white papers featured - UNC Kenan-Flagler Business School

Transcription

VOLUME 5
BUSINESS INSIGHTS FROM UNC EXECUTIVE DEVELOPMENT
WHITE PAPERS
FEATURED:
Developing Leaders in a
VUCA Environment
Got Game? The Use of
Gaming in Learning and
Development
Building A Resilient
Organizational Culture
The Big Data Talent Gap
BONUS SECTION!
Reprinted from the best
selling book “One Page
Talent Management”
A message from the
President of Executive Development
at UNC Kenan-Flagler Business School
Greetings again from the University of North Carolina at
This volume also features a chapter from what’s been called
Chapel Hill. We have had a productive year in executive
the “talent management bible” - Marc Effron’s and Miriam
development, and I am excited to share with you that our
Ort’s “One Page Talent Management”. This practical, science-
efforts were reflected in the annual Financial Times ranking
based guide to accelerating talent growth has become a
of executive education providers. UNC Kenan-Flagler was
best seller in talent management circles, and the chapter
ranked 8 in the world for custom executive education and
we’ve included outlines the barriers to building talent and
4th among U.S. institutions. We also ranked highly in many
the philosophy for successful talent development based on
individual categories, notably 2 in the world for value, 1
simplicity, accountability, and transparency.
th
nd
st
among our U.S.-based competitors. We are very pleased to
be recognized by our partners for the value we bring to their
organizations through their talent development efforts.
The other two white papers included in this volume examine
new trends in talent development. Got Game? The Use
of Gaming in Learning and Development takes a serious
In addition to this news, I am also happy to share with you
look at how gaming technology can be used to develop
the latest volume of ideas@work, our white paper journal
organizational talent. The Big Data Talent Gap explores the
dedicated to exploring critical issues and best practices in
talent implications of the big data revolution.
talent management.
I hope that this journal provides value to you and that you
Two of our papers focus on today’s volatile and constantly
find some useful, actionable ideas within it that you can apply
changing business environment. Developing Leaders in a
in your own organization. All of our white papers, research
VUCA Environment provides talent managers with ideas,
projects, and webinars are available in the resource library on
guidance, and examples on how to address the shift needed
our website (www.uncexec.com).
in leadership development to adapt to the new normal,
while Building a Resilient Organizational Culture focuses on
how to cultivate and nurture a culture of resilience at all
As always, thank you for your support of UNC Executive
Development.
levels of the organization.
Susan Cates
[email protected]
Consistently ranked one of
the world’s best business
schools, UNC Kenan-Flagler
Business School is known
for experiential learning
and teamwork, superior
teaching, innovative
research, and a collaborative
culture. Our commitment
2
ALL CONTENT © UNC EXECUTIVE DEVELOPMENT 2013
to developing socially
responsible, results-driven
leaders distinguishes our
programs. We educate
people at every stage of
their careers and prepare
them to lead successfully
in the global business
environment.
At UNC Executive
Development, we are
committed to providing
new, impactful learning
experiences to help our
partners successfully
manage and develop their
employee talent.
To subscribe, visit www.uncexec.com
Inside this issue
V U
C A
Developing Leaders in a VUCA Environment
page 4
Got Game? The Use of Gaming in Learning and Development
page 14
Building A Resilient Organizational Culture
page 22
page 32
One Page Talent Management
page 42
(Note: The information or conclusions expressed in the following white papers are the authors’ review of findings expressed by the
organizations. All brand representations are registered trademarks owned by the respective companies or organizations.)
3
Developing Leaders in a
VUCA Environment
Kirk Lawrence
Program Director
UNC Executive Development
Introduction
In “The World Is Flat”, Thomas Friedman notes that
the rate of change today is much different than in the
past. “Whenever civilization has gone through one of
these disruptive, dislocating technical revolutions—like
Gutenberg’s introduction of the printing press—the
whole world has changed in profound ways,” he writes.
“But there is something different about the flattening of
the world that is going to be qualitatively different from
other such profound changes: the speed and breadth
with which it is taking hold….This flattening process
is happening at warp speed and directly or indirectly
touching a lot more people on the planet at once. The
faster and broader this transition to a new era, the more
likely is the potential of disruption.”
“To put it another way, the experiences of high-tech
companies in the last few decades who failed to navigate
the rapid changes brought about in their marketplace
by these types of forces may be a warning to all the
businesses, institutions and nation states that are now
facing these inevitable, even predictable, changes but
lack the leadership, flexibility and imagination to adapt—
not because they are not smart or aware, but because
the speed of change is simply overwhelming them.”
4
This rapid flattening, as Friedman calls it, is creating a
new environment that strategic business leaders are
increasingly calling a “VUCA” environment. Coined in the
late 1990’s, the military-derived acronym stands for the
volatility, uncertainty, complexity, and ambiguity—terms
that reflect an increasingly unstable and rapidly changing
business world. This new VUCA environment will require
HR and talent management professionals to change the
focus and methods of leadership development.
Promise
This white paper:
• D
iscusses the history of VUCA and how it applies to
business strategy and development.
• E xplores how VUCA is relevant to leadership
development.
• D
iscusses the “VUCA Prime,” which flips the acronym
to focus on vision, understanding, clarity, and agility.
• O
ffers suggestions on what HR and talent managers
must do to change their leadership development
approach to foster leadership vision, understanding,
clarity, and agility.
DEVELOPING LEADERS IN A VUCA ENVIRONMENT
The Origins of VUCA
The notion of VUCA was introduced by the U.S. Army
War College to describe the more volatile, uncertain,
complex, and ambiguous, multilateral world which
resulted from the end of the Cold War (Kinsinger &
Walch, 2012). The acronym itself was not created until
the late 1990s, and it was not until the terrorist attacks
of September 11, 2001, that notion and acronym really
took hold. VUCA was subsequently adopted by strategic
business leaders to describe the chaotic, turbulent, and
rapidly changing business environment that has become
the “new normal.”
By all accounts, the chaotic “new normal” in business
is real. The financial crisis of 2008-2009, for example,
rendered many business models obsolete, as
organizations throughout the world were plunged
into turbulent environments similar to those faced by
the military. At the same time, rapid changes marched
forward as technological developments like social
media exploded, the world’s population continued
to simultaneously grow and age, and global disasters
disrupted lives, economies, and businesses.
5
VUCA and Leadership Development
This new VUCA environment, as Friedman notes, is taxing
even the most able of leaders who may find their skills
growing obsolete as quickly as their organizations change
in this volatile, unpredictable landscape. Leadership agility
and adaptability are now required skills if organizations
are to succeed in this VUCA world. As Horney, Pasmore,
and O’Shea, authors of “Leadership Agility: A Business
Imperative for a VUCA World” note, to succeed,
“leaders must make continuous shifts in people, process,
technology, and structure. This requires flexibility and
quickness in decision making.” (Horney, Pasmore, O’Shea,
2010). (For additional insights on a new approach for
developing leadership agility, refer to the UNC Executive
Development white paper: Leadership Agility: Using
Improv to Build Critical Skills.)
The Boston Consulting Group (BCG) concurs. A recent
BCG study concluded that organizations today must shift
their business models—and their leadership skills—to
become “adaptive firms.” Adaptive firms can adjust and
learn better, faster, and more economically than their
peers, giving them an “adaptive advantage.” Adaptive
firms, the study notes, include Apple, Google, 3M, Target,
and Amazon.
A report by the Center for Creative Leadership (Petrie,
2011) also notes that today’s VUCA business environment
requires leaders to possess more complex and adaptive
thinking abilities. It also notes that the methods used
to develop these new skill requirements (like on-the-job
training, coaching, and mentoring) have not changed
much, and as a result, leaders are not developing fast
enough or in the right ways to keep up with the “new
normal” for business.
HR and talent management professionals must position
their organizations to succeed in today’s turbulent
business environment by developing agile leaders.
Applying the VUCA model as a framework to re-tool
leadership development models may enable HR and talent
management professionals to identify and foster the
leaders their organizations need now and in the future.
Example: Unilever
In 2010, Unilever, one of the world’s largest consumer goods companies, pledged to double
the size of their business in the next 10 years while reducing its environmental footprint and
increasing its social impact. Sustainability became a central component of their new business
model, one based on VUCA principles. When asked by Forbes contributor Avi Dan why they
changed their business model, Keith Weed, chief marketing and communication officer for
Unilever, responded:
“We look at the world through a lens, which we call VUCA, which stands for ‘Volatile,
Unstable, Complex, and Ambiguous.’ So you can say, ‘It’s a very tough world,’ or you
can say, ‘It’s a world that’s changing fast, and we can help consumers navigate through
it.’ Two-and-a-half billion more people will be added to the planet between now and
2050, of which 2 billion will be added in developing countries. The digital revolution,
the shift in consumer spending, all this suggests that companies have to reinvent the
way they do business.” (Dan, 2012.)
To meet that VUCA challenge, Unilever has also changed its leadership development model.
Source: Sullivan, 2012 January.
6
VUCA Defined
V
The “V” in the VUCA acronym stands for volatility. It
means the nature, speed, volume, and magnitude of
change that is not in a predictable pattern (Sullivan,
2012 January 16). Volatility is turbulence, a phenomenon that is occurring more frequently than in the
past. The BCG study found that half of the most
turbulent financial quarters during the past 30 years
have occurred since 2002. The study also concluded
that financial turbulence has increased in intensity
and persists longer than in the past. (Sullivan, 2012
October 22). Other drivers of turbulence in business
today include digitization, connectivity, trade
liberalization, global competition, and business model
innovation (Reeves & Love, 2012).
U
The “U” in the VUCA acronym stands for uncertainty,
or the lack of predictability in issues and events
(Kinsinger & Walch, 2012). These volatile times make
it difficult for leaders to use past issues and events as
predictors of future outcomes, making forecasting
extremely difficult and decision-making challenging
(Sullivan, 2012 January 16).
C
The “C” in VUCA stands for complexity. As HR
thought leader John Sullivan notes (2012 January 16),
there are often numerous and difficult-to-understand
causes and mitigating factors (both inside and outside
the organization) involved in a problem. This layer of
complexity, added to the turbulence of change and
the absence of past predictors, adds to the difficulty
of decision making. It also leads to confusion, which
can cause ambiguity, the last letter in the acronym.
A
Ambiguity is the lack of clarity about the meaning
of an event (Caron, 2009), or, as Sullivan writes, the
“causes and the ‘who, what, where, how, and why’
behind the things that are happening (that) are
unclear and hard to ascertain.” (2012 January 16).
Col. Eric G. Kail defines ambiguity in the VUCA
model as the “inability to accurately conceptualize
threats and opportunities before they become lethal.”
(Kail, 2010 December 3). A symptom of organizational
ambiguity, according to Kail, is the frustration that
results when compartmentalized accomplishments
fail to add up to a comprehensive or enduring success.
7
The VUCA Prime
The VUCA model identifies the internal and external
conditions affecting organizations today. The VUCA Prime
was developed by Bob Johansen, distinguished fellow at
the Institute for the Future and the author of “Leaders
Make the Future: Ten New Leadership Skills for an
Uncertain World”. Johansen proposes that the best VUCA
leaders are characterized by vision, understanding, clarity,
and agility - the “flips” to the VUCA model.
The VUCA Prime can be seen as the continuum of skills
leaders can develop to help make sense of leading in a
VUCA world. HR and talent management professionals
can use the VUCA Prime as a “skills and abilities”
blueprint when creating leadership development plans.
In the VUCA Prime, volatility can be countered with
vision because vision is even more vital in turbulent
times. Leaders with a clear vision of where they want
their organizations to be in three to five years can better
weather volatile environmental changes such as economic
downturns or new competition in their markets, for
example, by making business decisions to counter the
turbulence while keeping the organization’s vision
in mind.
Uncertainty can be countered with understanding, the
ability of a leader to stop, look, and listen. To be effective
in a VUCA environment, leaders must learn to look and
listen beyond their functional areas of expertise to make
sense of the volatility and to lead with vision. This requires
leaders to communicate with all levels of employees
in their organization, and to develop and demonstrate
teamwork and collaboration skills.
Complexity can be countered with clarity, the deliberative process to make sense of the chaos. In a VUCA
world, chaos comes swift and hard. Leaders, who can
quickly and clearly tune into all of the minutiae
associated with the chaos, can make better, more
informed business decisions.
Finally, ambiguity can be countered with the ability to
communicate across the organization and to move
quickly to apply solutions (Kinsinger and Walch, 2012).
Vision, understanding, clarity, and agility are not
mutually exclusive in the VUCA prime. Rather, they
are intertwined elements that help managers become
stronger VUCA leaders.
VUCA leaders must have foresight to see where they are
going but must also remain flexible about how they get
there (Apollo Research Institute staff, 2012). They must
be self-aware about their strengths and weaknesses as
leaders, adaptable, open to change, and, according to
the Center for Creative Leadership, knowledgeable about
their organization beyond their function (Management
Education Group staff, 2011). Finally, they must work
collaboratively and be excellent communicators to thrive
in a complex VUCA environment (Kail, 2010 December
3). Above all, VUCA learners must be able to learn fast
because change is constant.
These skills and abilities are a far cry from the more
function-specific skills and abilities leaders needed in the
past to succeed. HR and talent management professionals
must refocus their leadership development efforts to hone
these more strategic, complex critical-thinking skills.
VUCA Prime
Vision
Understanding
Clarity
Agility
8
Example: McDonald’s
Fast-food giant McDonald’s was a frontrunner in adapting VUCA and VUCA Prime
principles in its leadership development programs. In 2001, the company launched a new
leadership development program for high-potential Regional Manager candidates. The
company realized that there was a need for a specialized leadership development program
for this position because the expectations and challenges for the role had changed
significantly over the previous decade. These expectations and challenges included
heightened competition, the increased challenge of a growing market share, increased job
autonomy as the organization became more decentralized, and the increased expectation
for regional managers to act strategically as well as tactically.
The new leadership development program included the following goals:
1. To help participants take a critical look at themselves and their current management
capabilities and to develop a personal learning plan that could help them increase the
likelihood of success in a regional manager role.
2.To provide participants with action-learning assignments that would help them increase
their understanding of the business while also contributing to the development of
practical solutions to address significant business issues they worked on.
3.To give participants the opportunity to build relationships with peers from across the
organization.
4.To demonstrate the power of action learning as a model to accelerate the development
of leaders.
The goals of this program acknowledge some key VUCA Prime skills and abilities,
including self-awareness, knowledge of the business beyond the functional area,
innovative and critical-thinking skills, collaboration, and the importance of rapid learning
within the organization.
Source: Intagliata & Small, 2005.
Steps Talent Managers Can Take
Nick Petrie, senior faculty member at the Center for
Creative Leadership writes in a 2011 study, Future Trends
in Leadership Development, that there is a growing belief
among senior leaders that the more traditional leadership
development methods such as on-the-job training, job
assignments, coaching, and mentoring, are falling short
in helping them develop the capabilities they need to
succeed in a VUCA environment. These methods are often
at odds with the leadership demands in a VUCA world,
where knowledge across the organization and the speed
of learning outpace these slower and more job-specific
learning methods.
HR and talent management professionals must reframe
leadership development activities to accommodate the
faster-paced VUCA world and to focus less on behavioral
competencies and more on complex thinking abilities and
mindsets. Leadership development should be focused on
learning agility, self-awareness, comfort with ambiguity, and
strategic thinking (Petrie, 2011). To do so, HR and talent
managers may want to begin at the selection process.
9
Step 1: Hire Agile Leaders.
Horney, Pasmore, and O’Shea (2011) recommend that
HR and talent management professionals assess agility
and complex thinking skills during the selection process
by using a structured interview format designed to evoke
from the examples of past agility on the job.
Some sample questions they recommend include:
• G
ive an example of when you performed well in a
work environment that featured rapid change and/or
ambiguity. Did you enjoy this environment? What did
you learn?
• G
ive an example of when your ability to be decisive
was put to the test—when you had to convey a sense
of urgency in decision making. What was the situation,
what factors did you consider when making the
decision, and what was the outcome?
• H
ow do you determine when you need to gather more
information before making a decision versus making a
decision based on the information you have at hand?
Give recent examples of when you made a quick
decision based on the information you had immediately
available and a situation where you opted to collect
more information before making a decision. Which
decision-making style was more comfortable for you
and why?
• G
ive an example of when you modified your personal
style to achieve an important work objective. What was
the situation, how did you change your approach, and
what was the outcome?
HR and talent management professionals can formulate
other questions that can assess a candidate’s strategic
thinking skills, self-awareness, openness to change, ability
to collaborate and communicate across functions, and
other skills required in a VUCA environment. The key is
to attract leaders into the organization who already have
these skills and abilities.
10
Step 2: Develop Existing Leaders to
Be Agile Leaders.
On-the-job training, job assignments, coaching, and
mentoring will still have a place in the training and
development of employees, but to develop VUCA
leaders, HR and talent development professionals must
focus on programs that help develop agility, adaptability,
innovation, collaboration, communication, openness to
change, and other, higher-order critical thinking skills.
And they need to deliver those programs faster (via social
media and other technology) to keep up with the pace
of change. (For additional insights on using technology
to deliver L&D programs, refer to the UNC Executive
Development white paper: Wired to Learn: How New
Technologies are Changing L&D Delivery.)
Horney, Pasmore, and O’Shea recommend that HR and
talent management professionals engage in scenario
planning about possible futures when developing
leadership programs. Scenario planning about futures
involves projecting possible situations and deciding how
the organization would or would not react. Scenario
planning can help identify the knowledge, skills, and
other attributes leaders may need in future business
environments.
Leadership development programs based on VUCA
principles can also include scenario training where
participants can anticipate possible future challenges and
devise possible solutions. This can make leaders more
confident when they actually encounter a new situation.
Scenario training should be conducted frequently so that
reactions become part of the leader’s “muscle memory.”
(Sullivan, 2012 January 16).
Simulations are also powerful learning tools when
developing VUCA leaders because they give participants
a chance to practice skills in a safe, non-threatening
environment. Simulations can range from classroom
role plays, to day-in-the-life assessment centers, to
virtual simulations. Simulations can also help leaders
assess their strengths and weaknesses, making them
more aware of their own skills and gaps (Lanik & Eurick,
2012). Simulations are appealing across generations, but
they have particular appeal to younger high potentials.
This generation has learned many of the desired VUCA
leadership skills by playing video games.
To develop collaboration and to encourage thinking
outside the box, HR and talent managers should also
consider the use of job rotation to help leaders think
beyond their functional areas.
HR and talent development professionals who can foster
adaptability, innovation, and agility in their leaders will
realize tangible rewards. The Adaptive Advantage Index
developed by BCG measures how well organizations
adapt to turbulence. They calculated the adaptability
scores for 2,500 companies in the United States over a
30-year period and found that the ability to adapt creates
value over the short and long-term (Reeves & Love, 2012).
Example: Procter & Gamble
In 2010, Supply Chain Quarterly staff reported that consumer goods giant Procter
& Gamble (P&G) was revising its supply chain to reflect changes it expects in a
VUCA world. Global Product Supply Officer R. Keith Harrison reported on the
steps the company was taking to ensure that the company’s supply chain could
accommodate the volatility, uncertainty, complexity, and ambiguity of today’s business
worlds. “VUCA is the reality for the foreseeable future, and it affects how we think
about supply chains and design,” he told attendees at the 2010 Supply Chain and
Logistics conference (Supply Chain Quarterly staff, 2010).
P&G has applied the VUCA concept beyond its supply chain. During a visit with
students at Vanderbilt University’s Owen Graduate School of Management, P&G CEO
Bob McDonald discussed values-based leadership in an increasingly VUCA world.
During the speech, he shared his ten rules of successful leadership, among them:
Rule #7: Ineffective strategies, systems, and cultures are bigger barriers
to achievement than the talents of people. Recruiting and training are top
priorities.
Rule # 9: Organizations must renew themselves. Only nine of the original
Fortune 50 companies are still on the list today. The majority of successful companies
don’t realize that the world is changing around them. What differentiates those
who succeed from those who don’t is the ability to learn.
Source: Knight, 2011.
11
Step 3: Foster an Organizational
Culture that Rewards VUCA Prime
Behaviors and Retains Agile Employees.
To survive in a VUCA world, organizations must do more
than hire and develop agile leaders; they must create an
organizational culture that rewards the desired behavior.
HR and talent management professionals can play an
integral role in developing a VUCA culture by rewarding
innovation, agile behavior, and calculated risk-taking.
Performance management systems should reflect VUCA
Prime values and attributes.
Rewards for desired behaviors could include different
incentives including job perks, additional compensation,
promotions, and preferred work assignments. A key to the
best rewards systems in a VUCA environment is to not be
rigid and to offer successful leaders rewards that appeal to
them the most—in other words, be adaptable and agile.
The organizational culture that promotes and rewards agile
leaders will begin to perpetuate itself and attract and retain
the type of innovative and agile talent that businesses today
are seeking. It will also provide businesses a competitive
advantage in our ever-changing global marketplace—which
is the ultimate VUCA environment.
V U
C A
Conclusion
The volatility, uncertainty, complexity, and ambiguity
inherent in today’s business world is the “new normal”,
and it is profoundly changing not only how organizations
do business, but how business leaders lead. The skills and
abilities leaders once needed to help their organizations
thrive are no longer sufficient. Today, more strategic,
Apollo Research Institute staff (2012
March). The VUCA world: From building for
strength to building for resiliency. Apollo
Research Institute. Retrieved from http://
apolloresearchinstitute.com/sites/ default/
files/future-of-work-report-the-vuca-world.
pdf.
Caron, D. (2009 February 08). It’s a VUCA
world. CIPS. Retrieved from http://www.
slideshare.net/dcaron/its-a-vuca-world-cipscio-march-5-2009-draft.
Dan, A. (2012 October 14). In a VUCA
world, Unilever bets on “sustainable living”
as a transformative business model. Forbes.
Retrieved from http://www.forbes.com/
sites/avidan/2012/10/14/in-a-vuca-worldunilever-bets-on-sustainable-living-as-atransformative-business-model/.
Forum staff (2010). Speed in a VUCA world:
How leaders of the future will execute
strategy. Forum. Retrieved from http://www.
forum.com/downloads/transcripts/vucainterview-2010-final.pdf.
Intagliata, J. & Small, D. (2005). McDonald’s
Corporation: A Customized Leadership
Development Program Targeted to Prepare
Future Regional Managers. Best Practice
Champions in Organization Development
and Change (Eds. Lou Carter, Dave Ulrich,
Marshall Goldsmith and Jim Bolt), Jossey
Bass.
Kingsinger, P. & Walch, K. (2012 July
9). Living and leading in a VUCA world.
Thunderbird University. Retrieved from
http://knowledgenetwork.thunderbird.edu/
research/2012/07/09/kinsinger-walch-vuca/.
Kail, E. (2010 December 3). Leading
effectively in a VUCA environment: C is for
complexity. HBR Blog Network. Retrieved
from http://blogs.hbr.org/frontlineleadership/2010/12/leading-effectively-in-avuca.html.
Kail, E. (2011 January 6). Leading effectively
in a VUCA environment: A is for ambiguity.
HBR Blog Network. Retrieved from http://
blogs.hbr.org/frontline-leadership/2011/01/
leading-effectively-in-a-vuca-1.html.
Horney, N., Pasmore, B. & O’Shea, T. (2010).
Leadership agility: A business imperative for a
VUCA world. People & Strategy, 33, 4.
12
complex critical-thinking skills are required of business
leaders. HR and talent management professionals
can help their organizations succeed in today’s VUCA
environment by developing leaders who can counter
volatility, uncertainty, complexity, and ambiguity with
vision, understanding, clarity, and agility.
Kavanaugh, S. & Strecker, G. (2012
September 20). Leading learning in VUCA
times: How does a volatile uncertain complex
ambiguous context impact strategy? Chief
Learning Officer. Retrieved from http://www.
slideshare.net/humancapitalmedia/920-cloarielgroupfinalslidesv2.
Reeves, M. & Love, C. (2012 August 21).
The most adaptive companies 2012. Bcg.
perspectives. Retrieved from https://www.
bcgperspectives.com/content/articles/
corporate_strategy_portfolio_ management_
future_of_strategy_most_adaptive_
companies_2012/.
Knight, B. (2011 September 7). P&G CEO
Bob McDonald on values-based leadership.
Owenbloggers.com. Retrieved from http://
www.owenbloggers.com/2011/09/07/
pg-ceo-bob-mcdonald-on-value-basedleadership/.
Sullivan, J. (2012 January 16). VUCA: The
new normal for talent management and
workforce planning. Ere.net. Retrieved from
http://www.ere.net/2012/01/16/vuca-thenew-normal-for-talent-management-andworkforce-planning/.
Lanik, M. & Eurich, T. (2012 June 28).
Simulate leadership for success. Chief
Learning Officer. Retrieved from http://
clomedia.com/articles/view/simulateleadership-for-success/print:1.
Sullivan, J. (2012 October 22). Talent
strategies for a turbulent VUCA world—
shifting to an adaptive approach. Ere.
net. Retrieved from http://www.ere.
net/2012/10/22/talent-strategies-for-aturbulent-vuca-world-shifting-to-an-adaptiveapproach.
Management Education Group staff
(2011 November 1). It’s a VUCA
World. Management Education
Groups, Inc. Retrieved from http://
managementeducationgroup.com/2011/11/
its-a-vuca-world/.
Petrie, N. (2011 December). Future Trends in
Leadership Development. Greensboro, NC:
Center for Creative Leadership.
Supply Chain Quarterly staff (2010
December 20). P&G readies its supply
chain for a “VUCA” world. Supply Chain
Quarterly. Retrieved from http://www.
supplychainquarterly.com/news/20101220
procter_and_gamble_revises_supply_chain/.
WisdomatWork staff (n.d.). Navigation
skills for thriving in “VUCA” times. Wisdom
at Work. Retrieved from http://www.
wisdomatwork.com/about/thriving-in-vucatimes/.
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13
Got Game?
The Use of Gaming in
Learning and Development
Kip Kelly
Director
14
GAMING IN LEARNING AND DEVELOPMENT
Introduction
The first patented video game, the “Cathode Ray
Tube Amusement Device,” is celebrating its 65th
birthday this year (Gettler, n.d.). This may come as a
surprise to many, because people usually place the
birth of video games in the 1970s or 1980s, when
coin-operated video games became a mainstay in
arcades, and the first game consoles appeared in
American homes.
Video games—and the people who play them—have
changed dramatically since 1948. Generations of
gamers have grown up and entered the workplace,
and video games have made the same transition,
extending their influence into companies around
the globe. Many organizations are increasingly using
gaming technology in their learning and development
programs to help build the next generation of
business leaders.
Gaming Terms Defined
Game: A competitive activity that involves skill,
chance, or endurance.
Video game: A game played by electronically
manipulating images produced by a computer
program on a television screen or display.
Simulation game: A game that attempts to
represent real or hypothetical processes, mechanisms,
or systems.
Serious game: Computer or video games designed
for a primary purpose other than pure entertainment;
often designed for the purpose of education and/or
solving a problem.
Alternate reality game: An interactive game that
uses the real world as a platform, often involving
multiple media to tell a story.
MMORPGs: Massively multi-player online roleplaying games.
Promise
This white paper:
• Explores the popularity of video games and the
characteristics of the people who play them.
• Reviews different types of games and defines some
video game terminology.
• Discusses how serious games can be used to
develop organizational talent.
• Provides examples of companies using serious
games to develop skills and behaviors.
• Examines the future of serious games in learning
and development.
Games Are Big Business
Video games today are ubiquitous. Just about every
electronic device with a screen–TVs, PCs, tablets, and
smart phones–have games installed and ready to play,
and people are taking advantage of their accessibility.
A recent study by the NPD Group, a market tracking
firm, found that 211.5 million—or two-thirds—of
Americans play video games (Boorstin, 2012).
Americans aren’t just playing the free, preloaded
games; they are buying them in droves. According
to the Entertainment Software Association (ESA),
consumers spent $24.75 billion on video games in
2011 (ESA staff, 2012).
Puzzle games, board games, trivia, and card games
are the most commonly played games (42 percent),
but 25 percent of gamers also play action, sports,
strategy, and role-playing games. The ESA also found
that 62 percent of gamers play with others, either
in-person or online, and most do so for at least an
hour a week.
Online simulation (sim) games have also grown in
popularity, thanks in large part to the explosion
of social media. Facebook, for example, boasts
more than 100 sim games, among them Farmville
2, Airport City, and FrontierVille. These popular
sim games were designed to entertain but have
15
an educational component and are sometimes called
edutainment games. In Farmville 2, for example, players
create and manage their own farms; in Airport City,
gamers manage a busy city airport; and in FrontierVille,
players “tame the wilderness and build a town.”
As video games grow in popularity and sophistication,
an increasing number of organizations and government
agencies have embraced them to support learning and
development efforts. A recent ESA study found that 70
percent of major U.S. employers use interactive software and
games for L&D purposes, and nearly eight out of 10 U.S.
employers plan on doing so in 2013 (Steinberg, 2012).
Who Plays Video Games?
Video games have changed and matured over the years,
and so have users. The average game player today is 30
years old. Sixty-eight percent of gamers are 18 years of
age or older, and 37 percent are over the age of 35. Just
over half of gamers are men, according to the ESA, but
women gamers are gaining fast. Forty-seven percent of
all players are women, and women over the age of 18
are one of the industry’s fastest growing demographics.
In fact, women now represent a significantly larger
portion of the game-playing population (30 percent)
than boys age 17 or younger (18 percent). Perhaps the
most interesting characteristic of gamers is that the
average adult gamer has been playing video games for
14 years. That’s a lot of game time.
What’s in a Game?
There are three types of video games: casual games,
advergames, and serious games.
Casual games are intended for entertainment purposes
and can include everything from the solitaire game
that comes pre-loaded on most computers to complex
multi-player games like Uncharted, Call of Duty: Modern
Warfare 3, and Battlefield 3. These games are available
in a number of formats, including PC, game console, and
mobile. Although learning can occur when playing casual
games, it is not an intended outcome (Derryberry, 2007).
16
Who’s Playing
32%
37%
31%
Less than 18 years of age
18-35 years of age
36 years of age and older
Source: Entertainment Software Association (2012).
Advergames are games designed to advertise a product,
organization, or cause (Derryberry, 2007). There are several
types of advergames, but the goal is to promote a brand
or organization while providing fun and entertainment.
Serious games are video games designed to improve
learning, and players engage in serious games with
that understanding (Derryberry, 2007). Also known
as immersive learning simulations, digital game-based
learning, and gaming simulations, serious games are
developed with specific learning outcomes in mind
that will result in measurable, sustained changes in
performance or behavior. Serious games have been used
in emergency services training, military training, and
health care settings to positive effect (Derryberry, 2007).
According to Sue Bohle, executive director of the Serious
Games Association, industry estimates range from $2-10
billion in revenue for serious games, depending on how
much simulations and virtual worlds are included in the
calculation (Maurer, 2012).
Serious Games in Learning
and Development
Serious games can allow players to apply what they
have learned in an L&D experience and apply it in a
safe, simulated environment. For example, health care
professionals can practice a new medical procedure
using a serious sim game before introducing it in the
workplace. There is also evidence that serious games
can develop soft skills like emotional intelligence,
communication management, and critical problem
solving and collaboration skills (Marinho, 2012).
Some L&D professionals argue that video games can help
develop the leadership skills that organizations will need
in the future. Tomorrow’s workplace will be global, fasterpaced, competitive, and more virtual than ever before.
Online games, specifically massively multiplayer online
role-playing games (MMORPGs), “offer a glimpse at how
leaders develop and operate in environments that are
highly distributed, global, hyper-competitive, and virtual.”
(IBM & Seriosity staff, 2007).
There have been several studies conducted on learning
and serious games, and results are encouraging. A
recent study by the Office of Naval Research found that
video game players performed 10-20 percent better in
perceptual and cognitive ability than non-game players,
and that video games helped adults process information
faster (Steinberg, 2012). Another study by the Federation
of American Scientists found that students remembered
only 10 percent of what they read; 20 percent of what
they heard; 30 percent if they used visuals related
to what they heard; and 50 percent if they watched
someone performing a task while explaining it. Students
remembered 90 percent of what they learned, however,
if they did the task themselves, even if it was as a
simulation (IBM staff, n.d.).
A recent study reported in Personnel Psychology
(Sitzmann, 2011) found that trainees using serious
simulation games had improved post-training efficacy
(20 percent), higher declarative knowledge (11 percent),
improved procedural knowledge (14 percent), and better
retention (9 percent) than trainees in a non-simulation
comparison group. The study also found that trainees
in the simulation control group learned more when the
game was used as a supplement to other instructional
methods, rather than as stand-alone instruction.
In contrast, a study by Adams, Mayer, MacNamara,
Koenig, and Wainess (2012) found that narrative
educational games resulted in poorer learning and took
longer to complete than simply showing content on a
slide. Ruth Clarke, an instructional design and technical
training consultant, gave a possible explanation in a
recent American Society for Training & Development
article exploring the results of the study. Clarke
speculates that the reason for this lack of learning may
be because some game features are at odds with the
game’s learning objectives. For example, many games
time players, requiring them to complete tasks within a
certain timeframe.
Gamification Explained
Gamification is the use of gaming techniques, game thinking, and game mechanics to enhance nongame contexts. Gaming techniques like questing, badging, and leader boards have been incorporated into
workplace practices such as the onboarding process, career development, and performance evaluations. It
should be noted that gamification techniques do not have to be rooted in technology. For example, leader
boards can be visual aids posted in a department to motivate and inform workers about departmental goal
achievement (such as sales). Gamification practices are particularly appealing to the Millennial generation
who have grown up playing games that send them on quests, award them with badges, and post their
achievements on leader boards, but the fundamental human need for recognition spans generations.
Gamification can help fill that need and increase employee morale, retention, and job satisfaction.
Source: Pitt, 2012.
17
For learning outcomes that are based on critical thinking
skills, Clarke argues, timed games that reinforce speed are
not a good match (Clarke, 2012). She recommends that
HR and talent development professionals stick to serious
games that emphasize drill and practice exercises for tasks
that require immediate and accurate responses.
The Federation of American Scientists, however, believes
that serious games can have a broader L&D application
and can teach higher-order thinking skills such as
strategic thinking, interpretive analysis, problem solving,
plan formulation and execution, and the ability to adapt
to rapid change—skills U.S. employers increasingly look
for in workers and new workforce entrants (Steinberg,
2012). A Harvard Business Review study concurs. The
study, which focused on the leadership skills taught
through the immensely popular video game, World of
Warcraft, concluded that the game gave participants
a sneak peek into tomorrow’s workplace. The game’s
environment features fluid workforces, self-organized
and collaborative work activities, and decentralized,
nonhierarchical leadership; all features that will be
prevalent in tomorrow’s business world. The game also
allows for risk-taking and teaches participants how to
work quickly and efficiently (Marinho, 2012).
MMORPGs can also help develop other desirable
leadership skills. MMORPGs can closely match actual work
environments and can be developed in such a way that
the skills required to succeed in the game are similar to
leadership skills employers want to see developed. These
games can bring together millions of gamers who play
the game through the use of avatars. Players interact with
each other, form relationships, and join guilds (or teams)
to collaboratively resolve missions (Melchor, 2012).
“MMORPGs mirror the business context more than you
would assume,” says Byron Reeve, Ph.D., professor at
Stanford University and faculty director of the Stanford
Media X Partners Program. “They presage one possible
future for business—one that is open, virtual, knowledgedriven, and comprised of a largely volunteer or at least
transient workforce.” (IBM & Seriosity staff, 2007).
MMORPGs require cooperation and collaboration among
many players to achieve a mission, and as such, can help
teach such business skills as recruiting, organizing, and
motivating and directing others to accomplish a shared
goal in a safe environment where risk-taking, critical
thinking, and creative problem solving is encouraged
(Melchor, 2012).
Innovation Games®
Innovation Games® creates online and in-person games to help organizations solve problems
across the enterprise – in sales, corporate strategy, product development, and marketing – by using
collaborative play to tap into new innovation. They offer games designed to help organizations
gain a better understanding of their key stakeholders inside and outside the organization.
Source: Innovation Games, n.d.
Organizations Are Serious About Games
Serious games are increasingly being used by large U.S.
employers to recruit, improve communication among
managers and their staffs, and to train employees and
new hires at all levels in their organizations (Derryberry,
2007). The U.S. Department of Defense, the U.S.
18
Army, Nortel, Cold Stone Creamery, McKinsey & Co.,
SAS Institute, and Digital Equipment are just a few
organizations using serious games in their workplaces
(Derryberry, 2007; Maurer, 2012; Steinberg, 2012).
IBM and Farmers Insurance have used the IBM-developed
serious game, INNOV8, to teach the effect of business
decisions on their organizations’ ecosystems. INNOV8 is
a sim-style serious game where players manipulate their
business models to make their cities less congested, their
supply chains more effective, and their customers happier
(IBM staff, n.d.).
Northrop Grumman has also developed several serious
games for use in development and recruitment. The
award-winning Quality Tycoon game teaches players
the effect that quality and ethical integrity have on
business opportunities. Northrop Grumman’s Virtual Jet
Works introduces students to engineering concepts and
is demonstrated at college recruitment fairs (Serious
Games Market staff, 2011). Cisco’s The Cisco Mind
Share Game facilitates network certification. Ultimate
Team Play is used by the Hilton Garden Inn to teach
employees customer service skills (Steinberg, 2012). And
Dublin-based Front Square teamed with Serious Games
International to develop Teddy’s Chocco Shop, a game
that teaches employees the basics of lean manufacturing
(Marinho, 2012).
The U.S. Army was an early adopter of serious games.
In fact, they are credited with coining the term “serious
game.” The Army first released America’s Army in 2002
and updates the game every three to four months.
Game versions include America’s Army: Special Forces
and America’s Army: Overmatch. The Army also gained
recognition from the Serious Games Market with First
Person Cultural Trainer (FPCT), a 3-D cultural training
simulation. The game places players in an unfamiliar
community where they don’t know how members of
the community feel about them or who the community
leaders are. The game’s goals are to have players move
through the community, learn social structures and issues,
and then work with the community to affect missions.
“FPCT challenges the Army’s junior leaders to understand
the consequences, good and bad, of their speech, body
language, posture, temperament, and action,” says
Ben Jordan, director of TRISA’s Operational Environment
Lab, the Army’s lead for the project. “It even replicates
physical micro-expressions, which users learn to identify
as possible cues for threatening or non-threatening
behaviors.” (Roth, 2011).
Generating New Insights
and Solving Problems
Serious games can be an effective method to develop
talent in an organization. They can also serve as a
valuable information source for employers. Serious games
can yield insights that organizations can use to assess
performance, identify patterns, and predict behaviors
in situations that may occur in the real world. L&D
development professionals can use these insights to gain
a better understanding of individual and organizational
capabilities and to identify potential gaps.
Serious games can also serve as a source for new
ideas, helping organizations become more innovative.
Organizations are using serious games to tap into the
knowledge and experience of the entire organization,
and in some cases, beyond the organization to
“crowd-source” new ideas. According to information
technology research firm, Gartner, Inc., more than half
of organizations that manage innovation processes will
gamify those processes by 2015.
Organizations can also use serious games to analyze
the abundance of data (such as operational, customer,
and sales data) that organizations collect from various
sources. Serious games can give employees access to
real-world, real-time “Big Data” to make decisions and
experiment in virtual environments without the risks
and consequences that they would face in the “real
world”. As players engage and interact in the virtual
environment, both the players and the game become
more sophisticated. In other words, the system gets
“smarter” while the constant stream of new, real-time
data continues to change the dynamics of the game.
Many organizations are already using serious games to
gain new insights and solve real business challenges and there are some who believe serious games have the
potential to solve some of the world’s biggest problems.
There are already games designed to fight AIDS, global
poverty, water scarcity, and climate change. Many of
these games are available online from anywhere in the
world, empowering people from all over to come up with
creative solutions to our most urgent social problems.
19
FoldIt
Foldit, an online puzzle video game developed by the Center for Game Science at the University of Washington
in collaboration with the University’s Department of Biochemistry, encourages players to try to solve one of
the hardest computational problems in biology, protein folding. Players try random combinations for folding
proteins into different shapes. In 2011, players were credited with helping discover an enzyme involved in the
reproduction of AIDS, opening the potential for development of new drugs to fight the disease. Scientists had
previously pursued the creation of this enzyme for years but failed to find the right protein structure through
other techniques, such as computer simulations. Guided by intuition and reasoning that computers can’t match,
the players successfully configured the structure of the enzyme in 10 days.
Source: FoldIt staff, n.d.
Conclusion
Video games have been around for years, growing in
popularity and sophistication. Most of today’s workers
grew up playing these games, so it comes as no
surprise that organizations have started to use gaming
technology in new and exciting ways–including talent
development. Well-crafted serious games are used to
develop and reinforce skills and competencies. They can
Boinodiris, P. (2011 December 14). Let’s play!
Turning serious business issues into games.
Forbes. Retrieved from http://www.forbes.
com/sites/ciocentral/2011/12/14/lets-playturning-serious-business-issues-into-games/.
ESA staff (2012). Essential facts about
the computer and video game industry.
Entertainment Software Association.
Retrieved from http://www.theesa.com/facts/
pdfs/ESA_EF_2012.pdf.
Boorstin, J. (2012 September 5). Fewer
people now playing videogames. CNBC.
Retrieved from http://www.cnbc.com/
id/48917308/Fewer_People_Now_Playing_
Videogames.
Farrington, J. (2011 July 11). From the
research: Myths worth dispelling: Seriously,
the game is up. Performance Improvement
Quarterly, 24, 2, 105-110.
BusinessWire staff (2012 August 23). Spend
on serious games growing steadily. Now a
multi-billion dollar industry. BusinessWire.
Retrieved from http://www.businesswire.
com/news/home/2012823006124/en/
spend-games-growing-steadily-multi-billiondollar-industry.
Clarke, R. (2012 April 30). Why games
don’t teach. American Society for Training
and Development. Retrieved from http://
www.astd.org/Publications/Blogs/L-andD-Blog/2012/04/why-games-dont-teach.
aspx?goback=%2Edge_102144_
member_112844552.
Derryberry, A. (2007). Serious games: Online
games for learning. Adobe. Retrieved from
http://www.adobe.com/products/director/
pdfs/serious_games_wp_11-7.pdf.
20
Foldit staff (n.d.). The science behind Foldit.
foldit. Retrieved from http://fold.it/portal/
info/about.
Gale, M.T. (2011 May 9). Gameplay in higher
education: The use of serious games vs.
traditional instructional methods in learning.
Auburn University. Retrieved from http://etd.
auburn.edu/etd/bitstream/handle/10415/
Mark%20Gale%20Dissertation.
pdf?sequence=2.
Gettler, J. (n.d.). The first video game?
Brookhaven National Laboratory. Retrieved
from http://www.bnl.gov/bnlweb/history/
higinbotham4.asp.
Heidingsfelder, A. (2012 September 23).
Increase salesforce productivity with
Bunchball gamification. Examiner. Retrieved
from http://www.examiner.com/review/
increase-sales-productivity-with-bunchballgamification.
be used to safely practice tasks that require rapid and
accurate responses, but their potential applications are
much broader. Serious games can closely approximate
actual working environments, while allowing players
an opportunity to safely take risks, develop teamwork
skills, creatively problem solve and collaborate, and to
experiment and innovate.
slideshare.net/budmelchor/computergaming-for-leadership-development.
IBM and Seriousity staff (2007). Virtual
worlds real leaders: Online games put the
future of business leadership on display.
Global Innovation Outlook. Retrieved from
http://www.ibm.com/ibm/gio/media/pdf/
ibm_gio_gaming_report.pdf.
Pitts, R. (2012 September 18). Using
gamification to motivate Millennials. SHRM
Online. Retrieved from http://www.shrm.org/
HRdisciplines/diversity/articles/pages/usinggamification-to-motivate-millennials.aspx.
IBM staff (n.d.). Serious games for smarter
skills: The future of learning. IBM. Retrieved
from http://www.01.ibm.com/software/
solutions/soa/newsletter/oct09/article_
seriousgames.html.
Roth, M. (2011 December 8). TRADOCsponsored simulation wins Serious Games
Challenge. U.S. Army. Retrieved from http://
www.army.mil/article/70550/.
Innovation Games staff (n.d.). The
seriously fun way to do work—seriously!.
Innovation Games. Retrieved from http://
innovationgames.com/.
Serious Games Market staff (2011
December 26). Zooming in on 2011 Serious
Games Showcase and Challenge. Serious
Games Market. Retrieved from http://
seriousgamesmarket.blogspot.com/2012/12/
zooming-in-on-2011serious-games.html.
Marinho, N. (2012 June 23). Corporations
look to serious games for organizational
development. e27. Retrieved from http://
www.e27.sg/2012/06/23/corporations-lookto-serious-games-for-organisational-learningand-development/.
Maurer, A. (2012 October 10). Serious games
invade the military, medical and corporate
worlds. Tech Journal. Retrieved from http://
www.techjournal.org/2012/10/seriousgames-invade-the-military-medical-andcorporate-worlds/.
Sitzmann, T. (2011 May 27). A meta-analytic
examination of the instructional effectiveness
of computer-based simulation games.
Personnel Psychology, 64, 2, 489-528.
Steinberg, S. (2012 March 13). Video games
are tomorrow’s answer to executive training.
Fast Company. Retrieved from http://www.
fastcompany.com/1824740/video-games-aretomorrows-answer-executive-training.
Melchor, A. (2012 July 03). Computer games
for leadership development. Slideshare.
Retrieved from http://www.
Lead your
HR organization
into the future.
B U S I N E S S
A N D
H U M A N
R E S O U R C E S
Now more than ever, senior HR leaders need the knowledge,
skills, and experience to respond to emerging trends that are
shaping the future of global business. Offered in partnership
with the Society for Human Resource Management
(SHRM), UNC’s Business and Human Resources program
• Earn 29.75 recertification hours
• Meets the HRCI strategic
requirements for SPHR®
is designed to equip senior HR leaders with the most
up-to-date business knowledge and skills needed to succeed
in the rapidly changing business environment today and tomorrow.
To learn more, visit www.bhr.uncexec.com.
21
Building a Resilient
Organizational Culture
Marion White
Director
22
R E S I L I E N C E
I N
T H E
W O R K P L ACE
Introduction
A 2012 Towers Watson study found that in most
organizations, only 35 percent of employees said they
were engaged. In other words, 65 percent of employees
have mentally checked out, causing productivity,
innovation, and creativity to plummet. The study also
found that 38 percent of employees felt stress and
anxiety about the future, and that less than half of the
employees surveyed agreed that senior leaders had a
sincere interest in their well-being.
While this is never good news for employers, the timing
could not be more critical as organizations across the
globe continue to struggle to survive. An uncertain
economic outlook, the rapid pace of change, and the
need to continually adapt has made resilience—the
ability to bounce back in the face of a setback—the new
priority in leadership development. The good news is that
resilience can be taught.
Promise
back after setbacks, are often stressful places to work,
a situation in which far too many employers and
employees are well versed.
Stress lowers employee performance, productivity,
morale, and strains workplace relationships. People
experiencing excessive stress have difficulty managing
emotions, focusing attention, making decisions, and
thinking clearly (Spangler, Koesten, Fox and Radel, 2012).
Stress is also associated with heart disease, cancer,
pain, and depression (Spangler et al, 2012). Stressed
employees feel overwhelmed, tired, and disengaged.
Resilient employees, on the other hand, experience
increased productivity, lower turnover, and have lower
health care costs (Lee, 2008). A growing body of
research shows that organizations that foster positive
attitudes have employees who are more optimistic and
creative (Kolski-Andreaco, 2012). Resilient employees
are engaged, have improved communication, and
are better team players.
This white paper:
• E xplores why resilience is more important than ever
for organizations to cultivate.
• Explains
the difference between wellness programs
and building a resilience culture.
• D
iscusses why resilience should be cultivated, not
just at the senior leadership level, but at all levels in
an organization.
• O
ffers steps HR and talent managers can take to
develop resilient organizational cultures.
• P rovides examples of organizations that have
engaged in a resilience initiative and the benefits
they realized as a result.
Resilience Is Crucial
Thought leaders are increasingly calling today’s turbulent
business world a “VUCA” environment—one that is
volatile, uncertain, complex, and ambiguous. To succeed
in this environment, organizations must be more adaptive
and agile than ever before—they must be resilient.
Organizations that lack resilience, that ability to bounce
How Engagement Affects
Financial Results
Same year operating margin: Study of 50 global companies
30%
27.4
25%
20%
15%
14.3
10%
5%
9.9
Low
traditional
engagement
companies
High
traditional
engagement
companies
High
sustainable
engagement
companies
Source: Towers Watson normative database 2012.
23
Resilience Requires a Culture Change
To create a culture that fosters resilience, HR and talent
management professionals must do more than offer stress
management and yoga classes, although these can and
do have a beneficial role. It requires the development
of an organizational culture that encourages trust,
accountability, and flexibility.
Creating policies and practices that support employees’
ability to manage their energy across all four dimensions
makes it possible for employees to better manage their
stress, to live more balanced lives, and to have more
autonomy over when and where they get their work
done.
Resilient organizational cultures give all employees—
from the CEO down—permission to take care of their
physical, mental, emotional, and spiritual needs with the
understanding that when these needs are tended to,
resilience occurs, and the entire organization benefits
through increased productivity, job performance,
retention, engagement, and physical well-being.
“For organizations, the challenge is to shift from their
traditional focus on getting more out of people, to
investing in meeting people’s core needs so they’re freed,
fueled, and inspired to bring more of themselves to work,
more sustainably,” says Schwartz.
The Towers Watson study recommends that employers
strive for “sustainable engagement” by creating policies
and practices that make it possible for employees to
better manage their stress, to live more balanced lives,
and to have more autonomy over when and where they
get their work done.
Tony Schwartz, CEO of The Energy Project, agrees with
the Towers Watson recommendations. “The key factor is a
work environment that more fully energizes employees by
promoting their physical, emotional, and social well-being.
I’d add to that mental and spiritual well-being—or more
specifically, the added energy derived from the capacity
for absorbed focus and a strong sense of purpose.”
PHYSICAL
24
MENTAL
According to Spangler et al, research has found that some
people are more resilient than others. These people can
bounce back from setbacks faster than others, are more
adaptive, and demonstrate a secure emotional attachment
to others. They have a good sense of humor, are more
action-oriented, have a sense of personal competence,
take time for personal replenishment, and can express
needs and engage the support of others.
Perhaps most importantly, the authors conclude, research
finds that individual resilience is modifiable; it can be
learned, giving HR and talent management professionals
an opportunity to teach resilience at the individual and
organizational levels.
EMOTIONAL
SPIRITUAL
R E S I L I E N C E
I N
T H E
W O R K P L ACE
About The Energy Project
The Energy Project aims to energize people and transform companies by offering a detailed
blueprint for fueling a fully engaged workforce. Drawing on the multidisciplinary science
of high performance, The Energy Project has developed a set of simple principles and
highly actionable practices for more effectively managing energy to drive higher levels of
engagement, productivity, and innovation in people, leaders, and organizations.
HR and talent management professionals can find out if they are currently managing their
four sources of energy: physical, emotional, mental, and spiritual by taking The Energy
Project’s 20-question assessment, The Energy Audit. Results will be emailed immediately and
will include behaviors that should be addressed to improve performance, effectiveness, and
satisfaction, on the job and off. The audit link and results can be shared with team members
for comparison and team-building purposes.
© The Energy Project 2013.
Steps HR Can Take to Introduce Resilience into Their
Organizations’ Cultures
1. Obtain senior leadership support.
Resilient cultures begin with leaders who understand
and support building resilience at the individual and
organizational level. To obtain senior leader buy-in, HR
and talent management professionals can share research
such as the Towers Watson Global Workforce Study and
this white paper with top management. They can explain
how resilient employees are happier, more productive,
and more agile than their less resilient counterparts.
Senior leadership support for an organization-wide
resilience initiative may be easier to obtain if it is
exposed to leadership development opportunities (such
as stress management classes) that specifically target
resilience-building. Developing resilient leaders will help
them better grasp and support the benefits of building
resilience at all organizational levels.
2. Build safe and secure work
communities.
The workplace is often strained, stressful, and
overwhelming. Employees have been taught to check
their feelings at the door to focus on their work—to
“compartmentalize” their personal and professional
25
selves. As human beings, that is simply an impossibility;
employees cannot leave their emotions and personalities
at home. By building work communities that are safe and
secure, yet also encouraging and stimulating, HR and
talent management professionals can also create teams
that are more productive, satisfied, and high-performing.
It is important to establish safe and secure communities
and acknowledge, according to Schwartz, that the
“struggle to feel valued is one of the most insidious
and least acknowledged issues in organizations.” HR
and talent management professionals can challenge the
mentality that employees should check their feelings at
the door and begin that vital shift of building a resilient
organizational culture.
One simple way to create that shift is to implement
community meetings (Schwartz, 2013). Each time a
community meets—whether it is a team, a smaller
working group or an entire division— the community
leader should open with a few simple questions:
• How are you feeling?
• W
hat was the most important thing you learned
last week?
Community leaders should not accept “fine” or “good”
for an answer to the first question. Instead, they should
encourage community members to answer on a scale
of one to 10 emotionally and physically, one being
completely exhausted or drained and 10 being completely
energized and fueled. The idea is to encourage employees
to be honest and open about how they are feeling
physically and emotionally—to get it on the table so it can
be subsequently cleared.
The next questions, “What was the most important thing
you learned last week,” and “What are your goals for
this week,” help employees focus and clear their minds.
“What are you most grateful for” helps set a positive
mood among individuals and eventually the entire group.
If community leaders are afraid that asking all of these
questions will take up too much time, they should be
encouraged to stick with asking employees how they are
feeling and what they are most grateful for.
Asking these questions during community meetings
not only give employees strength and focus, but builds
team cohesiveness by delaying the need for immediate
gratification in favor of choices that uphold shared values,
serve the collective good, and generate long-term value.
• What are your goals for this week?
• What are you most grateful for?
Example: PricewaterhouseCoopers
PricewaterhouseCoopers, a leader in the accounting industry, offers newly
promoted senior associates a week-long leadership development program known
as the PricewaterhouseCoopers Discover program. The program immerses
participants in The Energy Project’s peoplefuel program. The peoplefuel curriculum
teaches employees how to more efficiently manage their four sources of energy;
physical, emotional, mental, and spiritual. As participants progress through four modules
divided by energy source, they learn to recognize the costs of the behaviors that deplete their
energy, reduce their emotional resilience, inhibit their focus, and weaken their motivation.
This program has helped the company engage their rising stars in ways that promote
sustainable growth in the organization, while also investing in employees who will, in turn,
invest in the organization.
26
R E S I L I E N C E
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W O R K P L ACE
3. Encourage all employees—from the CEO down—to embrace these tips to
increase energy and productivity.
• E ncourage employees to do the most important activity
first thing in the morning for a designated time of no
longer than 90 minutes and then take a break. Silence
all digital devices. Employees who can do this will find
that they will get more accomplished in that time than
most people do in an entire day.
• E ncourage employees to keep a running list of
everything that is on their minds so they can get it off
their minds. Working memories have a limited capacity,
so the more things on one’s mind, the less likely that
they will be remembered. Encourage employees to
download everything—the “to do’s,” ideas, everyone
who needs to be called or emailed, issues that need to
be addressed. By writing down everything as it arises,
employees will literally clear space in their working
memories, leaving room for what most deserves their
attention.
• A
sk employees to ask themselves “Is this the best use
of my time?” every time they go online. Sometimes, of
course, it will be. More often, though, it is something
people do to avoid engaging in more difficult work. If
the answer is no, ask “What is?” Then do it.
• E ncourage employees to systematically train their
attention. A simple way is to read more books,
preferably good ones. Deeply focused, uninterrupted
reading is an excellent way to train and sustain the
brain’s capacity for absorbed attention.
• E ncourage employees to take a few minutes each
day—either just before they leave work or just before
they go to sleep—to identify and write down the two
or three most important things they want to accomplish
tomorrow, and when they intend to work on them.
• E ncourage employees to monitor their moods. When
demand exceeds capacity, one of the most common
signs is increased negative emotions. The more
employees move into “fight or flight” mode, the
more reactive and impulsive they become, and the
less reflective and responsive. If employees are feeling
negative, encourage them to ask themselves “Why am
I feeling this way, and what can I do to make myself
feel better?” They may be hungry, tired, overwhelmed,
or feel threatened in some way. Awareness is the first
step. Employees can’t change what they don’t notice
(Schwartz, various).
27
Example: Genentech
Genentech has a rich history of medical breakthroughs and cuttingedge science. As the world’s first biotechnology company, today
Genentech develops and manufactures medicines to treat patients with serious or lifethreatening medical conditions. Despite numerous products on the market, a great
brand and reputation, and strong HR practices, Genentech found itself in a challenging
environment after a merger with the biotechnology company, Roche.
In March 2011, Dave Dickey, director of leadership development, asked The Energy Project
to run a program for his staff to address his team’s high levels of burnout and emotional
fatigue surrounding the merger. He recognized that it was not just an HR issue, but
reflected the growing need for a solution to address people’s capacity and an alternative
way of working. In addition to stress and burnout, the company was dealing with
unclear priorities, competing agendas, cost-cutting measures, and low levels of employee
engagement typical after a merger or acquisition.
By the end of 2012, more than 1,000 Genentech employees had participated in The Energy
Project program, and seven more courses are scheduled for 2013. Employees at all levels of
the company report that they are taking more time for renewal and being more proactive
about the choices they make.
Genentech leaders are also implementing policies suggested by The Energy Project designed
to better fuel their people’s energy. Examples include:
• S
horter meetings with fixed boundaries, leaving people more time to move around
campus and to complete their most important tasks
• Non-negotiable breaks at the 90-minute mark during long meetings
• “
Walking meetings”—short, on-the-go meetings comprised of small groups of people
tackling creative challenges
• A
n ongoing “Take Back Your Lunch” campaign encouraging workers to leave their desks
and get outside to renew themselves
• More consistent and useful feedback given to employees
• Areas and times during the day devoted to absorbed focus and creative thinking
The initiative continues to gain momentum at Genentech, with leaders requesting team offsite and leadership meetings to help their employees manage increased demands, improve
productivity and satisfaction, and to increase their engagement scores.
28
R E S I L I E N C E
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4. Develop policies and practices that empower employees to build resilience and
have senior leaders lead by example.
A key to a resilient organizational culture is
empowerment, which can come in many forms.
Employees need to be given the freedom to take regular
renewal breaks throughout the day to help rejuvenate,
metabolize, and embed learning. These breaks may come
in the form of taking a walk, a stretch break, or a quick
work out. Some organizations encourage employees to
combine business and pleasure by engaging in “walking
meetings.” Other organizations allow employees quick
afternoon nap breaks to rejuvenate. The important point
is to empower employees to manage their work and their
physical, emotional, mental, and spiritual well-being by
offering a flexible working environment.
It is also important to teach employees how to recognize
and manage their stress responses. This may come in
the form of offering psychological skills training and
training in stress management techniques. For example,
if personal financial management is a concern, a financial
management seminar can be offered.
As with any initiative, developing a truly resilient organizational culture will succeed only if senior leaders lead by
example. HR and talent management professionals should
encourage senior leaders to take time out of the day to
rejuvenate themselves and to de-stress. When their direct
reports see the priority senior leaders place on developing
their own resilience, employees will embrace it and follow.
Example: Sony Europe
Sony Europe was experiencing challenging times and was looking to drive
significantly higher levels of energy and performance, and to reduce sick
time and employee turnover.
In collaboration with senior executives in London, The Energy Project created a four-day
retreat that used a modified version of the company’s curriculum for the top leaders in
Sony Europe. The program was delivered in two-day segments, with a month between
meetings. The response from leaders was so enthusiastic that The Energy Project next
designed a three-day version of the program for their direct reports. Today, more than
3,000 Sony Europe employees have attended one of these three-day versions.
Sony Europe has instituted a number of organizational changes designed to support a
new way of working. These include restructuring meetings to include regular breaks;
banning the use of email during meetings to increase focus and productivity; providing
healthy snacks during the day; building an on-site gym and renewal rooms; and
creating a web portal that provides detailed information about different aspects of
the curriculum.
In the division that most openly embraced the initiative, sick time decreased by 36
percent; staff turnover decreased 60 percent; 75 percent of division employees said the
program had a positive impact on their business relationships; and 90 percent say their
energy and performance have increased significantly.
29
Conclusion
Today, “business as usual” means rapid change, an influx
of new technologies, economic turbulence, uncertainty,
and ambiguity. To counter this new normal, organizations
need employees and leaders who are agile, adaptable and
flexible. In a word, resilient. HR and talent management
professionals can help by creating resilient organizational
cultures. This will require a fundamental shift in thinking,
away from squeezing the most productivity from
employees to enabling employees to take care of their
physical, mental, emotional, and spiritual needs, thereby
building resilience.
Everly, G. (2011 June 24). Building a
Lee, D. (2008). Why you will need a
Schwartz, T. (2012 May 17). You are not
Schwartz, T. (2013 January 23). What if
resilient organizational culture. HBR Blog
resilient workforce in today’s economy.
a computer (try as you may). The Energy
you could truly be yourself at work? The
Network. Retrieved from http://blogs.
HumanNature@Work. Retrieved from
Project. Retrieved from http://www.
Energy Project. Retrieved from http://www.
hbr.org/cs/2011/06/building_a_resilient_
http://www.humannatureatwork.com/
theenergyproject.com/blog/you-are-not-
theenergyproject.com/blog/what-if-you-
organizat.html.
articles/workplace_stress/resilientworkforce.
computer-try-you-may.
could-truly-be-yourself-work.
htm.
GCC staff (2012 July 20). Workplace
Schwartz, T. (2012 May 29). Take back
Spangler, N., Koesten, J., Fox, M., Radel, J.
resilience—taking action. GCC. Retrieved
Schwartz, T. (2010 September 7). Six
your life in seven simple steps. The Energy
(2012 November). Employer perceptions of
from https://www.gettheworldmoving.
ways to supercharge your productivity.
stress and resilience intervention. Journal of
com/blog/building-employee-resilience-
The Energy Project. Retrieved from http://
theenergyproject.com/blog/take-back-your-
Occupational & Environmental Medicine,
and-responsiveness-to-change.
www.theenergyproject.com/blog/six-ways-
life-7-simple-steps.
54, 11, 1421-1429.
supercharge-your-productivity.
George, B. (2013 March 22). Resilience
Schwartz, T. (2012 November 1). Resilience
Towers Watson staff (2012). Global
through mindful leadership. Huffington
Schwartz, T. (2011 June 1). The only thing
in the eye of the storm. The Energy
workforce study. Towers Watson. Retrieved
Post. Retrieved from http://www.
that matters. The Energy Project. Retrieved
from http://www.towerswatson.com/
huffingtonpost.com/bill-george/resilience-
from http://www.theenergyproject.com/
theenergyproject.com/blog/resilience-eye-
Insights/IC-Types/Survey-Research-
through-mindfu_b_2932269.html.
blog/only-thing-really-matters.
storm.
Results/2012/07/2012-Towers-Watson-
Kolski-Andreaco, A. (2012 December 1).
Schwartz, T. (2012 August 15). Seeing
Schwartz, T. (2012 November 8). New
How resilience matters in the workplace
through your blind spots. The Energy
Research: How employee engagement
Tulane Solutions staff (2012 February 16).
and what employers can do to increase it.
hits the bottom line. The Energy
Leadership resilience. Tulane Solutions.
SmartBusiness. Retrieved from http://www.
theenergyproject.com/blog/seeing-through-
Retrieved from http://www.tulanesolutions.
sbnonline.com/2012/12/how-resilience-
your-blind-spots.
theenergyproject.com/blog/new-research-
com/leadership-resilience/?goback=%2Eg
how-employee-engagement-hits-bottom-
de_1602977_member_232853807.
Global-Workforce-Study.
matters-in-the-workplace-and-whatemployers-can-do-to-increase-it/.
Schwartz, T. (2012 August 24). Six keys
line.
to being excellent at anything. The
Warren, K. (2011 March 10). Creating
Energy Project. Retrieved from http://
the conditions for a resilient workforce.
theenergyproject.com/blog/six-keys-being-
CEO Online. Retrieved from http://www.
excellent-anything.
ceoonline.com.au/expert_talk/work_life_
balance/resilience_attitude/pages/id38962.
aspx.
30
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31
Stan Ahalt
Director
The Renaissance Computing Institute (RENCI)
Kip Kelly
Director
Introduction
The Big Data Revolution
Big data—the massive amounts of information companies
routinely collect through web crawlers, social media feeds,
server logs, customer service databases, and other sources
(CIO editors, 2012)—is quickly becoming big business in
today’s competitive marketplace. If HR and talent management professionals haven’t added big data to their
strategic agenda yet, they will be compelled to in the near
future. Few organizations possess technical leaders with
the expertise needed to collect, organize, and analyze
the data and provide meaningful insights. Even fewer
have business leaders with the knowledge and experience
needed to create value from big data.
The International Data Corporation (IDC) describes big
data as “the new generation of technologies and
architectures designed to extract value economically from
very large volumes of a wide variety of data by enabling
high-velocity capture, discovery and/or analysis.” (Villars,
Eastwood & Olofson, 2011.) In other words, as authors
Viktor Mayer-Schönberger and Kenneth Cukier write in their
book, “Big Data: A Revolution that Will Transform How We
Live, Work, and Think” (2013), big data “refers to the things
one can do at a large scale that cannot be done at a smaller
one, to extract new insights or create new forms of value in
ways that change markets, organizations, the relationships
between citizens and governments, and more.”
Promise
This white paper:
• A
nalyzes the big data revolution and the potential it
offers organizations.
• E xplores the critical talent needs and emerging talent
gaps related to big data.
• O
ffers examples of organizations that are meeting
this challenge head on.
• R
ecommends four steps HR and talent management
professionals can take to bridge the talent gap.
32
The potential applications of big data analytics are vast.
Internet giant Google, for example, uses big data analytics
to identify flu outbreaks in the United States in real
time—a feat that takes the Centers for Disease Control and
Prevention (CDC) about two weeks to complete because
it relies on slower reporting mechanisms. Google can do
this because it receives more than three billion search
queries on a daily basis. By using big data analytics, Google
was able to identify 45 search terms that when used in a
mathematical model, showed a strong correlation between
T H E
their predictions and the CDC’s flu outbreak statistics
(Schönberger & Cukier, 2013).
Another example of big data analytics comes from Target
Corporation. Target wanted to capture a very attractive
and lucrative market: new parents. New parents spend a
lot of time and money shopping and creating new buying
habits, and building loyalty among this audience can
be very profitable. This market is so valuable that Target
worked to identify customers who might be pregnant—
before a new parent buys the first diaper, or even registers
for the baby shower. Since Target captures and records
vast amounts of consumer data, they were able to review
purchase patterns looking for trends and examine the
items couples tended to buy prior to pregnancy, like
vitamins, unscented lotion, hand towels, etc. Through
mathematical machinations, Target determined the
B I G
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likelihood that couples were pregnant and used these
insights to market to these couples well before their
child’s birth, creating customer loyalty and capturing an
extremely valuable market segment.
Big data is transforming every industry, as companies
realize opportunities to leverage big data analytics in
marketing, sales, and operations—and HR leaders are
realizing the potential as well. Technical recruiting firm
Gild, for example, identifies highly-skilled engineers by
analyzing open-source code, assessing it for quality,
and reaching out to engineers who make the cut.
Online auction company eBay uses analytics to fight
attrition. Beth Axelrod, e-Bay’s senior vice president of
human resources, notes in a recent Forbes article that
big data analytics allows them to identify managerial
or departmental hotspots for talent loss. “If somebody
33
has been in a role for three years, hasn’t been promoted,
and hasn’t changed roles, there’s a far higher probability
of attrition than someone who doesn’t have those
circumstances,” she says (Clark, 2013). And, according
to some reports, Yahoo! CEO Marissa Mayer relied on
big data analysis to ban telecommuting in the company.
Business Insider reports that Mayer analyzed Yahoo’s
computer logs for the company’s virtual private network
(the network tele-commuting employees access when
working remotely) and determined that remote employees
weren’t logging in to the VPN often enough to justify the
policy (Klobucher, 2013).
What Is Big Data?
”Big data are high volume, high velocity, and/or high
variety information assets that require new forms
of processing to enable enhanced decision making,
insight discovery and process optimization.”
Source: Beyer & Laney, 2012.
The Trends Fueling the Revolution
Several trends have converged to fuel the big data
revolution. First, technology costs continue to plummet.
It is cheaper than ever to purchase memory and storage,
and good quality, open-source software is competing
with commercial software, putting pressure on
commercial software developers to keep their prices
The Three Vs of Big Data
Data challenges can be “big” in terms of three
characteristics, commonly known as the “Three V’s”:
Volume –
Challenges that arise from the vast amount of
data that must be processed.
Velocity –
Challenges that arise from the need to process
data within a certain timeframe.
Variety –
Challenges that arise from the many different types
of data needed to understand a situation.
Source: Ahalt, 2012.
34
down (CIO editors, 2012). Second, technology has
evolved to make business analytics more accessible and
faster than ever before. Third, businesses are acquiring
new data at an astonishing rate and from more varied
sources, such as operational data, customer service
data, sales transaction data, and machine or device data
(Manyika et al., 2011).
The amount of new data being created is mindboggling.
The IDC forecasts that there will be 4 trillion gigabytes
of new data created in 2013, nearly 50 percent more
than in 2012 (Press, 2012). Google alone processes more
than 24 petabytes of data each day, a thousand times
more than all of the printed materials currently housed
in the U.S. Library of Congress (Mayer-Schönberger &
Cukier, 2013). Mayer-Schönberger and Cukier also
report that Facebook has more than 10 million photos
uploaded every hour, and that the number of messages
on Twitter grows about 200 percent each year. That’s a
lot of data.
Mayer-Schönberger and Cukier note that while
technology has played a large part in creating the big
data revolution, something else also occurred to push
it along. “There was a shift in mindset about how data
could be used,” they write. “Data was no longer regarded
as static or stale….Rather, data became a raw material
of business, a vital economic input, used to create a new
form of economic value.”
T H E
B I G
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Seven Insights into Big Data
Research conducted by MGI and McKinsey’s Business Technology Office examined the
state of big data and found the following seven insights:
1. D
ata have swept into every industry and business function and are now an important
factor of production, labor, and capital.
2. There are five ways big data can create value:
a. Big data can unlock significant value by making information transparent
and usable at much greater frequency.
b. As organizations create and store more transactional data in digital form,
they can collect more accurate and detailed performance information on
everything.
c. Big data allows ever-narrower segmentation of customers and can result
in much more precisely tailored products or services.
d. Sophisticated analytics can substantially improve decision-making.
e. Big data can be used to improve the development of the next generation
of products and services.
3. Big data will become a key basis of competition and growth for individual firms.
4. Big data will underpin new waves of productivity growth and consumer surplus.
5. While the use of big data will matter across sectors, some sectors are set for
greater gains.
6. There will be a shortage of talent necessary for organizations to take
advantage of big data.
7. Several issues such as privacy, security, intellectual property, and even liability, will
have to be addressed to capture the full potential of big data.
Source: Manyika et al, 2011.
35
The Big Data Talent
Shortage
understand the fundamentals of big data, why it matters,
and what skills their organizations will need to analyze
and interpret the large amounts of data they collect.
The demand for big data talent is growing rapidly. A 2012
survey by InformationWeek found that 40 percent of
respondents said they planned to increase their staff in big
data and analytics in the upcoming year and estimated
that big data staffing would increase by 11 percent over
the next two years (Henschen, 2012).
The McKinsey study supports these findings. The authors
predict that there will be a severe shortage of those who
can analyze and interpret big data, predicting that by
2018, the United States could face a shortage of up to
190,000 workers with deep analytical skills and 1.5 million
managers and analysts with the ability to use the big
data analytics to make effective decisions. (Manyika et al,
2011.) This includes the ability to integrate findings from
big data with knowledge derived from other techniques
which offer different strengths and biases, such as focus
groups and targeted surveys.
The increasing demand for big data analysts who can
crunch and communicate the numbers and the lack of
managers and business leaders who can interpret the
data means there is a growing talent shortage in the field.
A survey conducted by The Big Data London group (in
Raywood, 2012) found that 78 percent of respondents
said there was a big data talent shortage, and 70 percent
believed there was a knowledge gap between big data
workers and those commissioning the projects (e.g.,
managers and CIOs). Another survey by NewVantage
Partners (2012) found that 60 percent of respondents
reported finding it very difficult to find and hire big data
professionals, and 50 percent of respondents said it
was very difficult to find and hire business leaders and
managers who could identify and optimize business
applications in big data.
This impending talent shortage will create a significant
challenge for HR and talent management professionals
responsible for recruiting, developing, and retaining
a critical skill set that will soon be in high-demand. To
help their organizations realize the full potential of big
data, HR and talent management professionals must
36
Big Data Skills
According to the editors of CIO, big data scientists and
analysts need strong math skills and proficiency in working
with massive databases and with emerging database
technology. Plus, they must have a deep knowledge of
their businesses, understanding the business processes,
customers, and products. The most difficult big data skills
to find, they contend, include:
• A
dvanced analytics and predictive analysis skills
• Complex event processing skills
• Rule management skills
• Business intelligence tools
• Data integration skills (CIO editors, 2012.)
Big data analysts or scientists must possess skills
similar to their IT predecessors—they must have a solid
computer science background that includes knowledge of
applications, modeling, statistics, analytics, and math—
but they also need business savvy and the ability to
communicate their findings to business and IT leaders in
meaningful ways, skills that are not typically required on IT
job descriptions. “Good data scientists,” writes IBM, “will
not just address business problems, they will pick the right
problems that have the most value to the organization.”
(IBM staff, n.d.).
As Rob Sentz, vice president of marketing for Economic
Modeling Specialists International, notes in an interview
for Career Builder, big data analysts “need to understand
why they are using data. What is the end goal? Data is…
like an assembly (line) of facts, which aren’t necessarily the
same thing as truth. If facts are poorly interpreted, it could
lead to the wrong conclusions.” (Lorenz, 2012).
Hilary Mason, chief scientist for bitly, a URL shortening
service, offered her opinion in The Wall Street Journal.
Data scientists, she says, “must be able to take data sets
and model it mathematically and understand the math
T H E
required to build those models. And they must be able
to find insights and tell stories from that data. That
means asking the right questions—and that is usually the
hardest piece.” (Rooney, 2012).
CIOs will also need to adjust their roles in this new, big
data environment. The authors of the “Strategic Guide
to Big Data Analytics” noted that CIOs will need to
realize that useful data can come from anywhere and
everywhere. Big data, for example, can come from the
organization’s server log files which track who checks
into a website and what pages they visit. Analyzing
who is checking in and where they go after they leave
a page can give an organization better insight into what
their customers want. CIOs will also need to realize that
big data does not need to be organized beforehand;
instead, data should be collected first with the goal to
decide what to do with it later. Finally, CIOs will also
need to recognize the skills their organizations will need
to analyze big data and be an active participant in the
training of or search for talent (CIO editors, 2012).
It is not just the technical leaders who need to rise to
meet the challenges of big data; managers at all levels
will also have to develop new knowledge, skills, and
experience to be effective. As Jeanne Harris, senior
executive research fellow for Accenture Institute
for High Performance, wrote in an blog for Harvard
Business Review, managers must become more adept
at mathematical reasoning, and while they do not need
to have the depth of statistical knowledge required of
big data analysts, they will need to understand how to
use statistical models and how to interpret data, metrics,
and the results of statistical models. They must also have
the ability to look beyond their functional areas and see
the big picture so they can tell the story the data reveals
(Harris, 2012).
It is this combination of business acumen, knowing the
right questions to ask, and deep technical knowledge
that is confounding most organizations when it comes to
finding big data talent. One survey found that more than
60 percent of respondents said their employees need
to develop new skills to translate big data into insights
and business value (Harris, 2012). Developing these skills
will take time, so many organizations are also looking to
recruit critical talent – but these hard-to-find men and
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women won’t come cheap; a Wall Street Journal article
estimated that some data scientists were making as
much as $300,000 a year (Press, 2012) which gives large
companies an advantage over small and medium sized
companies for acquiring the big data talent.
Recruiting and
Developing Big Data
Talent
Unfortunately, you won’t find big data talent coming out
of many colleges and universities because big data majors
are few and far between. The rapid growth of big data
has outpaced colleges’ and universities’ ability to develop
and implement new curriculums. A few universities are
ahead of the curve, though, including North Carolina
State University, which has a one-year Master of Science
in Analytics (MSA) program (supported by SAS, a business
analytics software and services provider headquartered in
Cary, North Carolina), University of Ottawa, Northwestern
University, DePaul University, University of Connecticut,
and Louisiana State University. Oklahoma State, Texas
A&M, Texas Tech, California State University at Long
Beach, and the University of Alabama also have strong
analytics programs (Henschen, 2012). Data analytics
courses are also available through Carnegie Mellon and
New York University (Bradshaw, 2013).
IBM is following SAS’ footsteps in helping move formal
big data analytics education forward. In late 2012,
IBM announced that it would partner with Ohio State
University to develop a new data analytics center in
Columbus, Ohio. The center will offer research, client
services, and skills training (Press, 2012). IBM plans to
hire 500 big data consultants and researchers in the
next three years to staff the center and to work with the
university to develop a curriculum in business analytics
and mathematics (SmartBrief staff, n.d.).
IBM and SAS are both involved in another effort designed
to unite the private and educational sectors to meet
big data analytics educational needs. IBM, SAS, GE,
Cisco, and NetApp have recently joined with a number
of leading research universities to form the National
37
Consortium for Data Science (NCDS). This consortium
aims to better align university curricula and research with
the needs of the private sector.
In response to the talent shortage, HR and talent
management professionals are getting creative and
looking outside the box when it comes to finding
big data talent. Big data talent could come from the
fields of research and development, finance, physics,
biology, medicine, and even meteorology (Henschen,
2012, Hall, 2012). Jeremy Howard, chief scientist at an
Internet startup that runs data prediction competitions
has a degree in philosophy. He believes that the key job
requirements in data science are really curiosity, flexibility,
and the willingness to learn, capabilities that can be
found in a wide variety of studies and job backgrounds
(Hall, 2012).
At Google, recruiters try to assess a candidate’s
agility, curiosity, and willingness to experiment in the
interviewing process by asking questions like, “How
many golf balls would fit in a school bus?” or “How
many sewer covers are there in Manhattan?” Getting
the right answer isn’t really the point of
the exercise—the point is to assess a
candidate’s skills in experimental
design, logic, and quantitative
analysis (Harris, 2012).
Capital One also assesses
mathematical reasoning in
the recruiting process. All
prospective employees—
including senior executive
candidates—are tested
for mathematical
reasoning, logic, and
38
problem-solving skills. Proctor & Gamble has developed
a big picture/data literacy program which establishes a
baseline digital-skills inventory for all employees. The
program then offers developmental opportunities tailored
to every level in the organization (Harris, 2012).
As demand for big data talent grows, competition for
this talent will become more aggressive - and expensive.
Recruiting and retaining big data talent will become
a significant challenge. HR and talent management
professionals will also need to provide development
opportunities; helping managers and business leaders at
all levels develop the right skills. According to a survey
conducted by The Big Data London group, 80 percent of
respondents said that on-the-job training is among the
best ways to learn and keep up-to-date with the latest
big data skills, and 72 percent cited “self-teaching”
(Raywood, 2012). The NewVantage Partners survey found
that 69 percent of respondents were training their existing
analytic professionals to get up to speed (NewVantage
Partners staff, 2012).
On-the-job training and self-teaching may not
be adequate in developing existing
staff, particularly if they “don’t
know what they don’t know.”
Fortunately, according to
an Information Week
report, a growing
number of organizations
are offering big
data training and
development through
conferences, seminars,
online courses, webinars,
and certification programs
(Henschen, 2012).
T H E
B I G
D ATA
TA L E N T
G A P
4 Steps to Bridge the Big Data Talent Gap
To address the talent gap created by the big data revolution, HR and talent management professionals should:
1. Educate themselves about big data.
HR and talent management professionals must
educate themselves about big data and learn how
big data will be a strategic driver for competitive
advantage in their organizations. This means they
must be proficient in big data and familiar with
the skills and abilities big data scientists, analysts,
managers, and senior executives need to be
successful. HR and talent management professionals
must also understand how big data can be applied
to their own jobs, in recruiting (e.g., Gild’s analyzing
of open-source code to recruit technical engineers),
salary, benefits, retention, social media, and
performance reviews, and they must be leaders in
using big data to advance the HR function.
2. Educate managers and senior leaders about
big data.
To use big data successfully, managers and senior
leaders (including the CIO) must also develop new
knowledge and skills—and they must understand
the real potential of big data. Business leaders must
develop and continue to nurture a broad perspective,
to see what’s possible. Successful leaders will be
those prepared to look beyond the current business
model to see future opportunities that are made
available through big data. They must be prepared
to ask “blue sky” questions. They must be willing to
take some risks. They need to become comfortable
with the complexity that is inherent in big data and
become adept at making the complex easier to
understand. They must also embrace the change
that is inevitable through big data, and have the
ability and courage to lead the organization
through change.
Many of these skills are not new, but they take on
new meaning—and urgency—when viewed through
the lens of big data. HR and talent management
professionals must work with managers and business
leaders at all levels to educate them about big data
and help them to develop the skills they will need to
be successful.
HR and talent management professionals must also
work as business partners to the various business
units seeking to attract big data talent. As noted,
a key component of recruiting the right big data
people will be asking the right questions—and this
will require close collaboration with business leaders
to understand the business needs.
3. Develop creative strategies to recruit and retain
big data talent.
Big data analysts and business leaders who
understand big data will be in high-demand and
ripe for poaching. Talent management professionals
should anticipate this talent shortage and adopt
a more aggressive recruitment strategy for this
population. They should also think outside the box
and become more creative in recruiting for this skill
set – considering non-traditional background and
experience to meet the growing need. Retaining this
talent may also become a challenge, so HR should
consider compensation, incentive, and recognition
systems designed to keep this talent within the
organization.
4. Offer solutions to build big data talent in their
organizations.
HR and talent management professionals may want
to consider taking a page from Proctor & Gamble’s
training book and develop an appropriately scaled
organization-wide big data literacy program. The
program can include formal programs and seminars,
but on-the-job training, mentoring, and self-paced
learning programs can also offer affordable and
effective results. These developmental opportunities
may also provide an opportunity to identify
employees in departments other than IT who possess
an aptitude for, and interest in, big data analysis.
39
Conclusion
Big data is big business, but its sudden appearance in the
marketplace has left a huge hole in terms of talent. HR
and talent management professionals must stay ahead of
the curve by learning more about big data, its applications
to their organizations as a whole and their functions in
particular, and plan now to develop existing talent and
recruit new talent that will be needed to realize the full
potential of big data.
Ahalt, S. (2012 July). Establishing a national
Davenport, T. & Patil, D.J. (2012 October).
Manyika, J., Chui, M., Brown, B., Bughin,
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consortium for data science. University of
Data scientist: The sexiest job of the 21st
J., Dobbs, R., Roxburgh, C. & Hung
data analyst shortage is a challenge for
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from http://hbr.org/2012/10/data-scientist-
frontier for innovation, competition, and
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wp-content/uploads/2012 /09/NCDS-
the-sexiest-job-of-the-21st-century/ar/1.
productivity. McKinsey Global Institute.
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article/270538/.
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Hall, S. (2012 July 23). Big data talent
insights/mgi/research/technology_and_
Bradshaw, D. (2013 February 11). Business
shortage requires creativity. ITBusinessEdge.
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Rooney, B. (n.d.). Big data’s big problem:
schools’ big data revolution. Financial
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for_innovation.
Little talent. The Wall Street Journal.
Times. Retrieved from http://www.ft.com/
com/cm/blogs/hall/big-data-talent-
cms/s/2/c017f2cc-7082-11e2-85d0-
shortage-requires-creativit/?cs=50835.
00144feab49a.html #axzz2LFxFeSdr.
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Big Data: A Revolution that Will Transform
little-talent/.
Harris, J. (2012 September 13). Data is
How We Live, Work, and Think. New York:
Beyer, M. and Laney, D. (2012 June 21).
useless without the skills to analyze it.
Houghton Mifflin Harcourt Publishing
Smart Brief staff (n.d.). IBM targets big
The importance of “big data”: A definition.
HBR Blog Network. Retrieved from http://
Company.
data talent shortage with research center.
Gartner. Retrieved from http://www.
blogs.hbr.org/cs/2012/09/data_is_useless_
gartner.com/DisplayDocument?ref=clientFri
without_ the_skills.html.
SmartBrief. Retrieved from http://www.
NewVantage Partners staff (2012
smartbrief.com/news/comptia/storyDetails.
November 13). Big data talent shortage
jsp?issueid=24C1241E-D7B3-47E1-B3A9-
Henschen, D. (2012 October). Filling
a potential challenge at Fortune 1000
03FD89052B88&copyid=8B1DBCB9-
CIO editors (2012). Strategic Guide to Big
the Talent Gap in Big Data Analytics.
organizations according to NewVantage
AD38-4931-9A9E-474DFB6868D4&brief
Data Analytics. Framingham, MA: CIO.
Manhasset, NH: Information Week.
Partners Big Data Executive Survey Part
=comptia&sb_code=rss&&campaign=rss.
endlyUrl&id=2057415.
II. Yahoo! Retrieved from http://finance.
Clark, D. (2013 March 8). How big data is
IBM staff (n.d.). What is data (a) scientist.
yahoo.com/news/big-data-talent-shortage-
Thomson, I. (2012 October 4). Big data
transforming the hunt for talent. Forbes.
IBM. Retrieved from http://www-01.ibm.
potential-132900266.html.
skills gap needs filling says tech industry.
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com/software/ data/infosphere/data-
sites/dorieclark/2013/03/08/how-big-data-
scientist/.
is-transforming-the-hunt-for-talent.
The Register. Retrieved from http://www.
O’Ryan, R.E. (2012 November 19). Big data
theregister.co.uk/2012/10/04/big_data_
talent shortage? Is recruiting to blame?
skills_gap/.
Klobucher, D. (2013 March 8). Big data
Dice. Retrieved from http://news.dice.
Dahad, N. (2013 January 20). The Internet
ended work from home at Yahoo—will
com/2012/11/19/jobs-in-big-data/.
of things: The next platform for global
your company be next? Forbes. Retrieved
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from http://www.forbes.com/sites/
Press, G. (2012 December 1). Big data
why you should care. International Data
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sap/2013/03/08/big-data-streamlines-the-
news of the week: Beautiful $300,000
Corporation. Framingham, MA: IDC.
com/7502/internet-things-next-platform-
workplace-and-may-end-telecommuting/.
minds. Forbes. Retrieved from http://www.
global-innovation#.UT5RHr7D9jp.
Villars, R., Eastwood, M. & Olofson, C.
(2011 June). Big data: What it is and
forbes.com/sites/gilpress/2012/12/01/
Woods, D. (2012 November 21). Will
Lorenz, M. (2012 November 15). Does
big-data-news-of-the-week-beautiful-
data science become the new bottleneck?
big data live up to its hype? The Hiring
300000-minds/.
Forbes. Retrieved from http://www.forbes.
Site. Retrieved from http://thehiringsite.
com/sites/danwoods/2012/11/21/will-data-
careerbuilder.com/2012/11/15/does-big-
science-become-the-new-bottleneck/.
data-live-up-to-its-hype/.
40
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41
Marc Effron
President, The Talent Strategy Group
Miriam Ort
Senior Director, Human Resources for PepsiCo
This special section of ideas@work,
Volume 5 has been reprinted from the
book“One Page Talent Management:
Eliminating Complexity, Adding Value”
by Marc Effron and Miriam Ort with
permission from the authors and Harvard
Business Press, 2010. Copyright (c)
2010 by Harvard Business Publishing
Corporation: all rights reserved.
Chapter 1
A highly respected business journal has
recently published an article proving
that when a CEO makes and serves a
cake to his employees, it causes huge
increases in employee engagement
[humor us]. Two CEOs read the article,
believe the findings, and commit to
making a cake for their staff. They
each ask their talent management
leader to design a process that will
produce a suitable cake.
42
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little time to learn. Her goal is to develop a solution
that will meet the CEO’s goal—employees eat cake and
become engaged. She knows that she has to make
the process as easy and understandable as possible if
her busy CEO is going to use it. Although she’s quite
competent in making cakes, she starts by reviewing
the science behind making a great cake to ensure she’s
applying the fundamentals correctly. Her research reminds
her that only six ingredients are required to make cake,
and she realizes that the process might be easier than
she had thought. (On a benchmarking visit to Company
1, she had seen the cake design proposed by its talent
leader and, while she admired the intricate detailing and
cake “bling,” she didn’t think they supported the core
goal. She decided not to include those extras in her
cake design.)
In Company 1, the talent leader is excited about this
challenge. His goal is to design a plan that will allow
the CEO to make a world-class cake. He starts by
benchmarking the best cakes in the best companies
around the globe and consulting with renowned bakers.
He takes this knowledge and everything he has ever
learned about cake making and designs a detailed
cake-making plan. When followed correctly, his plan will
produce a five-tiered cake with flowers of multicolored
frosting cascading from layer to layer, intricate icing
designs, a working fountain of melted chocolate,
and a rich butter-cream filling flavored with imported
Madagascar vanilla.
When his plan is finished, the proud talent leader hands
the CEO a 73-page instruction manual, 124 different
ingredients, and 7 pans. This, he tells her, will produce
a world-class cake with less than 100 hours of effort.
The CEO politely thanks the talent leader but wonders
how she can ever make this cake. She’s committed to
making a cake, but she simply can’t justify the time and
energy required to make this one. When she asks the
talent leader if there’s another way, he repeats that this
is a great cake-making plan—in fact, GE uses a very
similar plan to make its cakes. The busy CEO never
finds the time to make that cake, and without cake her
staff’s engagement decreases and the company’s
performance declines.
Finally, she realizes that while her basic recipe simplifies
the steps involved in making the cake, she can add even
more value. She mixes together the dry ingredients to
create a cake mix, greatly reducing both the time the
CEO will need to spend making the cake and the chance
for error. She gives it to the CEO with two eggs, a can
of frosting, a pan, and a one page instruction sheet.
She tells him that in one hour this simple process and
few essential ingredients will make a nice cake that the
employees will enjoy. The CEO sees that with little effort
he’ll be able to serve his employees cake, making them,
him, and the talent leader happy. The client now values
the talent leader, who gets invited to have a seat at the
table and share the cake.
At Company 2, the talent management leader is equally
committed to the goal. She understands that the CEO has
great intentions but no expertise in cake making and
1
2
3
43
companies and employees can work best together. We
understand the combination of job experiences, coaching,
and formal training that is optimal for development. We
know which talent practices have proved to be effective
over time. In short, we already have nearly every answer
needed to develop talent in our organizations.
Yet, there seems to be a gap between our knowledge of
how to develop talent and our ability to actually do it.
This is difficult to understand, given that most companies
have an HR department and many larger companies
have dedicated talent management or leadership
development groups focused on precisely that task. So, if
our organizations want to grow talent, know how to do
it, and have the resources necessary to get it done, what is
not working? More importantly, how can we fix it?
Sound a little silly? Substitute “performance
management” or “succession planning” for “making
a cake.” Does your organization resemble Company
1, with academically perfect talent-building processes
that are both unusable and unused? Or are you closer
to Company 2, building talent with lean, easy-to-use
processes that are guaranteed to achieve results?
Recent research by McKinsey & Company, Boston
Consulting Group, and Deloitte suggest the former.1
Their studies confirm that organizations are unhappy
with their ability to grow talent and are becoming
increasingly frustrated as their talent needs become
more severe. Outside their walls, they see a competitive
environment in which winning requires top-quality
talent, while inside those walls, they see millions spent
on talent development with very few results. Line
executives blame human resource (HR) groups for not
delivering better leaders, while HR says those same
executives talk a great game but do not deliver the
necessary resources or commitment.
While this situation is challenging, it is also somewhat
strange due to one key fact: we already know almost
everything necessary to grow great talent. Sixty years
of high-quality behavioral and industrial/organizational
psychology research can help us understand how
44
Four Barriers to Building
Talent
Through our corporate and consulting experience,
we have identified four talent-building barriers that
organizations create for themselves and then regularly
stumble over. These barriers explain why line executives’
exhortations and HR’s actions to build talent are not
translating into increased talent quality and depth.
Creating Needless Complexity
When you consider the simple intent behind most talent
processes, it can be challenging to understand why a
line manager experiences so much complexity. A simple
process like setting goals often becomes a multipage,
headache-inducing exercise and in doing so puts a
huge barrier in the way of increasing organizations’
performance.
Where organizations go wrong is that they fail to balance
complexity with value as they build these processes. It is
not that the additional components layered on—from
highly detailed competency models to the extra hundred
questions on an engagement survey—are technically
wrong. Many have sound behavioral science to support
their inclusion. However, as each additional element is
added, evaluating the trade-off between the complexity
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it brings to the overall process and the impact it will have
on the original business objective is critical.
Adding No New Value
Talent management tools have not been designed to help
managers make smarter decisions or to make their jobs
easier. Managers often need to attend training sessions
to learn how to use a talent tool or process or must rely
on their HR manager or other expert to help them. When
a manager receives an engagement survey report, can he
quickly understand the business choices he should make
because of it? The talent review process may differentiate
the best talent from the rest, but do managers know
how to use that information productively? In many
organizations, managers have come to see talent
management tools and processes as largely divorced from
their day-to-day management challenges.
Neglecting the Science
As we mentioned earlier, HR and talent management can
rely on a rich body of academic research to help inform
the right decisions. Basic behavioral science (e.g., Ivan
Pavlov’s classic conditioning or B. F. Skinner’s behavioral
research) provided the foundation for the industrial
and organizational psychology research (e.g., Victor
Vroom’s expectancy theory or Richard Hackman and Greg
Oldham’s job design) of the past fifty years that informs
every modern talent practice, from 360-degree feedback
to conducting performance reviews.
If companies would faithfully follow this science, they
would find that it performs up to its billing. Their talent
practices would work as the research suggests they
should. If they do not understand or choose to ignore the
science, companies will build talent practices using biases
and assumptions and wonder why their talent problems
are not going away.
Lacking Transparency and
Accountability
Few managers enjoy having tough conversations
with their employees. Giving feedback about subpar
performance or explaining that a career goal will never
be achieved significantly increases most managers’
heart rates. But transparent conversations like these
drive higher performance. Unfortunately, in too many
companies, fear of the consequences or a genuine
belief that employees do not need this level of clarity
means talent practices are opaque.
It’s also understandable that managers usually prioritize
coaching, performance feedback, and creating
development plans after activities that provide a more
immediate benefit to their business. These talent
practices are still important, however, and most
organizations do not hold their managers accountable
for executing them.
Designing a New
Approach
In late 2005, finding a way to overcome these
challenges dominated our thoughts. Marc was the
recently appointed vice president of talent management
for a $9 billion consumer packaged-goods company,
and Miriam was a manager on his team. The company
had started a major restructuring process that would
require great talent to achieve its objectives and strong
talent processes to sustain them. The organization
was not utilizing the talent processes in place, which
unfortunately felt like those in Company 1. Our charge
was to make fundamental changes that would allow
the company to quickly and easily identify the talent it
had, deploy that talent in the most effective possible
way, and rapidly develop critical capabilities. As an
added twist, we had to build and implement these
processes and show meaningful results in less than a
year in order to support the turnaround.
Sitting at a conference table in our New York City
office, we started to address our task with a blank
sheet of paper. We knew that we had great latitude
in what processes we proposed for performance
management, talent reviews, and other talent practices.
We also knew the somewhat depressing research on
the effectiveness of those practices. We recognized that
we had to find a better way.
45
Since little research existed about why talent practices succeeded in organizations, we asked
ourselves what we knew to be true. We concluded that:
The science works.
We knew that, thanks to legions of behavioral and industrial/organizational psychologists, how
to change leaders’ behaviors, grow their skills, align them with the business, and achieve almost
any other desired organizational outcome was widely known. Although that research still required
some translation into actual process designs, the raw material did, for the most part, exist.
Only implementation matters.
Our experience (and a little common sense) told us that no matter how artful the design, a talent
practice would work only if it was being used. Unfortunately, we had seen that many companies’
talent practices were bureaucratic, complex, and time consuming, so managers either did not use
them or made a minimum effort to comply.
Managers want to succeed.
Line managers have challenging goals, and most welcome a talent tool or process that helps
them to be successful. In our corporate and consulting experience, we had heard from managers
worldwide that traditional talent practices from talent reviews to 360-degree feedback seemed
designed to benefit HR, not to help the average manager.
Transparency and accountability guarantee results.
We understood the noise caused in an organization when processes were not transparent.
Eliminating that noise would make the processes more legitimate and likely to be used. We also
understood that some managers would never elevate talent to the top of their agenda. For them,
and for forgetful others, accountability for talent outcomes was required.
We were confident that if we used these truths to shape
our talent practices, the results would be at least somewhat
more effective than traditional talent processes and, we
hoped, much more.
Our design process started by identifying the business’s
most urgent talent objectives. First, we needed to
understand the quality and depth of the company’s talent
in order to ensure that we could make the right talent
selection and investment decisions. Next we needed
everyone in the organization aligned on the vital few goals
and behaviors that would turn around the business. This
alignment would accelerate progress toward those goals.
Finally, we needed to raise engagement to the highest
possible level to maximize every associate’s performance.
46
We designed our solutions by faithfully applying our
four truths. Since we knew the science worked, we
researched what the core science found to be effective
at driving individual and company performance, not how
HR practices were typically designed. We knew that only
implementation mattered, so we stripped complexity
from existing processes and built new ones that balanced
complexity with a commensurate amount of value.
Our constant focus was on whether the most skeptical
managers would find the process simple and valuable
enough to use. Since we knew that transparency and
accountability guaranteed results, we built these elements
into every practice.
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When we finished designing our processes, even we were
surprised by the results. After accurately translating the
research into practice, we were left with the simplest
possible path from science to effective execution.
Practices that managers had experienced as intensive,
bureaucratic, time-consuming exercises had been reduced
to one page, intuitive, business tools. When we applied
this approach to our performance management process,
for example, the result was a simple, one page form
that managers quickly adopted. In every practice, the
elements of complexity that could not justify their overall
value to managers had fallen away.
Not only was complexity gone, but value had been
added back. We could now turn complex HR data into
valuable insights for managers. We could tell them
exactly which actions would increase engagement in their
group and by how much. We could highlight the most
important behaviors for them to change, while avoiding
the resistance that typically accompanies 360-degree
feedback. We had found a way to turn the theoretical
power of behavioral science into actual results.
Focus on the Business Objective:
Creating Clear and Motivating Goals
When we wanted to set and communicate goals that would maximize performance, we
examined the academic research on goal setting, not the best practices in performance
management. In the research, we found four key concepts related to setting motivational
goals—goals should be extremely challenging, in the employee’s self-interest, few in number,
and very specific. Along with those findings, we found research that disproved conventional
goal-setting wisdom, including that participation in goal setting improves performance and that
one scale is superior to another.
In our goal-setting design, we included just those elements proven to work and left out
everything without clear science to support it. The result was a model of OPTM (One Page Talent
Management – what we call our structured approach and philosophy for building talent) applied
to the performance management process. Our finished goal-setting form kept employees
focused on the most important goals by allowing no more than four to be listed. Since the
science did not indicate that anything else was needed, we included just two boxes per goal—
the goal and the metric. A one page instruction sheet explained how to write goals that were
challenging and in the employee’s self-interest.
This new process—our first attempt to design on one page—yielded two benefits. The expected
benefit was that participation in goal setting went from about 30 percent to above 90 percent.
The unexpected benefit was that managers now understood that we had their best interests at
heart, which gave us permission to continue our talent management transformation.
47
Long-Term Performance
Results
This is an appropriate time to ask whether this very
untraditional approach actually delivered results. It is also
a good time to briefly share our point of view on talent
metrics, which, as you may now suspect, varies somewhat
from traditional views. We are big fans of quantitatively
measuring talent results and using the data to make
decisions about talent. However, we believe that the best
overall talent metric is the long-term performance of the
business. Other talent metrics are interesting intermediate
measures of process performance and, although helpful
in measuring progress, do not measure the only talent
outcome many shareholders and executives care about.
Long-term performance is also a good metric because,
if you believe what the research indicates—that better
leaders deliver better results—over time, better talent
practices deliver better leaders who deliver better
performance. Both the Top Companies for Leaders
research and a number of academic studies provide
ample proof.2 In short, if talent management is working
well, the company is much more likely to succeed. We
also recognize that although talent is critically important,
hundreds of other variables affect corporate performance.
It would be wonderful if it were possible to draw a
straight line from talent practices to specific business
outcomes, but it is not.
For the work on talent management that we did in
our company, we can point to corporate performance
metrics and both quantitative and qualitative measures
of process performance. During the three years after
we implemented our OPTM processes, our organization
was able to reduce administrative expenses by nearly
4 percent, increase revenue by more than 20 percent,
increase profit margins by almost 50 percent, and was
regularly cited by the media as a well-run organization.3
These were certainly strong results, but can be considered
even stronger because they were delivered during the
worst economic crisis since the Great Depression.
At the process level, we worked to increase engagement,
the power of talent reviews, and the effectiveness of
performance management, among other efforts.
48
Engagement increased 20 percent (30 percent among
managers), and performance discussions took place for
more than 90 percent of associates, up from less than
30 percent. The number of “ready now” successors
for key roles increased by 25 percent, even though we
aggressively increased the quality standards for talent
each year. Our success rate for using coaching to change
behaviors went from well below 50 percent to north of
90 percent. There are many more similar results that we
could present.
Strangely, the qualitative measures actually seem more
powerful than the quantitative ones. General managers
thanked us for the new performance management
process. That was certainly the first time in our careers we
had ever heard that! The executive team praised the talent
review process as the most effective in the company’s
history and said that better people decisions were being
made faster because of it. Engagement was woven into
the culture of the company. There were more qualified
general managers available for key roles. We had moved a
meaningful amount of talent who no longer fit out of the
organization. Overall, these metrics seemed a much better
measure of success than anything quantitative.
Can we claim that everything that went well with talent
was because of our processes? Of course not. It would be
impossible to separate out the effects of new executive
team members, adjusted compensation structures, and
all the other variables that might have had an impact
on talent outcomes. Still, at the end of four years, we
felt comfortable claiming that our approach was more
effective than typical talent process and, very likely, quite
a bit more.
One Page Talent
Management
Shortly after we began implementing these practices, we
were invited to speak to a leading HR group about the
talent management changes our company was making.
Needing a clever title for the presentation, we coined
“One Page Talent Management.” We now use the term
to define the integration of behavioral science, simplicity,
accountability, and transparency into practices that
accelerate the development of talent.
DO
E VNE E
L O PP I A
NG
G R
MRAVNI RAT U
GAEL MT EEANMTS
We use OPTM both figuratively and literally. As an
integrating concept, it stands for the addition of value
and removal of complexity from talent practices. At the
most practical level, it suggests a design discipline for
creating these practices and a metric for evaluating their
design. We do not expect that the key form or process
for every talent practice can be reduced to one page,
but we believe that aspiration forces an entirely new way
of thinking about process design. Most importantly, we
consider the OPTM approach to be a superior way to
grow better leaders faster.
The Added Benefits of Simplification
It Gets Even Better
If having talent practices that allow you to build better leaders faster is not enough to convince you that
OPTM is the right approach, a few other benefits are worth considering.
Line managers get a free week.
Processes are cheaper to design.
If you transform talent practices, managers will
get back at least forty hours a year compared to
what they are spending now on current talent
practices. Processes that used to take an hour per
employee will take as little as fifteen minutes.
Less complex processes do not require as much
consulting time, as many benchmarking trips,
or other costs traditionally associated with the
design process. Given the $50,000 to $500,000
you can spend designing and implementing more
traditional talent practices, OPTM starts to look
even more compelling.
The design process is faster.
Although it might seem intuitive, simpler
processes take much less time to create. Weeks,
not months, are needed to design and implement
talent practices. A faster design cycle means
you will start building better leaders, even
faster. It also means that you can get feedback
more quickly on which parts of the design need
adjustment, make fast changes, and re-release the
new process in record time.
1.Deloitte Touche Tohmatsu and the Economist Intelligence Unit,
HR earns the right to do more.
A simple, effective process quickly wins the loyalty
of managers and executives. They will be much
more receptive to your next recommendation if
your last one proved its effectiveness.
2.Marc Effron, Shelly Greenslade, and Michelle Salob, Top Companies
3.Avon Products, Inc, “The Avon Opportunity, Annual Report
Aligned at the Top: How business and HR executives view today’s
for Leaders 2005 (Lincolnshire, IL: Hewitt Associates LLC, 2005); Mark
2007,” http://www.avoncompany.com/investor/annualreport/pdf/
most significant people challenges—and what they’re doing about it
Huselid, Susan Jackson, and Randall Schuler, “Technical and Strategic
annualreport2008.pdf, October 8, 2009,
(New York: Deloitte Touche Tohmatsu, May 2007), 6; Ranier Strack,
Human Resources Management Effectiveness as Determinants of Firm
Jean-Michel Caye, Michael Leicht, Ulrich Villis, Hans Böhm, and
Performance,” Academy of Management Journal 40, no. 1 (February
Michael McDonnell, The Future of HR in Europe: Key Challenges
1997): 171–188, AOM Archive, Ebscohost.
through 2015 (Boston: Boston Consulting Group, June 2007), 16;
Matthew Guthridge, Aamus Komm, and Emily Lawson, “Making
Talent a Strategic Priority,” McKinsey Quarterly, no. 1 (2008): 50–59.
49
Drive your
organization’s
talent management agenda.
T A L E N T
M A N A G E M E N T
I N S T I T U T E
One of the most pressing strategic issues facing CEOs
today is whether they have the right talent with the
right skills in the right places. UNC is partnering
with three of the world’s most experienced Talent
Management Practitioners to help HR and Talent
Management leaders productively and proactively steer
their organizations’ talent. Come learn from Marc
Effron, Corey Seitz, and Jim Shanley – it’s your turn in
the driver’s seat.
To learn more, visit www.tmi.uncexec.com.
50
Managing employee talent is vital to the success
of any organization. At UNC Executive
Development, we provide learning experiences
designed to empower participants to think
differently and consider new ways to tackle
challenges and grow business.
We listen to our partners and develop a deep
understanding of their business, industry, and
needs. Our approach to program design and
delivery draws upon the power of real-world,
applicable experiences from our faculty and staff,
integrated with the knowledge our client partners
share about the challenges they face. We make
a commitment to the organizations we work
with to meet their business and academic
objectives and to provide ongoing support,
client management, and follow-up.
We call our approach The Power of Experience.
We combine traditional with experiential and
unique learning to ensure that all individuals
gain relevant new skills that they can implement
within their own organizations. Through action
learning and business simulation activities, we
challenge participants to think, reflect, and
make decisions differently.
Our goal is to provide memorable,
transformational learning which results in
stronger individuals leading stronger teams
and organizations.
Nonprofit Organization
U.S. Postage
PAID
The University of North Carolina at Chapel Hill
Kenan-Flagler Business School
Executive Development
Campus Box 3445
Rizzo Conference Center
Chapel Hill, NC 27599-3445
Permit Number 177
Chapel Hill, NC
In this issue:
V U
C A
Developing Leaders in a VUCA Environment
Got Game? The Use of Gaming in Learning and Development
Building A Resilient Organizational Culture

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