American Public Power Association September 18, 2006 Workforce Planning for the Successful Utility Michael Friedman, F&L Group

2 The Business Case Will you have the talent to execute your business strategy?

3 Can you answer these questions? ?? Number of KEY (mission critical) positions to be filled?? Number of viable successors in your talent pool?? ?? Ready now ?? Ready in 1-2 years ?? Ready in 3-5 years

4 Succession Coverage

5 Workforce Planning 3 Steps WHERE WE ARE Conducting a talent assessment (People) WHAT WE NEED Identifying critical needs (Jobs) CLOSING THE GAP Buy or Build?

Step 1 Conducting a Talent Assessment

7 Components of Talent Assessment Manager/Supervisor Answers Four Questions Per Direct Report: 1. Performance 2. Potential (or adaptability) 3. Willing and ‘ready-now’ placement opportunities 4. Willing and ready with some development placement opportunities

8 Performance Assessment Average Performance Over Diverse Tasks for Last 3 Years: 1 = In the Top 10% of performers 2 = In the remaining Top Third of performers 3 = In Middle Third of performers 4 = In Bottom Third of performers X = not classified

9 Potential/Adaptability Assessment Estimated Ability To Adapt to New, Diverse, Intense, Varied, Adverse Situations: 1 = In the Top 10% of adapters (significant long-term potential; promotable inside and outside of specialty/functional area) 2 = In the remaining Top Third of adapters (promotable inside and/or outside of specialty/functional area) 3 = In Middle Third of adapters (may be promotable; can lateral to another position) 4 = In Bottom Third of adapters (not likely promotable outside of specialty/functional area; may be adaptable/promotable within specialty/functional area) X = not classified

10 The Ability and Willingness and Opportunity to learn from experiences – successes, failures and exposures

11 Some Questions To Ask What has this person done that led to effective job performance? What was done that may have detracted from job performance or led to ineffective job performance? What could this person do differently to be more effective? What behaviors, attitudes, values does this person need to be considered a “High Potential” employee?

12 The Talent Matrix Categories Bottom ThirdMiddle ThirdTop Third Top Third Middle Third Bottom Third Adaptability Performance 9 Consistent Star 8 Future All Around Star 6 Diamond in the Rough 7 Adaptable High Pro 5 Key Performer 3 Adaptable Performer 2 Solid Pro 4 High Pro Highest Potential 10 1 Low Performer

13 Talent Matrix Discussion Format Each person presents their assessments and justification Group feedback on each employee after all assessments have been presented Reach consensus on talent matrix plotting Where possible, force distribution evenly across cells/categories with no more than 10% identified in the strategic few Unresolved placement will be deferred to organizational leader

Step 2 Setting the Success Profile

15 We know: Competencies that matter How they are developed Who can develop them The system to get there

16 We know 85% of the skills needed for success as a supervisor, manager and executive The 85% Solution

17 The Critical Competencies Planning Creativity Strategic Agility Personal Learning Self Development Motivating Others Conflict Management Dealing with Ambiguity Innovation Management Building Effective Teams Developing Direct Reports Directing/Managing Others Managing Vision and Purpose Managing and Measuring Work

Step 3 Creating Development Plans

19 70 Assignments 20 People 10 Courses What Development Looks Like!

20 Construction of a Development Plan WHAT IS Describe the current skill level in behavioral terms WHAT SHOULD BE Describe the skill level when it is being done correctly STRATEGIES New job assignment, taskforce, special projects, community board, industry association leadership, executive coach, mentor, training MONITOR/EVALUATE Follow up date, success measure

21 Successful Development Plans... Focus on what makes sense for the employee as well as the organization Are very specific about the objective Contain a variety of developmental strategies Are always a work-in-progress

22 Talent Identification Grid Priority for Development Core Performers The “Strategic Few” Bottom ThirdMiddle ThirdTop Third Top Third Middle Third Bottom Third Adaptability Performance 9 Consistent Star 8 Future All Around Star 6 Diamond in the Rough 7 Adaptable High Pro 5 Key Performer 3 Adaptable Performer 2 Solid Pro 4 High Pro Highest Potential 10 1 Low Performer The “Pipeline”

23 Talent Categories Grid Development Strategies The “Pipeline” Backup “STRATEGIC FEW “ Bottom ThirdMiddle ThirdTop Third Top Third Middle Third Bottom Third Adaptability Performance Core Performers ASSIGN TO KEY ROLES ASSIGN MENTOR PROVIDE REGLUAR FEEDBACK VISIBILITY TO SENIOR MGT Performance Based Feedback Skill Competency Training Some Conferences/Seminars Use High Performers as Mentors Assess Competencies Diversify Background Advanced Courses The “STRATEGIC FEW” Visibility to Local Senior Mgt. Move Across Organization

24 Talent Categories Grid Development Strategies The “Strategic Few” – Assign to key roles – Assign mentor – Provide regluar feedback – Visibility to senior mgt The “Pipeline” backup to the “Strategic Few” – Assess Competencies – Diversify Background – Advanced Courses – Visibility to Local Senior Mgt. – Move Across Organization The “Core Producers” – Performance Based Feedback – Skill Competency Training – Some Conferences/Seminars – Use High Performers as Mentors

25 Questions??