Posts in category: hrboard

At the end of every calendar year, The Conference Board research group conducts a yearly job survey to measure job satisfaction. Results from 2009 were more than disappointing. Only 45 percent of Americans reported being satisfied with their work – the lowest level recorded by The Conference Board in more than 20 years. According to Scott Hunter, president of consultancy The Hunter Partnership Alliance, this year’s results will likely not be any more optimistic.

“It gets worse every year,” Hunter said. “The success of a company is a function of the mood of the company, and most people that run companies don’t understand that. They’re so busy getting the product out, getting the service out, making money, that they forget to take care of their most precious asset – their people.”

According to Hunter, the drop in workers’ contentment can be partly blamed on the worst recession since the 1930s, as well as on managers worrying too much about this economic downturn and not enough about their employees.

“It’s the saddest thing seeing how many people are sitting around waiting for the economy to improve rather than understanding that they hold the keys to their own success,” Hunter said. “A company is a collection of human beings, and the results a company produces are a function of what the human beings are all about.”

As the effects of the recent recession continue to be felt, American businesses are losing billions of dollars in turnover, lack of creativity, stress-related health claims and absenteeism from employees. As employees become progressively more anxious about job security and financial uncertainties, they want managers to acknowledge the impact this recession has had on them personally and appreciate their commitment and work.

“We were born into a world which has people focused on themselves and not on other people,” Hunter said. “We have this ego voice, and the ego voice takes care of you.” According to the Small Business Administration, 90 percent of businesses fail in the first 10 years due to a lack of fundamental principles, one of these being a lack of soft skills from a manager. Creating and maintaining an effective culture of commitment and engagement takes effort from leaders who work closely with employees, and that’s too often being neglected. In The Conference Board’s study, 51 percent of respondents said they were satisfied with their boss. That’s down from 55 percent in 2008 and around 60 percent two decades ago.

“We’re not a human doing, we’re a human being,” Hunter said. “It’s the compassion, the appreciation, the desire to take care of people and empower people. You can call that skills if you want, but I prefer to just call it a way of being. Managers don’t acknowledge people for what they do that they like, and they beat people up for the things that they do that they don’t like. They spend their time criticizing people rather than acknowledging them.”

Businesses need to be receptive to developing new tactics that acknowledge employees as appreciated individuals because old methods have not been working. According to a new report from research firm the Economist Intelligence Unit, sponsored by consultancy Hay Group, 84 percent of top executives believe disengaged employees are one of the three biggest threats facing their business. Engaged employees, those who are fully involved and passionate about work, find their jobs interesting and thus are more likely to be innovative and take the calculated risks and initiatives that drive efficiency toward economic growth. “Leaders need to work on creating excitement and enthusiasm,” Hunter said. “Be clear about the future you want to create. Be clear about what’s in it for everybody in the company. Build a sense of team. Have people feel like they’re part of what’s going on; include them, have them feel acknowledged and appreciated. When you do that, that’s the formula for success.”

Measuring Human Capital: Business Executives Perspective on Influence, Standardization and Governance is a dissertation study sponsored by Mercer. It was conducted by Ephraim Spehrer Patrick, a Principal in Mercer’s Human Capital business in Frankfurt, in January and February 2010 with 132 participants from Germany as well as the US, Australia and other European and Middle Eastern countries. This article is a summary of the research findings.

Business leaders frequently state that people are their greatest asset – but in reality, very few of them have the evidence to back up their claim. A recent Mercer study found that while most executives believe that “human capital” (the value of people and what they produce) is very important, far fewer of them measure it or have any idea of the return on their investment.

There are a number of reasons for the discrepancy – not least the difficulty of quantifying the value of intangible assets and of coming up with a standard approach. But growing pressure in three main areas – cost control, corporate governance and sustainability – will force companies to address the issue.

The need to control costs will continue to preoccupy businesses as they strive to do more with less in uncertain post-recessionary economies. As such, they will increasingly be forced to justify spending between 21% and 60% of their total revenue on compensation and benefits, training and development, and other people-related investments, by quantifying the return.

What’s more, analysts and investors view human capital measures as important predictors of a company’s future health – not least because of the significant impact we intuitively know individuals have on customer satisfaction, productivity and revenues. Likewise, more and more questions are being asked about whether the high pay many companies award to their most senior executive correlates with superior performance, or whether it could be contributing to those organizations’ decline.

According to Mercer’s research, most business executives believe that human capital plays a key role in helping their firms achieve results and competitive advantage. More than four in five (83%) respondents think that it has a strong impact on customer satisfaction, 77% feel that it has a strong impact on productivity and 65% believe that it helps increase revenues. Yet this belief amounts to little more than an act of faith. 84% of business executives surveyed admitted to having no more than a moderate understanding of the return on human capital in their organizations.

Respondents also saw human capital as the second most important intangible asset, after customer relationships, in terms of its role in creating and sustaining competitive advantage. But while 95% agreed that intangibles should be monitored closely, nearly 60% admitted that intangible assets in their business are not measured properly.

One of the reasons human capital is not measured properly is that it is difficult to do. Inadequate data support is a factor: Human capital information is often managed on a country, division or business-unit level, when what is required is a companywide system to collate and analyze the information consistently. The technology is available to do this, but it has not been fully exploited.

Another factor is the variable ability and enthusiasm of HR professionals to measure human capital. More than half of the business executives responding to the survey believe that human capital measurement is the preserve of HR, but some of them doubt whether HR is up to the job.

And while human capital measurement could borrow from the methods applied to determine other intangibles – not least brands – a consistent approach is stymied by the significant ideological differences about how human beings and their contributions should be valued. For example, many academics and practitioners believe that qualitative measures – engagement, knowledge and skills, leadership capabilities and so on – are the most pertinent predictors of business health and sustainability, whereas the business executives who responded to the survey believe that quantitative measures, such as compensation, absence and recruitment costs, are equally relevant.

As a side note, a recent government-funded initiative in Germany – the Human Potential Index – sought to create a standard set of measurements that would allow both internal and external audiences to see which organizations were best at managing their people in order to deliver business results. But the initiative foundered because HR opinion leaders and academics believed that it was too prescriptive.

Another key finding of Mercer’s research is that most business executives are unwilling to disclose human capital information to external stakeholders, with fewer than 20% on average prepared to do so. Ironically, while they feel disclosure could undermine their competitive advantage, it might actually enhance it, because at present many research analysts don’t factor a company’s wider human capital assets into their valuations. Mercer’s analysis of the way organizations measure their human capital has led to a number of recommendations.

1. Establish human capital measures on a company level. These should be relevant for your organization and linked to the overall business and HR strategy, but are likely to comprise a mix of qualitative and quantitative measures.

2. Once you have a set of workable measures in your organization, you could start to benchmark them against peers in your industry. Human capital measures are much more industry-specific than geography-specific.

3. Prepare yourself to report selected human capital metrics to external stakeholders, such as analysts, banks and investors, as doing so can have a positive effect on your company’s market value in the long term.

4. While business executives – the chief executive and finance director, in particular – should be involved in determining which human capital measures to use, HR should be the driver and owner of the overall process.

Establishing a human capital measurement and management discipline represents a significant opportunity for HR to be recognized as a strategic contributor to the organization. After all, as the adage goes, what gets measured gets managed, so measuring the return on investment in human capital is likely to improve the way it is managed. At that point, business leaders may say not just that their people are their greatest asset, but also that they are an appreciating asset. And they will be able to prove it, too.

As the economy begins to rebound, companies may be looking to bolster their hiring process so as to attract the right talent. Finding a candidate who has the right skill set and fits the mold of an organization can be a challenge – and every company knows how important it is to have the right fit. Compounding that search is the mountain of resumes from qualified and unqualified applicants.

In the midst of sifting through what could seem like countless resumes, employers risk overlooking the most qualified candidates and damaging their company reputations and brand by not handling applicants’ interest appropriately. Quality candidates will likely get snatched up by competitors that have tools to quickly find, interview and hire the people they need.

Organizations that manage the process appropriately – acknowledging all inquiries and communicating clearly with potential candidates – will create positive impressions of the company’s brand, which will make future hiring more productive when organizations face fewer applicants and a more competitive marketplace.

Businesses that don’t have tools to filter the incoming applicants are going to find themselves shortchanged, drowning in an endless volume of resumes – and quality candidates may get overlooked in the resume tide. Businesses need a plan of action for how they are going to tackle this process quickly and effectively.

Answering these questions and navigating this process is a daunting task given that there is pressure to quickly get the right candidate in a climate of multiple qualified people looking for work. A good fit represents future success for the organization; a bad choice represents a burden on the business and added costs.

Tools to Aid the Process

There are many different HRIS/HRMS tools on the market that can help businesses optimize their human resources departments and the recruiting process. Recruitment management solutions offer tools to assist recruiters and hiring managers with the entire hiring process – from requisitions, sourcing, and applicant tracking and management all the way through the interview process to the job offer and on-boarding.

These technology tools graphically match applicants to open positions based on required skills by identifying or ranking the best applicants, which significantly reduces the time recruiters need to spend on the qualification process; this results in faster identification, interviewing and hiring of top candidates.

These recruiting tools also generate and track all types of correspondence, including “resume received,” invitations for interviews, job offers and other communications. Recruitment management solutions can organize and store all these types of correspondence, making it easier for the hiring manager to manage applicant data and provide documentation for Equal Employment Opportunity and diversity analysis.

The same recruitment management tools can also play an important role in turning the challenges of managing what many refer to as the “resume tsunami” into an opportunity. Organizations that manage the process appropriately – acknowledging all inquiries, communicating clearly with potential candidates – can create positive impressions of the company’s brand. Organizations can use this rise in activity to build a candidate database and a favorable impression of the company, even with candidates not selected for a position; this can help future hiring efforts to be more productive, particularly when organizations are faced with fewer applications and a more competitive marketplace.

It’s important that organizations don’t lose sight of internal candidates even as external resumes pile up. Searching through candidates internally, prior to an external search, offers many benefits. Not only does it save money during the recruitment process, but it establishes company culture, enables retention and career growth and defines the employer’s brand. If a company has an HRIS/HRMS solution in place, internal candidate performance, job history, training, skills and levels attained, competencies and salary history are readily at hand – making recruiting internally an easier process.

Imagine a company has just identified its high potentials – the rising stars among the ranks who outperform their peers and “exhibit behaviors that reflect their companies’ cultures and values in an exemplary manner,” according to June 2010 Harvard Business Review article “Are You a High Potential?” This assumes the organization’s operating culture – how things are currently done and what’s really expected – is aligned with its visions and values, or what it says is important and wants to achieve.

The Organizational Culture Inventory has been used to quantitatively measure and compare the operating cultures of thousands of organizations around the world to their values, and rarely do they match. In many cases, they are quite different. Further, data on the impact of managers, leaders and high potentials show they tend to encourage the people around them to behave in ways that are more consistent with their organization’s operating culture than their organization’s values.

Of course, there are organizations that live their values and promote managers who exemplify and reinforce them. Unfortunately, such organizations seem to be in the minority. Based on quantitative research conducted by culture and leadership expert Robert A. Cooke, operating cultures are created and reinforced by the behavior and decisions of the organization’s leadership and management and the systems, structures, and technologies they put in place, all of which the people inside the organization have to deal with on a day-to-day basis. Rising stars usually aren’t those who rebel against their organization’s leaders. They tend to be “good soldiers,” those who exemplify the organization’s operating culture, regardless of whether it is consistent with its values.

Talent managers should take a critical look at the company’s criteria for high potentials to ensure that they do, in fact, identify and develop the potential to move an organization closer to its vision, values and goals.

Step 1: Identify Organizational Values

This sets the foundation and benchmark for evaluating an organization’s criteria and practices for high potentials. Most organizations have made their values explicit in employee handbooks, company reports and on their websites. If an organization’s values are not explicit, or if employees question whether they are still relevant, talent managers can use a validated survey to identify them. The advantage of this approach is the ability to gather information from a variety of people in the organization – top leaders, middle and first-line managers, and even front-line employees – relatively quickly and inexpensively. Though an organization’s values are usually defined by its leadership, data from a variety of people will enable talent managers to gauge the extent to which those values are shared and viewed by most people as relevant.

An organization’s values should support and reflect its mission and vision and promote its long-term effectiveness. For just about every organization, constructive thinking and behaviors top the list. This type of thinking and behavior is driven by and directed toward what psychologist Abraham Maslow called higher-order needs to take responsibility and achieve, develop mutually satisfying relationships, develop oneself and others, and continuously improve. In organizational settings, this requires a balanced focus on both tasks and people – tasks need to be coordinated and done well, and relationships need to be genuine and productive.

The quest to make these values part of the operating culture is well worth it. Constructive operating cultures are positively associated with a variety of desired outcomes, including profitability, revenue growth, sales growth, earnings/sales ratios, product and service quality, and teamwork, as well as employee retention, motivation, satisfaction and well-being.

Step 2: Use the Organization’s Values to Identify High Potentials

For example, if an organization values responsibility, accountability, continuous improvement and respect for others, these are the behaviors that high potentials should exemplify. However, most organizations make two major errors when using their values to identify high potentials:

1. They focus on the results achieved by high potentials and assume they behaved in ways consistent with their organization’s values.

Assumptions about behavior based on results or other outcomes are not always correct, and we have outstanding organizational – Enron – and industry – banking – examples to demonstrate the dangers of making these assumptions. There are many ways to achieve results and look good in the short term that actually counter what most organizations value and aim to achieve over the long term. That is why talent managers have to directly assess rather than guess or make assumptions about how high potentials achieve results.

2. They exclusively rely on the reports of higher-level leaders and, in some cases, peers.

How people behave around higher-level managers and peers is not necessarily how they come across to direct reports. It’s called impression management. People who want to be high potential know they have to look good to those who have the power to promote them. The only way to know if it’s genuine is to talk with their direct reports – and not just their favorites.

Thus, once an organization’s values are identified, assess the extent to which high potentials act on these standards by going beyond an assessment of their quantitative results. Observe them in action, ask them how they achieved particular results, and talk with people who work with them.

Step 3: Evaluate High Potentials’ Impact on Others

Management and leadership are about bringing out the best in others. This means asking employees – including direct reports and peers – about the impact that high potentials have on them. Data on managers and leaders at all levels of organizations show that those who strongly encourage defensive, self-protecting or self-promoting behaviors are viewed as less effective at moving their organizations toward their visions and goals; create insecurity, stress and dissatisfaction among the people around them; make people want to leave; and are not perceived as ready for their current position, much less promotion to a higher level.

In contrast, managers and leaders who motivate people to behave in constructive ways are viewed as highly effective at moving their organizations toward their visions and goals; foster a greater sense of self-confidence and satisfaction as well as less stress in the people around them; promote retention; and are perceived by a variety of people as energized, growing and ready for promotion.

Step 4: Help High Potentials Understand Their Current Impact

High potentials often get results and approach certain responsibilities effectively from the standpoint of their impact on others, but perhaps in order to get things done quickly or look good, they inadvertently do other things in ways that, over the long run, have a detrimental impact on other people and the organization. Unfortunately, the feedback provided by organizations usually focuses on whether high potentials carry out their responsibilities rather than how they carry them out. The examples below, based on survey data, illustrate how two different ways of approaching the same responsibility yield a different impact on other people’s behavior:

1. Managing communications:

High potentials who listen and engage others in dialogue motivate the people around them to take the time to understand others’ opinions and strive for excellence. In contrast, high potentials who rely on the most convenient, rather than the most effective, modes of communication and let their personal agendas take priority drive the people around them to retaliate, compete, withdraw or simply go along with whatever is said, even if it is wrong.

2. Managing work activities:

High potentials who provide others with autonomy in carrying out their work and check if people are able and willing to do a task before they delegate it motivate those around them to take initiative, plan their own work and coordinate and cooperate with others. In comparison, high potentials who dictate details and assignments and commit people to projects and deadlines without their prior input lead those around them to be submissive, follow orders without question, focus on building and maintaining their own power bases and avoid the appearance of any errors or mistakes.

Providing feedback on how they are perceived to approach their responsibilities and the impact it has on the people around them enables high potentials to see how certain approaches, though possibly effective in achieving specific near-term results, are counterproductive from a broader, longer-term perspective. This information also helps them to pinpoint specific areas to work on to enhance their effectiveness in their current role as well as prepare them for their future roles where the span of their impact likely will be much greater. Supplement feedback by asking high potentials to describe how they carry out targeted responsibilities or manage work activities. Then work with them to identify more effective language, practices and approaches in terms of the impact on other people. Encourage them to enlist trusted employees and peers to provide them with intermittent feedback on their progress.

Step 5: Establish Commitment to, and Accountability for, Self-Development

High potentials do not necessarily have a highly constructive personal style and impact on the people around them immediately, particularly if they are young or inexperienced. And some of them – because of the organization’s operating culture, their managers or the behaviors and strategies that worked for them in the past – may not understand that it’s their responsibility to make their organization’s visions and values a reality. If there are people who really don’t buy into the organization’s vision and values, it’s better to find that out before one promotes them rather than after they are holding one of the top positions. By examining their current behavior and impact on other people and comparing it to organizational values, talent managers will know how much work they need to do.

Then discuss with them their willingness to invest time and energy into developing the behaviors and skills that differentiate truly great managers and leaders from those who simply make the numbers and get short-term results regardless of their long-term effects. Those who commit to this investment will need managerial support. Too often management and personal development programs go nowhere because ongoing support and accountability for achieving these kinds of goals is lacking. Consequently, some organizations now require as part of their programs that participants share their development goals and strategies – but not necessarily their feedback – with their immediate supervisors or managers, who in turn incorporate them in future performance evaluations. In this way, participants’ developmental feedback remains confidential, yet they are held accountable for using it in specific, positive ways that they themselves define.

High potentials can be identified by finding high-performing individuals who already exemplify the organization’s values and motivate the people around them to do the same. More commonly, however, high potentials are selected solely on the basis of the results they achieve – with the hope that they’ll be willing and able to develop the skills and abilities required to take their organization to the next level. The latter approach is more difficult than the former. By following the steps outlined here, talent managers can help strengthen their organization’s potential to realize its vision, values and goals and maximize long-term effectiveness.

It might be the most wonderful time of the year, but the holiday season can often be stressful for employees.

An employee’s children could be off of school for winter break and need extra care, for example. Anything from visiting relatives to holiday traffic can increase tension levels in the workplace and make it difficult to get work done.

Talent managers should be mindful of holiday stressors when recruiting and training employees during this time, especially if these employees interact directly with customers, explained Sharon Daniels, CEO of AchieveGlobal, a consulting firm specializing in interpersonal business skills.

“There [are] a lot of things that happen [during the holidays] that have nothing to do with work, and employees can bring the hassled feeling with them to work,” Daniels said. “It’s difficult for people to put that aside and think about what to do here at work.”

To ensure that holiday stress doesn’t cause a decline in engagement or productivity, Daniels recommended that talent managers focus on training with an emphasis on challenges that are likely to appear during this time. For many service-oriented positions, the biggest difficulties stem from increased workloads and upset customers.

“There are a number of things that I’ve seen effective managers do, and it starts with training,” she said. “They’ve got to be thinking about skills that employees need during these times. Employees might need specialized courses on how to deal with heavy foot traffic or irate customers who are also stressed from the holidays.”

Daniels also cited the swell in temporary employees as a potential challenge for talent managers during the holidays. Recruiters should keep in mind the hectic and fast-paced environment that these employees might face and try to find individuals who are comfortable working in those conditions. Also, managers shouldn’t skip the typical orientation and training sessions for temporary or part-time employees, even if they are only seasonal workers.

“I would never bypass the things you do with full-time employees during the year that keep them engaged,” Daniels said. “Effective orientations – though [they can be] short – help employees understand how important the customer is and what a long way they can go in helping make their holidays brighter.”

Talent managers should also be aware of individual differences in employees’ motivation to work. To bridge generational gaps, talent managers should avoid age stereotypes and remember that all employees want to be treated with respect and be part of a team, she explained. Training and orientation play a big role in creating a feeling of camaraderie.

Lastly, Daniels emphasized that employees’ patience with customers is often directly influenced by the way they are treated by their supervisors and managers, and workers at all levels should be prepared for the holiday season.

“There’s a service chain that starts at the top of the organization and how the leader treats his or her direct reports,” she said. “When there’s a consistent way of addressing people and treating them with respect, that alignment all the way through the organization makes it easier for those working on the front lines to perform and behave with customers as the organization would want them to.”

Going into the new year, the state of business is change at every turn. From workplace norms to innovations in technology, there is frequent and continuous fluctuation. A nimble, flexible workforce with the skills and knowledge to function effectively in a state of constant change is essential to survive and thrive in the new economy of 2011.

Optimizing the skills and knowledge of an organization’s employees and streamlining the distribution of business-critical information is essential to help achieve your business goals. As CLOs know, learning and development is a key factor in accomplishing these new product and service launches; reduce the time needed to implement IT updates; and enhance the expertise and effectiveness of customer-facing teams like the sales and service departments.

Yet many companies underestimate the importance and business impact of spending time and resources to cultivate an atmosphere that encourages and supports continuous learning. While most organizations have a stated goal to help employees grow and advance, the learning function is one of the first areas to experience cutbacks when times get tough. This is often counterproductive, as it hampers the ability of the organization to develop and maintain the skills and knowledge that are the foundations for business success.

Globalization Continues to Demand New L&D Approaches

Workforces are more dispersed than ever, another result of the increased pace of business today. With offices and employees spread out across states, countries and even the globe, extending the reach of training across locations and time to ensure organizational alignment is critical. The uptick in flexible-work culture – such as virtual-work policies – and mobile employees also contribute to the widely dispersed workforce. Techcast.org, the virtual think tank at George Washington University, estimates that 30 percent of employees in all industrial nations will work remotely two to three days a week by 2019.

As business becomes more dispersed and the adoption of virtual collaboration continues to rise, engaging employees and aligning the whole organization via learning becomes even more crucial. L&D pros must realize that these changes in workplace culture often require new learning solutions and practices.

Meeting the Need for Speed

According to a report by webinar consultancy the 1080 Group titled “Web Conferencing Training Trends 2010: North America,” last year, in-person training was expected to decrease from 62 percent of all training delivered to just 50 percent. Meanwhile, the expected use of alternatives like Web and audio conferencing has increased. In-person-only training programs often struggle with low attendance and content retention, hampering ROI as these programs involve high costs and time commitment.

A recent survey of decision makers and training managers of businesses with between 100 to 1,000 employees, conducted by research firm Kelton Research for virtual meeting service provider Citrix Online, found that traditional corporate training programs often underachieve due to logistical obstacles such as employee availability, time constraints and staffing. Survey respondents said frequent business travel and remote working were reasons contributing to low participation in training.

Though in-person training is still beneficial in certain situations, such as providing content for small group work, role-playing or advanced discussions, the rate at which business is now moving renders in-person-only training programs ineffective, as participants are rarely able to congregate in the same office – let alone the same room. Survey respondents cited remote access from any location as a key change that would increase the effectiveness of training.

Another thing to note is how technological advances in the past five years have opened the door to new ways to participate in corporate learning and development initiatives. These technologies fit today’s accelerated rate and dispersion of business operations, as well as the new cultural implications of the workforce. From Web conferencing software for online training platforms to virtual meeting applications for mobile devices such as smart phones and tablets, these tools and platforms enable nearly instantaneous information distribution and consumption and provide intriguing new channels for effective and efficient employee training.

The Bottom Line

As the pace of business continues to accelerate and mobility within the workforce continues to rise, virtual communication and collaboration in support of learning becomes more and more essential. Blended approaches that combine the best of traditional learning models with online learning are gaining momentum because they help decrease costs and meet the needs of an increasingly dispersed and mobile business workforce. A blended learning approach offers faster and more affordable ways to arm an organization with the knowledge and skills needed to adapt to changes and achieve business goals.

The Role of the HR Business Partner

Globalization and growing operational and labor market complexity have made HR a key player in solving organizations’ business challenges. Chief human resource officers (CHROs) are under tremendous pressure to deliver business outcomes while managing functional costs – unlocking the key drivers that improve the effectiveness of the HR function while having a greater impact on the business.

A September 2010 survey of CHROs by the Corporate Executive Board’s Corporate Leadership Council (CLC) found that improving the strategic effectiveness of the HR function is one of the top 10 priorities for 2011.

Other studies have shown that effective talent management has a direct impact on business performance. Organizations that do the best job attracting, developing, engaging and retaining their talent often outperform their peers in terms of sales, revenue growth and investor returns.

CLC survey analysis also revealed that HR must effectively partner with business line management to drive talent outcomes. Real strategic value doesn’t come from compliance, benefits administration or transactional efficiency. These roles and responsibilities are important, but for HR to have a meaningful impact on business results, it must partner with the line to drive talent outcomes. CLC found that effective HR line support can increase employee performance by 21 percent and employee retentionby 26 percent. Further, effective HR line support also drives business unit revenue and profit improvement by 7 percent and 9 percent, respectively.

The challenge for HR departments is determining what drives effectiveness. CLC analysis of different HR structures found that regardless of organizational model, the HR business partner (HRBP) consistently explains the most variation in HR line support effectiveness. HRBPs are the HR employees who work with managers within business units on talent and business and are sometimes referred to as HR generalists.

That doesn’t mean other HR functions don’t matter. They do, and there may be good reasons to use them for cost or expertise. However, CLC analysis has shown that even if an organization has the best specialists and shared services in the world, if its HRBPs underperform, it’s not likely to build an effective partnership with the line. In fact, HRBPs – specifically the strategic partner role they have – are fundamental to the effectiveness of HR support to line management.

The challenge is how to make the HRBP great at the strategic role, given that a September 2007 survey found that fewer than 1 in 10 line managers thinks the HRBP is an effective strategic partner.

CLC examined a host of different factors that could impact HRBP strategic effectiveness. Among these driver categories, analysis found only two have the most impact:

1. An individual’s capabilities:

Companies that focused on developing an HRBP’s competencies in business acumen, innovation, leadership and metrics through on-the-job experiences maximized HR’s strategic effectiveness.

2. Job design:

While spanning HRBP’s over too few line managers limits experiences, responsibility for too many client groups can overwhelm the HRBP and reduce strategic effectiveness. Deploying HRBPs against executives with similar needs improved understanding of the business line issues required to deliver strategic impact and allowed HRBPs to support a greater number of line managers.

Given today’s dynamic business environment, improving the strategic effectiveness of the HR function will be a major initiative for CHROs in 2011. Critical to its success will be the development of HR business partners and their support to line management. By focusing on the aforementioned areas, HR can drive talent outcomes and the positive business outcomes that follow.

The shopping is done and the gifts are wrapped. But for CLOs in the market for a new or upgraded LMS, the buying season may be just beginning. According to a recent report from Bersin & Associates, the $1 billion LMS market is expected to grow by 9 percent in 2011.

While the market is expanding, it’s also fragmented among large, enterprisewide LMS vendors such as Saba and Plateau that integrate learning with broader talent management systems and niche vendors specializing in a specific industry, such as HealthSmart and MC Strategies in health care.

“This market is still growing, but it’s increasingly hard to say this is still one space,” said David Mallon, principal analyst with Bersin & Associates.

The Bersin report “Learning Systems 2011: The Definitive Buyer’s Guide to the Global Market for Learning Management Solutions” combines data provided by LMS vendors with customer surveys to reach its conclusions.

At the top end, the market is increasingly driven by integration with broader talent management. Even if they’re considering buying a stand-alone LMS, many large, global companies expect it to integrate with performance management and succession planning. “Most at that level are now shopping with talent management in mind even if not necessarily driving the selection,” Mallon said, adding that many small to midsized companies are moving in that direction, too.

At the same time, specialized providers are combining content designed specifically for the needs of a particular industry with a technology platform to deliver it. Mallon points to vendors such as HealthStream, Elseview and NetLearning in the health care market, which increasingly compete with larger content-agnostic, platform vendors.

“There are a number of learning management system providers that are content and service providers first, but they offer a holistic experience along with this technology platform,” Mallon said.

The overall system isn’t as great an advantage for large vendors as it used to be. LMS administration and learning delivery are increasingly commoditized, Mallon said, with most providers offering much the same services and platform.

While the market grows, so does customer dissatisfaction. The LMS continues to be one of the “lowest satisfaction systems” of any HR software, Mallon said. Increased learner expectations and misplaced analytics expectations may be to blame.

Traditionally, the two primary drivers are training administration and e-learning delivery. LMS providers focused on making the learning department’s life easier, sometimes at the expense of learners’ experience.

“For much of the early history of this space, the providers knew that to make their buyers happy, they needed to make the training admin happy,” he said. “Whatever happened out front where the employees came was gray.”

Vendors are now re-engineering the user experience in response to rising expectations from learners familiar with the easy-to-use social software and programs in their personal lives.

At same time, businesses are looking for more sophisticated analytics from their learning departments that can be used to drive employee and business performance. Most learning organizations lack that level of reporting expertise and turn to the LMS, expecting it to provide the answer for their own shortcomings.

“The learning management providers get put between a rock and a hard place on the reporting question, but there’s not much they can do,” Mallon said.

Most LMSs offer canned reports that provide about 80 percent of what buyers need, but the level of detail and sophistication users are seeking can only be delivered through customized reporting.

“But those custom building report tools require some amount of expertise and maturity from the buyer to use them and to generate successful data,” he said.

Beyond those shortcomings, Mallon said two broad trends are driving the evolution of the LMS market: integrated talent management and the need to accommodate continuous learning, both formal and informal. The traditional strengths of the LMS – training administration and e-learning delivery – remain important, but they are increasingly the opening bet in a bigger game.

“The CLO should absolutely be thinking about continuous learning and integrated talent management and how they’re going to address those two big conversations,” Mallon said.