1. SHRM Thought Leaders Conference Scottsdale, AZ October 5-6, 2009

3. “Their argument is a strong one, and the idea that companies would benefit in the long run from putting more into preparing the right people for the right jobs seems timely. As we look for ways to dig our way out of recession, it is worth remembering that effective and creative people are any company’s best weapon in the war, not for talent, but for survival.” Financial Times March 12, 2009

4. Strategy, Strategy Execution and Resource Accountability Strategy Execution Resource Allocation Financial Material Time Data Workforce Budget Supply chain Schedules Information systems ??? Resource Accountability Strategy Differentiation to create competitive advantage How grow? Where play? How win? Value creation: −Customer −Economic

5. Least Effective in Business Skills HR staff are more effective in the skills that characterize their most traditional roles Percentage Answering “Effective” or “Very Effective” People Skills Mean = 42% HR Expertise Mean = 52% Implementing Skills Mean = 35% Business Skills Mean = 29% Effectiveness of HR Skills Skill Effectiveness Mean = 39% Least Effective in Business Skills>08-20-2008 17% 12% 27% 60% 40% 28% 27% 40% 41% 63% 53% 44% 48% 43% 40% 44% 0 10 20 30 40 50 60 70 APPLYING BUSINESS ANALYTICS TAKING A GLOBAL APPROACH

6. The Workforce and Value Creation HR as a Strategy Player

7. Strategy and Talent: Evolutionary vs. Revolutionary Change Growth Financial Customer Growth/Change Expectations 20032004200520062007200820092010

8. Evolutionary vs. Revolutionary Change Growth Financial Customer Growth/Change Expectations 20032004200520062007200820092010 Culture/Talent/Capability

9. Capabilities STRATEGIC CAPABILITY 1 Evolutionary vs. Revolutionary Change Growth/Change Expectations 20032004200520062007200820092010 GrowthTalent SC 2 SC 3 SC 4 SC 5

10. STRATEGIC POSITION 1 SP 2 SP 3 SP 4 SP 5 Evolutionary vs. Revolutionary Change Financial Customer Growth/Change Expectations 20032004200520062007200820092010 CapabilitiesGrowthTalent Culture

11. Competitive Context Strategy Innovation Structural Cost Strategic Capabilities Speed

12. Competitive Context Strategy Innovation Structural Cost Strategic Capabilities Speed (How different?)

13. Competitive Context Strategy Innovation Structural Cost Strategic Capabilities Speed (How different?) (What workforce investments?)

14. Competitive Context Strategy Innovation Structural Cost Strategic Capabilities Speed (How different?) (What workforce disinvestments?)(What workforce investments?)

15. Growth Strategy Matrix

17. Six Month Target Key: Today = Black. Six month target = Red

18. Key: Today = Black. 12 month target = Red One Year Target

19. HR’s Biggest Challenges  Thinking like a strategist  Scoring on the scorecard of the business  Understanding that numbers are the language of organizations  Understanding how, where and who creates customer and economic value  Developing strategic data for strategic workforce decision making Self Assessment: Abysmal Fairly Competent Fully Competent Among the EliteWorld Class 12345

20. Strategic Talent as a Sustainable Source of Competitive Advantage: Alignment for Value Creation Old FocusNew Focus Question Asked Data NeededDecisions Made Question Asked Data Needed Decisions Made Communication  Is our workforce satisfied / happy?  Traditional job satisfaction survey  Give the workforce more “ satisfiers ”  Is our top talent in strategy position thrilled with our firm?  Strategic engagement survey  Provide top talent what is needed to retain and motivate them Work Design  How do we do our work?  Job descriptions  Did we accurately capture how work was done?  Are we focusing on value creation in every job?  Performance Appraisal data/ information  What work is strategic? Support? Surplus? Selection  Are we “ fair ” in our selection process?  Adverse impact analysis  Remove all selection tools that have an adverse impact  How well does our top talent in strategic roles compare to the labor supply?  External market assessment of our talent  Keep and reward top talent that benchmarks well against the external labor supply Training/ Development  How did our participants feel about our training?  Conduct post training “ smile ” surveys  Remove unpopular instructions  How can we accelerate the skills of our emerging talent in strategic roles?  Identification of developmental needs of emerging talent  Develop rotational, mentors / coaches and training programs for emerging talent in strategic positions Performance Management  Are performance appraisals completed and on time?  Submission on due date and complete  Withhold increases until performance appraisal forms are completed  Is our performance management system a tool to execute business strategy?  Analysis of alignment of performance management systems  Use zero-based strategic work planning/ budgeting Rewards  Is our program fair?  Analysis of distribution of increases  Everyone gets a raise  Are we adequately rewarding our value creators for their success?  Assess relationship between strategic performance and extraordinary rewards vs. lower performers  Assure that we never abuse our best performers with inadequate rewards (or over reward our poor performers) Transitioning HR Practices 20

22. 1.Think like a strategist 2.Ask the right questions 3.Develop the right metrics 4.Use metrics to make strategic workforce decisions: minimize risk and maximize value 5.Hold leaders accountable for the management of their strategic workforce The “Back Home” Challenge — The Charge —