This Week's Herman Trend Alert Engaged Employees Increase Bottom Line Performance

The Herman Trend Alert December 31, 2008 Navigating the Next Year A recent study by the well-respected organization The Corporate Executive Board offers some sage advice for corporate leaders about how to successfully navigate the next year. Speaking on MSNBC, Tom Monahan, Chairman and CEO of this unique peer-to-peer network, shared the results of their recent research. When asked which issues would be most challenging in 2009, 30 percent of the corporate leaders who responded answered "protecting growth initiatives", 24 percent said "making critical talent plays", 21 percent answered "exploiting risk opportunities", and 17 percent replied "improving cost discipline". Overall, the suggested strategies highlight the need for leaders to change in five key areas. First, the report directs executives to "focus on product and services [expenditures] in their cost-cutting process, not just overhead cost, because that is where long-term competitive advantage lies". Second, leaders must be vigilant to "protect growth initiatives ". This strategy involves identifying and sheltering growth opportunities in the capital budget. In addition, the report suggests they integrate concrete innovation targets into performance expectations and reporting, even while belt-tightening". Third, leverage financial strengths. Foster innovations that target the shifting financial strengths of customers and suppliers. Fourth, "exploit risk opportunities: embrace, don’t eradicate, "the right" risk exposures". Finally, and in our view most importantly, now is the time to "make critical talent plays", "to court and cultivate tomorrow’s winners". Take the opportunity to close critical skill gaps with less-occupied talent. Reward outstanding performance. "Use the economic crisis to sharpen the acumen of future executives." "Embrace offshore centers as a source for critical skills and next-generation executive leadership, not just low-cost execution." The study also found that one in four top, high-performing employees expects to leave in next 12 months, up from one in 10 last year. Wise employers will use this downtime to re-engage employees with "stay interviews", re-orientation, and special projects. This re-engagement will also reduce the five percent productivity loss that translates into about $100 Million in lost operating cash flow for the average company. Monahan closed his interview with an astute observation: "Companies playing offense on talent have a remarkable opportunity right now." © Copyright 1998- by The Herman Group, Inc. -- reproduction for publication is encouraged, with the following attribution: From "The Herman Trend Alert," by Roger Herman and Joyce Gioia, Strategic Business Futurists. (800) 227-3566 or http://www.hermangroup.com. The Herman Trend Alert is a trademark of The Herman Group, Inc." WHAT WOULD HAPPEN IF... What would happen if 25% of your top performers left in the next year? According to a recent study from The Corporate Executive Board, that may well happen to you! Turnover costs A LOT, especially when you lose top performers, and it comes right off the bottom line. Let The Herman Group and its team of very experienced consultants help you address your turnover issues right away. We have an impressive track record and stand ready to help you. Call Carol at 336-210-3547 for a no-obligation conference call. FIND OUT WHAT YOUR EMPLOYEES REALLY THINK AND FEEL Discover what's really going on in the hearts and minds of your employees. Our InnerViews interviewing service uses SPHRs and PHRs, certified human resource professionals to probe for the information you really need to know. Exit and Stay Interviews, as well as Why-Didn't-You-Take-Our-Offer Interviews. Call Rosalie Catalano at 937-416-7066, or read more at: http://www.hermangroup.com/retentionconnection/exit_interviews.html. BUSINESS IS PICKING UP Most employers are unprepared. The recovery will bring a new set of challenges for employers that have been in prolonged contracted mode. They will need more skilled workers or will need now to begin to upskill their current staffs. But organizations can not engage in Strategic Workforce Planning, when they don't know how. That's where The Herman Group can help. We can help you with your "People Review"----large or small---so that you will know who you will need and when you will need them... and we can also guide you to the best sources for the people you will need. For more information, call Joyce at 336-210-3548 or e-mail joyce@hermangroup.com. Herman Trend Alerts are produced by the Herman Group, strategic business futurists, Certified Management Consultants, authors, and professional speakers. New subscribers are welcome. There is no charge for this public service. The Herman Trend Alert is received by over 30,000 subscribers in 78 countries, in addition to other websites and printed magazines. 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