AlignMark Recruiting and Selection Blog

Sales Assessment allows for use of leading (vs. lagging) indicators

Is your sales team run by leading indicators or lagging hindsight?  All it takes is a brief look within the talent management practices of the organization to answer this question.  According to McKinsey's War for Talent surveys (200 companies, 1200 respondents) the percentage of companies engaged in positive talent leadership action and execution is very small.Indeed, when it comes to talent leadership, most organizations are failing, and failure is easily traceable to a weak mindset and belief.  In fact, 72% of managers say that winning the war for talent is critical, yet only 9% are confident that their current actions will lead to a stronger talent pool in the next three years. In summary, the McKinsey survey lists the following as views of senior managers’ beliefs about their own organizations:

• Brings in talented people……….……19%
• Develops people effectively………….3%
• Retains top talent……………….…………8%
• Removes poor performers……........3%
• Knows the A, B, and C players…….16%

Where do you think your company falls? How can you improve your leading indicators?

Accurate information drives effective strategies.  This is good news for sales organizations, because, unlike many other functional areas, sales organizations already have great appreciation for accurate information. Operating metrics are a familiar form of sales information and receive intense attention in all sales organizations.  But operating metrics alone are not enough.  Sales leaders need to be passionately and diligently focused on the knowledge, skills, and abilities (i.e., the competencies) required in all their positions and they need to be likewise focused on the knowledge, skills, and abilities of their incumbents (individual contributors and leadership alike), internal candidates, and external candidates as well.  The sales organization with accurate information about their position requirements, and the corresponding level of human capital knowledge, skills, and abilities available to fill those positions, is in the best position to be more strategic and intelligent when making all human capital decisions (i.e., selection, promotion, training, succession planning, performance management, etc.). In this definition, “passionately and diligently” means an unwavering commitment to measure, measure, and measure again. Great sales organizations extend their measurements beyond operational metrics to include significant focus on key human capital metrics: skills, abilities, knowledge, engagement and retention levels, quality-of-hire, ROI, etc. These measures are examples of “leading indicators” that great sales organizations focus on and attend to as they know that such indicators do accurately predict ultimate operating metrics like revenue and profitability. All measurement should be directed at providing better information for improved decision-making.

We have found repeatedly when critical, strategic decision-making is attempted without rigorous attention to the predictive data and metrics, wrong decisions are made which will lead to poor sales performance. If a sales leader can lead their managers and sales people to arrive at a point--mentally (through initial belief and eventual successes) where there is “passionate and diligent focus,” both on the targets that will drive its future success and the competencies needed to drive that success, much progress will have been made in building this core belief. Most great sales organizations share the following beliefs:

• Better Talent equals competitive advantage
• Talent Leadership “Mindset” is the catalyst for action
• Strengthening the talent pool is every leader’s job
• Talent “Gold Standard” has been established (be a role model)
• Leaders, especially senior leaders, must be held accountable for aggressively developing center talent
• Real money must be invested in Talent Leadership
• Talent Review processes are critical

Don’t lag behind without focus on leading indicators. Hindsight with poor results is a position your sales organization does not need to face.  Below are only a few of the differences between leading and lagging indicators.  Which do you measure?

Lagging Indicators	Leading Indicators
Quantity of hires	Quality of hires
End of year results	Gap Analysis of results weekly
Time to fill a position	Skills identification and gap analysis of incumbent sales force
Percent of quota attained	Leadership Involvement
Turnover	Identification of “at risk” incumbents
Objectives Made	Engagement Levels

For more information on these and other white papers on sales assessment click here.

Executive Assessments: A new dimension to Talent Management

 

"A mind is too valuable a thing to waste" -anonymous

Today's challenging business environment is a stark reminder to HR organizations of the need for better talent management. Appropriately deploying employees' skills and personalities to optimize performance is a critical and difficult task. Furthermore, identifying and developing executives who have leadership potential, is a demanding process that is both an art and a science. More than ever before, businesses today rise or fall on the strength of their people; the onus to build and nurture this strength is on HR.

To carry out this mission well is to fully appreciate the wide range of competencies necessary to have effective leadership teams that can withstand the test of time and market ups and downs. Operating excellence, technical competence, marketing savvy, passion, energy and drive are always important, but today's knowledge- and talent-intensive organizations also require the "soft" people skills that facilitate execution across functions, departments, regions, and operating units.

Understanding and Implementing Talent Strategies

Understanding the importance of all these skills is one thing; being able to put this understanding into practice is another. How many corporate leaders today can say with confidence that their management team has the complete package of skills to take the company forward? How many are certain that their executives are deployed where and when they can put their specific talents to the best and highest strategic use? And when a leadership need arises, how many can accurately discern whether it's time to promote an individual or if that executive needs further development? Until they gain strong insight into the talent in place within their organizations, senior managers are essentially handcuffed with what they can accomplish now and in trouble when it comes to succession planning for the future.

Compounding the difficulty is the sheer size and complexity of many contemporary business organizations, which make it no simple undertaking to gather the information that will enable senior leadership to craft a winning talent strategy. And without robust information and analysis, leaders have little basis for deciding when and who to develop internally.

A Strategic Tool

One information-gathering tool that many corporate leaders are finding useful is the executive assessment, which evaluates and measures an organization's management talent in three key dimensions: against the organization's current and future strategic needs; against the competition; and against the overall talent marketplace. Properly performed, such assessments can help form the foundation of a winning talent strategy. They can produce the information that corporate leaders need to put the right people in the right positions at the right time, and they invariably clarify the processes that monitor performance and develop capabilities. Corporations can use executive assessments to build a database to model the skills and competencies that their business strategies demand, and to help them determine whether they have talent in-house to match their needs and the level of professional development that may be needed. Assessments also allow companies to maximize the value of executive education programs, creating custom-fit learning strategies for their next generation of corporate leaders.

Most importantly, by partnering with a third-party expert to conduct executive assessments, senior managers can counteract the "in-house" bias that all too often leads to sub-optimal decision making. By approaching talent management in this manner, companies can better target retention, career development, and succession planning efforts on their stars of the future

Talent management takes on a new dimension in today's competitive market- place. It requires an understanding of corporate strategic goals and of the role that talent plays in reaching them. And it requires a nimble organization with the expertise and resources to identify talent needs and quickly decide whether to meet them from within or draw them from out- side. Indeed, it is not an exaggeration to say that the future belongs to businesses that can weave talent and strategy into a seamless whole, and in the process build an organization with not only optimized performance but also with a significant competitive advantage as well.

Does Web 2.0 mean anything for Recruiting, Selection, and HR

Of course it does! For HR leaders Web 2.0 is a phenomenal opportunity to engage with their employees and talent community and the community at large. In this blog I will share examples of how companies are leveraging these social computing technologies to gain competitive advantage in talent management.

So what is Web 2.0? It is the second phase of the revolution that started almost 15 years ago with the introduction of Netscape browser and changed how we access knowledge, communicate and collaborate with each other. Forrester Research identified a trend it called "Social Computing" where people are socially and professionally connecting with each other using on line tools and social networks like LinkedIn, Facebook, and Plaxo to get information from each other rather than from centralized structured institutions. People buy from each other on EBay vs. going to a supermarket or store; people in cities throughout the world rent apartments from Craigslist vs. looking through the classified section in newspapers. A friend of mine just recently downloaded Open Office - a Microsoft Office competitor that is free and is being created by engineers working together across the world vs. a big company like Microsoft.

Businesses and HR are ambivalent about how to put its arm around this phenomenon as businesses are built on command and control and organized dissemination of information. This undermines that control and flow of information. This revolution has already transformed businesses, created new business models and how companies conduct business. Encyclopedia Britannica which was the fountain of knowledge cost a fortune to own and a room to store has been replaced by Wikipedia which is free, real time and takes no space. This revolution has been embraced in our personal lives. One out of seven urban couples married in 2007 met online; MySpace is the 11th largest country in the world; and now companies are engaging with candidates as much via SMS text messages as email.

Among the top trends Watson Wyatt has recently identified many companies are adopting advanced, "web 2.0" technology. With the rapid growth of consumer-oriented web 2.0 applications, organizations are considering increasingly interactive strategies and technologies. While many corporations are using web 2.0 elements such as blogs and wikis, organizations are just beginning to implement other elements of social networking. All of these systems could reduce the focus on traditional e-mail and make work communication a more dynamic experience for employees.

Let me first share few examples of how web 2.0 is changing the HR world.

Connecting with Talent

Employees and talent community are natural groups for such social network. They work for you or would like to work for you. Dow Chemical was one of the pioneering adopters of a corporate intranet and recognized the value of social computing especially to keep in touch with former and retired employees but understood the need for corporate governance and risk management that is imperative for a 50 billion dollar global company.

Dow launched a social network primarily aimed at is US workforce that allowed people to upload their profile and pictures that could be accessed by current employees and alumni. One month after launch, more than 3,000 users had posted profiles, including 2,624 current employees, 93 former employees and 374 retirees. Managers are effectively using the platform to hire people, obtain referrals or bring in retired employees for short tern projects. The cost savings of hiring using this platform over traditional methods paid for the cost of technology is a few hires.

Listening

Bell Canada like any large company has employees that have frustrations and complaints and they do not know what or how to channel them, and when they have a good idea do not know who to go to or how to move to forward.

Bell Canada came up with their version of a "suggestion box." Anyone can submit ideas, grievances and have employees vote on them. In 18 months over three thousand ideas were shared, 15,000 employees have visited the site and 6,000 have voted. 27 of the top ideas have been significantly reviewed and 12 have been implemented.

Here is a list of the Web 2.0 component technologies that can be used by HR as well.

Blog - A web site ("web log") where people or groups "post" their thoughts, videos, pictures comments, usually displayed in reverse chronological order. Readers of blogs add their own comments and thoughts. Blogs link with each other to create a blogosphere. It is a great platform for organization to understand what is happening in their company and reach out and connect with the talent community.

SNS (Social Network Sites) - Members of these sites maintain their profile, picture, videos and share with other members their mood, thoughts, ideas. MySpace and Facebook already have over tens of millions members and Facebook is adding over 1 million users per month. Social networks have emerged based on interest and geography. LinkedIn targets professionals. Orkut is popular in Brazil. Hi 5 and Bebo dominate Europe.

Podcast - A digital audio or video file distributed over the Internet for play back on media players and computers. Some are live and interactive. The word is derived from Apple's iPod and "broadcast."

Wiki - "What I Know Is." It is a web site where various people contribute to the content and take shared responsibility editing and maintain the truthiness of the content. According to Wikipedia (the largest wiki), the word comes from Honolulu's Wiki buses (wiki means "fast" in Hawaiian).

Here are the four factors that make adoption of Web2.0 into HR easy and inevitable.

1) Inexpensive -Most of the time the software is free.
2) Easy to implement - This is not your centralized deployment of ERP system. Web 2.0 thrives on amorphous adoption by people.
3) No training needed.
4) It is powered by human need to connect, hear and listen.

For more information contact AlignMark or feel free to browse our White Papers on Recruiting, Selection, and Assessment.

What is the Value of Experience in Recruiting and Selection?

During our 35 years experience in the Corporate employee selection and testing market, AlignMark has completed numerous analyses comparing results of behavioral skill assessments to measures of on-the-job performance and has likewise accumulated assessment results on literally millions of job applicants. One finding which has emerged across virtually every individual job studied, regardless of industry, centers on the value of experience and may somewhat surprise even seasoned HR professionals.

The finding across our different studies is that experience, defined as years of prior experience in a similar job, has little or no affect on neither skill assessment results nor job performance. In repeated studies of incumbents as well as applicants (sales, customer service, supervisors, etc.) whereby confidential measures of job performance were obtained along with personal demographics, job experience of individuals seldom correlated to overall job performance or their performance on behavioral skill assessments. Although easily viewed as a counter-intuitive, potential explanations include the following:

• Tenure and Experience are often different factors. Some individuals continually learn from their experiences and others do not - 5 years in B2B sales does not equate to 5 years of sales "experience."

• Tenure may produce a greater accumulation of knowledge that is not reflected in measures of "soft" skills. However, it also appears that such increased knowledge does not often translate into enhanced on-the-job performance for many individuals.

So what are the implications of such findings? For some companies they are unimportant. For example, in a study of 2,000 B2C sales professions results demonstrated no significant differences among experienced and inexperienced job applicants on selection assessments or subsequent sales results. Despite this finding, the company continues to focus the majority of its recruiting efforts on experienced sales professions and accords them preferred hiring status. (See earlier comments regarding failure to learn from experience.) For other companies, implications are embraced more positively and result in challenging existing experience requirements, etc.

Those things being said, I clearly do not advocate universally abandoning experience requirements. Indeed, some experience requirements may be useful for decreasing voluntary turnover associated with mismatched job expectations, etc. However, at the same time, I do advocate differentiating "time" from "experience".

Click here for more information or White Papers on these topics and other recruiting and selection practices.