Strategic HR Planning

Strategic HR Planning and the global „War for Talent“ Prof. Dr. jur. Dietmar Högel Heilbronn University —  Facts & Figures - University ¡  > 8.000...
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Strategic HR Planning and the global „War for Talent“ Prof. Dr. jur. Dietmar Högel

Heilbronn University —  Facts & Figures - University ¡  > 8.000 degree-seeking students ¡  4 campuses, 7 faculties ¡  47 BA- and MA programmes in the fields of Engineering, Business and Informatics ¡  > 200 professors, 430 assistants and technical specialists ¡  https://www.hs-heilbronn.de Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Faculty International Business (1) —  Facts & Figures - Faculty ¡  1.600 BA- and MA-students ¡  35 Professors ¡  30 assistants and technical specialists ¡  Campus Heilbronn am Europaplatz

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Faculty International Business (2) ¡  5 BA-Programmes (7 Semesters) } Tourism Management (TM) } Hotel- and Restaurantmanagement (HM) } International Business – Intercultural Studies (IBIS) } International Business – Eastern Europe (IBO) } Wine Management (WB)

¡  2 MA-Programmes (3 Semesters) } International Business & Intercultural Management (MIBIM) } International Tourism Management (MITM) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Contact Details Prof. Dr. jur. Dietmar Högel HHN / Faculty for International Business Max-Planck-Str. 39 D-74081 Heilbronn, Germany Phone: ++49 - 7131 / 504-516 E-Mail: [email protected] Visitors‘ adress: Am Europaplatz 11, D-74076 Heilbronn, V-Building, Office V 502

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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My „Online Bulletin Board“ —  Dietmar Hoegel / schreiberdkho —  Retweets of current news and background information from the worlds of: ¡  HRM / IHRM / (international) work conditions ¡  Employment Law und Business Law ¡  University Education, Eastern Europe and more ... Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Learning Objectives (1) —  Upon completion of this lecture students will be able to ¡  explain how and why demographic decline in Germany is perceived as a threat to the existence of companies and the economy ¡  to describe strategic workforce planning as a means of demographic risk management

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Learning Objectives (2) ¡  to name and explain strategies and measures developed by German companies in order to cope with the effects of demographic change ¡  to compare demographic trends in Germany with those in the Russian Federation ¡  and identify potential HR challenges for Russian companies

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Outline (1) 1.  HR Fundamentals 2.  The demographic Challenge 3.  Strategic Workforce Planning 4.  From Planning to Action 5.  HR Marketing 6.  Rethinking the Recruitment Process Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Outline (2) 7.  Finding „new“ Human Resources 8. Summary / Conclusion

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1. HR Fundamentals (1) —  Human Resources The people that staff and operate an organization. W.R. Tracey, The Human Resources Glossary, St Lucie PR, 3rd ed. 2004

Human Resources is the set of individuals who make up the workforce of an organization, business sector, or economy. "Human capital" is sometimes used synonymously with human resources, ... Likewise, other terms sometimes used include "manpower", "talent", "labour", or simply "people“. http://www.businessdictionary.com/definition/human-resource-management-HRM.html

Often „HR“ is simply used as a kind of abbreviated form of „HRM“, e.g. the „HR function“ (instead of „HRM function) or „HR“ (instead of „HRM Department“. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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1. HR Fundamentals (2) —  Human Resource Management The process of hiring and developing employees so that they become more valuable to the organization. HRM includes conducting job analyses, planning personnel needs, recruiting the right people for the job, orienting and training, managing wages and salaries, providing benefits and incentives, evaluating performance, resolving disputes, and communication with all employees at all levels. ... http://www.businessdictionary.com/definition/human-resource-management-HRM.html

¡  Germans tend to clearly differentiate between: } HR Management Task } HR Administration Tasks Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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1. HR Fundamentals (3)

HR Management (HR-Gestaltungsaufgaben)

HR Administration Personalverwaltung

HR Administration handles all administrative routine tasks of HR like managing and providing information, management of overtime work and overtime pay, payroll accounting, vacation planning, providing information for management and public agencies and many more.

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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1. HR Fundamentals (4) —  HR Management Tasks (Personalgestaltung) } HR Planning } Recruitment } Working Structures } Mgt. / Leadership } Compensation } HR Development } Release

Pre-entry

Working Life

End of Work

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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1. HR Fundamentals (5) ¡  Structuring the HRM Process HR Administration Work HR Management Tasks Working Life

Pre-entry HR Planning

Recruitment

Working Structures

Mgt. & Leadership

Compensation

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

End of Work Training & Developmt.

Release

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1. HR Fundamentals (6) —  The very core Function of HRM ¡  It is the vital function of HRM to constantly provide the company with } qualified employees } in required numbers } at the right time } for the right duration } at the right work place.

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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1. HR Fundamentals (8) ¡  Can you imagine what will happen to the economy of a country if its industrial and commercial enterprises do not have } qualified employees } in required numbers } at the right time } for the right duration } at the right work place?

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Demographic Change Germany (1950 – 2060)

Source: Statistisches Bundesamt

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Retiring Baby Boomers leave huge gap (2030)

Source: Statistisches Bundesamt

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Demographic Change at Global Level Regional Distribution of World Population 2015 - 2100 (in per cent)

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Population Pyramid Russia (2015)

Source: https://en.wikipedia.org/wiki/Demographics_of_Russia#/media/File:Russia_Sex_by_Age_ 20150101.png (last seen: 02.08.2015) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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2. The demographic Challenge (1) —  Factors influencing the Effects of demographic Change ¡  Global competition between companies and economies ¡  Transparency of national and international labour markets (Online Job Markets!) ¡  Decreasing employee loyalty / retention ¡  Growing international employee mobility Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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2. The demographic Challenge (2) —  Situation today ¡  German politics and the economy have realized the multifold challenges triggered by demographic change. ¡  Challenges to the State } adjusting social security systems } creating a more child- and family-friendly society } developing (legal) frameworks for companies to survive in increasingly tight job market conditions Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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2. The demographic Challenge (3) ¡  Challenges for companies } An intensifying competition between companies for specialists has already begun in the fields of Engineering and Information Technology. } This is described as the „War for Talent“. In a globalized World this is a „war“ across borders. } Managers understand that competition will be won or lost in the Human Capital Market Place. } Attracting and retaining the necessary human resources is becoming a question of survival and top strategic priority. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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2. The demographic Challenge (4) } Both the political system and the economy have started to change existing und develope new (legal) frameworks in order to enable companies and the German economy as a whole to survive in the War for Talent. } At the company level strategic workforce planning has become a strategic issue of top importance.

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3. Strategic Workforce Planning (1) —  Workforce / HR Planning HR Management Tasks Working Life

Pre-entry HR HR Planning Planning

Recruitment

Working Structures

Mgt. & Leadership

Compensation

End of Work Training & Developmt.

Release

Workforce Planning: Systematic identification and analysis of what an organization is going to need in terms of the size, type, and quality of workforce to achieve its objectives. It determines what mix of experience, knowledge, and skills is required and sequences steps to get the right number of right people in the right place at the right time. http://www.businessdictionary.com/definition/workforce-planning.html, last seen: 25.08.2014 Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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3. Strategic Workforce Planning (2) —  Objectives and Functions of HR Planning ¡  Continuously securing labour as a vital production factor, ¡  deploying employees in the optimal way, ¡  while taking into account: } corporate objectives } personal objectives of employees } all changes inside and outside the company (e.g. demographic change, changes in the market, changes in the global economy) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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3. Strategic Workforce Planning (3) ¡  In other words: Enabling HRM through planning to constantly provide the company with: } qualified employees } in required numbers } at the right time } for the right duration } at the right work place. Competition will be won or lost in the Human Capital Market Place. Frank Hauser CEO Great Place to Work® Institute Deutschland

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3. Strategic Workforce Planning (4) —  HR Planning Types (Overview) ¡  Headcount Planning: planning quantitative and qualitative changes ¡  Requirement Planning: establishing the number and qualification of required personnel ¡  Deployment Planning: planning the relationships between people and work (numbers, qualification, time) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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3. Strategic Workforce Planning (5) ¡  Recruitment Planning: planning how to supply the workforce required by the company ¡  Reduction Planning: planning the reduction of personnel surplus ¡  Development Planning: planning personnel training- and development measures ¡  Cost Planning: planning direct and indirect staff cost Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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3. Strategic Workforce Planning (6) ¡  Strategic Workforce Planning (SWP) } planning period: mid- to long-term } no. 1 challenge: demographic change (SWP = demographic risk management!) † quantitative aspects: ¶  forecasting the effects of demographic change on the number of employees availabe for the company ¶  identifying (new) sources for human capital † qualitative aspects: ¶  assessing changing abilities of an aging workforce † both in light of the mid- and long-term corporate objectives of the company Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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3. Strategic Workforce Planning (7) —  Strategic HR- / Workforce Planning (SWP) 1. 

Workforce Analysis

2. 

Forecast Needs

3. 

Analyze Gaps

4. 

Develope Strategies

5. 

Implement Strategies

6. 

Monitor & Evaluate Source: http://www.kepion.com/media/img/www/solutions/capabilities/1-workforce-planning/01.png (last seen: 04.08.2015)

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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4. From Planning to Action (1) —  To survive the „War for Talent“ (German) Companies are ¡  sponsoring scientific research projects on demographic change (analysis, forecasts)

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4. From Planning to Action (2) ¡  developing strategies to cope with the effects of demographic change ¡  motivating politics (the state) to establish frame-works in which they can implement those strategies,e.g. } child-care infrastructure } education system } integration of migrants } immigration law } etc. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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4. From Planning to Action (3) —  Survival of the Fittest ¡  Strategic Workforce Planning is just the starting point. ¡  Planning leads to action! HR Planning

Recruitment

Working Structures

Mgt. & Leadership

Compensation

Training & Developmt.

Release

¡  Demographic change is the #1 driving force behind most of what is happening today in the different fields of HR Management. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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4. From Planning to Action (3) —  Coping Strategies of Companies ¡  Boosting HR Marketing ¡  Rethinking the Recruitment Process ¡  Developing existing Human Resources ¡  Tapping into new Sources and Potentials of Human Resources

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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4. From Planning to Action (4) —  Attraction and Retention – two Sides of the same Coin ¡  How helpful is it to successfully recruit new talent for your company ... ¡  when you lose experienced employees to the competition? ¡  Retention of employees will become a major issue in the „War for Talent“! Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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5. HR Marketing (1) —  Demography as a Game Changer ¡  The supply of jobs will overtake demand: the job market will soon become an „applicants‘ market“. ¡  Qualified job seeking applicants will have a wide range of choices. ¡  Potential employers have to activate (→ active sourcing!) and boost their employer attractiveness. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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5. HR Marketing (2) —  Employer Branding (EB) Employer branding is the process of promoting a company as the employer of choice to a desired target group, one which a company needs and wants to recruit and retain. The process facilitates the company’s ability in attracting, recruiting and retaining ideal employees – referred to as Top Talent in recruitment – and helps secure the achievement of the company’s business plan. http://universumglobal.com/2014/03/what-is-employer-branding/, last seen: 27.08.2014

¡  EB aims at promoting a company‘s image as that of an employer of choice. ¡  It is understood as a key instrument of demographic risk prevention. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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5. HR Marketing (3) ¡  Employer Branding aims at potential and existing employees. ¡  The Employer Brand is communicated through all relevant channels, e.g.: } company website } advertisements } positioning in the media } mouth-to-mouth propaganda (employees!) } employer branding videos and TV spots } etc. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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5. HR Marketing (4) —  Measuring Employer Attractiveness ¡  Online Employer Rating: comparable to hotel or restaurant evaluation portals ¡  Anonymity guaranteed! ¡  Employer rating portals in Germany: } www.kununu.com } www.meinchef.de } www.glassdoor.com Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (1) Organization‘s Perspective

Perform job analysis and plan recruiting effort Generate applicant pool via internal or external recruitment Evaluate applicants via selection process Impress applicants (positively!) Make offer

According to Fisher/Schoenfeldt/Shaw, Human Resource Management, 5th ed.

Vacant or new position occurs

Applicant‘s Perspective Receive education and choose occupation Acquire employment experience Search for job openings Application for jobs Impress company during selection process (positively!) Evaluate jobs and companies Accept or reject job offers

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (2) —  Is „Post & Pray“-Recruiting dead? ¡  Today, in recruitment we observe a mixed and often contradictory picture: } Most recruitment processes are still oriented towards identifying (rare) talent in huge piles of applications. } However: The skills gap forces companies to change their traditional ways of recruitment. } Experiments, mirages, new approaches

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6. Rethinking Recruitment Process (3) —  New Approaches - Overview ¡  Active Sourcing ¡  Social Media Recruiting (Facebook, Twitter) ¡  Campus Recruitment ¡  Company Internships ¡  Candidate Experience Management ¡  Poaching of Employees (headhunting) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (4) —  (Pro)Active Sourcing Concept 1.  Make (as early as possible!) contact with potential recruits using: } events, fairs } social media } CV-data-bases } private and professional circles of acquaintance } acquaintances and friends of employees } whatever works ... Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (5) 2.  Keep contact and establish a relationship 3.  Recruit when time is ripe

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6. Rethinking Recruitment Process (4) —  Social Media Recruiting ¡  Use of online jobmarkets is a long established standard ¡  Making and keeping contact through } Xing (German speaking countries) } LinkedIn (international) } Facebook (not really important)

¡  Students / applicants should build a presence in LinkedIn and Xing. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Sources for Active Sourcers (Germany 2013)

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6. Rethinking Recruitment Process (5) —  Recruitment on Campuses ¡  University marketing activities of companies in cooporation with Career Centers of Universities ¡  Career days, recruitment fairs ¡  Building and activating Alumni networks ¡  Company representatives as external guest lecturers („talent scouts“) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (6) —  Company Internships ¡  Many study programs have an integrated internship semester (e.g.: 5th semester) ¡  Companies offer internships: } identification of talent (professional, social skills) } retention of qualified interns (retention programs)

¡  Internship → Work Student Contract → BA-/ MA-Thesis → Job offer Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (7) —  Candidate Experience Management ¡  Candidate experience: reaction of an applicant to a company‘s job application process

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (8) ¡  Derived from the concept of „Customer Experience“ (in custumor relationship management) ¡  Candidate Experience Management: } managing the recruitment and hiring process in a way that avoids to frustrate job applicants } critical contact points: first contact, correspondence, job interview, onboarding etc.

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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6. Rethinking Recruitment Process (9) —  Poaching of Employees / Retention ¡  Today: headhunting as a discreet way of recruiting managers and specialists currently employed by the competition ¡  Tomorow: a widespread recruiting approach? ¡  Challenge: impregnation of your (best) employees against poaching-efforts of the competition → retention no less important than effective recruitment! Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (1) —  Developing existing and unlocking „new“ Human Resources ¡  Existing workforce („normal“ employees) ¡  People with low or no qualification ¡  Women / mothers ¡  Older employees ¡  Qualified immigrants / recruiting abroad Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (2) —  Continuing Qualification of existing Workforce ¡  „Life long Learning“ ¡  HR Training & Development ¡  Flexibilization of educational pathways } vocational education and training } professional training & development measures } academic (e.g. extra occupational study programs for employees offered by HHN) Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (3) —  Low-achieving Groups and People distant to Education ¡  In 2013 5,7% of all school leavers left without a certificate ¡  In 2013 1,4 million of young adults (aged 20 – 29 years) had not completed an apprenticeship ¡  Challenge for German education system! Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (4) —  Women ¡  Traditional German family model: housewife / mother + male breadwinner ¡  Development of female employment rate } 1960: females → 47% (males → 63%) } 2015: females → 63% (males → 73%)

¡  But: Most German mothers work part time! ¡  More women should work (longer)! Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Female Employment Rate (1960 – 2009)

Source: Statistisches Bundesamt, Mikrozensus

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Employment Mothers and Fathers (2010)

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Mums and Dads working Part-Time (2012)

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7. „New“ Human Resources (5) ¡  The Challenge } making work increasingly „family-friendly“ † flexible work-times † company kindergarten † family friendly atmosphere

} eliminate disadvantages for women at work, e.g. † unequal pay † career perspective

} improve childcare infrastructure } encourage men to more actively share domestic work Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (6) —  Older Employees ¡  Retirement age has been increased to 67 years for birth cohorts 1964 et seq. ¡  HR Training & Development („life long learning“) ¡  Health Management: keeping an aging workforce fit ¡  Several generations working together: harmonizing different work styles Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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Seniors as a Human Resource Increasing Number of working Seniors Employment Rate (figures in per cent)

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (7) ¡  Five generations working together } traditionalist (born before 1955) } Baby boomers (born 1955 – 1965) } generation X (born 1966 – 1985) } generation Y (born 1986 – 1995) } generation Z (born after 1995)

¡  Age diversity } challenge } chances Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (8) —  Cross-Border-Recruiting ¡  Focus: (young) specialists from } crisis-ridden EU-member countries with high youth unemployment like Spain, Greece (free movement of labour in the EU!) } non-EU-countries (Poland, Ukraine, Russia etc.)

¡  Challenges: } attracting, integrating and retaining foreign talent } reducing legal, bureaucratic, political obstacles Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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7. „New“ Human Resources (9) —  Refugees ¡  Enabling asylum-seeking refugees with adequate qualification } to receive work permits } get access to school and higher education

¡  Hotly disputed issues in the political arena } Does Germany need – in addition to asylum law – an Immigration Law (like Canada or the US)? } How shall Germany integrate so many migrants? Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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8. Summary / Conclusion (1) —  Failing to plan is planning to fail! ¡  Demographic Change poses a serious threat to German companies and the German economy as a whole. ¡  Therefore, at the company level, Strategic Workforce Planning has to be understood as an essential element of Demographic Risk Management.

Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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8. Summary / Conclusion (2) —  Planning leads to Action! ¡  Companies in Germany (and many other countries) are developing strategies to cope with the effects of demographic change. ¡  There is no single one coping strategy. ¡  A whole kaleidoscope of measures is emerging especially in the fields of HR Marketing and Recruitment. Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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8. Summary / Conclusion (3) —  SWP is an ever revolving Cycle! 1. 

Workforce Analysis

2. 

Forecast Needs

3. 

Analyze Gaps

4. 

Develope Strategies

5. 

Implement Strategies

6. 

Monitor & Evaluate Source: http://www.kepion.com/media/img/www/solutions/capabilities/1-workforce-planning/01.png (last seen: 04.08.2015)

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8. Summary / Conclusion (4) —  SWP is and will remain a permanent HR Task of Strategic Importance

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9. Recommended Literature (1) Text- and Workbooks for Students —  Dessler, G., Human Resource Management, 14th global ed., Pearson Education Ltd. 2014 —  Torrington / Taylor / Hall, Human Resource Management, 9th ed., Financial Times Prent. 2014

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9. Recommended Literature (2) ¡  Fischer, C.D. / Schoenfeldt, L.F. / Shaw, J. B., Human Resource Management, 6th ed. 2005, Cengage Learning ¡  Bratton, J./Gold, J., Human Resource Management: Theory and Practice, Palgrave MacMillan, Basingstoke 2007 ¡  Werner, M.L./DeSimone, R., Human Resource Development, Thompson South-Western, 5th ed. 2008 Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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9. Recommended Literature (3) —  Berendes, K., Strategic workforce planning: Shaping the future today, 1st (englisch) ed. , Wirtschaftsverlag N. W. Verlag für neue Wissenschaft 2012 —  Smith, T., Strategic Workforce Planning. Guidance & Back-up Plans, 1st ed., CreateSpace Independent Publishing Platform 2010

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9. Recommended Literature (4) German HRM Text Books for Students —  Olfert, K., Personalwirtschaft, 16. A. 2015, Kiehl Verlag —  Holtbrügge, D., Personalmanagement, 5. Aufl., Springer/Gabler 2013 —  Berendes, K., Strategische Personalplanung: Die Zukunft heute gestalten, 1. Aufl., Wirtschaftsverlag Verlag für neue Wissenschaft 2011 Copyright  Prof.  Dr.  D.  Högel  (WS  2015/16)  

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