The New Talent Management The Radical Shift
by HEIDI SPIRGI
As Senior Vice President of Product and Technology, Heidi Spirgi is responsible for the direction and strategy of the company’s technology products. She oversees all aspects of global delivery and consulting to ensure that products drive a measurable increase in team performance and engagement.
With over 20 years of experience in HR and the technology industry, Heidi has worked with many of the world’s largest companies, helping them reinvent their approach to talent and leverage new and emerging technologies to create a meaningful employee experience.
Heidi is an active participant in the HCM community and is a frequent presenter and panelist at industry events. She writes frequently on the topics of HR, talent management and technology. Heidi holds a master’s degree from the University of California Los Angeles and a bachelor’s degree from the University of Michigan.
Man: As Senior Vice President of product and technology, Heidi Spirgi is responsible for the direction and strategy of the company's technology products. She oversees all aspects of global delivery and consulting to ensure that products drive the measurable increase in team performance and engagement. With over 20 years of experience in HR and the technology industry, Heidi has worked with many of the world's largest companies, helping them reinvent their approach to talent and leverage new and emerging technologies to create a meaningful employee experience. Heidi is an active participant in the HCM community and is a frequent presenter and panelist at industry events. She writes frequently on the topics of HR talent management and technology. Heidi holds a master's degree from the University of California, Los Angeles and a bachelor's degree from the University of Michigan. Please welcome to Elevate 2015, Heidi Spirgi.
Heidi: Hi. Welcome to the New Talent Management: The Radical Shift in What You Need to Know to Not Be Left Behind. I'm Heidi Spirgi with The Marcus Buckingham Company, and I'm here to share with you some of my perspectives and thoughts on where we are today with talent management, and where we're going over the next few years.
First off, I want to give you a little bit of background on myself. I have been in the HR technology space for over 20 years now, believe or not, and a year ago today, I was ready to leave the HR technology industry entirely. I'd become incredibly disillusioned by the lack of real progress and real change and impact that we as an industry were making with our customers. Most of my career in HR technology, I've been focused on building and implementing and deploying and trying to drive transformation into organizations, particularly in the area of talent management and really trying to leverage technology to find new ways to optimize the way people are leveraged within organizations and also optimize and improve the human experience in the workplace. And after 20 or so years, I had really become disillusioned.
And then I discovered StandOut, which is our product at The Marcus Buckingham company and I got really excited by the potential for all of us in the industry to really do things radically differently in talent management. So I joined TMBC and I am the VSP, as you could see here, of Product and Technology. And I'm really excited about being part of this sea change in HR tech to really think very, very differently about what the potential is to deliver change and really impact both business outcomes as well as the employee experience within organizations through technology. So let's get started and I'm gonna share with you some of my thoughts and what I am excited about.
I think a good place to start is taking a quick look at where we've come from. The early 90's to the early 2000's, we really saw this era of automation where organizations were moving pretty heavily, manually intensive processes online and automating in form of best-of-breed solutions, really automating those processes to drive higher levels of efficiency. From there we started to realize in the early 2000s that there's a lot of opportunity and a lot of advantage to be gained by developing unified suites and really integrating processes collectively in order to optimize those processes and how they work in the workplace to really deliver a higher level of effectiveness to the organization. So that was really the dawn of the era of the talent management suite.
And that's really where we've been largely operating over the last 10 or plus years. And what I've come to learn and I think many of us have come to learn is that automation and optimization is good. It's not bad. It's absolutely needed. But it has limited impact in terms of its ability to truly accelerate the individual performance of a person, the individual performance of a team and ultimately the performance of the business. And what we really started to see over the last couple of years is this new breed of technologies which are leveraging, really some new and advanced principles in technology, such as machine learning, such as data visualization across social networks, leveraging social networks themselves to really accelerate the productivity and the performance of the workforce in new and very radically different ways.
And what we're seeing is this is a shift as we start to focus on the acceleration of performance and productivity. We're shifting away from process. We're shifting away from HR with the goal of really trying to maximize human potential and maximize the impact on the business. So it's a very exciting era in something that I think is really going to make a major impact on the way businesses function in the next 10 or so years.
So, what's caused this shift? It's not only the fact that new things are now possible through emerging technologies. But we've also seen this radical power shift from the employer to the employee over the last few years. I call this the Glassdoor era. It's really an era where we've really taken the employment experience and culture and made it public. We have an unprecedented level of transparency within the organization both internally and externally. So what's resulted from that is that no longer is culture and no longer is the employee experience a responsibility and accountability of HR alone. So a huge amount of attention is going towards things like culture and engagement at the highest levels of organizations. So it's causing businesses to really think and look more closely at how do we actually proactively provide care and attention to the employment experience and the culture that we're building and the environment that employees operate in.
We're also seeing, because of technology it's easier than ever to get a job, so high performers can switch jobs extraordinarily easily. So we're seeing that businesses are starting to pay attention to what does it mean to build a fantastic employment experience, a place where people love where they work, they love what they do, they love the teams that they're part of. And we've also seen that when people operate in that environment, it leads to not only higher levels of engagement, but higher customer satisfaction, higher levels of quality, and higher levels of innovation. So it's really becoming a business imperative, and no longer simply a nice thing for HR to do to try to boost employee morale.
So what has that led to? That's really where we've come from, and what that's really led to is what I consider six core trends in talent management, which are really together collectively turning talent management on its head. The first is localization. So we're no longer focusing on the enterprise as a whole and focusing on one-size-fits-all, top-down driven processes and systems. But really starting to look at the local level where work actually happens, at the team and at the individual human being level.
The Agile Organization. So, we're seeing a huge amount of focus on organizations who are trying to really become more agile and think about processes and tools that help them operate much more as an agile business. Personalization. We're also seeing that a lot of the one-size-fits-all or what I call peanut butter approach to HR is no longer working and organizations are saying we have to personalize and build one-size-fits-one culture. And so that organizations can make the experience meaningful to the individual employee. The Attention Economy. How do we actually ensure that employees feel attended to, cared for, listened to, and heard? It's really the new currency of the new economy.
We also were seeing an entirely new mission for performance management. Rather than just simply redefining performance management and optimizing and changing the processes and tools with which we do performance management. We're really starting to see an entirely new mission emerge. And then lastly, Engagement Reimagined. What is engagement? How do we actually build tools and processes and derive the meaningful information out of engagement to really ensure that we not only have the visibility into engagement on real-time basis, but how are we actually building it on a day-by-day basis.
So let's drill into our first trend, localization. Four the last 20 years, we've been building tools. Sometimes great tools, and I've been a big part of that. But we've been building tools that are largely for HR. They largely have been designed to automate and optimize processes that were built, in some instances, 30 years ago for an extraordinary different business world and extraordinarily different economy. And most importantly, an extraordinarily different work force. And so what we're seeing today is an opportunity to flip that on its head and begin to build tools that are built for the team leader, as opposed to HR, so at the local level where engagement and performance actually happened. And in order to do that, we need to focus on how do we build tools that get employees addicted, that they want to use, that actually adds meaning to them on a day-to-day basis, as opposed to having those tools be mandated and driven in a top-down, HR centric, sometimes annual, sometimes quarterly cyclical basis.
So how do we build at that local level? So why is that important? Why do we care about the team? So first of all I'm gonna give you a little example here. First of all, what we see, and you can study any industry whether it be retail, manufacturing, financial services, hospitality, or healthcare. What we see is that there's a radical difference in the level of performance, team by team, team leader by team leader. So this is an example of a large retailer, one which you probably all know and have been a patron of. And as you can see across the x-axis, you see the local economic potential. That means, what is the business potential in order to perform given the local economic environment.
And if you look at the highlighted dot at the bottom, you can see and then trace your eyes upward, and you see a second highlighted dot. Each of these represent a store. One would think that given the fact that they have similar local economic potential, that they would also performance similar levels. But as you can see on the y-axis, they have vastly different levels of profit, vastly different levels of business performance. So what makes the difference? The difference is the team leader. And actually, we all know this. We all in our human experience being part of a workplace can provide example after example of how the team leader makes the difference. We like to say, "So goes the team leader, so goes the organization."
So what are these great team leaders? What do these great, extraordinary team leaders do? What do they do differently than those lower-performing or even average-performing team leaders? We actually know a lot about this, and in fact, here at TMBC we spent the last 20 years studying it. They really do three things fundamentally different than average or low-performing team leaders. First of all, they understand what their people are doing at all times. Not on an annual basis. They don't align goals once a year. That's not natural. No great team leader does that. They don't even do it on a quarterly basis. They do it all the time, every day, every week. They understand and help manage what their team members are working on. They also are relentless in understanding and having really accurate insight into what are the strengths of their people.
And then they also ask on a regular basis how they're feeling. They take a real-time temperature, the real-time pulse of their team religiously, to then adjust on a real-time basis when things go south. Or do more of what they're already doing when things are going well. So these are things that we know great team leaders do naturally. So then the question in this next era for talent management, is how do we build tools to help all team leaders do the things that these best team leaders do naturally. And we know from other industries, from other business functions, that technology is extraordinarily powerful when used to scale best practices and things that the best team leaders do on a broader basis and bring those to all team leaders.
The second trend, the Agile Organization. The agile organization is one which is based on dynamic teams, work is fluid, project teams come together, they form, they change, they include employees, freelancers and even the crowd via crowdsourcing. Work is done on a 24/7 basis and no longer do we have this one-to-one relationship between job and person. Job is now disintegrating and we're seeing that work is actually being redefined by a series of projects, by a series of initiatives comprised of cross-functional teams, global teams, virtual teams. This is the new era of work and this is the agile organization.
And this is not how our systems have been built historically. Historically, they've been built based on hierarchical structure that are dictated by the GL structure as opposed to the way work really gets done. Today, the agile organization looks like this. This is the real world work chart. It's comprised of numerous numbers of connections of people, internal and external to the organization, with across departments coming together to work on projects, cross-functional teams. And get work done in a very, very fluid way. This is the Agile Organization. So it becomes a question for all of us. What does this mean to our tools? So we need to build tools for dynamic teams, not for the traditional top-down organizational hierarchy.
The third trend, Personalization. We in HR, including myself, I've been part of it, we have been guilty of building programs, processes, and tools that are really a one-size-fits-all approach. How many of you have heard the old saying, "Well if it works for 80%, then I guess we have to do it." That whole 80/20 rule doesn't work anymore. There is no such thing as working for 80% of the workforce. Employees today expect a very high degree of personalization. They experience it everywhere they go outside of the organization. They experience it with some of their favorite sites, like Amazon, and Netflix, and Facebook. Technology today can know who you are on an ever-increasing basis.
So we need to leverage that in this next era of talent management, and show that we personalize everything that we do to the individual. It means developing a calibrated and curated experience so that my experience within the system is different than your experience. We also need to, as part of this, move away from these traditional static models called competency models or skill models, and stop pretending that we can actually structure work or structure jobs into categories called competencies. We need to move away from these models and stop pretending that we can describe work and describe human beings in these static models and shift to real-world behaviors. What are people doing? What are their strengths?
And then lastly, we also need to move away from learning. We're starting to see this rise of the coaching era, where people expect to have their learning delivered to them in much more of a real-time personalized basis that's about me and for me. It's not the standard peanut butter approach to learning such that everyone who's consuming the content gets the same content. We need to ensure that we push content in the moment, in the context of work, and in a highly personalized way, such that the content that I'm consuming, the coaching and development that I am getting, is different than what you would get.
Trend number four, the Attention Economy. The Attention Economy is really the new currency of the modern economy. Attention is at an all-time demand people. People's attention is being pulled from more different sources than ever before. And we also know, by studying Generation Y, is that people are craving attention more than ever before. The Millennials are looking to be seen, to be understood, to be heard, to be acknowledged within the workforce. And this is very, very different than all of the attention we've been giving to this notion of feedback, which I'll talk about in just a moment. We need to focus on the behaviors and not these theoretical models and really focus on the individual and what's unique about them, what individual strengths our team members bring to the table as opposed to simply what competencies are expected in the job and then how do employees map to those competencies and skills.
We need to have strength-based conversations about near-term future work. This is the ritual that the best team leaders do religiously. They have strength-based conversations about near-term future work. They're constantly, on a week-by-week basis, talking to their team members, talking about the work that's coming up, not next month, not in next quarter, but today, but this week. And then they coach them around that work in the context of their individual strengths.
So how do we build tools? How do we build tools that provide attention, that provide that level of personalization to ensure that employees get the coaching in the moment? So the first thing that I wanna talk about is that attention is not feedback. We've seen a tremendous amount of focus on feedback apps in the market over the last 12 to 24 months. And the reality is that nobody likes feedback. Feedback is something which, and David Rock has done a lot of studies on this from a neuroscience perspective. Feedback actually create a fight-or-flight mechanism in the brain. Feedback doesn't feel good. Feedback is backward-looking. Feedback is typically provided in a way such that it tells you what you've done wrong and it is not in the context of coaching how do I get better moving forward. What human beings want is actually attention. They want to be coached about the work that's coming up based on who I am and how do I get better. Feedback, we've gotten it all wrong with feedback. We need to provide attention and coaching moving forward.
So, the fifth trend, a new mission for performance management. So we've all seen it in the press. Kill performance ratings, kill performance reviews. You almost can't pick up a business publication today without some mention of what's broken with performance management. We're seeing the largest organizations around the world beginning to abolish their existing performance management process and really rethink how performance management's done. The interesting thing about this is, what we're beginning to see emerge is that not only is performance management being rethought from a process and tool perspective. But really even more importantly, it's being rethought from a mission perspective.
Why do we do performance management? What are we trying to get out of the performance management function? What's included in the bucket called "performance management." So a few thoughts here and a few things that are starting to emerge. First, we're starting to see this trend, and it's something that were here at TMBC are passionate about and are building and our tools, this shift from a performance review to performance acceleration. So, looking at not how do we build tools and processes to simply review the work that came before. But how do we actually build tools and processes to actually help increase and accelerate the performance of the workforce, person by person and team by team. Radically different mission.
The performance management tools, I'll be as bold as to say, that have come up until now, have not, even if their marketing machine has sort of pretended as if they drive performance management. The reality is, what they've done is automate, codify, track performance management, not drive and not accelerate. So that's one big shift. How do we actually leverage technology to drive performance at the team level? Secondly, moving from competencies to knowing your people. It's a very, very big difference. We talked a little bit about this with the Attention Economy. But really, rather than trying to focus on assessing individuals against some static competency, which, let's face it, I have actually never, and I've been consulting in this space for the last 10 years, I've never met a business leader who has a whole lot of faith in the competency model. It just doesn't work.
So rather than all of that effort being put into buildings static competency models that are really almost impossible to maintain and truly impossible to assess people against due to the idiosyncratic rater effect. Rather than that, let's focus on how do you actually know your people? How can we build tools that can help people bring the best of themselves to life to the organization so that they can be seen, they can be heard, they can be understood? So that their peers can understand how to work best with them, how to focus them, how to recognize them, how to challenge them, how to reward them in a highly personalized way, as opposed to how HR thinks we should recognize, focus, and challenge people.
Third, a shift from this traditional model of annual cascading goals to focusing your people. Work moves way, way too fast to pretend that we can create top-down waterfall approach to cascading goals, where work is very, very fluid today and the best and highest-performing organizations are adjusting in real-time and the focus of their team members to ensure that they're always working on what is most important this week. That they always understand the top priorities for the organization today. And then lastly this shift from compensation to engaging your people. No longer is performance management or should performance be a business function which is really a means to drive some type of compensation decision. But it needs to be a means to engage your people. Radically different function.
So where are we today? Fewer than 15% of organizations believe the time that they're spending on their performance management process is actually worth the time. So the time is now, if your organization is like the rest of the organizations out there, it's time now to really rethink the mission and redefine performance management. So what does this mean? First of all, it means how do we build tools and applications that will actually drive performance, as opposed to just track or measure performance.
So how do we drive performance? First of all, know your people. How do you understand what each individual team member's strengths are at work? How to actually coach them around those strengths and bring out more of those strengths in the way that they operate within your organization? Two, focus your people. Get clear with them about the work and their highest priorities on a day-by-day, week-by-week basis. And then third, engage your people. Ensure that you've leveraged technology to connect with your people. With team leaders to team members, team members with each other. Really leveraging new technologies to drive new levels of connections and collaboration across the workforce to in turn drive engagement.
And then the second function, you also need to measure performance. Let's face it, measurement's not gonna go away. We're always gonna need to differentiate true performance. The problem with our measurement strategies up until now is that they've given us bad data. They've been based on flawed measurement tools. So what does good measurement look like? First of all, you have to ask your team leaders what they want to do with each person. Not what they think about them. When you ask somebody what they think about them, their answer is always more a reflection of them, the rater, as opposed to the reflection on the person that they're rating. But it turns out that people are excellent at answering, "What would I do with them?" It's much more of an action-based approach to deciding how a person is doing within an organization.
Secondly, create a natural and unforced range of data. Unforced is key here. Natural is key. The traditional performance management processes, we've built this calibration process, fooling ourselves into thinking that we're somehow getting a better range of data when in fact we're actually further distorting the range of data, through all of those rounds and rounds of conversations. Which in the end, are driven based on, yes, compensation as opposed to really looking at how do we actually get at real data, smart data, to really see a natural range of performance. And then you can use that data for many downstream business processes. But let's not taint that data and skew that data with unnatural processes which then we use to tweak the actual natural data.
And then lastly, how do we reveal this range reliably? How do we actually ensure that the range of performance data both takes into account the natural rating biases both of country, the country you may live in, as well as the team leader bias. So leveraging machine learning and algorithms to ensure that we further account for the bias that goes into a rating by leveraging algorithms to neutralize that bias. So, a few reasons performance management needs to change. Wrong outcomes, wrong frequency, wrong raters, wrong models and structures, and wrong tools. We've just basically gotten it wrong. So it requires rethinking all five of these as we look at the next generation of tools and systems.
So, lastly, the sixth trend, Engagement. From an engagement perspective, here too we need to reimagine engagement. We need to look at engagement and building the engagement process not for HR but for the team leader. How do we build tools that actually reside and exist in hands of the team leader, can be deployed by the team leader with the results delivered immediately back to the team leader? We need to ensure that engagement is not a snapshot, a one-point-in-time view of engagement. But it's a movie, it's a continual reel, looking at engagement on a real-time basis to ensure that we always understand, week-by-week, quarter-by-quarter, exactly how the team is doing and what their level of engagement is. We need to stop divorcing it from where the work actually occurs. We need to give team leaders the actual tools to impact engagement, as opposed to simply measure engagement and then provide them with perhaps not such good results about the engagement of their team, with no corresponding actions to take.
And then lastly we need to move from big data to the right data. So, we have been fooling ourselves and calling really what I consider to be climate surveys. We've been calling them engagement surveys. And most of those questions actually don't get at something which is truly engagement. So we need to be smart about the questions we ask. We need to ask them at the local level to the team leader when it makes sense in the context of work. Radically different model of engagement measurement.
So here, too, we have gotten in the past. We've asked the wrong questions. We've asked them at the wrong time, sometimes annually, sometimes every two years, believe or not. We've asked the wrong audience with HR driving top-down processes, and delivering the data back to HR and leadership as opposed to the team leader where engagement actually is created. And then we actually have not even provided, in most instances, actions to the team leader to improve engagement overtime. So much like performance management, the challenge and the call to action for engagement in this next generation of talent management is both focused on building tools that actually fuel engagement and increase engagement at the team level providing team leaders with tools that help them impact engagement as well as then, deliver smart and accurate measurement tools to the team leaders so that they can, all the time, on a real-time basis, understand the engagement of their teams.
So, this is a summary of where we've come from and where we are going with talent management technology. This also happens to be what I use for the core differentiators of the StandOut platform. It's a radically different model than what's come before it. And I would ask all of you to begin to ask yourselves how are your current talent management tools doing in terms of this future. Do they deliver to the team leader? Do they actually help all team leaders do those things that the best team leaders do naturally? Is it based on research and what we know great teams actually do and don't do? Is it filled with personalized, rich content so that the individual has a very meaningful experience and are continually developing in the context of work and being coached around their individual strengths? Are these tools delivered at the local level or are they top-down, annual, cyclical processes? And are they simple to use? Are your talent management tools sets today, are they personalized to the individual, and are they delivered on a real-time basis? This is the future of talent management systems and I ask you all to evaluate your current systems and get excited about the future.
Love this quote here, the secret to change is to focus all your energy on not into fighting the old but on building the new. It's absolutely the time for us in the HR technology space to really look to a new future, acknowledge that the world around us has changed dramatically and really define what that future looks like and build that in our organizations. Thank you very much, and if any of you wanna further the discussion, I'd love to talk with you more. My email and Twitter handle's here, so feel free to reach out. Thanks so much.