Around the world, the contemporary workforce is in a relentless state of flux. As technology reshapes the recruiting process, among other HR activities, the hunt for skilled talent is more competitive than ever before. iBi recently spoke with three human resources gurus from a range of industries to discuss this ever-evolving landscape. Read on as Kim Hauer, chief human resources officer at Caterpillar Inc.; Jim Hefti, vice president of human resources at Advanced Technology Services (ATS); and Joy Ledbetter, chief human resources officer at UnityPoint Health – Methodist l Proctor discuss the skills gap, leadership development, the multigenerational workplace, and how their organizations are positioning themselves for the challenges ahead.
What are the top skills your company is looking for in prospective employees?
Jim Hefti: In general, we place the highest priority on cultural fit. At the same time, we are in a business where we need multi-craft maintenance skills, which are in short supply in the labor market. We are also looking for employees who have a continuous-improvement and customer-focus mindset. All things being equal, we will hire for culture and train for skills.
Joy Ledbetter: UnityPoint Health is looking for something more than the basic skillsets required in healthcare. We have a unique culture that is mission-driven and patient-centered, which means we need employees who will provide the best experience to our patients and families, no matter what position they hold. As healthcare continues to change, we need a team to drive performance in quality, experience and affordability, and when we hire employees that fit our culture, we know we can teach any other skill required for the job.
Kim Hauer: Skilled trades will always be critical to Caterpillar’s success and the success of our dealers and customers. Our view is that our employees—our skilled workforce—is a competitive advantage and a valuable asset. However, we also see that all our employees must possess the right balance of technical and critical thinking skills to keep up with rapid changes in processes and technologies. We are also concerned with talent availability in:
- Skills to support the mobile and autonomous technologies embedded in our equipment;
- Female and minority engineers, IT and other technical talent to provide the diverse perspectives we need to succeed long-term;
- Experienced accountants and environmental health and safety professionals; and
- An overarching gap in the “soft skills” focus on accountability, commitment to the organization, and working in a team environment across all professions.
How has the so-called “skills gap” impacted your organization?
Hefti: Like all manufacturers, the lack of skilled labor creates a competitive landscape for skilled talent, which requires ATS to position itself as the employer of choice for these individuals. A strong military recruiting outreach, local referral network and innovative training solutions helps us close this gap. For example, ATS owns a technical training company with a strong curriculum, assessment tools and mobile training units to support development of our employees.
Ledbetter: We have put a tremendous amount of effort and resources into ensuring our patients and family members have an exceptional experience. We developed an internal curriculum called Service Always, which sets expectations for candidates during the interview process, new hires during orientation, and current employees with required and ongoing training. I currently participate in workforce initiatives with the Greater Peoria Economic Development Council, as well as presenting employer perspectives to ICC faculty and high school students. We’re also fortunate to have Methodist College, which anticipates our workforce needs and designs programs to develop the talent we need now and in the future.
Hauer: At Caterpillar, the skills gap is very real. We can train employees to fill many roles; however, the most critical talent gap we face is in the technical competencies related to welding, machining and skilled trade positions in the production environment. To add to that, part of the manufacturing skills gap is the underrepresentation of women in the industry. At Caterpillar, only 13 percent of our production workforce is female. Dispelling the perception that manufacturing is only for men continues to be a challenge that we are hoping to make progress on.
Here in the Peoria area, we frequently partner with local community colleges to train new employees in job roles such as machining and welding. Another initiative is called Project Lead the Way, which is a partnership between Caterpillar, Bradley University and the Peoria school district to bring a pre-engineering curriculum to a local high school. We partner with several programs that encourage today's youth to become future STEM innovators, including FIRST LEGO League and FIRST Robotics, which provides mentor-based programs to help students of all ages build STEM skills.
How has the millennial generation altered your HR strategies? And what about “Generation Z” [defined as those born between 1994 and 2010]? On the flip side, many boomers are delaying retirement and staying in the workforce longer. Do you believe this has slowed the rise of millennials into leadership positions?
Hefti: These generations are challenging us to think and do things differently. The millennials are bringing new technology to the work environment which challenges our past practices, but makes us better as a company. Being on the cutting edge of technology, it positions us well to attract millennials and individuals from “Generation Z.” These generations have made us think differently about HR, particularly when it comes to offering more real-time data and mobile solutions. We introduced a cutting-edge HRIS system a couple years back called Workday. This system is very mobile and innovative, allowing our employees to manage their careers on a daily basis.
We have noticed some of the baby boomers in our organization delaying retirement. While this may limit some opportunities for the next generation, it is also a way to develop top performers from the millennial generation into excellent leaders. They are then able to leverage the knowledge base of our more experienced leaders to improve their skillsets.
Ledbetter: Organizations and HR strategies have to respond to the rise of millennials in the workforce. This is a generation that loves technology, thrives in a collaborative work environment and expects work-life balance. The team-based approach to care is not only changing outcomes of patients, it also enhances the work-life balance of this new generation. Working in a collaborative, team-based environment creates an effective and efficient workforce that provides patients with the highest level of care and something this generation values. Our culture and strategies around communication and engagement activities can be powerful tools in the recruitment and retention of both the millennials and the upcoming “Generation Z.”
Historically, healthcare has had delays in workforce retirement, which has slowed the rise of younger generations into leadership positions; however, as the economy improves, we are seeing more long-term employees retire. We value the years of experience employees in this generation bring to our workforce and are committed to provide training and resources to help them continue learning and adding to their skillsets.
Hauer: Data tells us both trends are true for us, depending on the location—the workforce is increasingly younger and retirement ages are increasingly older. These trends impact us in how we plan for recruiting, benefits administration and flexibility policies, among other things. But this is the strategic nature of the HR function. Our role is analyze the current state, remain flexible in serving the business’ current needs, and partnering with the business for the future.
We’ve developed both an employment brand and regional recruiting model in the past few years, and we are working to integrate more technology into our job fair experiences. We are also using more social media, proactive sourcing, relying less on search firms and maximizing our reach through internal talent pools. The end result is that we hope to be casting a wider net internally and externally. To attract the best talent to Caterpillar, we decided a few years ago to embrace social media and technology and leverage it to tell our story. A national example of these efforts is our partnership with Mike Rowe from Dirty Jobs. He acts as a voice for manufacturing and when he speaks, tweets, posts… our dealers see an uptick in people visiting their open positions.
I’m not certain the reason millennials are not rising into leadership positions at a fast pace is correlated to the increase in retirement age. In general, we’ve seen a decrease in the number of new leaders we anticipated we were going to need by 2020, but there are so many factors at play, including decreasing workforces, personal preferences, benefits portability, changes in span of control for our leaders… I cannot say definitively if this is connected.
Companies are struggling with leadership development at all levels, according to a recent Deloitte report. How are you addressing this issue?
Hefti: One strategy that has been particularly successful for us is recruiting leaders from the military. Military candidates tend to bring excellent leadership skills and training that are a very good fit for their roles at ATS. At the same time, developing leaders—especially in the technical space—can be difficult. It all begins with hiring people who have leadership potential and the drive and ability to be leaders. ATS has put increased focus on hiring leaders, not just for their current jobs, but for one to two positions above. We also spend a great deal of time assessing internal talent and building individualized development plans to help facilitate the skills needed to take on new opportunities that become available due to our growth as a company.
Ledbetter: Leadership development is an important strategic initiative and is very deliberate at the manager and director levels. As healthcare changes, we need to ensure our leaders are provided the tools and have the knowledge to lead through the change. We have spent a great deal of training on change management, healthcare industry shifts, goal deployment and developing talent. We also have a new focus on emerging leader development, which is a very important part of building our internal talent pipeline.
Hauer: Our chairman takes leadership excellence very seriously. About five years ago, we designed a new leadership development program (L.E.A.D.) for the leaders at Caterpillar. The L.E.A.D. program is global, but takes into account local needs by providing development in skills such as creating a motivating work environment, integrating talent needs into the business strategy, serving as leader-teachers, and reinforcing our values. Our aggregate data shows a 10-point improvement in the work climate over the last four years, and an additional nine to 17-point improvement in the other leadership styles.
How is your company incorporating mobile technologies, social media and/or “people analytics” data into your recruiting practices?
Hefti: One of the biggest trends we’ve noticed in the past couple years is the rise in mobile applications to job postings. Because of this, we strive to make our application process as mobile-friendly as possible. From our mobile-friendly website to mobile-enabled job postings, we are staying on the forefront of this shift. Due to the skilled labor gap, ATS puts increased focus on the passive candidate. Social media outlets are a great way to network and create relationships with current and future passive candidates.
Ledbetter: We know that candidates search for jobs using mobile devices and social media, and to remain competitive in the hunt for talent, we have developed social media strategies using Facebook and Twitter. It is also important to remain accessible to people who choose to search for jobs using traditional mediums. That is why we take a close look at all of our open positions and develop field-specific recruitment strategies.
Hauer: Caterpillar’s global recruiting process integrates as many tactics into the overall strategy as possible in order to find the most capable and diverse talent. Today, 30 percent of people who come to our site are coming on a mobile device, and over 25 percent of our applications are coming from mobile devices. In addition, 34 percent of completed applications identified their source as social media, and 15 percent of hires in the last year can be traced to social media. So how we make that experience for the applicant easy and seamless is incredibly important to us.
We know the key to success with digital is placement, so we are aiming to use as many platforms as possible in order to build the best team. Our Built for It videos do more than entertain or drive sales; they tell a story about who we are and who we want to attract to work here with us. Examples of this are our Mike Rowe partnership, our participation in Manufacturing Day, our use of mobile technology at job fairs, and our relationship with the HR Policy Association.
Generally, I think there’ll be a number of changes as we get smarter and better understand data. We have a small but mighty talent analytics team, and with the development of a new division focused on Innovation and Analytics, they are excited to have additional emphasis placed on the value of talent data for decision making.
I think oftentimes, we make a lot of decisions based on instinct or what has worked in the past. As we get more progressive with analytics, data will drive a lot more decision- making than it does today. For example, I think how we compensate people will change as we learn what’s valuable to them personally.
In addition, we are using data to forecast our footprint in the future. I can look at a dashboard today and get information on the makeup of the workforce at every facility across the globe. We look at how our workforce has evolved over time and make some predictive assumptions on where we’re heading, and it gives us a really good sense of where our talent needs of the future are going to be. We can then target certain functional disciplines and geographic areas, and build talent pools so we’ll have that talent available to us when the business goes that direction.
According to Forbes, “job hopping” continues to rise as workers, enabled by technology, are undergoing a nearly continuous job search. Have you seen this trend in your company?
Hefti: From our experience, job hopping is mostly a result of the demand for technical skills in the marketplace, assisted by the ease of the job search. To combat turnover, ATS is focused on programs aimed at selecting the right talent initially and providing opportunities to keep employees engaged in their careers so there is no need to look elsewhere. We collect employee engagement data annually and use this information to continually improve our organization.
Ledbetter: Absolutely. Employees are unlikely to stay in a particular job long-term, and most employees entering the workforce will have 15 to 20 jobs in their working lives. We are fortunate to be a large employer in a changing industry that encourages growth opportunities within the organization. Although internal turnover creates challenges, it also provides extended longevity of our employees and in turn, provides employees the learning and growth opportunities that help in overall retention.
Describe your company’s approach to learning and development.
Hefti: The ATS approach to learning and development is the 70-20-10 model, where we emphasize structured on-the-job learning as a preferred path to development. For formal learning, we offer both classroom training (which some employees prefer) as well as online training, which is able to meet the needs of our distributed workforce. We acquired a technical training company with mobile assets to meet this demand, and our technical training has really taken off as a result. We focus a great deal of time on individualized development plans for every employee, not only for their current roles but for what the company will look like in the future.
Ledbetter: To engage all level of employees, we offer both online and classroom learning opportunities. Classroom learning is preferred to engage with employees and offer an enriched opportunity for employees to learn from others. Our online capabilities also include video and audio to provide some level of interaction. Learning and development is a very important aspect of employee communication and engagement and a driver of our culture.
When it comes to employee benefits, what have been some of the biggest changes in recent years?
Hefti: The Affordable Care Act has impacted our healthcare costs as well as our plan complexity. It’s an increasing challenge to find an employer/employee cost-sharing balance while offering market-competitive benefits. Our strategy is focused on driving healthy living, consumerism and education. We have added some innovative tools and services to our healthcare model, which is gaining traction with our member base. For example, we recently began offering a solution for our employees to contact medical professionals using the web, WebEx technology or by phone. This saves time and money, while providing a very valuable benefit. It basically acts as a visit to a doctor’s office from an employee’s own home or office.
Ledbetter: The biggest change has been the shift toward defined contribution models in retirement plans, as well as health benefits. Employees are being encouraged to “participate” in their benefits to receive a higher benefit offering. Retirement plans continue to shift toward 401(k) plans with a matching benefit; health plans are moving toward consumer-directed, high-deductible plans with health reimbursement accounts; and wellness and incentive programs are being offered to engage employees in lifestyle changes. We continue to evaluate employee benefits to control costs while attracting and retaining a competitive workforce.
How have your methods of performance evaluation and feedback changed in recent years?
Ledbetter: Some industries are eliminating performance reviews altogether and moving to frequent, less-formal feedback sessions throughout the year. In order to maintain regulation compliance, healthcare is slow to change to more innovative performance management systems. To ensure strategic plan alignment throughout the organization, we have enhanced our pay-for-performance system to measure goal setting and attainment. Employee performance is not only based on basic job responsibilities, but tied to the attainment of organizational goals. Cascading goals in our performance management system shows employees how they contribute and are rewarded with the success of UnityPoint Health.
Hauer: Technology may be part of the answer, but it's really about behavior, attitudes and beliefs. Our leaders and employees create the culture with what they do, think and say, and our challenge in HR is ensuring it is a positive, business-enhancing culture. As one of our senior business managers said, "HR can build the brand-new stadium and state-of-the-art equipment, but if we don't have players who can hit, throw and catch, we'll lose."
That being said… integration is the key for all our HR systems moving forward. To simplify processes and allow for the most robust data available, all the systems we use need to be integrated. The long-term game changer for Caterpillar’s HR will be to have completely-aligned systems for the annual performance review and career planning processes, as well as recruiting and employee development.
What are some of the biggest challenges you see ahead in the next decade?
Hefti: There are a variety of challenges, including government regulations, technical staffing, employee retention, attracting and retaining a changing workforce, developing our internal bench strength and growing our leaders. Our opportunity will be in how we lead versus lag in the market addressing forthcoming challenges.
Ledbetter: The biggest challenges I see are ensuring employees remain engaged and productive, continuing our leadership development and retaining our key talent. There is nothing more powerful than having high-performing, engaged employees and leaders to deliver on our strategies. iBi