Outlaw eReport

STRATEGIC STAFFING PROCESS:
A Holistic Approach to Better Organizational Results

In years past, many organizations felt there was an ample labor pool
to provide an unending supply of employees for their human capital
needs. They believed even if employees left, Personnel simply placed
an ad in the paper and easily filled the position. Even if this has been
true in the past, it will not be in the future. Between now and the year
2005, the reduction of workers entering the workforce will increase the
number of jobs unfilled. In certain positions, such as entry level jobs
and high tech jobs, the labor situation will be even more critical.

The effort and investment required to hire, train, and develop a top
performing employee is significant, and it dramatically impacts the
bottom line. The more the wages increase and the more the job
demands highly skilled workers, the more it will take to fill the job. It is
no wonder organizations are paying more attention to the acquisition
and retention of their workforce.

Because of scarcity, cost, and impact of the workforce, many
organizations are taking a significantly innovative and different
approach to staffing. No longer is staffing the organization separate
or unconnected to its strategic business objectives. Executives are
realizing that just as getting customers, retaining customers, establishing product superiority, or creating marketplace dominance is important, having the organization staffed with capable, talented, and experienced individuals is of critical importance and should be a strategic objective. Staffing is now considered a key element of the business strategy of many innovative organizations.

For the first time, companies have begun acquiring other companies not
for products, technology, customer base, or market share, but for their
employees. The capability of employees was the most important asset
considered in the decision to buy the company.

The organizations that realize the importance of staffing are also realizing they cannot reach their objectives by focusing on one or two elements. The attention cannot only be placed on recruiting ignoring the quality of the hiring decision. Retaining employees will reduce the need to hire, but unavoidable attrition and growth require continuous recruiting.

Staffing is now being approached in a holistic manner by progressive
organizations. Executives realize hiring talented people is fruitless unless
employee needs are developed, employees are rewarded for their efforts, and, like all precious assets, they are retained. They also realize the quality of the individual hired and level of "fit" between the individual and that particular job will determine the difficulty of effort required to develop, reward, and retain. Considering only one or two elements of this strategic objective alone is foolhardy because each is interrelated. One affects the other. The better one area is done the easier the others will become.

If this innovative approach will increase success, the question you are
probably asking is, "How can we do it in our organization?" The first step
in changing anything is to strongly declare its importance and the need for change. For staffing to be strategic requires it be identified as a business objective elevated to the level of other critical organizational and business objectives. It doesn't do any good to make the "right" statements in literature, or distribute memos and e-mail declaring the importance of staffing, and yet spend the time during staff meetings talking about sales, manufacturing, and service and only offhandedly ask a question such as, "How are we doing on getting our positions filled?"

By shifting the order and priority of staffing to the forefront, organizations can ensure they have staff to enable sales to be made, production levels hit, and customers satisfied. In short, to elevate staffing to a strategic level requires real, concrete action, not just lip service.

In some organizations shifting the priority of staffing to the forefront may require a change in mission, objectives, personnel and even structure of the Human Resources Department. The department may have to be elevated in stature, resources and even power. Human Resources must take a more active role in strategic planning and key decisions.

Once the importance of staffing has been established and elevated to the strategic level, you will want to improve results. Begin by examining your current situation and identifying your needs. This examination can take the form of a staffing audit, such as the ones OUTLAW GROUP conducts for organizations, which analyzes past actions such as employee intake, terminations, and its impact. In addition to simply examining past statistics, root causes for results are uncovered, such as the recruiting effort, hiring process, training and development, reward and recognition systems, as well as management of personnel. Experience has shown our Employee Attitude Surveys are extremely enlightening. Organizations can create all the right reward and retention programs and say all the right things in their recruiting literature, but if the management of employees does not reflect these values, it will all be wasted. In short, tremendous amounts of resources can be invested to create the right work environment and staff it with top performing individuals, only to have the actions of a few poorly trained or unenlightened managers erase the effort and cause significant turnover. In today's expanding job market and shrinking labor pool, employees have many positions to choose from and will not hesitate to move.

Organizations develop a plan to ensure that objectives are met in each of their strategic areas. Staffing is no different. Begin developing the strategic plan to provide your human capital by first assessing the organization's needs. Identify past turnover by tenure, job type, level, location, and other key factors to get a greater understanding of its cause. Examine exit interviews, executive interviews, and attitude surveys to determine the factors contributing to turnover. Based on the business needs and financial factors such as salary levels and impact of loss, determine an acceptable turnover level by department and position. Evaluate the factors or reasons for turnover and determine the response or changes that must be made to bring turnover within the acceptable level. While turnover can never be eliminated, it can be brought to a manageable level.

Recently, in doing a turnover analysis for a division of a Fortune 500 company, we found if their turnover level for the past year had been reduced to the industry average, the savings would equal the dollar amount they were below their profit target. In short, if they had only reduced turnover to the industry average, they would have met the profit expectations for the division.

Experience has shown for every dollar turnover costs are reduced, far more goes to the bottom line because turnover affects so many other areas of the organization's operation. The impact on customer retention may be difficult to calculate, but is very tangible and substantial.

After you understand turnover, project the employment needs for the organization just as you would its financial needs for the future. Take into account factors such as overall business growth, replenishment for turnover, attrition such as termination and retirement, or movement of individuals to different jobs and locations. Simply projecting needs is not enough. With today's changing workforce it is important to define the knowledge and skills required. The identification of need and retraining of an employee to fit current needs is a critical part of a strategic approach. Utilizing current employees is part of retention.

Now, more than ever, it is important to ensure that those hired can be top performing employees. As wages continue to rise, increased productivity becomes an even more critical factor to prevent inflation and reduced profits. One of the key determinants of productivity is "job fit". Even a highly motivated, intelligent, and skilled individual will not be successful unless they have the natural attributes to fit the work they are being asked to accomplish.

To ensure those hired fit the position, first clearly define each job. Identify the duties, responsibilities, level of performance, and career growth opportunities available. Now look beyond just the responsibilities and duties to determine the attributes of success. This can be done by benchmarking attributes of top performers. The resulting benchmark is used to measure candidates' potential for performance.

Some benchmarks or attributes are easier to identify than others. In positions such as sales and management the individual's behavior and values may be far more important than his or her knowledge or skill. Identify or develop instruments or tools to assist in the selection of candidates to ensure they have the benchmarked attributes required. For example, if extroverted behavior is required for a salesperson, being able to measure a candidate's extrovert level allows the determination of "job fit" between the individual and position. Most important, "job fit" makes possible better hiring decisions: employees who require less training and management and become higher performers.

Recently, we found the most significant reason for turnover for Financial Advisors at a Wall Street firm was poor "job fit," and we even isolated it to two primary attributes. The cost of their turnover was a minimum of $100,000 per Financial Advisor. Knowing what attributes are necessary for a good "job fit" as a Financial Advisor and developing methods to measure presence of these attributes in a candidate will dramatically improve success and the bottom line.

As business changes, it is important to periodically redefine the "job fit" for candidates. Once you know what you are looking for, develop the sources to ensure you have adequate candidate flow. By examining previous results, the best candidate sources can continuously be identified and your efforts focused on those sources. It is important to continually look for new and innovative sources, as well. For example, several years ago the Internet may not have been a reliable source of non-technical candidates, however it is improving daily and will only continue to gain in its importance and reliability. It is easy to think that one or two really good sources will meet all the needs. However, as the labor pool shrinks and the competition for workers increases, it is necessary to ensure that all sources are used to keep jobs filled. We can't afford to leave one untapped if it can be productive.

A well designed and implemented selection process is necessary to ensure consistent results and make hiring much easier. First, identify the steps such as screening, interviewing, reference checking, background checking, hiring decision, etc. Many would like Human Resources to control and implement the process. From my experience, it is best to have those with a vested nterest in the quality of the employee hired, such as the line management, highly involved in the process. This means they not only assist in the process, but also have ownership for those hired and a vested interest in their success.
Monitoring and control by Human Resources ensures the quality of the
ndividual hired, the correct implementation of the process, and legal
requirements are met.

The selection process should be monitored frequently to ensure that timetable and hiring objectives are being met. Tracking candidate flow and progress through the process helps spot problems and bottlenecks. Analysis can even determine the ratio or number of candidates needed for one hire. With this information recruiting can be planned to ensure positions will be filled by target dates. Applicant sources that have provided the greatest results can be identified and recruiting efforts focused on areas that provide the greatest return.

Continuously monitor turnover to identify problems. Don't just look at increases or problems. Look for positive changes and determine what works. Executive nterviews, exit interviews, and most important, Employee Attitude Surveys can help identify causes of existing turnover and predict future trends. Employee Surveys identify levels of employee satisfaction, just as customer surveysdetermine levels of customer satisfaction, and can point the way to improvements and the return on the effort to retain employees.

For years, organizations have monitored sales figures and customer satisfaction levels because they were two of the strategic elements of the organization's success. Because employees are the human capital that enable an organization to make a sale, produce a product, and serve a customer, allocate the same time, energy, and effort to monitor this element of your strategy. It is your report card indicating your future success.

Whether your organization is high or low tech, public or private, small or large, it is only able to succeed because it is staffed with talented, motivated, capable employees. The quality and quantity of your staff is what your organization's success is build on. Build a firm foundation for your success.

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Outlaw Group, Inc.

900 Johnnie Dodds Blvd. Suite 115 •Charleston, SC 29464 • 800.347.9361 • fax 843.881.1758 • info@outlawgroup.com

www.outlawgroup.com ~ www.wayneoutlaw.com ~ www.smartstaffing.net