strategy Archives - Page 11 of 12

March 21, 2011December 30, 2019

Deloitte Gets Physical with $300 Million Learning Center

Consulting giant Deloitte is putting serious cash behind its stated priority of training and development. Many companies have hoarded money in an uneven economy, but the New York-based firm is dipping into its profits to build Deloitte University, a $300 million “learning and leadership development” campus near Dallas.

Slated for completion this summer, Deloitte University will feature 35 classrooms, each outfitted with technology for interactive learning. The 712,000-square-foot complex also will be self-contained, including 800 hotel rooms on site to house visiting Deloitte employees who attend training. The company plans to hire a hospitality management vendor to operate the hotel.

Deloitte University’s primary purpose will be to help consultants buttress their technical proficiency with leadership, collaboration and team-building skills, says Bill Pelster, a Deloitte managing principal for talent development, who is based in Seattle. More than 45,000 consulting professionals make up Deloitte and its U.S. subsidiaries. Worldwide, the company has nearly 170,000 employees.

Deloitte consultants specialize in highly technical fields, such as tax accounting, auditing and risk management, corporate financial advice and regulatory/legislative matters. They also have expertise in selected business sectors.

It is unusual for consulting firms to adopt the corporate-university concept, says Sue Todd, president of the Mechanicsburg, Pennsylvania-based Corporate University Xchange, a research and advisory firm. In fact, Todd says most consultancies still cling to older models in which consultants specialize strictly in one strategic area.

However, the need for continuous learning by technical professionals is greater than ever and likely to remain so given the rapid pace of the changing business climate.

“Consulting firms are slowly finding the models they’ve used to define jobs need to be significantly expanded. Either they get more value from their consultants, or they risk losing whole hunks of business to competitors,” says Todd, whose organization is not directly involved with Deloitte University.

Still, it is unusual for companies in the current economy—even large concerns like Deloitte, which posted global revenue of $26.6 billion in 2010, up 1.8 percent—to sink vast sums of money in a physical learning campus. But Deloitte has been transforming the learning curricula across its varied lines of business, including switching last year from a regional to a national model for talent management. Construction of the leadership center dovetails with that effort, officials say.

As the most visible outgrowth of the strategy, Deloitte University will sprawl across 107 acres in Westlake, Texas. When operations begin—probably in October—it will deliver 1 million hours of training per year, or roughly one-third of all Deloitte’s U.S. training.

All told, more than 420 learning programs are scheduled during the first year of operation.

“It embodies our commitment to developing professionals in a much more dynamic way” than traditional learning formats, Pelster says.

Deloitte University plans to jettison traditional learning methods. Lecture-based learning is out. Instead, interactive training activities will force employees to anticipate hypothetical problems and devise solutions as a group. Computer-simulated business scenarios, case studies and role-playing will be the norm.

The participatory format should help consultants see things from a client’s point of view—an important attribute when addressing business issues fraught with ambiguity and complexity, Pelster says.

Some of Deloitte’s U.S. partners, managers, and executives will serve as instructors at the Dallas campus, facilitating small groups of cross-disciplinary teams and providing feedback. For roughly every five participants, one Deloitte leader will be on hand as a sounding board.

“It’s basically a leadership laboratory that gives us the opportunity to see how teams react, and then provide immediate feedback on their decisions. It’s important that our leaders be in the classrooms to teach and mentor the next generation of Deloitte professionals,” Pelster says.

Deloitte decided to invest money in a learning campus largely because it will provide flexibility in how learning is delivered, Pelster says. Video and other interactive technologies are being installed to connect classroom learners with colleagues in Deloitte offices, including another learning center in India. Classrooms also can be reconfigured to accommodate different types of learning events, Pelster says.

It’s not a true corporate university, however, in which employees can choose to enroll in professional courses. Rather, participants will be invited to attend by business units or sponsors of specific learning programs.

Deloitte’s sizable investment also comes amid growing optimism by senior executives, 70 percent of whom expected to spend more on all types of capital projects during the first quarter, according to a February survey by the Corporate Executive Board in Arlington, Virginia. That’s up from 52 percent in the fourth quarter of 2010.

Deloitte isn’t alone in pouring money into a building dedicated to employee development. This year, Planned Cos. is celebrating the second anniversary of its 2,000-square-foot interactive educational facility. The company, which provides building management and maintenance services at commercial and residential properties, built the $200,000 center next to its headquarters in Parsippany, New Jersey.

It features 14 workstations, each providing simulated exercises on a specific area of building management. A front-desk module, for example, enables employees to watch a live feed from a luxury condominium in Jersey City. “It lets them visualize what it means to man a front desk in a professional manner,” says Robert Francis, president and CEO of the company his family has owned for four decades.

Planned Cos. uses the facility as a retention tool for existing customers, as a sales tool to persuade new prospects, as well as a way to improve employees’ skills and help them plan their careers, Francis says.

The learning center also helps Planned Cos. hold onto its employees—a key goal in an industry with volatile turnover. “The higher our retention rate, the more it helps our bottom-line productivity,” says Francis, whose company’s efforts at career development earned it the 2010 Optimas Award for Vision from Workforce Management.

Even with the rise of e-learning and virtual technologies, Deloitte placed a high value on having its own leadership campus. The decision to build Deloitte University came after extensive internal research, including surveys across its multigenerational workforce. Pelster was surprised to find that throughout the company, including millennial employees, support for a physical learning facility was strong.

“It’s one place we’ll all go at key milestones in our careers, and it’s one place we’ll all have in common,” Pelster says.

Workforce Management Online, March 2011 — Register Now!

February 18, 2010June 29, 2023

Employee Engagement Workers Want Feedback — Even if It’s Negative

The best way to drive employee engagement is for managers to accentuate the positive in employee performance. The second best engagement approach is to focus performance discussions on employee weaknesses. Worst choice: Give no feedback at all.

That is the synopsis of “The Relationship Between Engagement at Work and Organizational Outcomes,” by Gallup Inc. More than 1,000 U.S. employees were interviewed for the report. Gallup broke management styles into three categories, based on employee perceptions:

• Managers who focus mostly on employee strengths
• Managers who focus mostly on employee weaknesses
• Managers who focus on neither strengths nor weaknesses

Thirty-seven percent of employees say their bosses concentrate on strengths, while 11 percent say their managers focus solely on negative characteristics. Gallup says 25 percent of employees surveyed fall into an “ignored” category, in which their supervisors address neither strengths nor weaknesses. Twenty-seven percent of people did not express strong opinions about their managers either way.

The differing approaches reflect back varying levels of engagement. Sixty-one percent of employees in the “strengths” group report being engaged in their jobs. Still, 38 percent of those workers remain disengaged despite the positive feedback, perhaps because they believe the praise is not sincere, according to Gallup. About 1 percent of employees whose managers are focused on strengths are considered to be “actively disengaged,” meaning they may act out on their job frustration.

By contrast, engagement is considerably lower—just 45 percent—for employees whose managers focus primarily on negative characteristics. One-third of such workers are disengaged. Most alarming: 22 percent are deemed to be actively disengaged.

The worst engagement scores can be found in the “ignored” category, where only 2 percent of employees are highly engaged. Fifty-seven percent report being not engaged and 40 percent are actively disengaged.

So while emphasizing strengths gives the strongest boost to engagement, even negative feedback is better than no feedback at all, according to Gallup.

“We found that it is better for managers to dwell on some aspect of employee performance—even if it is a focus on negatives—than to avoid the matter altogether,” says Jim Harter, a Gallup research scientist and co-author of the report.

Harter says negative feedback “at least lets people know that they matter,” while neglecting them can be far worse.

Engagement—or lack of it—carries huge implications for how well companies achieve their business goals, especially amid recession, Harter says.

“The growth trajectory for companies with highly engaged workers, on average, looks really good when compared against their competitors. These types of companies are holding their own while their competitors are dropping off” on key variables, Harter says.

Organizations with high engagement scores exceed their peers in nine areas of business performance, including customer loyalty, profits, productivity, quality, turnover and absenteeism. For instance, organizations with the highest engagement scores in Gallup’s database have an 83 percent chance of achieving above-average business performance. By contrast, organizations at the lowest levels of engagement have a 17 percent chance.

The report is based on Gallup’s Q12 Index, which measures a dozen factors that are known to affect engagement.

Workforce Management, February 2010, p. 10-11 — Subscribe Now!

May 6, 2009June 29, 2023

Employee Engagement in Tough Times, Part One

Amid periods of economic uncertainty, engaging and retaining valued employees is particularly critical if organizations are to maintain quality in their products and services and lay a foundation for future growth. Yet while challenging economic environments make employee engagement more critical, they also make it more difficult to achieve. Belt-tightening often results in organizational retrenching, reduced staffing levels, increased workloads and constrained compensation budgets.

The present economy may leave organizations feeling as if they are being squeezed in a vise. But there is opportunity amid the economic uncertainty. Careful attention to positioning individuals and teams to succeed will not only allow organizations to weather the storm, but also to emerge from the downturn in a stronger competitive position.

All organizations will be changed by the downturn
In the present economy, there will certainly be winners and losers, as there are in any period. But while some organizations may fare better than others, outcomes will be consistent in at least one respect: All companies can be expected to emerge from the downturn as changed organizations. In some cases, the changes may be fundamental, owing to mergers, acquisitions, restructurings, or shifts in market focus or positioning. In other cases, the changes may be more modest. Cost-cutting efforts, layoffs and shifts in priorities may simply result in new ways of addressing existing goals and objectives.

Also read: Employee Engagement in Tough Times, Part Two

However, regardless of the magnitude of the downturn’s impact on your organization, it’s important that you recognize that this time will bring changes, and with them come immediate challenges and longer-term opportunities. The immediate challenge is to minimize the disruptive aspects of organizational transitions on employees and customers. The longer-term opportunity is to ensure that once the downturn ends, your organization will be not only different but better.

Disruptive events, such as recessions, cause organizations to re-examine taken-for-granted ways of working. In these periods, there is a unique opening to restructure working relationships in more productive ways—before managers and employees once again settle into more stable patterns. And therein lies the opportunity to leverage a downturn to create positive changes that can serve your organization well—now and in the future.

Lessons from the past
In understanding organizational responses to periods of economic uncertainty, we can draw some lessons from the 2001-2002 downturn. Near the end of the recession, Hay Group surveyed executives from organizations appearing on Fortune’s Most Admired Companies list and from peer companies, as part of our ongoing partnership with the magazine. Nearly all respondents (86 percent) agreed that the economic environment was more challenging for their organizations than it was two years prior to the recession. With respect to motivating employees, however, respondents in the most admired companies generally reported that their organizations were in a better position post-recession than pre-recession. They also reported enhanced levels of employee loyalty and reduced concern about losing key talent. For the peer companies, by contrast, the downturn was perceived to have had a net negative effect in each of these areas.

The 2001-02 downturn was a transforming event for the most admired companies and peer companies alike, involving widespread changes in operations. While the most admired organizations and their peers exited the downturn in different places with respect to employee motivation and commitment, all came away with an enhanced appreciation for the impact on business success of employees’ performance and engagement. Fifty-seven percent of all respondents viewed the impact as greater or much greater than two years prior, whereas just 7 percent saw the impact declining.

A perspective from the vice president of human resources for a Fortune 500 building products manufacturer highlights the particular importance of employee performance in a downturn: “When our business is good,” he noted, “you could put monkeys in charge and they would still make money.” But when times are tough, he continued, strong leadership is essential and individual contributions are easily distinguished. Put another way by Warren Buffett, you find out who’s been swimming naked when the tide goes out.

A current view: human resource priorities

In November 2008, Hay Group conducted a global study to understand how human resource strategies, programs and priorities are being affected by the current economy. Nearly 2,700 respondents from 91 countries were asked to describe whether changes were being made to such areas as pay and benefits, staffing levels, performance management and training programs, and what those changes entailed.

Notably, three of the top five workforce concerns indicated by respondents pertained to the employee life cycle—attracting and recruiting the right talent, engaging and motivating employees and retaining key contributors. Concerns about talent acquisition and retention may seem misplaced during an economic downturn, when we are confronted with daily reports of organizations laying off large numbers of people. But the study results point to key reasons for organizations to continue to attend to these issues.

Even amid downsizings, organizations are still hiring staff to fill critical roles. And many are finding it harder to do so, as promising candidates are reluctant to move from their current positions. As one respondent noted, “Our new-hire offer acceptance rate is low due to the market situation. The candidates are worried about future layoffs if they change jobs, as the practice is commonly based on last in, first out.” Likewise, faced with constrained compensation budgets that limit their ability to reward staff, many organizations are fearful of losing valued employees. Savvy leaders recognize that competitors often see opportunities to lure away key contributors in downturns and worry about vulnerabilities in some or all of their markets.

Employee engagement is critical in a downturn, but it’s not enough

Maintaining a focus on engagement is especially critical in difficult times. Engagement refers to the commitment employees feel toward the organization (e.g., their willingness to recommend it to friends and family, their pride in working for it and their intentions to remain a part of it). But it’s also about employees’ discretionary effort—their willingness to go the extra mile for the organization. Right now, as organizations need to do more with less and strive for greater efficiency, tapping into the discretionary effort of employees is all the more essential.

Unfortunately, however, our research confirms that many organizations that have enviably high levels of employee engagement still struggle with performance issues. So while engagement is necessary, engagement alone is not sufficient for achieving maximum levels of individual and organizational performance. Leaders must not only engage and motivate employees but also enable them to channel their efforts productively and effectively.

In what we call an enabled workforce, employees are effectively matched to positions, such that their skills and abilities are put to optimal use. Likewise, employees have the essential resources—information, technology, tools and equipment, and financial support—to get the job done. They are able to focus on their key responsibilities without wasting time navigating such obstacles as procedural restrictions or nonessential tasks in the work environment.

Most organizations employ a sizable number of frustrated workers: individuals who are highly engaged but lack the tools required to be fully effective and successful. Frustration is a significant problem for organizations and employees, especially in a challenging economic environment. Organizations trying to squeeze out every drop of productivity can’t afford to squander the energy of motivated employees. And employees who are being asked to work harder and to do more with less understandably want to work in smart and efficient ways. In the short term, these motivated but frustrated employees may suffer in silence. But over time many can be expected to turn off and disengage, or tune out and leave.

The second part of this article will offer a “path to performance” for generating business results through enhanced levels of employee engagement and enablement.

May 6, 2009June 29, 2023

Employee Engagement in Tough Times, Part Two

Tough times make it essential that organizations get the most out of talent at all levels. But those that focus exclusively on employee engagement are likely to be disappointed by the extent to which improvements in this area translate into enhanced performance. To maximize individual and team contributions, engagement alone is not enough. The commitment and discretionary effort offered by engaged employees can easily be squandered if leaders do not also enable them to succeed by putting them in roles that fully leverage their potential and providing them with the workplace supports they need to carry out their responsibilities.

A path to performance
The drivers of employee engagement and employee enablement can be organized around four major themes, representing a “path to performance” for generating business results through enhanced levels of employee effectiveness.

Also read: Employee Engagement in Tough Times, Part One

Organizations first need to clarify strategic objectives to promote understanding and line of sight at all levels. They need to instill confidence in leaders and ensure appropriate market positioning and focus on customers and quality. Next, organizations need to align structures with strategy and ensure that resources, decision-making authority and support from co-workers are adequate to put employees in a position to succeed.

With the structure in place, organizations then need to attend to getting the right people “on the bus,” providing training to enhance employee skills today and development opportunities to build capability for the future. Finally, organizations need to motivate high levels of employee performance through appropriate performance management systems, along with compensation and recognition approaches that reward employee contributions.

Below we highlight key considerations in each of these areas in challenging economic environments.

Key considerations in a downturn
Leadership and direction:
Leaders need to help employees understand that the company has a coherent strategy that will allow it to succeed in the current business environment. They must communicate that both the company as a whole and its individual divisions are making progress relative to strategic objectives, and that all employees have a role to play in helping the organization carry out its plans. To win trust and confidence in a downturn, leaders are well advised to:

• Communicate, communicate, communicate: In the midst of change, communication channels in organizations often dry up. Yet in times of uncertainty, employees are most in need of communication. If leaders are not meeting this need with credible messages, gossip and rumor often fill the vacuum.

• Be transparent: As employees are asked to make sacrifices for the organization, it is important that they have a sense that decisions are being made rationally and equitably and that the changes will result in increased organizational effectiveness and the eventual betterment of the work environment.

• Enlist supervisors: If middle managers and first-line supervisors are supportive of senior executives, they can foster high levels of confidence in the organization’s leadership and direction. If, on the other hand, middle managers and supervisors signal to employees through their words or actions that they lack faith in organizational leaders, employees’ trust can be expected to decline rapidly.

Work structure:
Faced with challenging economic environments and competitive pressures, many organizations have reduced headcounts without reducing the amount of work to be done, resulting in higher workloads for remaining staff. To promote efficient execution of key tasks, leaders need to ensure that employee efforts are backed by efficient processes, adequate resources and support from co-workers:

• Solicit broad input: While effective job and organization design is part of the solution, so too is harnessing the creative ideas of employees at all levels. To draw out improvement suggestions broadly, organizations need to ensure that leaders and the organization’s overall culture encourage employees to come forward with innovative suggestions for improving the way work is done and reinforce the value of employee creativity by appropriately translating ideas into action.

• Clarify must-win battles: In high-workload environments, leaders must clearly state which personal goals and priorities are critical. Doing so allows employees to focus their efforts on essential, value-added tasks.

• Make sure managers wear “enterprise hats”: In transition environments, some managers and employees may be inclined to hunker down and focus on the achievement of individual or departmental priorities. It is imperative that organizational cultures, performance management systems and hiring and promotion processes reinforce the need to balance local concerns with broader organizational concerns.

Capability:
Faced with a difficult economy, some organizations may be tempted to shift their focus away from training and career development activities. But doing so is a big mistake. Recognizing that personal development and growth are among the most important drivers of engagement and enablement, organizations should instead:

• Be surgical in training and development cost reduction: In tough times, organizations are often forced to make cuts in training budgets. In doing so, however, organizations should identify and protect high-value training offerings and training that is focused on high-potential employees.

• Emphasize the role of line managers: Through coaching and regular performance feedback, supervisors can help employees identify developmental needs and enhance their skills. Supervisors also serve as mentors and sponsors for employees by helping them understand organizational expectations, develop supportive networks and work the informal systems that are a part of every organization.

• Promote equity and fairness: Where promotion opportunities are constrained, it is important that leaders effectively communicate the resources that are available to help employees manage their careers and clarify how promotion decisions are made. These messages build employee trust that development processes are fair and equitable.

Rewards:
In high-workload environments, employees are very sensitive to compensation issues. Acutely aware of all they are contributing, they can be expected to pressure their organizations to balance rewards and contributions. Managing rewards in a downturn requires that organizations:

• Focus on rewards, not just ratings: Many organizations spend an agonizing amount of effort to ensure that managers comply with prescribed distribution curves for performance ratings. But what is the value if the highest performer still receives only marginally more in merit or incentive pay than the average performer? Instead, organizations need to ensure that performance ratings translate into differentiated rewards.

• Clarify reward philosophies: In partnership with WorldatWork, Hay Group recently undertook a study of compensation practices and policies by surveying top compensation managers in member companies. Notably, more than two-thirds of more than 1,200 respondents rated their pay-related communications to be “not effective” or only “marginally effective.” Not surprisingly, these respondents also expressed much less favorable views of the motivational impact of their compensation systems. While 91 percent of respondents indicated that their companies have a pay philosophy, nearly two-thirds indicated that “about half” or “less than half” of employees understand it.

• Leverage tangible and intangible rewards: Especially when compensation budgets are tight, organizations need to think more broadly about the value propositions they are offering to employees—that is, the totality of financial and nonfinancial returns employees can expect based on their contributions.

Conclusion
Organizations that manage dynamics in all four “path to performance” areas successfully during the downturn are likely to foster the engagement and enablement necessary to cope with economic challenges and set the stage for enhanced performance when the economy recovers. When it comes to employee issues, a downturn is not the time to take your eye off the ball. For organizations as for individuals, character is revealed in tough times. The organizations that continue to put people first in tough times will win loyalty for the future.

August 2, 2007March 2, 2020

Managing the CEO Sweepstake at GE

In 2000, there was a very public horse race going on at GE. Who would succeed Jack Welch? Here, GE’s Bill Conaty discusses how he and Welch handled the business world’s equivalent of the Kentucky Derby, with the media betting on one of three CEO candidates: Robert Nardelli, who at the time was CEO of GE Power Systems, and who recently stepped down as CEO of Home Depot; James McNerney, then-CEO of GE Aircraft Engines, who went on to be CEO of 3M and now is president and CEO of Boeing; and Jeff Immelt, then-CEO of GE Medical Systems, who ultimately won the top job.

WM: How did you keep morale up when everyone in the media was making bets on who would win?
Conaty: We just banned running for office. In fact, running for office still is the kiss of death at GE, because when you have people running for office you have competition going on within the house. We are competitive as hell, but we want to direct that at our real competitors. So when the media got involved, we just let them do their thing. But internally, we just kept drilling down and watching the top three individuals at the time.

WM: But how did you make sure that the three candidates didn’t start competing with each other in a negative way that affected morale?
Conaty: Jack told them within the final six months that, No. 1, we were putting their replacements on the job. There would be one winner, and the two that didn’t get the job would have to leave. Putting their replacements on six months in advance was more of a shocker for them than it was for us. We also got the opportunity to see how they managed their successors.

WM: These individuals represented some of your strongest talent. Isn’t there something to be said for trying to keep the two candidates who didn’t get the CEO position?
Conaty: There is, but in this case we felt—and Jack felt stronger than I did on this—that the level of interest in the candidates as future CEOs of other major companies would just be intolerable for us. While I personally was trying to make the case that we could retain two of the three, Jack listened to me, gave me my day in court, but decided that the pressures to leave would be too intense. And he was absolutely right. There were companies that were holding their CEO positions open at the time—3M was one of them, so was Home Depot. And there were a couple of others. I think Jack felt that when he took over as CEO, there was an internal horse race. There were five or six candidates in the running and he just found that environment and internal competition to be distasteful and dysfunctional for the company. He also felt that you have to give one person the job and not have somebody looking over their shoulder hoping they slip on a banana peel.

Workforce Management, July 23, 2007, p. 28 — Subscribe Now!

July 11, 2007June 29, 2023

HR for HR at Amex

American Express sees HR as such an important part of driving business performance that the company has assigned an executive specifically to the task of developing future HR leaders.

” ‘HR for HR’ is one of our five ‘big bets’ for the HR function this year,” explains Patricia McCulloch, vice president for HR capacity and development. “It’s really elevated the importance of the subject. I’ve got a standing spot in every one of our town hall meetings for the HR group and in our HR leadership team meetings to talk about it.”

The company’s plan for developing HR leadership centers on a competency model with five components: applying knowledge of the American Express business; driving creativity and change; demonstrating value as HR professionals to internal partners and employees; leveraging HR expertise; and transforming ideas into tangible, measurable outcomes. American Express lists behaviors at different career stages that meet parts of the competency model, and uses these to plot an HR leadership candidate’s current proficiency level.

American Express recruits leadership candidates with business or HR degrees from a small number of core graduate schools and puts them through a program of three eight-month rotations—a position as an HR generalist partnered with a business unit, a stint in an HR functional area and a job outside of the HR field. “This way, they’ve started their career with a mind-set that it is OK to move around and experience various parts of HR,” McCulloch says.

At the end of the two-year program, they’re placed in an HR job somewhere in the company.

American Express also provides future leaders with Project Endeavor, a training program designed to build their financial and business acumen, with American Express itself as the case study. The company is developing additional programs to augment Project Endeavor and sustain the learning experience.

“There’s the piece around what people do in the two and a half days in the class,” McCulloch says. “But another part is what they do six months later to keep that knowledge alive.”

Workforce Management, June 25, 2007, p. 36 — Subscribe Now!

September 29, 2006March 8, 2019

Hurd Tells Congress HP Way Can Be Restored

It took more than seven hours before a congressional hearing on spying by Hewlett-Packard got around to a discussion about the impact of the scandal on employees.

A day that featured 10 former HP executives and security consultants exercising their constitutional right to decline to testify and the relentless grilling of former HP chairwoman Patricia Dunn concluded with a query from Rep. Michael Burgess, R-Texas, about the company’s outreach to its workers.

“We’ve made an effort to communicate with them as often as possible,” HP chief executive Mark Hurd replied to Burgess, whose district includes an HP facility. “We’ve communicated with them about our governance changes and the issues around the investigation.”

Hurd was the last witness in a hearing of a House Energy and Commerce subcommittee on September 28 that lasted from 10 a.m. until nearly 6 p.m. The panel delved into the unfolding drama surrounding HP’s efforts to ferret out boardroom press leaks about company strategy.

The investigation involved HP’s obtaining phone records and other personal information about board members, journalists and its own staff through clandestine methods, including the use of false identities, or “pretexting.”

Even as HP tries to recover, lingering concerns about corporate spying may become an issue for employers.

“Every company in America is examining itself to see if it has the same kind of problem,” says Nell Minow, editor of the Corporate Library, an independent research firm in Arlington, Virginia, that specializes in corporate governance.

Congress may also take up the issue. “This gives us a good opportunity to open the window on some of the practices going on in companies around the country,” said Rep. Diana DeGette, D-Colorado.

HP, which has built a reputation as an exemplar of ethical corporate behavior, may now find itself lumped with other rogue companies, according to Rep. Tammy Baldwin, D-Wisconsin.

Enron and WorldCom shook American’s confidence in the finance and accounting arena. “HP is shattering their expectation of telecom privacy,” Baldwin said during the hearing.

The company’s employees may have similar concerns, which could even outweigh the fretting about damage to HP’s brand. “It’s not the reputation issue; it’s the paranoia issue,” Minow says.

House members on both sides of the aisle spent the first hour and 15 minutes of the hearing castigating the company with variations on the same theme: What were you thinking?

Hurd apologized for HP’s behavior and said that he is ultimately “responsible for everything that goes on at Hewlett-Packard.”

Although he admitted to approving the content of a bogus e-mail to a journalist, which was intended to monitor her sources, Hurd said that he ignored the scope and tactics of the investigation.

In part, he blamed the demands of running a huge company. “A CEO cannot be the backstop for every process in the company,” he said. “I pick my spots when I dive for details. There’s no excuse for that.”

But at the end–perhaps because the questioners were exhausted after working over Dunn and others–Hurd was both unbloodied and unbowed.

“We are committed to our core to redefine our company in a way that not only we can be proud of, but in a way that all corporations in America can be proud of,” he said.

—Mark Schoeff Jr.

July 15, 2005January 15, 2019

Dear Workforce: What Is Standard Practice for Paying Out Commissions to Terminated Salespeople?

Q: What should we do when a salesperson is terminated involuntarily or the company is sold/acquired? Is there a standard practice regarding how commission is paid? We have salespeople who earn two kinds of commission: one on the sale of products and services, and another for subscription services billed monthly. What should we do when a salesperson is terminated involuntarily or the company is sold/acquired? Is there a standard practice regarding how commission is paid?

— New Start in Sales, controller, software/systems, Costa Mesa, California

Dear New Start:

This is an area where the maxim “you get what you pay for” truly applies. Your sales-incentive program should directly and effectively support business goals and sales strategy. Design the plan so it is easy to understand. Communicating with the sales force about the intent and operation of the plan also proves a great help.
Your plan should detail the administrative rules on how payments get distributed. However, if you do not have a plan document, here are some questions to research before deciding how to proceed.

What has the company’s practice been? This doesn’t necessarily govern your decision, but you may find upon examination that sales administration or payroll does things that the human resources folks are unaware of.
How do competitors handle this? Ask your counterparts in companies against which you compete for sales and labor.
If an employee leaves, when does another salesperson take over the customer accounts? This is probably the most important question, as you will not want to pay a double commission, nor will salespeople be willing to work on accounts for which they receive no pay.
What can your company afford?

In our experience, most companies do not pay commissions to employees who are involuntarily terminated unless there are extenuating circumstances (reduction in force, significant number of layoffs, job eliminations, etc.). Certainly, when employees are let go because of poor performance or incompetence, incentives stop immediately. Remaining monthly commissions are transferred to the employee who assumes responsibility for managing those accounts for the duration of the contract.
The terminated employee may be paid commissions earned for the month of termination and not beyond. Plans that we design specify that an employee must be active and on payroll at the end of each performance period (in some cases a pro-rated amount is provided for partial periods). If the employee leaves voluntarily, he or she typically forfeits the right to additional monthly commission.
Acquisitions or changes in control of the company do not have an immediate impact on sales compensation or commission payments. However, the change enables new management to examine whether existing compensation systems meet corporate goals. It also offers a chance to change previous incentive programs if they don’t live up to expectations.
One final note: consult an attorney about state wage and hour laws that apply to you. Legal expertise also can help ensure that you are complying with federal and state FLSA regulations, particularly those that apply to inside sales reps.
SOURCE: Bob Fulton, managing director,The Chatfield Group, Glenview, Illinois, Sept. 15, 2004.
LEARN MORE: Termination Checklist
The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion. Also remember that state laws may differ from the federal law.

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Dear Workforce Newsletter

April 20, 2000June 29, 2023

Sample Performance Review for Non-exempt Employees

This form must be written in ink or typewritten

PERFORMANCE REVIEW AND EVALUATION

Name:
Position:

Location:
Department:

This review covers the period from __________to __________

The performance review and evaluation process requires the supervisor to do the following:

1. Clearly establish the areas of responsibility for the job.
2. Establish expectations, standards or objectives for the work to be done during the next review period.
3. Periodically review progress with the subordinate concerning how well expectations were met. Maintain on-going documentation of performance.
4. Annually review and evaluate performance.

The key to this process is clear communication between the supervisor and subordinate.

The objective of the entire process is to ensure that all employees understand:

1. What they are to do;
2. What the standards are by which they will be measured;
3. How they are progressing; and
4. What their evaluation is at the end of the review period.

Document the employee’s performance and select a rating (1-4, defined at the bottom of this document) for factors listed below:

Quality of Work — Consider the accuracy, thoroughness, and neatness of work performed.

_____________________________

Productivity — Consider the amount and timelines of satisfactory work completed and whether the employee consistently meets established or reasonable deadlines.

_____________________________

Interpersonal Skills — Consider the employee’s ability to work cooperatively with others, resolve conflict, and help others. Also consider customer relations, telephone technique, etc.

_____________________________

Dependability — Consider the reliability and consistency of the employee’s work. Also, consider the employee’s attendance record.

_____________________________

Initiative — Consider the exercise of independent judgment and innovation within the employee’s limits of authority and the amount of supervision required.

_____________________________

Job Knowledge — Consider the extent to which the employee understands and applies his/her knowledge of the techniques, methods, and skills involved in the job.

_____________________________

PERFORMANCE RATING DEFINITIONS

CLEARLY OUTSTANDING: Clearly exceeds, by a significant degree, most of the major requirements of the job, while maintaining fully satisfactory performance in the remaining duties. Performance results are clearly outstanding. Employee regularly assumes additional responsibilities beyond those which are required. This rating usually including the top 10% of the workforce.

ABOVE EXPECTATIONS:

Usually exceeds, by a significant degree, some of the major requirements of the job while maintaining fully satisfactory performance in the remaining duties. Employee often assumes additional responsibilities beyond those which are required.

MEETS EXPECTATIONS:

Consistently meets and occasionally exceeds the requirements of the job. Performance results are satisfactory in all aspects of the job.

NEEDS IMPROVEMENT:

Usually meets most of the job requirements; but improvement is needed in one or more phases of the job. Results are less than normally expected. When this rating is a warning that the employee’s job is in jeopardy if performance continues at the current level, Human Resources will be involved in preparing an Improvement Plan.

Discuss any other factors which relate to the employee’s work performance, such as significant accomplishments, critical incidents, or necessary improvements:

_____________________________

Overall Evaluation — Select one overall rating which best describes the employee’s performance throughout the review period considering the ratings and commentary throughout the above document.

Clearly Outstanding
Above Expectations
Meets Expectations
Needs Improvement

INDIVIDUAL DEVELOPMENT

What are this employee’s strongest skills and abilities?

_____________________________

What development action(s) will be needed to maintain or improve current performance? Also, what action(s) will help prepare the employee for future job assignments?

Development Objective

Action/Anticipated

Completion Date

Appraised by
Date

Reviewed by
Date

Employee Comments:

_____________________________

Employee:
Date

(Employee signature does not necessarily signify agreement with the evaluation, but that the evaluation has been discussed with the supervisor.)

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion.

April 19, 2000June 29, 2023

Sample performance appraisal for exempt employees

Performance Appraisal for Exempt Employees

Name: _______________
Position: _______________
Location: _______________
Supervisor: _______________
Reviewer: _______________
Period Ending: _______________

PERFORMANCE RATINGS:

Exceptional
Above Expectations
Meets Expectations
Needs Improvement
N/A — Not applicable

PERFORMANCE RATING	DEFINITION

Exceptional:	Consistent performance substantially exceeding normal expectations for total job.

Above Expectations:	Frequently exceeds normal performance expectations for key job tasks.

Meets Expectations:	Meets normal job requirements in accordance with established standards and may exceed requirements for some job tasks.

Needs Improvement:	Overall performance acceptable but improvement needed in one or more significant aspects of job.

All evaluations must be supported with specific comments, and all “Overall Evaluations” (see below) of Exceptional and Above Expectations must include specific examples to support the ratings given. When Needs Improvement is the performance rating, attach a written plan to improve performance to this review and enter the Next Review Date in the space provided.

PERFORMANCE RESULTS: Achieves expected quality and quantity of output. Places greatest effort on most important aspects of job. Does work on-time, on-budget without sacrificing performance goals or standards.

RATING:

COOPERATION/TEAMWORK: Willingly accepts assignments. Able to work on or with teams to cooperatively reach goals.

RATING:

INITIATIVE: Self-starter who willingly puts forth effort and time and performs tasks with a minimum of supervision. Begins to solve problems within scope of responsibility as soon as they are apparent. Advises supervisor of current or anticipated problems. Able to apply job knowledge to produce innovations in work process or product.

RATING:

ORGANIZING AND PLANNING: Resolves conflicting priorities and schedules with peers and other staff. Performs effectively under pressure and deadlines. Effectively uses time and resources to accomplish work. Will shaft strategy, make decisions, obtain the aid of others to achieve objectives.

RATING:

COMMUNICATION: Verbal and written communications are clear, concise and accurate. Appropriately documents work so others can find work in progress and historical information about the job.

RATING:

INTERPERSONAL SKILLS: Interacts productively with others in formal and informal groups both within and outside the company; is receptive to differing ideas and adjusts to the different work styles of others.

RATING:

For Supervisors, Managers, and/or
Sales Related positions include the following:

SUPERVISION AND LEADERSHIP: Effectively leads and develops staff. Effectively directs staff and provides ongoing feedback. Accurately evaluates performance, matches abilities and job requirements, establishes an effective working relationship, and acts as a positive model for others. Assures a positive working environment in compliance with company standards.

RATING:

SALES/MARKETING: Obtains new work (e.g. listings, corporate accounts, etc.) from both existing clients and new clients. Makes marketing suggestions and effectively implements existing marketing programs.

RATING:

OTHER (Define and rate another significant performance factor if appropriate)

RATING:

PERFORMANCE PLAN FOR NEXT PERIOD (Include expected accomplishments and measurement criteria)

DEVELOPMENT NEEDS (Areas of knowledge or skill to develop that will improve job performance)

Plan for how Supervisor will specifically assist employee to maintain or improve performance:

OVERALL EVALUATION:

EXCEPTIONAL
ABOVE EXPECTATION
MEETS EXPECTATIONS

NEEDS IMPROVEMENT (Requires written improvement plan of maximum 6 months)

Next Review Date and/or Other Actions:

SUPERVISOR’S OR EMPLOYEE COMMENTS (If needed, attach additional sheet)

(Employee’s signature indicates that evaluation has been discussed with the supervisor. It does not necessarily signify agreement).

Signatures:

Immediate Supervisor:
Date:

Reviewer’s Manager:
Date:

Employee:
Date:

The information contained in this article is intended to provide useful information on the topic covered, but should not be construed as legal advice or a legal opinion.