What do really successful companies have in common? They focus on leadership development systems and make it their number one priority. Designing high performing cultures revolves around the assessment and continuous improvement of nine specific systems that are designed to attract and retain top talent.
Strategically assessing and improving the design and education of these systems is critical to your company’s success. Think of each of these systems as representing one of nine ingredients that combined become the recipe of talent.
But, designing and improving your current nine talent systems is only half of the equation. The other half is dedicated implementation. Once designed, every manager at every level must follow and administer the system and implement it the way it was designed. Strategic communications, training and accountability are needed for the execution and long-term sustainability of each of the systems.
When asked about their plan for the next 3 to 5 years, most CEO’s express that their top concerns (after cash flow and revenue issues) are ”PEOPLE”. The combination of the following nine systems impact the quality and productivity of your company’s delivery model, and will strategically eliminate your concerns and worries about your most valuable resource…PEOPLE.
1. Recruiting System
How your company decides what your recruiting system looks like, who is involved, where you recruit and how clear you are about exactly what type of talent you are looking for, are all ingredients of a well designed strategic recruiting system. The quality and quantity of possible candidates will over time change the culture of your company and consistently improve your customers experience with your business.
QUESTION: What is the GAP between your current recruiting system and an industry leader’s recruiting system?
2. Hiring and Selection System
Take a moment and imagine what would be different if you could replicate your top 2-3 employees? Most executives have allowed their hiring system to be inconsistent, used by untrained professionals who use improper assessment tools. Your current hiring system needs to be improved and or redesigned to produce better results.
QUESTION: What changes would your company experience if you hired only “A or B” performers for the next five years?
3. On-boarding System
On-boarding, often called new employee orientation, is rarely designed to be world class. In fact, too often managers meet and then put the new employee to work immediately. The on-boarding system in great companies can last as much as three to six months, starting a week prior to their first day at work and continuing on for at least another week.
QUESTION: What would you save in hard dollars annually if the productivity of all new hires increased significantly and in a more timely manner because of how quickly and effectively new associates are oriented at all levels?
4. Training and Development System
Organizations really have three options when it comes to people. They can tolerate their existing performance, go outside the company and buy new talent, or develop the talent already on your payroll. The amount of time allocated for training makes the difference. The American Society for Training & Development’s (ASTD) annual survey shows that employees at most mid to large companies received 35.2 hours training, while employees at BEST organizations allocated 49.1 hours on average. The ASTD survey also showed that if your organization offers about 30 hours of training per employee per year; and spends around $1,182 per employee, you are about average. Your board may not agree with your decision to be just “average”.
QUESTION: What would it mean to your company profitability and customer loyalty to have the most talented and skilled workforce-only top performers?
5. Accountability System
This system aligns the human resources of every full and part time associate to the key priorities of the organization. Training for all managers and associates is critical to ensure that employees have clarity about their position and how they will be held accountable and their performance measured. This process also provides important information for compensation planning.
QUESTION: What would it mean to your culture to have only positive employees that know exactly what their contributions are to your company goals?
6. Leadership Development System
If leaders create the culture of your business through their behaviors, why do so many executives consider the budget to develop their management team such a big expense? Our performance management system designs an individual development plan (IDP) for all management, but too many companies simply offer training and managers may or may not attend with very little effort given to conduct a needs assessment by identifying key leadership competencies required in your business. According to the ASTD national study in 2013, average performing companies spend about $1100 per manager per year.
QUESTION: Developing leaders is much more than a once or twice a year training. Haven’t you tolerated to many average performing managers for too long? What would it be worth over the next two years to significantly increase your leadership talent? Remember, an organization will never outperform its leadership team.
7. Promoting of Talent System
Think about it. How do you identify associates you think should be a frontline manager? When should a front line manager be promoted to be a department head or director? How do you currently promote directors or middle managers into executive level positions? The system should identify and prepare top candidates for promotional options. Promoting talent is all about preparation, planning and proactive development.
QUESTION: What would it mean to the quality of your management team if only the most talented people are promoted into management positions?
8. Compensation System
It’s no surprise how poorly and unstructured many companies are in their approach to compensating employees. Laws vary from state to state, but all require management to not discriminate or treat select people differently when it comes to base pay increases, bonus systems, profit sharing or any other method of recognizing effort and results. Your company must have a system and every manager must be trained to consistently use the system the way it is intended.
QUESTION: What would it save you in hard dollars annually if top performers were paid more than average performers and your bonus system was directly tied to the individual’s actual measurable performance and to the actual performance of the company?
9. Measuring Culture System
We have all hear and generally believe if it is worth measuring, it is worth investing in. Every culture is a reflection of its leadership. However, your entire management team has created your current culture, weather by design or by luck. Unfortunately, almost every organization has employees who are sour and negative. Those individuals will not perform at a high level in an organization. However, they often exert an influence over the culture that is more powerful than that of your positive employees. Such loudly negative employees should be considered a virus and should not remain on payroll, as they’re being paid to take away from your bottom line. Jeof Bean, author of that book (co-author: Sean Van Tyne), presented his research at the 2011 National JD Powers annual conference, which includes this little gem: “The top ten customer experience leaders generated cumulative total returns that were 41% better than the S & P 500 Index.”
QUESTION: What would it do to your annual profits if you raised your prices and significantly increased your customer’s experiences and tripled your referrals?
Knowing the ins and outs of your company’s talent systems can put you steps ahead of your competition. Each of the above management systems are unique, yet all are integrated and contribute to the quality of your greatest asset – TALENT! Think of them as a company wellness plan – a well-designed talent system recipe that orchestrates every core part of your operation and keeps your company running like a well-oiled machine!
What are your scores below costing you each month and why are you okay with those scores?
Scoring Report Card
Instructions: Circle one rating for each.
1. Recruiting System A B C D
2. Hiring and Selection System A B C D
4. Training and Development System A B C D
5. Accountability System A B C D
6. Leadership Development System A B C D
7. Promoting of Talent System A B C D
8. Compensation System A B C D
9. Measuring Culture System A B C D
ACTION: In one day I can complete an assessment of your current nine talent systems, are you ready to take your business to the next level?