The bank pays a lot of attention to the development of young employees to support its rapid global expansion. The talent management team plans to recruit some 600 “early in career” individuals during 2014. These include apprentices, school leavers and university graduates.
As well as its graduate development programme, the bank has a “Flying Start” programme for school leavers to help them gain professional banking qualifications. It lasts for four years and is marketed as a “paid alternative to university”. Selected school leavers go through induction and are assigned both a mentor and a buddy from their workplace to help them during the programme. They receive professional training through a mix of classroom training, e-learning and work shadowing. Participants progress through a series of professional qualifications, culminating in becoming a chartered banker. At the end of the four years, they are assigned to a role as a team leader, sales specialist or technical specialist.
Santander UK is also seeking to scoop up talented people overlooked by its competitors, such as postgraduates or high-flying graduates who are in their first or second job.
Although it has invested considerable resources in overhauling its entire talent management system, directors at the bank still look for as yet unidentified sources of talent. Stephen Dury, managing director of strategy and market development, comments:
Whenever I have an innovative and challenging project, which is about changing the business and shaping the organisation, I look for intrapreneurs, those people that feel an individual responsibility for doing things better, who think differently and want to make a difference … people who might not appear on our talent map but who you know fit the talent profile that is needed.
Caroline Curtis, head of talent, succession and leadership development, is equally concerned about talent outside the core banking business of Santander UK. She comments:
My feeling is that there may be opportunity to cast our net further afield; looking at the talent that we have within some of our own internal support companies.
The issue of looking for talent at the “periphery” of the organisation (part-time, contract and associate staff) is explored in more depth in Chapter 6.
Demographic change
As outlined in Chapter 1, an ageing workforce is forcing companies operating in the United States and western Europe to rethink their talent strategies.
Such is the predicament of 3M, a technology company with 19,000 employees in more than 30 countries, which has ambitious growth plans, intending to fill 4,300 positions by 2015. When the talent implications for its five-year business plan were examined, a number of serious skills gaps became apparent. It also realised that it might struggle to achieve its target for succession planning, given that its workforce was ageing (with a forecast average age of 46.5 years by 2015) and not enough younger managers were in the pipeline.
3M therefore broadened its definition of talent to include both technical and leadership skills and recognised the need to take a more flexible approach to differences of demographics and labour conditions within European countries. The newly created global Centre of Expertise for Talent Solutions now works in partnership with the country/region board of directors to fill their skills gaps through external recruitment and moving high-potential individuals around the business. Internal mobility has tripled since the new talent management processes were implemented.
In a 2012 report on talent mobility by the World Economic Forum, 3M advises that companies need to focus on a more tailored approach to developing people with talent:
Organisations must move from “one size fits all” tactics. Increasing workforce diversity means human capital planning must be innovative … regional management teams should be flexible regarding talent mobility, leadership styles and generational differences.
Wells Fargo, a multinational banking and financial services company, has taken a different approach to capitalise on the skills of both older and young workers. In some parts of the business, especially in the Great Lakes region of the United States, more than 50% of the workforce is under 30. In other regions, notably Indiana and Minnesota, there is a larger proportion of older staff. The company wanted to improve career-development opportunities for both these groups of employees, so the talent management group launched two internal networks, which are sponsored by senior managers and have dedicated resources to develop and engage them (see below).
Wells Fargo
Wells Fargo, one of the largest companies in the United States based on revenue, recognised that many of its older employees were likely to be forced to delay their retirement as a result of economic circumstances. It wanted to find a way to keep these employees motivated and engaged in their own career development.
In 2009 the talent management group launched an internal network for those born between 1946 and 1964, the “Boomers Network”, which focuses on providing career-development opportunities for older workers and helps them deal with issues such as caring for elderly parents that might be affecting their well-being or career prospects. The company believed that older workers were being overlooked because of the stereotypical assumption that they were not interested in furthering their careers.
Wells Fargo already has approximately 52 internal networks in the Great Lakes region. These “Team Member Networks” represent specific groups of employees based on culture, ethnicity and sexual orientation. Each group must gain executive approval and enlist an executive sponsor, officers and chairs. The networks are allocated a budget and must submit annual plans detailing how they will provide opportunities for professional development, education and awareness, community service, as well as how they will benefit the business in any of the following five areas:
business development and customer insight;
team member engagement;
talent leader development;
community development;
branding and communication.
The effectiveness of the networks is assessed, using measures such as satisfaction scores of participants, growth of participation in the networks and how they have helped develop leaders, as are their business benefits, such as insights on customer preferences or feedback about new products.
Soon after the creation of the Boomers Network, young employees asked for a similar arrangement. So the Young Professional Network, which provides career development for employees aged below 30, was formed.
Members of both networks have worked with Wells Fargo’s talent management group to look at how they can become more effective leaders. Courses in partnership with St Catherine’s University were set up, some of which are offered on site at Wells Fargo and others on-campus. One programme, for example, leads to a graduate certificate in organisational leadership that can also count towards a degree in the same subject. There is also a leadership perspectives course, designed for baby-boomers, which aims to build on the experiences and leadership of people who want to develop their leadership skills in both their work and their personal life. Participants can opt for a life coach, although they have to contribute towards some of the costs of coaching.
Both networks have run a series of seminars looking at career development and other work–life issues, such as successful mid-life career changes, networking, managing money, healthy lifestyles and retirement planning.
Wells Fargo is now considering offering older employees more opportunities for part-time work, and is including health and wellness in its diversity and work–life programmes for all employees.
The talent management group looks at networks as both sources of talent and an ideal way to develop leaders. Each network is assigned two executive “advisers”, who are chosen from the company’s pool of high-potential talent. They then select the president of each network who puts together the network organisation. The advisers also set up meetings with senior managers to discuss business plans and how the networks can contribute; and senior managers may ask the networks for help on specific projects.
Dive
rsity
An increased desire for diversity also demands that talent management become more flexible and customised.
A more diverse customer base has highlighted the need for companies to reflect greater diversity at every level of the organisation, not just at the top. In an analysis of this trend, Jean-Michel Caye and Karen Hinshaw, consultants at Boston Consulting Group, assert:
Companies staffed exclusively with similar-looking, like-minded employees lack the broad range of insight and experience needed to meet the challenges of a globalising world. By contrast, organisations that tap into the full spectrum of capabilities of a diverse workforce are better equipped for a dynamic environment.
They say that managing a more diverse spread of talented people will pose challenges for firms, creating the need to modify the incentives they offer employees to meet more varied expectations. Mobility and regular feedback, for example, matter more to the latest generation of workers than they did to their older counterparts.
An Economist survey on diversity in 2011 reveals that while many firms acknowledge the benefit of developing more diverse senior leaders, such diversity is hard to achieve. Indra Nooyi does not feel that PepsiCo has cracked this particular nut:
How do we get people to embrace multi-generational, multi-cultural and multi-ethnic talent – and get people to walk in their shoes? Tough questions.
Despite the difficulties, she urges firms:
[To] leverage and integrate diversity. I’m talking about diversity of thought, background, experience, capability, culture, race, gender and also age diversity.
PepsiCo equates diversity in the way people think and act with a greater emphasis on recruiting and developing external talent:
Talent management requires courage, because outside points of view can shock inside talent … they stretch us in terms of our thinking because many of us get locked into a traditional model and outsiders ask us whether we are wearing “Emperor’s clothes”. That makes a huge difference.
Age diversity in the top team is also desirable to PepsiCo, as Nooyi points out:
Too often at the top, everybody in that group tends to be of the same age group, even though we are dealing with technologies that we have never heard of. Yet we feel very uncomfortable when someone who is 10–15 years younger joins a senior team. We live in very unsettling times, but if we don’t encourage age diversity at the top, I think our models might become outdated.
Spotting and accelerating the development of a young manager is not easy, so some firms have resorted to “reverse mentoring”, where young people with a fresher view of the market counsel their elders. As the example of Boeing reveals, bringing together different generations of employees can result in powerful benefits both for individuals and the organisation.
Boeing
Multinational aerospace and defence corporation Boeing was concerned about both the loss of expertise as older workers approached retirement and the need to retain and motivate young “generation Y” workers, who represent the future workforce.
The company wanted to improve collaboration between these two groups of employees and to help them learn from each other. It especially wanted to help older workers become more confident with technology-based collaboration tools, and younger employees who were technically oriented to become better “people managers” and improve their communication and collaborative skills, especially using conversation as a means of problem solving.
Boeing piloted an approach to bring together generation Y employees and experienced managers in a “Workplace Innovation Lab”. In 2009, it asked REACH (a network for early-career Boeing employees) members and their managers to seek volunteers to participate in the project. Managers and younger employees were asked to work together in pairs and commit to spending 24 hours over three months, including two face-to-face workshops, on achieving a business goal or project of their choice. Over the next ten weeks, they participated in a series of conference calls to discuss new ideas and approaches that could help Boeing improve the three areas they had chosen:
virtual collaboration, using new technology, including social media;
agile working, using alternative employment contracts and flexible working to build responsiveness and reduce fixed costs;
building a culture of trust and engagement to improve productivity and encourage staff to develop their skills and adopt new ways of working.
Participants also attended a 24-hour “Innovation Event”, an intensive programme of theory and practice in relation to affecting change and innovation. The final stage was to demonstrate the results of the project to Boeing’s global head of HR. The experiment was judged to be highly successful and some valuable ideas were generated, leading to improvements and cost savings.
Managers and younger employees reported benefits from two-way mentoring; for example, older managers felt more confident about using collaboration tools such as web X, share point, global conference calling, webcams and Insite, Boeing’s internal social-networking site. There was improved communication between the two groups, and both recognised the value of combining seasoned experience with a fresher and sometimes more questioning perspective.
Boeing plans to repeat the innovation labs but with one important difference. Instead of drawing together a wide variety of participants from across the whole organisation, it will aim for a critical mass of participants from a single business area. It believes this concentrated approach will generate more focused and measurable business benefits.
Cisco UK & Ireland, part of Cisco Systems, a multinational designer and manufacturer of networking equipment, also uses reverse mentoring for strategic planning. Small groups of generation Y employees (broadly, those born between 1980 and 2000) meet the senior management team regularly to discuss emerging trends which might pose both opportunities and threats to the business.
Reverse mentoring is part of a wider effort at Cisco UK & Ireland to build a broader and more diverse culture. It has been particularly successful at using mentoring and other schemes to attract and develop women. Indeed, its chief executive, Phil Smith, won “Mentor of the Year” at the Women of the Future Awards 2010 for his efforts in making the company an attractive employer to women.
Smith says that when he first started at Cisco’s new country operation for the UK and Ireland in 1994, the fledgling company was “mainly middle-aged males”. Its workforce of approximately 4,000 is now one of the Times Top 50 Places Where Women Want to Work.
The company’s success is based simply on “listening to your employees” and being responsive to their individual needs, Smith says. There are many issues that are minor to solve for the company, but make a huge difference to staff, particularly work–life balance. Smith believes that a business must reflect the diversity of its customers and society at large, and that without that diversity it will lack dynamism; but he is also of the view that it must never be about fulfilling quotas. As he explains:
This is not good for an individual or a company. You need the best people for the job, and you as a company need to be doing the best for them.
However, despite extensive efforts among firms to get more women into senior management positions, few are succeeding. The reasons are examined in greater depth in the next chapter, but two reports highlight the problem.
A 2012 report by McKinsey, “Unlocking the full potential of woman at work”, reveals that women may be well represented in junior management but many fail to progress to top management roles because they are either sidelined into staff jobs, get stuck at middle management, or leave the corporation. In terms of four “success” measures for getting women to the top (for example, having at least 55% of women vice-presidents and senior vice-presidents) only 12 of the 60 companies surveyed met three of the four measures.
A similarly dismal picture is painted by Catalyst, an American nonprofit research organisation, which produced a report in 2010 based on the career-path profiles of 9,927 alumni who graduated between 1996 and 200
7 from MBA programmes at 26 business schools in Asia, Europe, the United States and Canada, and additional data from 4,143 women and men who graduated from full-time MBA programmes and worked full-time at companies and firms at the time of the survey.
Sponsored by corporations that include American Express, Barclays Capital, IBM, Chevron, Procter & Gamble and Deloitte, the report pointed out that although women represented 40% of the worldwide workforce, few of them reach senior management positions (the results of this research are discussed in greater depth in Chapter 4). James S. Churley, chairman and CEO of Ernst & Young, a multinational professional services firm and a sponsor of the research, admits:
Frankly, the fact that the pipeline is not as healthy as we’d thought is both surprising and disappointing. Companies have been working on this, and I thought we’d seen progress. The last decade was supposed to be the “promised one” and it turns out that it wasn’t.
This is a wake-up call for corporations. First, we need to put more pressure on business schools to coach women and men during the job placement process. Second, companies need to be looking at where women land when they come into the corporation. Then we need to make sure they’re getting the same development and visibility chances as the men.
We need to focus even more on how we’re leading our companies to get the most out of employees … In this war for top talent we can’t afford to do otherwise.
Diversity and business performance
In a survey of 656 business leaders in 2011, conducted by the Economist Intelligence Unit, diversity of gender, ethnicity and nationality is seen to be beneficial, but difficult to attain. The majority of respondents believe diversity in management:
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