Recognizing what core values are

Core values are the guiding principles and beliefs that underpin a company and its employees. For example, I lead a professional services business (HRD — A Leadership Development Company). Key components of our employer brand include growth and service. At HRD, our core values are growth, service, and connection, and we’ve defined specific behaviors for these values in actions with clients (externally) and with each other (internally). The values guide all of our decisions and shape our culture.

We offer employees variety — the opportunity to work with many leaders across large, global organizations. We offer a work-from-anywhere model that allows flexibility for employees to integrate work and life activities. Because of our mission, vision, and values, our employer brand is different from a large production organization whose value proposition includes stability, career pathing, and an attractive total rewards package.

Figuring out your organization’s values

Here’s a simple five-step process for determining (or validating) your organization’s values. Note: Many organizations overcomplicate this process. Your organization already has a brand, and similarly, you have values, so this process is about exploring and documenting them. I encourage you to engage key leaders/team members in this process to get different perspectives:

1. Identify four to five top performers/superstars in your organization and write down their key leadership attributes.

   Determine what about these leaders differentiates them and the value they bring to the business and your customers.

2. Identify four or five employees who haven’t been successful in your organization.

   Write down the attributes/characteristics that most hindered their success in the business.

3. Identify three to five key themes across both lists and notice connections.

4. Based on your observations, identify three to five core values.

   Limit these values to no more than five to keep the process simple and focused.

5. Over a period of time (one to three months) use the core values as a guide in your decision-making to validate and/or shift the final list of values.

After you determine your organization’s values, you can use them in the recruiting process to define your employer brand and the culture.

Being strategic with workforce planning

The idea is to begin thinking in terms of need rather than job, long term rather than short term, and big picture rather than immediate opening. To succeed, you need a firm understanding of your organization’s goals and priorities.

A strategic workforce plan ensures that you get the most out of your current workforce while preparing for the changes to come. The place to start is your organization’s vision and goals — what are you trying to achieve? Then, identify the skills necessary for success and the talent you’ll need to support those goals. Table 4-1 shows the difference between the traditional approach to acquiring talent and a strategic approach based on workforce planning.

Looking at your company’s overall priorities, your job is to determine the staffing implications. You need to make sure that any staffing decision clearly supports these business priorities. To do so, look beyond the purely functional requirements of the various positions in your company. Focus instead on what skills and attributes workers need to perform those roles exceptionally well as well as skills gaps that exist within your current workforce.

Unless you’re a sole proprietor or run a very small business, you can’t adopt a strategic staffing approach all by yourself. Make it a priority to reinforce the concept with other managers in your organization. You need their input to better understand company and departmental priorities — and they need your help in guiding them through the process and adopting this mindset as well.

To get you started, here are some of the key questions that you and other people in your organization should answer before you make your next move:

• What are your organization’s long-term strategic goals or those of departments seeking your assistance in hiring?
• What are the key competitive threats in your industry? In other words, what factors have the greatest bearing on your organization’s ability to compete successfully?
• What kind of culture currently exists in your organization? And what kind of culture do you ultimately want to create? What are the values you want the organization to stand for?
• What knowledge, skill sets, and general attributes are required to keep pace with business goals and, at the same time, remain true to your organization’s values?
• How does the current level of knowledge, skill sets, and attributes among today’s workforce match up with what will be necessary in the future?
• How reasonable is it for you to expect that, with the proper support and development, your current employees will be able to develop the skills they’re going to need for your organization to keep pace with the competition? In addition to on-the-job experience within an employee’s current role, would programs such as job rotation help reach these objectives?

Change is the name of the game in business. Organization priorities will undoubtedly shift over time as leadership innovates and identifies ways to keep the firm competitive. As a result, you should consider performing a needs assessment on an annual basis. That helps ensure that you’re still on track with the assumptions and priorities that are guiding your staffing strategy. Workforce planning is an ongoing activity, not an event.

Developing potential within the current team

Workforce planning isn’t just about hiring more employees. It involves making the best staffing choices available to address the core business needs you and the hiring manager have identified.

For some needs, you may not have to hire at all. Your job is to help company hiring managers strategically — and honestly — evaluate projects and focus their teams’ efforts on only those that grow revenues, increase efficiency, reduce expenses, or meet other company priorities.

If a line manager you support is thinking of filling an existing position, encourage them to consider how their group’s most critical needs may have changed since the last time the job was open instead of immediately searching for a candidate to fill the vacant position. Is a full-time individual still required in this role? And should a potential replacement have the same skills and experience as their predecessor?

In some cases, employees may have full work schedules, but their expertise isn’t devoted to the right projects. Ask the hiring manager to focus here:

• Analyze their work group’s daily activities to better understand how current resources are allocated. Needs identified as crucial may be handled in a variety of ways to best utilize the team.
• Suggest the idea of creating project teams to focus on critical, but temporary, activities to the manager of a group who feels that there is a case for new staff. These groups could then be quickly disbanded or reassembled, depending on changing needs.
• Look at current positions and consider combining the responsibilities of two less critical positions into one to free up a staff member who can help out elsewhere.

Encourage line managers to look at their group’s projects and attempt to match staff members with assignments best suited to their talents, even if some tasks fall outside their traditional job duties. Better utilizing the skills and experience of each person can help teams operate more efficiently.

Also, discuss with hiring managers whether it makes sense to provide targeted learning and development to current team members. Organizing a development session to help a team better utilize a common software program, for example, may be a cost-effective way to increase the group’s efficiency and develop the potential within the current team.

Recognizing the pros (and cons)

Before seeking outside talent, consider whether refilling positions or creating new ones by using internal resources may best serve your workforce plan. In other words, first consider promoting from within. Here are the key reasons:

• Increased efficiency: Filling jobs from within usually takes less time and is generally less costly (in the short term, at least) than hiring from the outside.
• Increased morale: Hiring from within sends a message to team members at all levels of your organization that good performance gets rewarded.
• Shorter adjustment period: Everything else being equal, an existing employee requires a lot less time to acclimate to the new job than an employee who’s never been with your organization.

The drawbacks of filling positions from within? Only two, really.

• Limiting your search to internal candidates limits the pool, and you may end up promoting someone who isn’t as qualified or doesn’t have the future potential of an external candidate.
• Whenever you recruit from within, you always run a risk that otherwise important and valuable employees who don’t get the job may become resentful and even eventually decide to leave the organization.

That’s why it’s essential to establish an atmosphere of trust when looking to existing employees for available positions. Make it clear that employees can be comfortable applying for open internal positions. No employee should be concerned about repercussions, such as a manager or supervisor being frustrated that they want to change jobs when they’re doing “just fine” in their current position.

Knowing where to look for internal talent

When beginning your search for internal candidates, you don’t have to search far. Most organizations have traditionally maintained a personnel file or job history file for each employee. The difference lies in how the information is categorized. Conventional job histories tend to focus on accomplishments. An employee skills inventory focuses on the skills and attributes that led to those accomplishments — and that can be called upon once again.

You may assume that this practice is one that is suitable only for big organizations. And you may assume, too, that the process is more bother than it’s worth. Neither assumption is necessarily true.

Even if your organization is relatively small, it still may be worth the time and effort to develop the capability of pulling an employee skills inventory. The chief benefit is that, instead of picking your way through reams of folders to compile a list of people who may be logical candidates for an opening, you simply search your employee profile database using specific categories.

Some of the categories you may want to pull from the employee profile include the following:

• Skills/knowledge areas: Business-related functions or activities in which the employee has either special knowledge or a proven record of proficiency.
• Second-language skills: Anything other than English. Emphasize that familiarity with another language isn’t enough; the candidate must be fluent if they’re going to assist customers or work with suppliers who communicate in that language.
• Special preferences: Requests the employee has made about their own aspirations, other jobs in the company they want to pursue, or areas of the country (or world) to which they may be interested in relocating.
• Educational background: Schools, degrees, and subjects in which the employee majored and minored.
• Job history at your organization: Include the title, department, organizational unit, and actual job duties the employee has performed.
• Previous job history: Include the same general information as for the preceding category but for the employee’s prior employers.
• Learning & Development courses and seminars: List the program, topics covered, and, if applicable, the format and timing of the development experience.
• Assessment results: Key results, if applicable, of any company-sanctioned assessments or other types of measurement activities that the employee has formally undergone during their tenure at the organization.
• Licenses, credentials, and affiliations: Obviously, all these categories should be work related and logically linked to the tasks and responsibilities of the job. (A warehouse employee who’s going to operate a forklift, for example, doesn’t need a certificate from a stunt-driving school, and the person you hire to supervise the kitchen of your company cafeteria doesn’t need to belong to an international wine society.)

The preceding list is meant to be a set of recommendations, nothing more. You can incorporate into your own employee skills inventory anything that you consider relevant. Just be careful that, as you develop your inventory (and the employee profile that drives that inventory), you don’t inadvertently violate any equal employment opportunity (EEO) laws. If you have any question about any category, check with legal counsel.

The more in touch you are with the existing talents, skills, and attributes of your people, the easier time you’ll have getting the most out of their expertise. Your employee profiles and skills inventory is a valuable tool.

Employees

Companies hiring employees are required to pay whatever payroll taxes are required by law and must also withhold applicable state, federal, and local taxes. Employees can be either full time or part time, and they may be hired either on a short-term basis or on an ongoing, indefinite basis. Regular part-time employees enjoy many of the same benefits (usually on a prorated scale) and the same federal and state protections as full-time employees.

Contingent workers

Contingent workers are employees of a staffing firm, which for a fee assigns them to client companies to augment the client’s employees or provide skills and knowledge not available internally to the client. This category includes temporary to full-time staffing but not ICs. Staffing firms employing contingent workers are required to pay whatever payroll taxes are required by law and must withhold applicable state, federal, and local taxes. As with all three of the worker relationships, contingent workers can be either full time or part time and either short term or long term. Companies can conceivably hire contingent workers on their own, but using a staffing firm is strongly advised.

Correctly defining contingent workers can be tricky for someone beginning in an HR role (or anyone, for that matter) because there are no uniform, commonly understood terms used to describe them. In fact, contingent workers often are described collectively and interchangeably as temporary, contract, interim, leased, or project-based workers; consultants; or other designations.

Contingent workers represent a large segment of the workforce, and the tasks they perform are varied ranging from administrative to strategic, specialized support. For this reason, I discuss contingent workers in more detail in the section, “Benefitting from Contingent Workers,” later in this chapter.

For clarity with regard to worker classification, I consistently use the term contingent workers throughout this book whenever I refer to individuals employed by a staffing firm and assigned to a client company — even when the workers are professional-level specialists, an increasingly likely scenario in today’s business world.

Independent contractors

Strictly defined, an IC also referred to as a freelancer controls the methods and means of performing their tasks and is responsible to the organization they’re working with only for the results. The organization engaging the IC has no tax liability and almost no other administrative responsibility other than paying the invoice and reporting payments on 1099 forms.

You can’t be too careful when working with ICs. There is a significant risk that the Internal Revenue Service (IRS) may not agree with your interpretation of an IC or contingent worker and may declare that the proper classification of the worker is as an employee. Likewise, the person in question may claim that they never should’ve been treated as an IC but, instead, should’ve been treated as an employee, entitled to the various financial and other benefits associated with an employer/employee relationship. You must understand the specific distinctions between ICs and employees. Seek the advice of a knowledgeable and experienced lawyer for help in this sensitive area.

Noting the pros to contingent workers

The flexibility of variable-cost labor provides an advantage to organizations that seek greater control over their HR budgets and appreciate having access to skilled talent when and for as long as they need that talent. In fact, as companies continually rebalance their workforces to remain profitable in both good and difficult times, many are discovering that a year-round mix of core employees and contingent workers is their best bet for ultimate flexibility.

Here are some advantages to using contingent workers in your workforce mix:

• It allows departments to adjust staffing levels to the ebb and flow of business cycles, thus helping to keep overhead costs under control.
• It eases the work burden on employees who may already be spread too thin because of business demands or duties added to their roles from prior layoffs or downsizing.
• It offers departments a way to handle special projects — or special problems — that lie beyond the expertise of current staff members.
• It gives the organization an opportunity to engage — on a short-term basis — high-level specialists it can’t afford for the long term.
• It creates job stability for a core group of full-time workers in highly cyclical businesses. Otherwise, those sorts of businesses need to subject their workforces to constant nerve-racking cycles of hiring and layoffs as the demands of the business fluctuate.
• It provides what amounts to a trial period for potential new employees. If, as your needs evolve, you decide to consider converting a contingent worker to employee status, you have the advantage of already knowing some of the individual’s capabilities and personal attributes.
• It allows an organization to grow and scale more quickly, especially when in-demand skill sets are required.

Determining whether they’re the right fit

The more proactive and strategic you and hiring managers are in approaching your talent needs, the bigger the payoff. However, before you use contingent workers, answer these threshold questions:

• What specific tasks do you need someone to perform and over what time period? The shorter the time period, the more inclined you should be to seek contingent help.
• What skills or expertise are necessary to perform those tasks? Generally speaking, the use of contingent workers enables you to tap into a knowledge base that’s far broader than you can find in your current staff.
• Can people who are on the organization’s payroll perform those tasks — without affecting other aspects of their job performance and without creating excessive overtime costs? Balancing basic responsibilities with additional tasks isn’t easy. To answer this question, departmental managers will likely look to you and your HR colleagues because you’re probably more familiar with the skills and workloads of people in all parts of the company.
• Can the department and company afford the extra cost involved to engage highly skilled supplemental staff? Think overall value, not just immediate expense.
• Can I build a team with this skill set in the time frame needed? It’s important to understand market availability and costs associated with specific skill sets to determine whether it would be more cost effective and also feasible to bring the skills into your organization in a needed time frame.

You can engage many types of contingent workers on your own without going through a staffing/recruiting firm. You also can run a marathon in a pair of sandals.

The case for using a firm to help execute a contingency staffing strategy is strong. Firms that specialize in providing contingent workers already have a pool of experienced people they can assign to your company. They understand the complex legalities (including tax-related issues) of contingency staffing. They handle all the paperwork. The cost is a little more than the average pay rate for people in that particular specialty, but the staffing firm handles preliminary evaluation of the candidate and government-mandated benefits and assumes responsibilities as the employer of record.

Your company has a number of options, as staffing firms expand their services in efforts to remain competitive. But with so many options available, making the right choice can be a challenge. Reputation is important. The best job candidates — and these are the people you want access to — work for the best staffing firms. Specialization is a key factor in attracting skilled talent, so look for staffing firms that focus on the types of positions you’re looking to fill or individuals with the types of skill sets or experience you need.

Asking the right questions

To help you on your way, the following checklist offers several questions you may want to ask whenever you’re checking out potential partners:

• Does the firm specialize in the areas where you need help?
• How long has the firm been in business?
• How does the firm recruit and retain a highly skilled set of candidates?
• How does it evaluate and select its talent?
• How broad and deep is its candidate base?
• How does the service match needs with skills?
• Does the firm guarantee its workers? Does it provide replacements?
• Is a contact person available after hours?

The Staffing Firm Evaluation Checklist in the online tools can serve as a quick reference when evaluating staffing firms.

Make sure you nail down all the costs ahead of time. Clarify this information with the departmental supervisor who’s going to be managing the worker(s). A reputable firm is always willing to communicate its fee structure in writing.

The more familiar a staffing firm is with your organization — how it operates, who your employees are, the needs of various departments — the greater its ability to provide you with the right talent.

Engaging a contingent workforce

All of the workers serving in your business, including contingent team members, represent your business. Each individual, regardless of classification, is adding to the environment and culture, so it’s important that contingent workers feel a connection to the business and as if they’re part of the team. Create an environment where they feel connected. Here are some ideas:

• Communicate to your internal team. You’re inviting misunderstanding if you don’t communicate beforehand to your internal staff the rationale behind your strategy of engaging contingent workers for a project. Failing to do so can cause trouble on two fronts:

  • It leads to needless confusion or even tension among your full-time employees who may wonder why the individual has been engaged, what that person’s role is to be, and what may be amiss that caused the need for a contingent worker in the first place.
  • It creates unnecessary pressure for the contingent staff who must work with or near a group of people who are puzzled by their mere presence.

  Instead of merely announcing that a contingent worker has been engaged, involve employees weeks earlier in the staffing process to help you clarify the scope of the department or project team’s workload. Internal team members can offer input about specific tasks that require attention or skills that are needed and creative solutions, such as reassigning certain activities among themselves and carving out a particular function for the supplemental worker.

• Create a plan for successful execution. You need to have a clear idea — before the contingent worker arrives — about the scope of the project, when it should be completed and, as appropriate, matters related to quality. Just make sure that your expectations and those of other managers are realistic, particularly regarding the difficulty of the task. Also, factor in the reality that even seasoned contingent workers need time to acclimate themselves to a new working environment.
• Ensure that equipment and resources are available. Verify that the contingent worker has the equipment and materials needed to be successful, including the provision of any necessary logon IDs and passwords.
• Make safety a priority. Provide appropriate safety and health training, particularly for workers in manufacturing or other nonoffice settings.

• Create a friendly atmosphere. The more at home a company can make contingent workers feel, the more productive they’re likely to be.

  Either you, their manager, or someone in the department to which the worker has been assigned should conduct a mini-onboarding session.

• Be explicit. One of the concerns that contingent workers who have unsatisfying work experiences voice most often is that they’re not given enough direction at the start of the assignment. Here’s a general rule: The lengthier and more complex the assignment is, the more time you or a line manager needs to spend on orientation and explaining the nature of the assignment.
• Provide adequate leadership and management. Regardless of how busy your company is, make sure that hiring managers stay connected with the work of the contingent workers you engage. They’re working under your direction. Check in with managers and make sure that they’re communicating well with contingent staff.
• Intervene early. As important as it is for managers to provide clear direction to contingent staff, sometimes the work simply isn’t getting done properly. Let managers on your team know that if they’re not pleased with the quality of a contingent worker’s contributions, they should contact you or the staffing firm immediately.
• Don’t settle. A reputable staffing firm won’t argue with you if the person who’s been sent to your firm isn’t doing a good job. The firm simply sends a replacement and handles communication directly with the individual (the contingent worker is their employee, after all) regarding termination of the assignment. For everyone’s sake, however, try to be as specific as you can when expressing displeasure. If you do a good job of telling the firm where the individual fell short, you’re more likely to get a suitable replacement.

Documenting performance and offering feedback to the staffing firm

When contingent workers finish their assignments, document their performance. Depending on whether your experience was positive or negative, you may want to ask the staffing firm for a particular person again — or ask that they never return!

Sharing your assessment with the staffing firm helps the firm do a better job of meeting your company’s needs. (Note: Many staffing firms offer evaluation forms after an assignment to solicit this type of feedback.) As you go through this exercise, you and line managers who have used contingent staff should ask yourselves whether the contingent worker:

• Met your expectations
• Finished the job on time and professionally
• Required little, some, or too much daily instruction
• Worked well with others

Additionally, ask your line managers:

• What could the contingent worker have done differently? Done better?
• Would you hire this person as a full-time or part-time employee? If no, why not?

Be aware that your assessment isn’t to be used as a performance evaluation. Your records should be treated as internal documents only and shared only with internal staff and with the staffing firm. Under no circumstances should you share what may be perceived as a formal performance evaluation with a contingent worker. Why? Doing so is one of the criteria the courts use to determine whether the worker was really working on a contingent basis or directly for you. If you’re sued, and the decision goes the wrong way, you could be liable for back payroll taxes and other expenses.

That’s not to say that you can’t offer feedback, including words of encouragement (“Good job!”) to a contingent worker or point out when your expectations aren’t being met during the course of the assignment (“I need you to improve your performance”). Just don’t formalize the encounter or offer anything in writing.

At the end of the assignment, ask for feedback from contingent workers about your company or department and its procedures and approaches.

Looking at your legal responsibility

Apart from whatever strategic benefits the use of contingent workers offers, their growing presence in the workplace introduces some thorny legal issues as well. One key question: To what extent are companies that hire temporary or project workers directly (instead of relying on staffing firms) obliged to provide these workers with the same benefits and protections that regular employees receive?