People: The Critical Factor for Workplace Success

Q&A with Eric Tolman, Caterpillar Inc.

It is widely understood that the greatest asset in any workplace is the people that fill it. Getting the right people, matched with the right work, is critical to creating a successful company culture and a positive workplace. But the ways in which we attract the best people has changed dramatically in recent years—gone are the days of the old-fashioned job board—and these changes are even more challenging in an increasingly tight labor market.

iBi discussed these issues with one of our region’s largest employers and gained insights valuable for companies large and small. Eric Tolman is Caterpillar’s new director of global talent management, with accountability for workforce and succession planning, diversity and inclusion, employment brand, talent acquisition, university recruiting, and performance management. He holds an MBA from Northwestern University and a bachelor’s degree in organizational communication from Arizona State University. Tolman shares his ideas on the quickly changing nature of recruiting and retaining Caterpillar’s diverse and global team.

What industry trends are causing the landscape of talent acquisition to change?
Data is changing the way businesses operate in all facets, and HR is no different! We are seeing the most change occur because of the increasing use of HR analytics to make recruiting decisions… and we expect to see it become even more sophisticated in the years to come.

In the past, recruiters had to rely heavily on their instincts, which could be unreliable depending on their level of experience. Now, recruiters are more informed and have better tools to test those instincts. Of course, the value of our human intel will never be replaced, but these tools enable faster, more objective and—most times—more successful recruiting practices.

The benefits include improved sourcing and tracking of candidates, and the tools to measure the most important hiring metrics while analyzing every step of the recruiting process. For example, by tracking the source of hire (employee referrals, LinkedIn connections, social media, career fairs and networking events, et al.), we can find out which channel delivers the best candidates. Based on that, we can plan our recruiting investments and actions to provide the best results for the business.

What specific trends are you seeing at Caterpillar?
Caterpillar has an iconic product brand and a strong culture that helps communicate valuable and relevant messages to our customers. Our employment brand should do the same for candidates. To do that, we are elevating success stories about our team so potential candidates can see how joining Caterpillar’s global team provides them an opportunity to contribute to our company purpose: helping our customers build a better world.

As the digital space grows, how is Caterpillar focusing on the talent needs within this space to gain or keep a competitive edge?
Digital is a critical part of our enterprise strategy because the solutions we provide to customers makes them more successful doing business with us than with our competitors. We can provide data, expert advice and solutions that increase safety and productivity, which saves them money in the end. To continue leading in technology and digital applications for our customers, we must also tap into a niche talent group with the skills to drive this digital transformation of our machines.

Hiring new digital talent is challenging, time-consuming and highly competitive, so we also need to be innovative in the ways we identify talent. The recruits we are pursuing in this space are also considering employment with companies like Google, Facebook, Uber, Amazon… you name it! To stay competitive, we are creating programs within our product development community that makes us an attractive place to work in comparison to these non-traditional competitors. In addition, we have developed and offer the flexibility that is expected in this kind of role.

Building a diverse and inclusive organization can increase employee retention rates and create an open atmosphere that allows for different perspectives to be heard. What is Caterpillar doing to recruit and retain a diverse workforce?
As a global company, Caterpillar is incredibly proud of our diverse workforce. Diversity and inclusion is more than just what we do—it impacts how we run our business and how we treat one another. Ultimately, we believe that when employees with different opinions, experiences and backgrounds come together, that’s when true progress begins and that’s how we best work toward fulfilling our purpose of building a better world. Inclusion drives business results, and Caterpillar knows that when it focuses on having the best talent, everyone benefits. The more diverse our team, the better positioned we are to meet the needs of our customers around the world.

Our commitment to progress requires that diversity and inclusion is found throughout the entire talent management life cycle. We do this by sharing diversity metrics and communicating results both within our company and with our suppliers and dealer network. We also have various initiatives, such as our Women in Leadership and Building Diversity initiatives, that are very intentional about attracting, developing and retaining our talent with a focus on both gender and ethnic diversity.

Recently, Caterpillar moved its global headquarters to Deerfield, Illinois. How has this move affected your Peoria-based workforce? Are you still actively recruiting for talent in the Peoria area?
We continue to have a significant presence in the Peoria area which includes a large production footprint, our global research and development headquarters, and representation from many of our key business units. While recruiting is linked to the business cycle and economic conditions, we are actively recruiting talent in the Peoria area as well as other locations around the world.

Studies show that work-life balance and workplace flexibility is top of mind for many candidates, especially with younger generations. How is Caterpillar addressing these areas of focus for prospective employees?

Many people now see the flexibility their employer offers them as a benefit and part of their reasoning on whether to join a company such as Caterpillar. There is a lot written about millennials and their hunger for greater flexibility in the workplace. While this may be a driving factor for change, we believe flexibility should be an opportunity enjoyed by every employee, regardless of generation.

Ultimately, flexibility is a personal choice and means different things to different people. We understand this and try to offer different types of flexibility to meet different expectations. Not all jobs will lend themselves to various types of flexibility, so it is important that roles are properly evaluated to decide what forms of flexibility can be practical for that job.

We encourage different types of flexibility at Caterpillar that include both working remotely and flexible working hours. Like many other employers, we are also seeing more people wanting to work as freelancers so they can pick and choose the work they do and the terms they want.

What is Caterpillar doing to sustain talent while adapting to the cyclical nature of the changing markets, which can have an impact on demand?
Caterpillar serves a variety of industries, all of which operate in dynamic and cyclical markets. Our markets are impacted by many external factors including the availability of talent, the health of financial markets and the world’s economy, the globalization of work, and the changing nature of competition.

Economic downturns and upturns do not come as a surprise to Caterpillar, and we have plans in place to support and sustain talent in the business. We continue to invest in research and development throughout the cycles, making sure we are able to develop the products we need to sustain our business well into the future. We also continue our campus hiring—the fresh and vibrant talent joining our team straight out of college and universities—through the ups and downs of the business cycle. We believe that hiring and developing future senior engineers and leaders will place us in a great position going forward.

Unfortunately, every business must occasionally make difficult decisions during periods of economic challenge, which can take many forms, including workforce reductions. Caterpillar is not immune to these types of decisions, and our global workforce certainly felt the impact of these decisions during several recent years of downturn in many of the industries we serve. As challenging decisions are made through the business cycles, the key for any business is to act with clear communication and integrity. Sound investment in our people will pay significant rewards long into the future and contribute to Caterpillar’s long-term success.

When recruiting manufacturing talent, are you noticing any skills gaps within that group? If so, how are those being addressed?
We are actively recruiting manufacturing talent across most of our U.S. facilities, given the strong increase in demand we saw build throughout 2017 and continue in the first quarter of 2018. The skilled trade gaps are a challenge for Caterpillar, as they are for many of our talent competitors. We have identified applicant shortages in welding, machining and other skilled trades areas.

These gaps mean we must look harder for the right talent and use different approaches to ensure our manufacturing facilities have the right people to get the job done. With an eye on the future, we also develop our own trainees by working closely with local schools to grow the skills we need.

One example of this is the Caterpillar Hiring Innovation Program (CHIP), which pairs students from Peoria’s Manual Academy with our East Peoria manufacturing team. The students travel each school day to the manufacturing facility to learn hands-on skills, and they also receive development in soft-skills areas, such as financial literacy. The program has been a great success in providing students with a hands-on learning opportunity, while helping us develop our talent pipeline. We’ve had such success with the pilot program, our business partners plan to expand it. iBi

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