Author: Mark Jr.

Just as Congress was entering the final stages of wrestling with government funding bills in November, the Society for Human Resource Management was holding its leadership conference in Washington.

    The timing was propitious for SHRM’s lobbying operation, which was in the midst of a battle to remove language from several appropriations measures that would require all federal contractors to use the government’s electronic employment verification system.

    The system, formerly known as Basic Pilot but now renamed E-Verify, has drawn strong criticism from the business community. SHRM asserts that it is inefficient, ineffective and prone to error.

    About 24,000 employers use it voluntarily. The rider in the appropriations bills would have mandated that 200,000 federal contractors sign up. SHRM says that such an enlargement could severely disrupt the U.S. labor market because so many people would be declared ineligible to work.

    For now, SHRM has halted such an expansion. Leading a coalition of HR groups, the organization was able to jettison the E-Verify riders from the appropriations bills.

    Members of Congress “realized the shortcomings” of E-Verify, says Mike Aitken, SHRM director of government affairs. “There was a feeling that it wasn’t ready for prime time yet.”

    The sentiment was fostered in part by SHRM’s lobbying efforts. During its November leadership conference, it took 207 members to Capitol Hill to talk to House members, senators and their staffs.

    “We were able to raise awareness about employer verification,” says William Maroni, SHRM chief external affairs officer.

    The message they got across is that verification policy should be considered more carefully, not tacked onto other bills.

    “There was a lot of receptivity to not legislating through appropriations,” Aitken said.

    The skirmish over E-Verify demonstrates that Congress hasn’t given up on immigration reform even though the failure of a Senate bill last spring likely squelched the possibility of a broad measure that encompasses both sanctions and a path toward citizenship for illegal workers.

    But Republicans and conservative Democrats, many of whom were in the vanguard of the Democratic takeover of Congress, are enamored of a crackdown on illegal employment.

    A bill that was introduced in November 2007 by Rep. Heath Shuler, D-North Carolina, has attracted more than 100 bipartisan co-sponsors and requires that employers sign up for E-Verify.

    SHRM will stay engaged in the debate, urging Congress to develop a better verification system rather than just reauthorize E-Verify when the law establishing it expires in November 2008.

    “Our members really are the experts at what works and what doesn’t work,” Maroni says.

Workforce Management, February 4, 2008, p. 22 — Subscribe Now!

Employee engagement doesn’t end when someone leaves the payroll, according to IBM. In fact, helping workers determine a direction before walking out the door increases their affinity for the company.

    A new program the technology giant will launch in July is designed to persuade employees and retirees to consider working for the Department of Treasury. The agency says it must fill 14,000 “mission critical” jobs during the next two years, including 7,950 at the Internal Revenue Service.

    The Treasury talent shortage reflects a government-wide trend. The Office of Personnel Management estimates that 500,000 federal positions could come open during the next five years as baby boomers retire.

    To fill the gap, the OPM is trying to persuade the private sector’s baby boomers to begin “encore careers” in the public sector.

    IBM is the first to sign on to FedExperience Transitions to Government, a pilot project sponsored by the Partnership for Public Service, an organization that promotes government hiring. AARP and Civic Ventures, both of which promote the work skills of older Americans, also are involved.

    Neither the Treasury Department nor IBM has set a target for the number of people they want to steer into jobs with the agency. Their primary goal is to establish a program with a low attrition rate.

    The initiative represents IBM’s second foray into the transition area. It already has set up a program to encourage employees and retirees to become teachers after they leave the company. About 100 IBM employees are participating.
The effort is part of IBM’s Global Citizen’s Portfolio, a $60 million program the company launched last summer. In addition to the $6 million to $8 million transition dimension, the initiative includes a 401(k)-style account that helps employees pay for education and training and $2.5 million in funding for the Corporate Service Corps, which consists of 600 employees that IBM will send to emerging markets to work on economic and social issues.

    The portfolio is IBM’s way to help employees thrive in the global economy. Even when they find a niche outside the company, IBM still benefits, according to Stanley Litow, vice president for corporate citizenship and corporate affairs.
“It builds a more effective workforce when the company helps people think through transitions in their life,” Litow said at a mid-January press conference in Washington.

    IBM generates good will from people who start a fulfilling career in teaching or government, said Litow, a former deputy chancellor for New York City schools.

    “It will improve people’s view of the brand,” he said. “It is good business to operate this way.”
The way IBM operates on a daily basis—stressing collaboration internally and with suppliers in a $48 billion procurement system—makes its 350,000 employees a good source of talent for government, Litow said.
Challenges in luring people from the private sector to the government include a lack of knowledge about federal openings and a bureaucratic hiring process.

    “There are a lot of things we can do better; we know that,” OPM director Linda Springer said. But she emphasized that federal agencies offer rich benefit packages and flexibility.

    “Whatever inefficiencies we have, there are a lot of other good things we’re doing,” she said.

Diplomats recently demonstrated that the Iraq war is no more popular with them than it is among the general U.S. population.

    Members of the Foreign Service resisted when the State Department indicated in late October that it would use mandatory assignments at the U.S. Embassy in Baghdad, a policy that hasn’t been instituted since the Vietnam War.

    If a diplomat declines to go to Iraq, it could result in disciplinary action—including being fired.

    But since the original announcement, nearly half of the 48 vacant positions have been filled voluntarily. That means that about 90 percent of the 252 Iraq openings for next summer have been staffed, with seven months remaining to find more volunteers, according to John Naland, president of the American Foreign Service Association.

    By Thanksgiving, it should be clear how the State Department will fill its slots in Baghdad. One obstacle is getting people to serve in a country where duty can be perceived as a “death sentence,” in the words of a diplomat who spoke in an internal State Department meeting and was quoted by the Associated Press.

    Dangerous postings also can be common in the private sector—and companies use some of the same incentives that the State Department has in its repertoire to entice workers to take jobs in unstable regions.

    Depending on career level, a Foreign Service professional who takes a one-year Baghdad assignment could receive a 70 percent boost in base salary, premium pay for overtime, support for family members left behind, 10 weeks off and preference on the next assignment, says Nicole Thompson, a State Department spokesperson.

    Oil and industrial companies offer rich incentive packages for employees they send to volatile African countries like Angola and Nigeria, according to Fran Luisi, a principal with Charles¬ton Partners, an HR executive placement firm in Rumson, New Jersey.

    “They really are trying to recruit people to exotic locations,” Luisi says.

    The draw is more than money. Just as important is the opportunity to develop skills that will enhance careers.

    International experience on the ground “really adds value to your marketability in the corporate environment,” Luisi says. “There will be promotional opportunities. That tends to play well.”

    But much of the time, expatriate assignments in the private sector are not so exciting. They’re to more traditional—and safer—places like Europe and Asia.

    “Most companies aren’t going to be putting employees in harm’s way,” says Steve Kueffner, an international consultant at Watson Wyatt.

    When they are sent away, it’s usually for one or two years. That keeps costs down but provides enough time for cultural enrichment, Kueffner says.

    “The length of assignment is shorter than it was five or 10 years ago,” he says.

    At the State Department, the time frame for postings may vary, but the need to send senior officers with the right language and skill sets to threatening regions will remain constant.

    “Going into countries that are in transition is nothing new to the department,” Thompson says. “It has been done many times in the past, and we’ll continue to do it in the future.”

Workforce Management, November 19, 2007, p. 1, 3 — Subscribe Now!

Felice Gray-Kemp was within 72 hours of making a decision about several job offers when a vice president at United Technologies Corp. asked her to meet with him. She happened to work in the same building in Hartford, Connecticut, as the VP, so Gray-Kemp, a tax attorney, hopped on the elevator to go upstairs and hear him out.

    His pitch focused on one of Gray-Kemp’s primary motivations—the desire to earn another degree to advance her career.

    “He mentioned something about ‘What these other employers have, I’m sure, is great, but they don’t have ESP,’ ” Gray-Kemp says. “I thought he meant extra-sensory perception.”

    He actually was referring to UTC’s Employee Scholar Program, a comprehensive tuition reimbursement initiative that was put in place in 1996 and which finances upfront every penny of an associate’s, bachelor’s, master’s or doctoral degree. In addition, graduates receive up to $10,000 worth of UTC stock.

    When ESP was added to the other aspects of UTC she found attractive, Gray-Kemp made her decision.

    “The thought of being reimbursed or sponsored through an advanced degree was paramount in my mind,” she says. “It was a no-brainer that I was going to come to UTC.”

    Gray-Kemp joined the company in September 1998 and began her coursework for an LLM, a postgraduate law degree, in taxation in August 1999. She earned her degree from Boston University while working full time and is now assistant general counsel for UTC, which provides high-tech products and services to the building and aerospace industries.

    The company—whose subsidiaries include Carrier; Otis; Pratt & Whitney; Sikorsky; Hamilton Sundstrand; UTC Fire & Security; and UTC Power—says enhanced recruiting is just one benefit of the program for the company.

    It also aids in retention—a bonus for UTC—and promotion, which is good both for employees and for the company’s succession planning efforts. Those rates for ESP graduates are 2 percent to 3 percent higher than for their peers, according to company officials.

    Since the program’s inception, UTC has invested $626 million in ESP, a rate of about $70 million to $75 million annually. About 17,000 UTC employees have graduated over the lifetime of the initiative. About 14,000 are in classes now, or about 6.5 percent of the company’s 215,000-person workforce.

    The program is becoming increasingly popular in foreign countries where UTC operates, like Poland and Brazil. More than half of the company’s revenue is generated internationally, and 65 percent to 70 percent of its employees are based overseas.

    No matter where they’re located, once UTC workers graduate, there are no requirements placed on them to stay with the company—not even for a little while—or repay education expenses. They could leave immediately if they’re so inclined.

    One reason the program is so expansive is UTC chairman and CEO George David’s belief in the power of learning.

    “Education changes peoples’ lives,” he said during a speech in Washington last year. “It changes the way they think about everything.”

    That new outlook also can enhance their work performance. It’s not so much the degree that is earned but the earning of the degree that sets people apart.

    Gray-Kemp did not need an LLM to become the first tax attorney in UTC history to move to the general counsel’s office. But the intellectual curiosity, discipline, drive and other intangibles involved in going to school impressed her superiors.

    “To them, it was the ability to think through a problem, which going to get an additional degree helps you to do,” Gray-Kemp says. “It was about learning a way of thinking. You can position yourself to take on challenges—not to say that you couldn’t otherwise—but they’re easier to face, and excel, if you have that training.”

A part of the culture
    Donald “Scott” Richards, depot logistics manager for the F-119 engine program at Pratt & Whitney, also has strengthened his problem-solving skills by earning his bachelor’s and master’s degrees in management at Albertus Magnus College. He began an MBA program at the Connecticut school in August.

    “There’s a research method of how you go about coming to a conclusion, coming to an answer,” he says.

    His course work also has had a direct impact on his job. His master’s thesis focused on optimal contract length—a topic central to negotiations on work Pratt & Whitney does for the government.

    “It really engages you in the organization,” he says. “It gives you eyes to see some of the things that go on in the background that you may not have thought about in the past.”

    Richards began his career as a Pratt & Whitney mechanic in 1979. Since then, he has worked in several UTC aerospace businesses, including time in Brazil at International Aero Engines. He went back to school for a bachelor’s degree in 2001.

    His motivation stemmed in part from his family.

    “My daughters went to college, and they kind of inspired me to go back to school,” he says.

    He also wanted to take advantage of the breadth of UTC’s operations.

    “The ESP program has given me the opportunity to move to different areas,” he says. The company rewards performance and a person who shows some initiative, he says.

    By offering the tuition reimbursement incentive, UTC is making an important statement about its culture, according to company officials.

    “It speaks to our commitment to develop employees once they join United Technologies,” says William Bucknall Jr., senior vice president for human resources and organization. “You’re not just joining a company for a paycheck. You’re joining a company for a career.”

    Or at least they are setting off on a career path when signing on with UTC. The company acknowledges that not everyone will remain with it throughout their working life.

    In fact, the Employee Scholars Program grew out of a difficult time in UTC’s history—the early 1990s, when a recession forced the company to shutter plants and restructure by moving more work overseas.

    David saw that many people who lost their jobs were not placed elsewhere in the UTC universe. But rather than abandon them on the wayside of globalization, he wanted to help them bounce back.

    “We can’t promise you a job forever,” Bucknall says of the company’s philosophy. “But we can certainly give you the opportunity to develop yourself and be prepared for the next step in your career, even if it means you would leave UTC.”

    That kind of altruism fosters skepticism about the tuition program.

    “They have continued on with something as a benefit rather than looking at it strategically,” says Jeanne Meister, an author and consultant. “It’s an outdated model.”

    She doubts that unlimited reimbursement is effective and asserts the only way such a program can survive is when it is championed by an executive.

    “It’s an enormous leap of faith,” she says. “It’s been rolling along because it’s the brainchild of the current CEO and no one wants to mess it up.”

    Bucknall agrees that David is the force behind the initiative and has fostered the program’s success.

    “If HR had proposed that we do this, it wouldn’t have the impact that it does if the CEO proposes it and is committed to it,” Bucknall says.

    But a program that was born in the C-suite may also die there. “When this CEO leaves, the next guy will come along and say, ‘What were we doing?’ Meister says.

    UTC soon will have a chance to prove that the tuition program is bigger than David when the chief executive steps down in 2008. He will be succeeded by Louis Chenevert, the former head of Pratt & Whitney, who was named UTC president and COO last year.

    Chenevert has emphasized his support for the program. “I like to think it’s probably in the DNA of the organization now and will continue regardless of who the CEO is,” Bucknall says. “It’s not just a nice, good thing to do. There are measurable business outcomes from having the program as well.”

Tracking results
    Beyond recruiting and retention statistics, Bucknall points to UTC’s financial performance. In 2006, revenue increased by 12 percent over 2005 to $47.8 billion. Earnings per share were up 19 percent. Over the 10 years the tuition program has been in place, UTC has achieved shareholder return that is more than twice the Dow Jones and S&P 500 averages.

    A number of factors can influence financial results, which means even sterling ones probably won’t convince skeptics that generous tuition reimbursement makes business sense.

    John Sullivan, a professor of management at San Francisco State University, says that the inherent weakness in such programs is that they are usually run by the benefits office rather than by training and development. As a result, no one determines return on the educational investment, assesses whether skills required by the organization are obtained, or coaches participants.

    “This is the worst-managed program in HR,” Sullivan says. “No one does the metrics like they would in any other thing. I haven’t found anybody who’s even tried to calculate [return on investment]. There is no evidence that it’s going to help your company.”

    Another drawback is that participants do not reap the rewards of their newly acquired education, according to Sullivan.

    “At work, they get nothing, not a ‘thank you,’ not a cake,” he says. If they are trying to move up from being a secretary to an accountant, they often have to find a new employer.

    “You’re still labeled as a secretary,” Sullivan says. “The degree doesn’t turn out to be powerful until you leave the company.” At a financial firm Sullivan studied, 75 percent of the people who went back to school departed within two years of earning their degree.

    Sullivan maintains that there are “faster, cheaper ways” to learn than by entering college, such as participating in a leadership program. This route also ensures that employees take courses that benefit the company rather than wander off on their own.

    But 90 percent of the time at UTC, self-selection has resulted in employees taking courses that relate to their work, says Laura Osborn, director of learning and development for the company. So a financial analyst is likely to get a master’s degree in accounting rather than in anthropology.

    In the other cases, a divergence between curriculum and job duties may result from an employee wanting to move to another position within the company. For instance, an engineer may pursue an MBA.

    “The majority of people go for a business degree to sort of round out their skills,” Osborn says.

    They track into courses that are relevant to their career paths because “they’re passionate about what they’re going to end up working on.”

    Such enthusiasm highlights one of the challenges of managing the program—calibrating expectations. Sometimes, employees seek immediate job gratification after their accomplishments in the classroom.

    “There’s a need on our part to make sure people appreciate that more than likely because of advanced credentials and motivation, good things will happen in your career,” Bucknall says. “It’s not necessarily going to happen 30 days after you graduate.”

    But the number of people who get frustrated and leave—or take the degree and run to another company—is limited, according to Bucknall.

    “If there were a trend toward that, you can bet we’d be hearing from our business units and management that the investment wasn’t worth the return,” he says. “We don’t hear that at all.”

    The feedback they are getting from the public sector is praise. Rep. Tom Allen, D-Maine, has a Pratt & Whitney operation in his district in North Berwick. He says UTC’s education initiative sets an example for other companies to follow.

    “It’s an amazing program,” Allen says. “They have a very loyal workforce and a very good workforce.”

    When UTC helps its employees go back to school, it is also strengthening skills in the district’s labor market, which benefits all of Allen’s constituents.

    “That further training is a public good as well as a private good,” he says.

    It prepares someone like Donald Richards for whatever might come next in the churning, sometimes dangerous global economy.

    For jobs that used to be available for someone with a high school education, “a bachelor’s degree is required and a master’s degree or an MBA is preferred,” he says. “Education offers choices.”

Cubicles usually are the butt of jokes about life in the corporate world, as anyone who reads Dilbert knows.

    But Trane remodeled its Parsippany, New Jersey, office in 2005 to institute a cubicle culture for the approximately 120 employees who work there. And the company is proud of it.

    “We’re all in cubes,” says Rich Halley, district manager for Trane New York/New Jersey.

    Just as Halley completes his sentence, John Conover, president of Trane Americas, pipes up.

    “So am I,” he says.

    The corporate leaders have embraced cubism, so to speak, because they believe that it increases communication among employees and fosters collaboration. Both are key elements in the heating and air conditioning company’s efforts to move from transactional sales to strategic customer relations.

    Building deeper connections to customers to find opportunities beyond installing their next HVAC (heating, ventilation and air conditioning) unit requires such cooperation.

    In Trane offices, four people sit together in a large cubicle. There’s a desk and computer in each corner. In the middle is a file cabinet that supports a large tabletop on which building designs can be unfurled and studied.

    In addition to putting an end to closed office doors, which block communication, the new design eliminates interior walls and allows natural light to permeate working areas—a refreshing change from the previous dark, drab atmosphere.

    The benefits of the redesign began accruing even while remodeling was in progress. At one point, the entire sales force was relocated to a conference room while their section of the office was overhauled. They achieved a record month.

    “It was an immersion in teaming,” Conover says.

    Now such teamwork can occur daily. “Communication is the key,” Halley says. “The open atmosphere really works for us.”

Workforce Management, November 5, 2007, p. 36 — Subscribe Now!

When Morgan Stanley approached Trane to install a climate control system in its Purchase, New York, office, the heating and air conditioning company did more than sell and install equipment.

    Trane considered the different activities that occur at the investment bank’s 750,000-square-foot facility. It’s a data center, a trading floor and an office.

    In Morgan Stanley’s business, losing a few seconds—let alone a few minutes—to an infrastructure problem could cost millions of dollars.

    So, Trane engineers developed a thermal storage system that makes ice at night to cool the facility the next day. Such a process lowers Morgan Stanley’s electricity consumption, provides a more reliable source of air conditioning and helps protect the environment because it keeps the climate system off the electrical grid during peak business hours.

    A similar system devised for Credit Suisse’s Manhattan office saves the financial company about $1 million annually. Morgan Stanley enjoyed a further benefit when its green effort was rewarded with a $300,000 grant from the New York State Energy Research & Development Authority.

    The results emanated from a new mind-set that Trane has been instilling in its workforce for many years: The company is moving away from transactional equipment sales to developing strategic customer relationships.

    The company still sells heating and air conditioning systems, but now its engineers and salespeople must develop a deeper understanding of their customers’ businesses and look holistically at a building.

    That dynamic was at the heart of Trane’s work with Morgan Stanley on its Purchase facility. “We created a solution,” says Rich Halley, district manager for Trane in New York and New Jersey.

    What the financial firm sought from Trane was a way to apply environmental best practices to its building, says James McAleer, Morgan Stanley’s facilities manager. The result was a reduction in emissions and energy consumption.

    “This in turn benefited the environment and improved the overall efficiency of our facility,” McAleer said in an e-mail interview. “We are currently partnering with Trane on a Manhattan building to provide the same environmental benefits realized in Westchester.”

    The company took a similar approach in working with New Jersey schools. Ultimately, Trane’s charge was to help them meet their bottom-line goal—raising standardized test scores.

    The ideas that Trane developed, such as portable thermostats, were designed to raise air quality and improve the comfort level so kids could concentrate better.

Clients demand more
    This broader view of the client came from the people signing the contracts.

    “Our customers realized before we did how much impact we could have on their businesses,” says John Con over, president of Trane Americas. “They say, `You sell us a piece of equipment, then you go away. I don’t see you until I’m ready to build my next building.’ “

    The clients wanted Trane to do more for them and develop a deeper relationship. “We now stay with the customer,” Conover says.

    With this inspiration, Trane in 2002 began to formally make a transition from being a company that focused on equipment sales to one that emphasized customer account management.

    This evolution required the company to fundamentally change the curricula of its extensive training programs. Over the course of a year, 6,000 of the 7,000 Trane Americas employees are in some kind of development program.

    When Conover attended Trane’s signature Graduate Training Program in 1977, it essentially gave newly minted engineers that Trane had recruited from colleges advanced instruction in thermal heat transfer.

    The emphasis of the curriculum was on what Conover calls “back wheel” skills. “It was all technical,” Conover says.

    Now the new Trane hires, who study in La Crosse, Wisconsin, for six months, followed by six months of training at local Trane facilities, take an additional set of classes designed to hone “front wheel” skills—such as teamwork, listening, account management, leadership and interpersonal relationships—that will help them communicate with clients.

    “We want them to have that focus on the customer so that they can interpret what the customer’s real needs are, understand what the customer’s business needs are, and then bring technical solutions to those issues,” Conover says.

“We’ve made the business that we have much more profitable. This transition is what’s allowed us to do that.” –John Conover, president, Trane Americas

    The key for Trane and other companies going through the transition from transactional to strategic client relationships is to develop a workforce that is adept at soft skills, says Rich Thompson, vice president of training and development at staffing and workforce consulting company Adecco, where he concentrates on coaching, mentorship and skills development.

    This means that a salesperson is a good listener and can ask good questions that prompt a customer to reveal more than what he or she needs in the next order.

    For the customer, “it’s just as important now to have a consultant as it is to have an answer man,” Thompson says. “You have to consult with the client to get the answer, to get the solution.”

    This change has been fostered in part by the Internet, which promotes price transparency. “The consumer is smarter,” Thompson says. “They’re better educated. They’re more sophisticated. They’re savvy. You have to show them you have the best solution long term.”

    One salesperson usually can’t establish such a complex relationship. That’s why Trane has put a premium on internal collaboration.

    “It’s really important now that our salespeople, our account managers work together on teams with other people in the office,” Conover says. “That’s a different way to behave than the sales skills we were using 20 years ago.”

‘Ahead of the storm’
    The new approach is producing bottom-line results, according to Conover. Over the past three years, Trane has achieved double-digit growth, all of which has come “organically” rather than through acquisition, he says.

    “We’ve made the business that we have much more profitable,” Conover says. “This transition is what’s allowed us to do that.”

    Trane’s parent, American Standard Cos., announced in February that sales rose 8 percent in 2006, to $11.2 billion, with Trane accounting for $6.8 billion of the total. The company predicts 8 percent sales growth again this year and is projecting an increase of 18 percent to 22 percent in its earnings per share. In July, American Standard sold its bath and kitchen products company and announced that it would change its name to Trane.

    Trane, which employs 29,000 people worldwide, says that its 2006 sales—$4.9 billion from equipment systems and $1.9 billion from services—represent a 129 percent increase compared with 1995, when American Standard went public.

    So, for the past decade Trane has generally been in good shape. When it decided to transform its sales orientation from transactional equipment deals to strategic customer relations, it was essentially turning around a ship while the ocean was calm and the weather was temperate.

    “It’s harder to drive change when you’ve been successful, as opposed to driving change when you have a burning platform,” Conover says. “We haven’t had a crisis. We wanted to stay ahead of the storm.”

    In some ways, that makes a transition more challenging. “It’s a big change management issue,” says Shelly Heiden, executive vice president of global operations at Plateau Systems, a company that provides talent management software, content and services. That’s why it’s important for top executives to lead the transformation through example and communication.

    “When the message is delivered at the highest level of the organization, it resonates more,” Heiden says. The key concept to get across is “letting employees know what their stake is in it.”

    Their role has to be more fulfilling than just increasing bottom-line numbers, says Maxine Kamin, president of Touch Consulting Inc. They have to feel as if they’re truly delivering more value to the customer.

    “The challenge for the company is to show that it’s not the company’s intent to sell more products without reason,” she says. “It’s the company’s intent to provide better service. The paradigm shift has to be: `I really want to find out what this customer needs.’ “

    This kind of approach has become common in the telecommunications industry. With the advent of portable cell phone numbers, competition spiked for retaining customers through service.

    “People realized margins are better when you have a lifetime of usage,” says Marti Smye, market leader in coaching and change management at Korn/Ferry. “In the more equipment-oriented companies, this is a new trend.”

    Trane turned to Smye to help it become part of the movement. She worked with 36 Trane district managers over three years to retool the company’s culture.

    That meant changing their mind-set from transactional to strategic and from short term to long term. It required their “thinking from the customer’s point of view,” Smye says.

Shakeout
    Getting district managers to make the adjustment is a key to the transition. Of course, some people who have been used to doing sales the traditional way might resist the change, and decide to leave the company.

    There was some turnover as Trane started to make its transformation in 2002—the year Conover’s predecessor retired, as did many senior district managers. “Some people decided they didn’t want to make the transition,” Conover says.

    Although the company didn’t provide statistics, it said that turnover has been minimal. “Trane has been very committed to the people in place,” Smye says.

    Part of the reason the change didn’t cause a bloodletting is that the customer culture that has been ingrained over the past century.

    “When you convey it in those terms—`This is what the customer wants’—they’re quick to sign up,” Conover says.

    In fact, employee commitment increases because of the collaboration with customers and colleagues that the new approach requires. “They’ve been engaged by being part of a team,” he says.

    Cooperation is also emphasized in the Trane Leadership Development Program. Established in 2003, it involves 12 to 15 people at a time who are in class together for three days every six weeks over an 18-month period.

    The program is designed not just to teach talent management, solutions-selling and ethics, but also to help each class become a team.

    “It develops a network of people—15 peers,” Halley says. “It really ties us together. We’re all thinking the same way.”

    Trane hopes the end result is improved performance in the field. “You are building skill sets to run a district office or a business unit,” says Gigi Bruno, Trane’s global learning and development leader.

    And, as with all training at Trane, the client is the focus. “The idea is getting people together to talk about the customer,” Bruno says.

    The importance of collaboration is reinforced by Trane’s recognition system. “You have to align those rewards with all of this change,” Smye says.

    So Trane acknowledges group accomplishments. For instance, the One Trane Award signifies achievement in providing solutions and value to customers.

    “It’s a plaque; it’s a public acknowledgment,” Bruno says. “It’s got nothing to do with money. That’s something we’re very proud of in this culture.”

Workforce Management, November 5, 2007, p. 33-37 — Subscribe Now!

A controversial ruling on a wage discrimination case during the Supreme Court’s last term caused critics to assert that the majority ignored workplace realities.

As the justices convene October 1 for a new session, one of the employment law matters on the docket provides another opportunity for the bench to wrestle with workplace discrimination—this time age bias—in an era in which mistreatment is more often subtle than blatant.

In Sprint/United Management Co. v. Ellen Mendelsohn, the plaintiff alleges she was fired in a downsizing process prejudicial to older workers.

Mendelsohn lost her job in 2002 when the company laid off 15,000 employees. She was 51 and worked for Sprint/United since 1989. To support her claim, Mendelsohn wanted to call to the stand colleagues who believed age was the cause of their dismissal.

Such a move is typical, says William Deveney, a partner at Elarbee Thompson in Atlanta. “It allows an emotional argument to be made to the jury,” he says. “That issue arises in just about every reduction-in-force case.”

But the trial court didn’t allow the other employees to testify because they had a different supervisor. The 10th Circuit Court of Appeals, based in Denver, overturned the jury’s decision in favor of the employer.

The testimony of Mendelsohn’s colleagues may have been the best way to show that the layoffs unfairly targeted older employees, says Joseph Sellers, a lawyer with Cohen Milstein Hausfeld & Toll in Washington.

“Direct evidence of discrimination is increasingly rare,” Sellers says. “Most often, evidence of discrimination comes from circumstantial evidence. It’s hard to claim that the experience of other workers who were subject to the same [layoff] policy is irrelevant.”

Charles Craver, professor of law at George Washington University, says the Sprint case will be a difficult one for the court.

“This is a close call,” he says. “I don’t know where you draw the line. At what point do you say that this seems to be evidence of a firm practice?”

Another employment case is more procedural than substantive.

In Federal Express Corp. v. Holowecki, Patricia Kennedy and other colleagues made an age discrimination claim against the courier. The participants filed an intake questionnaire with the Equal Employment Opportunity Commission and attached a sworn affidavit.

But the agency did not open a case or notify FedEx of the charge. In a subsequent federal court proceeding, the company asserted the case had no merit because an EEOC charge was never filed. A trial jury ruling in favor of FedEx was overturned by the 2nd Circuit Court in New York.

A victory for FedEx ultimately could be a setback for business, according to Craver. It might result in the EEOC handing claimants a questionnaire and charge form at the same time.

“In the long run, it won’t necessarily help defendants,” Craver says.

But allowing an intake questionnaire to be a charge “is really neglectful of the agency’s role as it was initially conceived in screening out meritless claims,” says Manesh Rath, an attorney with Keller and Heckman in Washington.

Sellers, however, says the affidavit was a legitimate charge. If the case against FedEx is dismissed, “people will lack confidence in the integrity of the process and that will be the beginning of the end of the effectiveness of the EEOC,” he says.

Opinions on immigration vary sharply in Congress—and consensus on how to achieve comprehensive reform may be as difficult to reach this year as it was in 2006. But like last year, everyone on Capitol Hill seems to agree that employer verification is crucial to any bill that emerges.

    The question is whether the electronic verification mechanism that the government has been pushing the private sector to adopt—Basic Pilot—will survive the legislative process.

    Immigration activity has spiked. Senate Majority Leader Harry Reid, D-Nevada, has scheduled a vote for Monday, May 21, to begin a debate in that chamber. The basis for the deliberations will either be a comprehensive bill approved by the Senate last year or a bipartisan measure that Democrats, Republicans and the White House have been trying to forge for weeks.

    Last year, the House and Senate failed to reconcile their immigration bills.

    The 2006 Senate measure included a mandatory electronic employment verification system that would utilize government databases. This year’s bipartisan Senate negotiations are leading toward an electronic verification system that builds on Basic Pilot, according to Laura Reiff, co-chair of the Essential Worker Immigration Coalition. Reiff says the business community is stressing that the new system must work before all employers are required to use it.

    Coming to grips with employer verification is one of the many obstacles Congress faces on the winding and treacherous road toward comprehensive immigration reform.

    Basic Pilot, a Web-based system that checks new-hire information against Social Security and Department of Homeland Security databases, has been widely criticized as inefficient and ineffective.

    A Web-based system that checks new-hire information against Social Security and Department of Homeland Security databases, it has been widely criticized as inefficient and ineffective by the business community.

    The first piece of comprehensive legislation, a House bill written by Reps. Luis Gutierrez, D-Illinois, and Jeff Flake, R-Arizona, does away with Basic Pilot and replaces it with a system that verifies employment by using machine-readable, tamper-resistant documents such as secure driver’s licenses containing physiological proof of identity like a fingerprint or retina scan.

    Nevertheless, Basic Pilot did not lack for defenders during recent congressional hearings. Its advocates admitted that the system has flaws, but says improvements were being made as more employers register.

    One prominent Basic Pilot customer, however, is not satisfied. An official at Swift & Co., the nation’s third-largest meat processing company, testified before Congress on April 24 that the corporation was burned by Basic Pilot.

    Despite participating in the verification system, Swift was the subject of a December 12 raid by Immigration and Customs Enforcement at six of its facilities, which led to the arrest of 1,282 employees on immigration violations.

    The alleged culprits used false identities to pass as legal workers, a situation that Basic Pilot is not equipped to detect. In a Capitol Hill appearance, John Shandley, Swift senior vice president for human resources, said the disruption to Swift’s operations cost the company $30 million.

    The dollar amount, however, was not what galled Shandley the most. It was the fact that government immigration officials refused to work with Swift to resolve the situation before a raid was necessary.

    “All attempts to generate a collaborative solution were repeatedly rebuffed under the guise of an ‘ongoing criminal investigation,’ ” Shandley says at a hearing of the House Judiciary Subcommittee on Immigration, Citizenship, Refugees, Border Security and International Law.

    The Department of Homeland Security, which houses ICE, has stepped up employer enforcement during the past year, sometimes pursuing criminal cases against executives. It has not filed a charge against Swift.

    Shandley is frustrated that the company was swept up in the new DHS enforcement push. “You comply with all the laws of the land but you still get hammered,” he says. “It is a systemic failure.”

    He received a sympathetic nod from Rep. John Conyers, D-Michigan and chairman of the House Judiciary Committee, who says Shandley’s testimony was constructive.

    “I’m glad that you didn’t bring a hard attitude to the hearing or have a chip on your shoulder,” Conyers told him.

    Shandley responded, “The chip is buried deep inside right now.”

    Conyers’ appearance at the subcommittee meeting demonstrated the political priority he is putting on verification policy as the House works its way toward a comprehensive bill.

    He also made clear that immigration reform would have to include a verification system that won’t produce another result like the Swift raid.

    “What is the point, if you’re going to get busted for trying to comply and comport with the laws?” he asked.

    The chairwoman of the House subcommittee and the point person for House immigration legislation, Rep. Zoe Lofgren, D-California, shared a personal anecdote on frustration with Basic Pilot.

    When Lofgren tried to hire Traci Hong as the subcommittee’s legislative counsel, the system gave Hong a tentative nonconfirmation despite the fact that she has been a U.S. citizen for 15 years.

    Hong, an immigration lawyer, had to make multiple trips to the Social Security and House personnel offices over the course of eight days to solve the problem. She and her boss wondered how many other legal immigrants—with far less background and fewer resources than Hong—were being rejected by the system.

    “These are the real-life consequences we started thinking about,” Hong says.

    But Lofgren isn’t necessarily going to try to jettison Basic Pilot. She has scheduled a number of subcommittee hearings to delve into all aspects of immigration reform and hear from all sides.

    In one of those meetings, Jock Scharfen, deputy director of U.S. Citizenship and Immigration Services, defended Basic Pilot, noting that 16,000 employers are participating.

    Companies will use the system to verify more than 3 million new hires at 71,000 work sites this year. Scharfen says more than 92 percent of employer queries receive employment authorization within three seconds.

    In recent weeks, Basic Pilot has added a mechanism that incorporates green card and employment authorization photos so employers can check the photos on documents presented by new hires.

    The photo tool, which is designed to combat identity fraud, is being tested with 40 companies and will be rolled out in the coming months. The immigration service received a $114 million appropriation from Congress for the current fiscal year to bolster the system.

    One question regarding Basic Pilot is whether it has the wherewithal to ramp up its current search capacity of 25 million employees to 53 million, if it were to become a mandatory system.

    “We think we can do that in short order,” Scharfen told the subcommittee.

    The highest-ranking Republican on the panel offered support for the system, even though he says it can be improved.

    “The Basic Pilot program has been remarkably successful,” says Rep. Steve King, R-Iowa.

    In another of the subcommittee’s hearings, the congressional author of the legislation that created Basic Pilot asserted that it is the best foundation for employer verification because Congress has voted for it three times since 1997.

    “To create a new program from scratch would be a step backward that would be hard to explain to budget-conscious American taxpayers,” says Rep. Ken Calvert, R-California. “It’s a system that works, and it’s a system that employers want to use.”

    A coalition of human resource organizations, including the Society for Human Resource Management and the HR Policy Association, disagrees with that conclusion and is pushing to replace Basic Pilot. The groups have formed the HR Initiative for a Legal Workforce to influence the verification debate.

    The initiative is lobbying for what it calls a secure electronic employment verification system that utilizes biometric information provided by private-sector companies.

    Individuals would give their personal data to vendors that are certified by the Department of Homeland Security. They would then receive a card that employers could process to determine whether the new hire is eligible to work in the United States.

    Placing biometric information in a private database could help to ease privacy concerns like those raised by Jim Harper, director of information policy studies at the Cato Institute, a Washington think tank.

    In testimony before the subcommittee, Harper warned of the dangers of a centralized biometric database run by the government. Such a mechanism, for instance, might allow the Internal Revenue Service to track someone’s job history to determine how much they owe in taxes. He asserted that the current “sloppy” paper-based I-9 system would be preferable.

    It’s more important that eligible workers be allowed to obtain jobs—and more legal workers let into the country—than it is to keep illegal immigrants out of the workforce, Harper argued.

    In an electronic system, the goal is to ensure “security without surveillance,” Harper says. But that’s difficult to guarantee.

    “If you have employer verification, the sloppy system we have now is the best accommodation to the human interests at stake,” Harper says. “If you build this hardened [electronic] system, it’s bad for American workers.”

    Of course, the I-9 forms cause their own headaches for employers, who likely would prefer some kind of electronic verification system. But it should be one with fewer nonconfirmations than Basic Pilot currently permits, according to one business lobbyist.

    “Even with a 1 percent error rate, you’re talking about disqualifying millions of Americans from their livelihood,” Randel Johnson, vice president of labor, immigration and employee benefits at the U.S. Chamber of Commerce, testified before the subcommittee.

    Johnson also recommended that a new electronic verification system be phased in, limited to new hires and paid for by the government rather than by employers. He also says employers should not be liable for hiring violations by subcontractors.

    Perhaps the biggest challenge of reforming verification policy is that it requires the government, employers and employees to enter a new kind of relationship, according to Lofgren.

    “We need to sort through all those issues,” she says.

Democrats started their takeover of Congress on November 7 at about 6:30 p.m. Eastern time, when Brad Ellsworth was declared the victor in the race for Indiana’s 8th District seat.

Ellsworth decisively defeated incumbent Republican Rep. John Hostettler, who as chairman of the House Judiciary Subcommittee on Immigration was fiercely anti-immigration. In fact, Hostettler made his opposition to amnesty for illegal aliens his central campaign issue.

But Hostettler’s defeat didn’t result in a simple mathematical gain of one vote for comprehensive immigration reform. Ellsworth has to represent the same conservative southwest Indiana district that Hostettler did. And the former sheriff also has qualms about giving illegal immigrants a special path to legal status.

In his initial foray into the immigration issue, Ellsworth has focused on employers. Recently, he introduced the Legal Employee Verification Act, which would establish a mandatory electronic verification system administered by the Social Security Administration and the Department of Homeland Security. It would also double the minimum fines on companies that violate immigration laws.

Ellsworth didn’t say how his proposal might affect the government-run electronic verification system currently in place. Known as Basic Pilot, the Web-based system checks new-hire information against Social Security and DHS databases. Employers have criticized Basic Pilot for being inefficient, prone to error and powerless against identity theft.

The new congressman decided to introduce a verification bill after conducting town hall meetings in his district, where he was pressed on immigration.

“My voters and my constituents wanted me to go back [to Washington] and do something,” Ellsworth says. Verification “looked relatively inexpensive and not too intrusive on the employer.”

Eliminating job opportunities for undocumented workers is the key to shutting down illegal immigration, Ellsworth argues.

“That’s going to be the first spoke that needs to be fixed,” he says.

In Ellsworth’s view, companies have an important role to play once an electronic verification system is in place.

“They become an arm of border control,” he says. “It’s not too much to ask and not much more than they’re doing now” in the I-9 system.

That a new member of Congress would address employment verification demonstrates the resonance of the issue. Resolving it will influence how comprehensive reform unfolds.

“The linchpin to everything is to make sure employment can be verified,” Rep. Jeff Flake, R-Arizona, said at a recent House immigration hearing.

Flake and Rep. Luis Gutierrez, D-Illinois, have introduced the first comprehensive immigration bill in the House. The measure eliminates Basic Pilot and replaces it with a system based on machine-readable, tamper-proof biometric cards.

As the legislative process continues, Ellsworth’s vote may be difficult to obtain for reform advocates.

“If comprehensive [reform] means granting amnesty to the people who are here [illegally], I’m against that,” he says. “If that is in the mix, I can’t support it, and lobbying by [House] leadership won’t do any good.”

Stephen Rhinesmith, a partner at Mercer Delta Executive Learning Center, has trained executives in 60 countries during his 40-year career. He has seen U.S. corporations evolve from their 1960s domestic focus to their desire today to find the best global ideas and talent. Along with David Dotlich and Peter Cairo, he is author of the 2006 book Head, Heart and Guts: How the World’s Best Companies Develop Complete Leaders. Rhinesmith recently spoke with Workforce Management staff writer Mark Schoeff Jr.

Workforce Management: What are the biggest challenges in global leadership?
Stephen Rhinesmith: There are three major issues that global leaders have to deal with today. One is managing the complexity of the emerging social/economic environment. The second is managing diversity. And the third is managing uncertainty. On the issue of complexity, leaders still need to have the same kind of intellectual capacity that they’ve always had to deal with strategy and to deal with analysis of [market] options. Global emotional intelligence … requires specialized knowledge about fundamental issues that separate the cultures.

WM: What is guts?
Rhinesmith: Guts is making clear decisions in uncertain situations because you have a clear set of values that enable you to have courage. Guts is learned through experience … by stretch assignments, sending people to places they are unfamiliar with and giving them support and an opportunity to grow.

WM: What is an example of heart?
Rhinesmith: If you were leading anybody on 9/11, what they needed was heart. They needed empathy. They needed understanding. They needed human support because they were in shock. There were numerous stories of strong executives who literally wound up going to their offices and hiding from their employees because they didn’t know what to do.

WM: What are the leadership deficits in executives?
Rhinesmith: The two things most lacking in executives in the world today are the ability to coach effectively and the ability to deal with conflict. The really good organizations—GE, Intel, Pepsi—encourage conflict as a means of ensuring that they’re getting the right answers. A lot of leaders are ineffective because they’re trying to avoid conflict, and as a result they don’t get creativity [or] innovation.

WM: How should HR approach globalization?
Rhinesmith: Globalization from an HR perspective is to take the best people in the world and put them in the job for which they’re most qualified, regardless of nationality. There’s a mistake in the profession that going global means you hire locals to run local businesses. But in fact, that’s a multinational approach, not a global approach. The balance between expatriate and local talent is going to be an interesting evolution. Some countries have less tolerance for foreign managers.

Workforce Management, February 26, 2007, p. 9 — Subscribe Now!