Wouldn’t employees begin to see benefits as part of their total compensation package if benefits were treated like the rest of the package—that is, tied to performance? That may sound like a radical concept, but ultimately companies may find they have to make that change if they’re to remain competitive.

Companies must first standardize and consolidate.
Although tying benefits to performance may be where we’re headed, few organizations are in a position to make such a change today. Instead, most companies must do two things first: standardize and consolidate.

Consider the example of Stamford, Connecticut-based GTE Corp. Through a series of acquisitions, the telecommunications company at one time offered nearly 400 separate benefits plans. Ultimately, the number proved untenable and the company implemented a flexible benefit plan called “GTE Choices” in 1992.

The change consolidated many active employee benefits plans, eliminated benefits plan confusion and offered economies of scale. GTE now has only one summary plan description, one marketing brochure and one overall approach. The new plan is more efficient to administer and more consistent.

Employee satisfaction at GTEskyrocketed. The GTE Choices plan has allowed the company to offer more flexibility and higher quality benefits to employees, while at the same time giving its business units the ability to decide how much to subsidize the program for employees.

But not all organizations have done the hard work that GTE has accomplished. Many companies have plans that simply were cobbled together over time—one benefit after another added to the menu as employee needs were identified or perceived. And other organizations offer patchwork plans that are the outgrowth of mergers or acquisitions.

The result is that employees who are working for the same organization—but in different locations or different business units—aren’t eligible for the same benefits. And still other organizations have allowed operating units to develop unique benefit plans to meet the needs of their individual constituencies. None of these situations allows an organization to tie its benefit plan to overall business goals, which is a critical element if benefits are to be tied to performance.

“The benefits philosophy must reflect both how the firm creates competitive advantage from employee skills, knowledge and behaviors, as well as how employees value the various components of the employment product,” explains Doug Merchant, a former HRmanager for AT&T. “The benefits philosophy must rest on the firm’s business and HR strategies.”

In other words, organizations can only begin to link benefits to performance when they know the performance they want. At the simplest level, organizations that want short-term productivity increases might offer work/life benefits to those employees who demonstrate those increases. Organizations that are seeking long-term profitability are probably better off focusing on retirement plans. Such correlations already are being made.

Some employers already link benefits to performance.
In March 1999, the American Compensation Association (ACA) and The Segal Co. (a New York City-based employee benefits, compensation and HR consulting firm) jointly conducted a survey of ACA members to examine the extent to which their work/life programs are being used to reward employee performance. The survey, called the “1999 Survey of Performance-Based Work/Life Programs,” confirms that employers are beginning to use nonmonetary compensation—particularly work/life programs—as part of their total rewards management strategy.

According to the survey findings, 18 percent of survey respondents currently use some work/life programs to reward employee performance. Although 43 percent of the surveyed organizations don’t use work/life programs to reward employee performance, they believe that some of these programs should be used as rewards for performance in the future. Twenty-four percent of respondents quantitatively link work/life programs to improved employee satisfaction, 65 percent said they either are or should be linking some work/life programs to employee performance.

The work/life programs that currently are most commonly used to reward employee performance—particularly flexible work schedules and paid time-off programs—are programs that are geared toward rewarding high performers with additional time to conduct personal business. As employers seek continuously improved employee performance and strive for employer-of-choice status within their industries, while always watching expenses, low-cost work/life “add-ons” like convenience services are ideal avenues for rewarding high-level performers.

Beyond paid time-off benefits, there’s great potential for employers to expand the use of convenience services, financial planning, legal assistance and other voluntary benefits—which have broad-based appeal and are relatively inexpensive.

For example, convenience services currently are offered by 30 percent of the ACA survey respondents, yet less than 1 percent of those respondents use them as rewards for employee performance. Since convenience services are typically offered as time-savers for time-starved high performers, there’s an excellent opportunity to offer these services as reward incentives.

Perhaps the best-known example of a company that’s linking work performance to its total rewards strategy, including benefits, is Toledo, Ohio-based manufacturer Owens-Corning. In 1996, the company overhauled its comp and benefits strategy to create a variable plan that’s tied to performance. Workers clearly see how their work is rewarded with extra pay in the form of more benefits choices. Workers also get to pick from an array of options, making them responsible for their own choices.

The organization’s “Rewards and Resources” program has virtually eliminated the entitlement mentality, given employees greater choice and slashed the company’s fixed benefits costs.

Align your plan with other HR best practices.
If benefits truly are linked directly to performance, then don’t they cease to exist as benefits? Aren’t they then one form of compensation?

It’s a question of more than just semantics. The question challenges us to think about the entire nature of the employment relationship.

To stay competitive, we’ve given employees more responsibility for managing their own careers. For instance, employees are taking increasingly more responsibility for their own training and education. They have greater control than ever over how their retirement funds are invested. So does it really make sense for benefits to still largely be provided, in a paternalistic sense? Don’t we want employees to have more control, and doesn’t tying benefits to performance ultimately give them that control?

Some human resources professionals argue that it does.

“HR should get out of the benefits business. Pay employees well enough, and make independent benefit contractors available to them to handle this,” says John Way, HRmanager for Elf Atochem N.A. in Carrollton, Kentucky. “They’re the experts. As mobile as the American worker is becoming, this would be a step in the right direction. Let individual employees be responsible for their own benefits.”

It’s a radical idea, but one that would bring benefit plans more closely into alignment with other human resources best practices.

One thing is certain, if employees don’t understand the tie-in between their total compensation—including benefits—and how well they do on the job, employers will forever be offering something for nothing. It’s not an idea employers can afford to perpetuate, nor HR will want to market.

Workforce, January 2000, Vol. 79, No. 1, pp. 42-46.

In a recent study of HR in the ’90s, the Economist Intelligence Unit (EIU) of KPMG Management Consulting in the UK found that more than half the companies surveyed expected the HR function would need to be revitalized over the next five years.

That view was particularly prevalent in Europe, where 65 percent anticipate the need to revitalize. The European view contrasts somewhat with respondents in North America (55 percent expect to revitalize HR) and in Asia Pacific (where exactly half expect it).

Respondents believed even more change would be necessary if the HR function was to become truly viable and successful. Those surveyed said that in the future, HR professionals will be expected to move beyond the traditional attributes of being “organized” and “good listeners” to become “creative,” “strategic” and “visionary,” with developed leadership skills.

Support for ongoing change also is evident in a recent study conducted by Schooner and Associates in association with the Alexandria, Virginia-based Society for Human Resource Management (SHRM).

The report concludes that, “The changing environment is already producing major changes in the way HR professionals work. The next few years represent a critical period for the human resources community as new roles and responsibilities in organizations are being renegotiated. So far, HR as a whole is significantly behind the change curve. Clearly, HR professionals will not only have to fulfill their traditional roles, but assume critical new roles that focus on adding value to operational excellence.”

Workforce, January 2000, Vol. 79, No. 1, p. 56.

With the unemployment rate hovering at a 29-year low at 4.1 percent (as ofOctober 31, 1999), hiring is serious business. First you have to find the rightemployees — which, these days, is like looking for a needle in a haystack.Then, once you’ve found prospective employees, you have to let them know whyyours is the best company to work for, over other choices they may have.Finally, once you’ve wowed them with the opportunity, you have to close thedeal. And you have to do it quickly or another employer will snap them up with abetter deal faster than you can say, “Show me the money.”

How do you close employment deals rapidly without sealing your doom by hiringthe wrong people in haste? Here are some pointers on how to make, and close,employment deals quickly and effectively.

Make an Offer They Can’t Refuse

You’ve spent weeks, maybe even months, finding the right people. You’vescreened, interviewed, tested and evaluated. Now it’s time to make an offer.Although they’re not often thought of as critical points in the hiringprocess, because human resources professionals and hiring managers usually feellike by the time they’re making an offer a candidate has already pretty muchcommitted to working for their firm.

Don’t be fooled.

The offer letter and the subsequent negotiating phase are extremely importantaspects to sewing up the right deal with the right employees. These stages canactually make or break the deal. If these steps are done incorrectly, acandidate may snub you for the employer up the street. It’s as important toknow what to say, as it is to know what not to say.

Can you put that in writing?

Linda Konstan, president of LMK Associates, an HR consulting firm based inDenver, says a lot of her clients recently have experienced the followingscenario: A company representative makes a verbal offer. The candidate accepts.The rep tells the candidate he or she will receive a written offer in the mail.But by the time the written offer arrives, the candidate often has alreadyaccepted an offer from another company.

It’s a situation of too many jobs, and too few people to fill them. It canbe a hiring nightmare. And the problem is: If you snooze, you lose.”Consequently, a lot of my clients are changing the methodology of offerletters,” says Konstan.

Now they have an offer letter template that allows them to just fill in theblanks with the right numbers and dates. They then fax the offer letterimmediately to the candidate with an expectation of having a faxed copy backfrom them within 24 hours, and a hard copy mailed back the same day as well.

What to say

Here’s what Peter Firla, director of human resources for InfiltratorSystems Inc. of Old Saybrook, Connecticut, keeps in mind when he’s writing anoffer letter: “[It’s important to] understand the values, expectationsand longer-range issues a candidate has, and to ensure those elements areincluded in the offer.”

“It’s critical to get as much information as possible about thecandidate’s present situation because you’re generally recruiting people whoare gainfully employed and not necessarily unhappy in their present roles,”says Joan Farrell, an independent HR consultant based in Ocean City, New Jersey.

Knowing not only how the 401(k) match works, but which fund families they caninvest in through their current employer versus what your firm offers, iscritical to knowing whether the candidate will view your plan as a gain or aloss. “Professional candidates are far more savvy than they used to be atcosting an entire package against their present situation instead of justexamining the base salary,” says Farrell.

That’s why it’s critical to know what your competition is offering, andto know what your candidate wants the most from your particular firm. You shouldalso know the relative cost of living in your company’s location if relocationis necessary. “They’ll look up that information on the Internet, so beatthem to it and consider the data in the offer,” adds Farrell. “Youwant to put together a fair package in terms of total value. Once you’ve donethat, you can fine-tune it to the candidate’s specific needs and wants,”she adds.

You should build in some negotiating room up front, so that if the candidatecomes back asking for some relatively minor enhancements, you can approve themon the spot. “This makes the firm look like it’s responsive andinterested in the person, not just in the ‘rules,’” says Farrell.”And on the subject of rules — one-size-fits-all doesn’t work in a tightlabor market. Consider offering some things at ‘better than plan’ with areturn to plan at some future date, particularly in such areas as vacation orbonus guarantees,” Farrell adds. “You want to make sure you don’tjeopardize the tax status of your qualified plans, but other than that, yourobjective is to ease the individual’s transition, not to play cop.”

Say what you mean. Mean what you say.

In the offer letter, be sure to list anything you’ve already told thecandidate verbally. If you said you’d offer stock options, a stock-optionpackage should be included.

The rule is: Even if you neglect to put it in writing, your word can beconstrued as an implied promise. Candidates can later argue (in court if theyhave to) that anything you said during the “courting” phase of theemployment relationship is an implied and binding “contract.” Thatmeans, if you don’t mean to offer it as an enticement in the first place, makesure that no one in human resources or any of the hiring managers implies thatthere’s something that will be offered that eventually isn’t.

According to the Smart Workplace Practices newsletter (published by Employersof America in Mason City, Iowa) on the topic of job offers, the real dangers ofthe offer letter happen in one of these ways: either by being construed as acontract, by containing unintentional promises, or the letter conflicts withwhat the candidate was told during the interview.

“The frightening fact is this: Letters determined to contain acontractual agreement and letters containing no contractual agreement are forthe most part indistinguishable,” the Smart Workplace Practices newsletterstates. That’s why you should refer to the letter as a “statement ofunderstanding” rather than a letter of employment. This way, it sounds lesslegal and not so much like a contract.

It’s a matter of delivery.

Once you’ve got the letter written, how will you send it? There are as manyopinions as there are methods, but perhaps these guidelines will help.

One human resources professional at a media organization says she hase-mailed offers to candidates in a password-protected document. Either thepassword was hinted at in the e-mail or the candidate was told to call for thepassword. The document is sent in such a way so that the candidate can’tchange the content of the offer letter. Adds Bob Gately, president of GatelyConsulting based in Hopedale, Massachusetts: “All e-mail correspondence,such as offers, should be followed by written letters of confirmation until thecourts speak with one voice on the issue of e-mails as binding contracts.”

“If they’d like to fax back the agreement, fine,” says Konstan.”But, of course, a hard copy must be mailed in or delivered to me forbackup of signature.”

The offer letter, although it’s the first step in closing the deal, is notthe final say. There’s usually more to negotiate. It’s important to know howto bargain so each side wins.

Grab a Seat at the Negotiating Table

An offer letter is the first step in formalizing an employment deal. The nextstep is negotiating the terms. While there’s a small percentage of candidateswho inevitably will accept an offer “as is,” the largest percentage ofprospective hires realize the letter on the table is only the first step incoming to an agreement.

Many candidates will negotiate — and negotiate with a vengeance. And in thistight employment market — considered an employees’ market — they often havethe upper hand.

Here are some ideas on how to negotiate for the best talent, while doling outyour firm’s valuable resources in moderation — and where you get the biggestbang for your buck.

Negotiation is a two-way street.

Some human resources managers feel they have to make the first offer letter”perfect.” The big news is: It doesn’t have to be. Although theoffer letter certainly should state everything the company intends to offerinitially, it should always leave room for negotiation. So expect candidates atthis stage to ask for what they really want. Then be prepared to listencarefully. “It’s OK to make the offer a two-way conversation,” saysFirla. “Obviously the employer leads off with a good, solid offer, but askilled negotiator understands what others’ needs are and weaves those intothe [negotiation] process as much as possible.”

Make it a win-win

Any good negotiations will result in a win-win. “We need to makecandidates feel like they won, or at least got something extra as a result ofthe discussion. This is where a good relationship starts, or falters,”Firla adds.

“I tend to take a far more flexible approach these days, often puttingout feelers: (‘Our typical package would offer you x’) and then listeningcarefully for a response,” explains Ronnie Grabon, vice president, humanresources for jewelry retailer Carlyle & Co., based in Greensboro, NorthCarolina. With this strategy, he explains that sometimes the person accepts andsometimes he or she asks for more specific items such as a laptop (especially ifthe person’s a ‘techie’) or more time off. “I then work from theredepending on what we can do within guidelines. I generally have found this towork, but managers making these types of offers need to be carefully trained intheir limits and on how to negotiate.”

Grabon cautions that this strategy has backfired on occasion when workingwith an applicant who has a number in mind (especially a yearly salary figure)and has no interest in looking at all factors. “The basic principles hereare based upon the getting to ‘yes,’ by expanding the box onnegotiating,” says Grabon.

It’s important to remember that any negotiations that take place between aprospective employee and the hiring manager or HR, should be in the context ofmutual cooperation. After all, you’re hoping to bring the person on board. Theoffer negotiation process should set the tone for the future businessrelationship. If both sides are willing to give a little, it bodes well forfuture performance and business outcomes

Orientation:

Help Employees Hit the Ground Running

So you’ve offered an applicant the job. You’ve negotiated the deal, andnow the employee is coming on board. It’s true that at this stage, you’vegotten through the toughest part. But now that you’ve committed a great dealof resources into hiring the new employee, you need to ensure that your company’sinvestment in its new hire pays off.

Employee orientation is an often neglected and widely underutilized tool thatcan help your company’s newest recruits get up to speed. After you’ve spentan enormous amount of time finding and wooing the right employees, you can’tafford to drop the ball on day one when your new people show up. This is when agood employee orientation program can help.

Savvy human resources managers are realizing that employee orientation is atraining opportunity that gets people headed in the right direction from thestart. And it’s not just an act of goodwill. It’s smart business.

According to the American Society for Training and Development (ASTD) basedin Alexandria, Virginia, companies that invest in training (such as goodorientation programs) do better over time in market-to-book ratios and in stockmarket values. However, in 1996, only two percent of training budgets weretypically allocated to new employee orientation programs. Understanding today’semployee orientation program goals can give you insight into why they’re soimportant to finalizing the deal with new employees.

It’s more than just a tour

The original purpose for the employee orientation was to “orient”new employees to the company so they would know where things were located andget a brief overview of company operations, procedures and policies. It wasoften short and sweet.

The goals of today’s employee orientation have changed dramatically. Thesedays, the employee orientation process can last from a few minutes to severalmonths, depending on how much the company values the opportunity to show theemployee what the company is all about. The purpose of an orientation programnow includes helping reduce the cost of a new hire by getting him or her up tospeed more quickly; reducing a new employee’s anxiety; reducing new hireturnover; and helping new employees develop realistic job expectations, andtherefore increase job satisfaction especially in the critical first few weeksand months on the job.

New employee orientation is more than a one-day event. In a recent survey byThe Training Clinic, based in Seal Beach, California, 25 percent of thecompanies with a formal program described it as poor or just adequate. The mostcommon complaints heard about new employee orientation are that it isoverwhelming — or just the opposite: Nothing happens and the new employee isleft to sink or swim.

“Successful new employee orientation is an enthusiastic welcome, full ofvariety and timely information,” says Jean Barbazette, president of TheTraining Clinic and author of “Successful New Employee Orientation: Assess,Plan, Conduct and Evaluate Your Program” (Pfeiffer & Co., 1994).”Too many programs,” she contends, “dedicate only one day toorientation-a combination of filling out forms and a tour of the facility.Orientation needs to be a process, not a one-day event.”

The result of an unplanned orientation is often a confused new employee whoisn’t very productive, will probably make mistakes, and is likely to leave theorganization within a year. With the high costs of turnover, and the ongoingtight labor market, that isn’t a pretty prospect.

Types of orientation vary greatly

Often employee orientation programs come in two types: Company overview andjob-specific. The overview orientation usually gives an employee the broaderscope of the company and its operations, and is usually conducted by humanresources.

An example of a typical overview orientation are sessions conducted regularlyby the employee development and training team at the University of California,Berkeley. On the university’s main campus, the team conducts employeeorientations once a month, with a campus orientation (that takes three and ahalf hours), and a benefits orientation (that takes two hours). The team feelsthat the time spent planning for the new employee’s first days and weeks onthe job will greatly increase the chance for a successful start.

The job-specific orientation is usually conducted by a new employee’ssupervisor or team leader. “I like systems where the new employee’smanager is the gatekeeper [for employee orientation.] After all, he or she wasthe one who [hired] the person and who has the greatest vested interest in theperson coming up to speed and feeling comfortable in the environment,” saysHR consultant Joan Farrell.

Other companies, such as Santa Clara, California-based Intel, approachemployee orientation as a competitive advantage. The orientation process for newIntel employees starts before day one with an orientation package that’smailed to the person’s home. HR believes that it’s important to get thebasics out of the way before they arrive, so the real work (a six-month”induction” process) can begin once people start there.

Transmit values

A newer addition to orientation programs is the emphasis companies areplacing on giving employees a clear sense of their values and mission. In fact,it’s so important at some organizations that the company’s CEO often showsup to introduce himself or herself to new employees and kicks off theorientation meeting.

“Yes, it’s expensive to convene people but this is the one opportunitya corporation has to instill corporate values, expectations, and so on, into newemployees,” says Firla. Adds Grabon of Carlyle & Co., “I feel thatorientation is best used as a way of helping employees understand where yourvalues are, how flexible you are, what policies are most important to have themfollow, such as diversity.”

This transmission of values is important for everyone who works at your firm,including part-time or contingent workers. “I thought the orientation wasvery good because the person who was leading the orientation was the departmentdirector. He knew his subject matter very well, and communicated the companypolicies and values, and how they wanted their customers treated,” saysCarole Gallagher, a sales professional who recently started working as afragrance model at a San Diego Nordstrom, a department store chain that’s wellknown for its high quality of customer service.

But whether it was by chance or by design, she was left to figure out someother basic information through her own initiative. “As to the exactspecifics of the job, that was going to be handled by the people I was going tobe working with directly. Unfortunately it wasn’t handled well, it was a busysale day and I felt very much on my own. But by being assertive, I got myquestions answered.”

There’s no substitute for first-line supervisor interaction

HR can help plan the activities, and will still need to do the classicbenefits briefings. But someone from the hiring function should be the one totake the new person around for introductions and to learn the ‘lay of theland.’ Key managers can meet the new player and vice versa through a ‘treasurehunt’ process where the recruit sets up a series of meetings with individualsto garner specific information from them.

“The information should be primarily position-related but can include a‘treasure’ — something personal they need to discover about each of thepeople. It’s a great way to break the ice,” says Farrell.

Online orientation is an option

Some firms are beginning to take care of some employee orientation activitiesto the employee’s desktop. For example, at FedEx, based in Memphis, much ofthe employee orientation and other training is on an interactive trainingplatform. But it’s supplemented with face-to-face time with the new employee’sleader, who covers local elements of the company, including the company’svalues, mission and so on. It’s really important that an employee isn’t justplopped in front of a computer and expected to figure it all out on their own.

“Orientation tends to be tedious and boring as it is,” says NancyProbst, a manager and organizational development consultant of managementadvisory services for Dixon Odom PLLC, a certified public accounting andmanagement advisory firm, based in High Point, North Carolina. “Yet this isthe first chance you have to make a good impression on your new employees. Doesn’tmatch up, does it? I believe orientation is as much a socialization process asit is a way to stuff people full of information they won’t remembertomorrow.”

Whether it was the company strategy, or whether it happened by chance, havingemployees figure out a certain amount of information themselves can be aproductive tactic.

Greet Street, a San Francisco-based, e-mail greeting firm, takes anout-of-the-box approach to orientation — literally. Instead of walking in theirfirst day to find their desk set up with everything they need, new hires walk into find everything in a box — their desk, their computer and even theirtelephone. The first thing workers have to do is set up all their own stuff.During the following two weeks, employees are expected to get to know everyoneelse in the company (all 30 of them) by attending meetings, observing andinteracting.

There’s no substitute for face time

“Orientation is crucial and should bedone in person if possible,” says Firla. That’s a big key to orientation:having a balance between telling employees everything and letting them discoversome information on their own — and also creating a balance between deliveringdry information through reading material (either printed or online), and inperson.

“I still do orientation face-to-face on day one, but I consider it awork in progress for the first six months,” explains Barbara Sterling, HRdirector for Griffin Greenhouse & Nursery Supplies, based in Tewksbury,Massachusetts. Although she manages HR for seven offsite locations, Sterlingsays she always conducts a phone orientation, even if she can’t be there inperson. “In addition to necessary paperwork, I make sure new hires knowwhere the restroom, cafeteria, supply closet and MIS office are, not to mentionlocal restaurants, banks, walk-in clinics, dry cleaners, and places workersfrequent.”

After all, why would a company want to usher in someone they’ve just spenta significant amount of time interviewing and wooing, and then leave them out inthe cold to fend for themselves once they arrive on the job? With the vastnumber of opportunities people have these days to work independently, you haveto assume employees are coming to work with a group of people because that’stheir choice. Make them feel welcome. Inform them. Give them the tools they needto perform well. Then get out of their way so they can dazzle you. Only then canyou consider it a closed deal.

Workforce, December1999, Vol. 78, No. 12, pp. 56-64 — Subscribenow!