The release of the study follows the first full-year of the new SEC disclosure rules around executive compensation, which require public companies to describe the compensation packages of their top executives to shareholders via proxy statements. In addition to the correlation between greater responsibility for revenue and increased stock-related compensation, the report also reveals a number of other interesting trends about the compensation packages of top executives:

• The highest median total compensation of $3.9 million went to CEOs in the utilities, food and tobacco, and insurance industries with CEOs in the construction industry coming in right behind the CEOs in the leading industries. CEOs in the financial services industry ranked last, at $733,000 in median total compensation, among the top executives in the 22 industries surveyed.

• The highest median cash compensation, which is described as a total of annual salary, bonus and non-equity incentives, was earned by the CEOs in the insurance industry at $1.6 million.

• CEOs of the smallest companies are holding 11 times their annual salary in stock and stock options versus their counterparts in the largest 10% of companies, who are holding over 80 times their annual salary in company stock and stock options.

The authors of the survey note that CEOs of larger companies accumulate stock and stock options over time giving them more “skin in the game” and that the practice of granting more stock-related compensation should align CEOs with the goals of shareholders. The CEOs of smaller companies may have the ability to affect results more quickly, via new products or marketing processes, thus using salary as an incentive for those CEOs might be more appropriate than relying on stock appreciation.

That’s the conclusion of the latest salary survey on pharmacy personnel conducted by Mercer. The semi-annual survey contains detailed information on pay levels and pay practices for pharmacy personnel reported in more than 380 metropolitan areas across the U.S. The position of regional pharmacy operations manager earns median total cash compensation of $130,400 compared to $122,100 in 2006, which is an increase of 6.8 % and more than twice the pay increase of 3.1 % in 2005. Similarly, clinical pharmacists saw pay raises increase from 3.9 % in 2006 to 6.3 % in 2007.

Here are some of the results from the Mercer survey — year-over-year pay comparison of select pharmacy positions.

Many cars today tell the driver when it is time to perform maintenance. Even better, some tell the driver that maintenance is needed in 1,000 miles with updates along the way. It would be great if as a business executive or small business owner, you had this kind of technology at your fingertips.

Unfortunately, managing a sales organization will always be a manual effort. Sure, CRM systems and contact managers help, but there is no technology that replaces the leadership associated with sales management.

Not sure where to dig into your sales organization? Here are 12 areas that will show just how game-ready you are.

1. Business objective. In your capacity, I’ll bet you can cite the objectives of the business easy as pie, but do the key members of the sales team know them? Better yet, do they know the current one(s)? Business objectives change. It is important that those affected by the change are in the know. The business objectives serve as the foundation of the company’s sales architecture?, which is the overall selling system framework. If the foundation changes without reviewing the selling framework, there is a high risk of not achieving the objective. It is the equivalent of constructing a building with the wrong materials, or worse, in the wrong place.
2. Differentiation. Some argue that differentiation is the job of the marketing team. I see this as a shared responsibility between sales and marketing. The bottom line is whether your company is successful winning business at your desired prices. The comedian George Carlin has a great line about this: “If you nail together two things that have never been nailed together before, someone will buy it!” The target for differentiation is always moving. What is unique today is pass? tomorrow. However, sales people can differentiate themselves above and beyond the product by being a valued resource to their clients. This is critical in a competitive or commodity marketplace. One of my favorite questions to ask sales people is why someone should buy from them. The goal is to see what value they see that they bring to their clientele.
3. Ideal client profile. Hopefully, you already have one of these. This is the document that clearly defines the attributes of your ideal client. Think in terms of size, buying circumstance, budget, buying habits, etc. This is a profile that each member of the sales team should memorize and be held accountable for knowing. Their pursuit of new business should be aligned with this profile. As the objectives of the business change, this profile may change. Be sure that it still meets the needs of the business.
4. Messaging consistency. You spend time and money investing in a new campaign. Your sales people position the company using this new message, but the print material and website still convey the old information. Not good! The outbound message to the market must be consistent. If the sales people say it, the corporate presentation should reinforce it. The printed collateral material and website should help position the message. In essence, the entire approach should be aligned.
5. Intellectual capital. These are your “referenceable” clients. Other than your employees, they are your most valuable asset. This asset is critical for your sales team to help them win business. How are you growing your portfolio? How are you ensuring that your largest client is not over-utilized by the sales team for these purposes? Do you have clients who can speak to everything your firm does, coming from multiple buying circumstances (newbie, veteran, etc)? The use of references can serve as a key competitive advantage for your sales team. It is important that the portfolio be ever-growing and well-managed.
6. Sales performance. How are the members of the team performing relative to their assigned goal? While you may be tempted to measure only revenue performance relative to quota, this is not always the best approach for longer-term buying processes. In those circumstances, review of performance in the buying process itself is an important area for study. That said, the rule of thumb is to look to upgrade the bottom 20% of the sales team. Recruiting is an ongoing initiative of any healthy sales organization.
7. Pipeline analysis. There are various opinions on how large a sales pipeline should be to ensure it yields enough to meet the business objective. The challenge is that a strict quantitative value minimizes the importance of a qualitative one. I’ve seen salespeople with a pipeline of twice their goal finish the year at 150% of quota. I’ve also seen sales people with a pipeline of five times their annual goal miss the target. Quantitative studies aside, the best approach is to conduct formal, periodic pipeline reviews so that you and your executive team can dig into the pipeline to see what prospects are real. Quality supersedes quantity. Pipeline reviews are very helpful for executive teams with respect to learning market trends and competitive intelligence.
8. Ideal sales person profile. You need this tool if you are going to upgrade the bottom 20% of your sales team. The attributes of this profile change, however, as the business changes and matures. Think in terms of the Blackberry. About seven years ago, their sales people had to create demand in a minimally competitive market. Today, the Blackberry is a staple in business, but buyers have product choices outside of the Blackberry brand. The skill set required to be successful in their business initially is very different than today. Don’t have a profile? See my article titled “The Sales Marriage” to learn how to formulate your ideal sales person profile.
9. Revenue accelerator program. Again, you are probably asking yourself what this term means. I could have just written “new hire training.” That doesn’t convey the importance of getting sales people to a productive level as quickly as possible. Every time a salesperson is hired in your company, there is a cost to the business. Thus, the development of a program that is focused on reducing the time for a sales person to generate revenue is critical. To effectively formulate your revenue accelerator program, ask yourself what the sales person needs to know to effectively sell your product and when they need to know this information. Some err by using the fire hose approach. “Teach them everything in their first week and tell them to go sell!” The fundamental question is, how quickly is there a return on the investment for this hire?
10. Skill development. Many think that sales talent is born, not developed. Oh, if that were only the case. Companies need to invest in their sales team development just as professional sports teams practice their craft every single day. Sales is a profession, one of the few professions in which ongoing training is not required to continue to perform in the role. However, it is critical to success. One of the biggest disconnects between executives and sales people is when the sales team is criticized for not “selling the value.” When the executives are asked when and how they trained the sales team on demonstrating this value, a blank look appears on their faces. Sales people will perform based on how they are trained and how they are compensated.
11. Compensation. Does your compensation plan drive the sales behaviors you feel assist in meeting the business objective? It all comes back to the business objective. The blessing and curse of sales people is that they use their compensation plan as a job description. If you pay them for doing one thing, but expect another, you will be disappointed. This is also a very sensitive area. The plan must change as the business objective changes. However, if the plan changes too frequently, the sales team will grow distrustful and look to leave. Approach this with true circumspection.
12. Metrics. The beauty of sales is that just about everything can be measured. Some like sales for that very reason. It is incumbent on the executive team to create metrics with desired goals such that every aspect of the company’s sales architecture can be measured and analyzed. This is a great way to use your CRM. They are designed to track what needs to be measured. I suggest analyzing performance of team members, product lines, and the sales organization in total. Who sells the most of what product? Who sells the highest margin deals? What product is not selling as expected? Which sales person has the shortest buying cycle? Which sales person has the longest buying cycle?

A review of these 12 areas will ensure that your sales organization is finely tuned and ready to conquer the selling world.

I am still amazed at how many organizations do not allow their current employees to apply for internal positions until they meet a whole bunch of conditions. Typically, they have to have been in a position for a certain amount of time, may have to meet performance requirements, may have to fill out an application, and then go through the same interview process as an external candidate.

Most HR people think this is fine, and in fact, often put these rules in place. Their thinking is understandable from one perspective. After all, shouldn’t a boss be aware that an employee is looking? And if a person has only been in a job for a few months, isn’t it only fair they give their boss their services for a few months?

My answer is that yes, it would be fair, if we were not in the midst of a talent shortage where “fair” has little meaning. Is it fair any employee can simply tell her boss she won’t be back tomorrow because she has another job? Is it fair that employees can often get a salary increase of 10% or more simply by moving to another company? Is it fair that we have a labor shortage? There is little in life that is fair, and the days of stability and loyalty in our corporations are over. We could argue about why these traits have gone by the wayside, but the truth is that they have.

The shortage of talent in some areas such as engineering, IT, medicine, and finance are so severe that almost anything has become “fair” in the pursuit of talented people with these skills.

I have started to notice “For Hire” signs hanging in front of lots of stores and restaurants I have been in over the past three months seeking hourly help. This underlines the growing shortage of talent and the growing need for people with key skills. To place obstacles in the way of anyone with a motivation to raise their hand to move into a needed position is plainly just dumb.

Let’s face the truth: whether employees are allowed to transfer freely inside or not affects no one but the employer. They lose a good employee to another company for no good or value-added reason.

Employees As Investors

One of our problems is that we think of employees as assets, or things we control and dispose of as we see fit. Unfortunately, this characterization leads to behaviors that are incompatible with reality. Employees cannot be owned, taxed, depreciated, or disposed of as machines or other tangible assets.

They are investors in our organizations and they freely choose to share their expertise and skills with us or not. Each employee has a built-in return on investment meter that is constantly sampling the atmosphere and deciding if she is gaining or losing from a continuing association with the firm. As long as employees feel they are gaining, they don’t look for different jobs.

But in this job market, whenever the balance shifts even slightly, employees become vulnerable to any offer that may present itself. That is why having managers who have a history of good employee loyalty and low turnover are so valuable.

Usually when an employee wants to apply for another position inside the firm it is because they are looking for a new challenge, are unhappy with their current assignment of boss, or feel that the new position will offer more of a return on their investment. To deny them the opportunity and to place some HR policy in their way is not only a sure way to lose them to someone else, it is also just plain dumb. Happy employees who are being treated as investors will be unlikely to leave.

Here are four things every organization and HR group should be doing or should have in place today:

1. All policies should be abolished that limit or control how or when employees apply for positions within an organization. Every employee should have the same employment at-will opportunities inside the company as exist in the open marketplace.
2. Companies should make it a policy to encourage employees to share expertise and skills broadly. After all, it is the networking interconnectedness of our employees that add value and allow us to develop new products and generate new ideas. Creativity does not arise in stable, rigid, and change-adverse organizations. The most exciting new concepts and ideas come from small firms where people wear many hats and move between responsibilities such as the dot-com companies of Silicon Valley.
3. Let recruiters work just as freely inside as outside the organization and let them work on back-filling positions that may be vacated by an employee who is moving on to something else. If a recruiter knows an employee is leaving for a new position, they can help the manager find someone else for the old position at almost the same time.
4. Create policies that allow employees to try out new jobs for a short time to see whether they like it and can do it well. Let employees share their job with someone else so they can sample more than one kind of work or more than one project. Foster a spirit of sharing expertise and skills, not of owning the mind and body of someone.

The policies that restrict or limit transfers and change within an organization are leftovers of the 20th-century organizations that are hierarchical, paternalistic, and slowly fading away. A 21st-century organization removes barriers and builds networks that power creativity and growth.

I recently overheard several people talking about an employment offer one of them had recently received. The candidate, who has received three promotions in three years with her current company, was so under-whelmed with the offer that she was insulted and happy to discuss her disgust with others.

The offer, from a well-known company, required the candidate to take a drop in title, relocate to a city with a significantly higher cost of living at her own expense, and all for a $1,500/year increase in salary. Having spent a month chatting on the phone and in person with the company, this candidate was frustrated. Unfortunately, this situation happens all the time.

Do you work for a company that pays below-average compensation for your industry? Do you get embarrassed when you have to present offers to candidates that you know they will perceive as ridiculous? These situations are never fun, but there are some things you can do to increase offer acceptance rates when great pay is not an option.

Putting Your Mindset in Check

Before you start recruiting, realize that low pay is not as big of a problem as you might think if you know how to take the spotlight off of compensation. There are millions of people who work in poorly paying jobs but are satisfied and engaged. For instance, almost everyone in education, government, the military, childcare, and not-for-profit organizations work for far less money than they could get if they worked in other industries.

Huge segments of the population are willing to work for organizations that pay poorly, provided there are other aspects of the offer that are more compelling. Although many individuals turn down offers by saying, “It’s the money,” in many cases it really isn’t the money, or at least, not the money alone.

The real reason people reject job offers can be identified by simply calling candidates who rejected an offer three months later (after they have found another job and the pressure is off). More often than not, you’ll find it wasn’t the money, but rather that they were treated poorly during the recruiting process.

There are three recruiting process points to focus on if you want to solve the “low salary” problem. The first deals with actions to complete prior to starting the recruiting effort. The second focuses on things you can do during the recruiting process, and the third focuses on what can be done during the offer process to improve your chances of garnering an acceptance.

First, Things to Do Before You Start Recruiting

Design your recruiting process in such a way that you don’t set yourself up for failure. If you recruit from the ranks of the fully employed during positive economic cycles, you will consistently encounter issues with offers that are below or near the candidate’s current rate of pay. Unless, of course, the candidate is fleeing some extremely negative situation and does not have an opportunity to shop for the best offer.

If you exhaust all attempts to improve the compensation structure, here are additional actions to take:

• Develop a sales sheet. Survey your current employees who love their jobs, and use these reasons in recruitment materials. Provide this information to hiring managers so they can focus conversations on the non-soured aspects of the company. Quite often, job security, a fun atmosphere, and employee involvement come ahead of compensation in many applicants’ decision criteria. In short, don’t try to be something you’re not. Instead, sell and be proud of what you are.
• Rely heavily on referrals. Referrals work especially well in low-paying environments because your own employees are likely to do a better job of selling the non-monetary compensation aspects of the job and company. Employees are also good at screening out people who wouldn’t fit the environment, and the referring employee (if encouraged) often will help “sell” the candidate during the offer process.
• Be upfront about not wanting “compensation first” individuals. It might seem counterintuitive, but it’s actually a good idea to let people know upfront that your company seeks people who “care about the work” and that you purposely do not hire individuals who have compensation as their primary focus. It’s a fact that people who put money first are harder to manage and are a greater retention risk. Southwest Airlines and Ernst & Young are particularly good at this approach to recruiting.
• Cost of living comparison. If you happen to live in a low-cost living area, do some calculations in order to show candidates that even though the pay might be lower, the “relative pay” might actually be higher because housing, transportation, and other expenses are relatively low in your area.
• Build a relationship. If you can, pre-identify targeted candidates and build a relationship with them over time. Candidates are less likely to be shocked when they hear about the lousy pay and are more likely to trust you when you say the excitement of the job overcomes the low-pay aspect. Consider giving targeted individuals samples of your products to evaluate, or even involve them in a project as a consultant on nights or weekends so they get to know your team well.
• Seek out candidates with a hook. Target your recruiting to individuals who have some tie or “hook” to your local area. Quite often, individuals with family ties, those who went to school in the area, or those who used to work for your firm (boomerangs) are more willing to accept a low salary for that chance to return home.
• Quality of life. If you live in an area that has a low crime rate, lots of amenities, great schools, short commute times, or wide, open spaces, put together a convincing argument as to why your area is desirable, regardless of the pay involved. Put this and other positive aspects in all recruitment communications.
• Promotion rates. The MGM Grand Hotel in Las Vegas isn’t shy about communicating the rate of promotion are much higher than equivalent properties in big cities like New York. If this is true for your organization as well, demonstrate that while starting salaries are low, in just a few short years they would be making more money, have more responsibility, and a better job title than they would have had at another organization.
• Target low-pay industries. Focus your recruiting on individuals working in low-paying industries like education, government, retail, or healthcare. They already know what it’s like to work for low pay, so it won’t be a shock when they find out you pay below the average. Also look at individuals who volunteer a lot of their time, because they are more likely to put “making a difference” ahead of money. You might also target retirees and Gen Y and M candidates, because quite often, they put their profession, flexibility, and other factors before money.
• Target companies in turmoil. Seek employees at companies that are in economic trouble and people who have been laid off, because those individuals generally learn (at least in the short-term) to regard job security and stability over pay.
• Build a great employment brand. Although it’s a long-term strategy, by winning awards and “being talked about” in the media as a great employer, you can double your application rate, while simultaneously attracting individuals who want to work for your firm so badly that the amount of money they get paid is a secondary issue. Consider Google, Pixar, Apple, Starbucks, Procter & Gamble, or Timberland.

Second, Things to Do During the Hiring Process

During the hiring process and before the offer is made, take the following steps to increase your chances of getting an offer accepted:

• Don’t insult them. Ask them before the start of the interview process, “What is the minimum salary you need to accept an offer?” Also, ask them to identify any deal breakers like title, travel required, weekend work, etc., so you know in advance what you’re up against.
• Identify job-acceptance criteria. Be direct and ask them to list and rank their job-acceptance criteria. Use these criteria to guide your interview and offer process. If they put salary as number one, realize upfront that your chances are much smaller to win them over. If you’re really bold, ask them to outline their “dream job” and then try to meet each of the non-compensation-related items in your offer.
• Peer interviews. When coworkers interview applicants without managers present, candidates are more open with their concerns and coworkers are better able to make convincing counter-arguments because they hold the same job.
• Two-year projections. Everyone wants to know where he or she will be in a few years, so give concrete examples of how previous hires have actually progressed. Explain where they might reasonably expect to be in two to three years after they join your firm.
• Side-by-side comparisons. Managers are generally bad salespeople (to be kind), and they need ?sales” help. They generally need aid in the form of information that tells them what candidates generally expect and what the competitive job market is offering. A “side-by-side” benefits sheets for use during the interview process that demonstrates what the competitors are offering can highlight why your firm is clearly superior.
• Seek feedback during the interview. Periodically ask the candidate during the interview process, “Are we close?” or “Do you see any roadblocks?”
• Who would you like to talk to? Ask them, by title, who they would like to talk to during the interview process. By providing them some choice, you might excite them but also give them the opportunity to gather the information they need to say yes.
• Sell. Spend at least half of the time during the interview selling the candidate.
• Be selective. Only let people with the best “sales skills” sit in on your interviews.

Next week: In Part II, the third section will feature an overview of what can be done during the offer presentation process to increase acceptance rates and a list of non-monetary offer components that often go under-discussed.

Everyone talks about work-life balance. It drips from the lips of recruiters and HR folks and jumps off the pages of recruiting web sites. Articles touting the “Best Companies to Work For” include it as one of their criteria.

Yet, deep inside, we all know that almost no one ever achieves any balance. We either choose to mostly work or to mostly stay home, raise the kids, and dabble with a career.

The generational differences are huge in regards to work-life balance. As a baby boomer, I can honestly say that the concept never entered my head or my wife’s until a few years ago.

We accepted the fact that we would struggle to raise a family and both work, and that one of us would work “less” than the other to compensate. We didn’t even talk about it, because it was just the way it was.

Of course, unfairly, it was most often the woman who “lessened” her career. Recruiters talked about how challenging positions would be, not how much flexibility one might have. Time ruled and everyone was expected to put in at least an eight-hour day and a 40-hour week, and usually much more.

Gen X, those ranging in age roughly from 30 to 45, began to change this mindset in the 1980s by insisting that family was as important as a job and both had to co-exist in some sort of balance. Thus, the term work-life balance was coined.

Since then, companies have struggled and agonized over ways to achieve this balance. Some have offered on-site child-care, some flexible work time, some telecommuting, and some all of those.

Jobs were shared and managers where expected to show compassion and flexibility in dealing with family issues. HR polices have been tweaked to offer more exceptions and more flexible approaches to family illness and parent care. Some states have legislated more time off for pregnant or sick workers.

Yet, most of us don’t feel very balanced.

Gen Y, or the Millennials as some call them, range in age from the late teens to the late twenties. They have chosen a slightly different view of things, I think. Most of the Gen Ys I speak with have specific views about work balance.

I sum them up as follows:

1. They accept the fact that there is no such thing as work-life balance.
2. Therefore, they generally do not get involved with family commitments as early as boomers or Gen X did. They are not marrying as young. In 1950, men married on average at 23 and women at 20. In 2003, men averaged 27 and women 25. Nor are they having as many children. Fifty-seven percent of U.S. households in 1998 consisted of one or two people. This compares with 78.2% in 1950.
3. They are also choosing to create a sustainable lifestyle for the amount they wish to work. Those who want to travel and have personal time, choose to work part-time or in jobs with great flexibility. They do not have children and do not buy houses and expensive cars. Gen Y, for the most part, is much less focused on large material possessions. Those who are more career-oriented are choosing organizations where work is intense but satisfying. They are beating down the doors at Google, Yahoo!, and other organizations that offer exciting, leading-edge work. They want opportunities and challenges more than they want a job and a career just so they can raise a family.

They are not thinking about balance at all. They tip the scales one way or the other and seem content for now. This means we have three very different views about life, family, and work. This puts recruiters, hiring managers, and organizations in a tight spot.

What can recruiters do to attract and keep these different generations?

• Tailor messages and jobs and match them to the right person. It’s not easy or even smart to have the same messages for each generation. Smart recruiters are tailoring their messages to the generations they are seeking and are working with hiring managers to create a variety of jobs within the organization that appeal to the spectrum of generations. Many organizations have part-time positions, shared positions, and others jobs that are clearly designed for someone willing to sacrifice a lot for the opportunity. Positions need to be classified and advertised according to the level of flexibility and expected commitment. As people are interviewed for positions, their willingness to accept the job commitments are critical in making hiring decisions. What is missing today is a realistic assessment of what commitment the job requires and what flexibility is acceptable.
• Change the reward structure. Every organization also needs to realize that some of the things they need to get done will take people willing to go the extra mile, and those people will expect to be rewarded for that level of commitment. Rewards will have to be adjusted to better fit the time/commitment/flexibility equation for that position. For example, someone who is expected to spend half their time traveling and working in a global environment with phone calls at all hours and virtual meetings at odd times should be rewarded differently than someone who can count on a regular set of hours and a constant workplace.
• Open the lines of communication and discussion. Recruiters should sponsor executive briefings, conduct interviews, and spend time getting the word out to everyone in the organization that times are different and that the way organizations structure work must change. Websites and blogs can help. I recommend The Future of Work Weblog and http://www.generationsatwork.net. They have lots of good information and facts to help make your case.

Not everyone in a generation is the same and there are, of course, great variations in needs and expectations.

However, I think it is safe to say that when organizations set out clear expectations about the work and recruit accordingly, they have less turnover and less discontent than when they assume every generation thinks the same.

In the past few months, I’ve been working with organizations that are talking a lot about the internal mobility of employees. They want to know how employees should be selected for movement and what criteria should be followed.

Many HR professionals and hiring managers look at internal mobility as something they should control and as something that is somewhat independent of the employee’s wishes or timeframe.

Alas, back in the good-old 20th century, employers could call the shots. After all, there were quite likely to be more than one good candidate in the wings. HR wrote policies that restricted movement and placed lots of conditions such as length of service, criticality of the job, and so forth on any employee’s potential move.

Bosses had to be notified and had to give their permission. Bureaucracy was king and what the employee wanted didn’t matter much.

The world has changed and employees are more and more in charge of their own careers and timeframes. They have choices of employers and, while most would rather stay in familiar territory, they are much more willing to move on when they have to than they were a decade ago. There is little in life that is fair and the days of stability and loyalty in corporations are over.

The labor market is tight for skilled people and even for those who are semi-skilled. I’ve started to notice “For Hire” signs in every store, restaurant, and office I’ve been in over the past three months. The signs advertising positions are often larger and more colorful than those that advertise the products.

Let’s face the truth: keeping your good employees and letting them find opportunities that satisfy them is not only a good strategy, it may be an essential one for success.

Employees Are Not Assets

First, we should not characterize employees as assets, as many firms do, and treat them in a way that makes them feel as if they have no choices. Employees cannot be owned, taxed, depreciated, or disposed of as machines or other tangible assets can be.

They have become important investors in our organizations and they freely choose to share their expertise and skills with us or not. Each employee has a built-in return on investment meter that is constantly sampling the atmosphere and deciding if she is gaining or losing from a continuing association with the firm.

As long as the employee feels that they are gaining, they don’t look for different jobs. But in this job market, whenever the balance shifts even slightly, employees become vulnerable to any offer that may present itself. Hence, the value in having managers who have a history of good employee loyalty and low turnover.

Usually when an employee wants to apply for another position inside the firm it is because they are looking for a new challenge, aren’t happy with their current assignment of boss, or feel that the new position will offer more of a return on their investment.

To deny them the opportunity and to place some HR policy in their way is not only a sure way to lose them to someone else, it is also just plain dumb. Happy employees who are being treated as investors will be unlikely to leave.

Here are four things every organization and HR group should be doing or should have in place today:

1. Abolish limiting policies. Remove policies that limit or control how or when employees apply for positions within an organization. Every employee should have the same employment-at-will opportunities inside the company as exist in the open marketplace.
2. Encourage employees. Companies should make it a policy to encourage employees to share expertise and skills broadly. After all, it is the networking interconnectedness of our employees that adds value and allows us to develop new products and generate new ideas. Creativity does not arise in stable, rigid, and change-adverse organizations. The most exciting new concepts and ideas come for small firms where people wear many hats and move between responsibilities such as the dot-com companies of Silicon Valley.
3. Empower recruiters. Let recruiters work just as freely inside as outside the organization and let them work on back-filling positions that may be vacated by an employee who is moving on to something else. If a recruiter knows that an employee is leaving for a new position, they can help the manager find someone else for the old position at almost the same time.
4. Let employees test positions. Create policies that allow employees to try out new jobs for a short time to see whether they like it and can do it well. Let employees share their job with someone else so they can sample more than one kind of work or more than one project. Foster a spirit of sharing expertise and skills, not of owning the mind and body of someone.

The policies that restrict or limit transfers and change within an organization are leftovers of the 20th century organizations that are hierarchical, paternalistic, and slowly fading away. A 21st century organization removes barriers and builds networks that power creativity and growth.

Watson Wyatt’s new study shows 69% of workers are concerned their employer will increase out-of-pocket healthcare costs through higher deductibles and co-payments over the next three years.

Additionally, 53% worry that their employer will reduce the scope of their healthcare benefits by limiting providers or items covered in the next two years. More than 12,000 workers across all job levels and in all major industries participated in the study.

The survey shows two out of three employees say healthcare benefits are an important reason to stay with their company.

The Retirement Reality ?

Watson Wyatt said of all employers surveyed, only 2% believe that top performers would consider leaving over retirement benefits .

Meanwhile, 17% of top employees cited retirement benefits as a main reason for leaving.

Further, 43% of employees are concerned their company will reduce pension, retirement, or retiree medical benefits in the next three years, while 30% of employees covered by a defined-benefit pension plan are concerned their company will freeze or terminate their plan over the same time.

For example, a job that commands a salary of $30,000 nationally can pay as little as $27,840 in Birmingham, Alabama or as much as $37,680 in San Francisco, according to the 2006 Geographic Salary Differentials study (link shows salary definitions for select cities) from Mercer Human Resource Consulting. That one example represents a pay variation of more than 32 percentage points ? from 7.2% below the national median to 25.6% above.?

The Mercer study compares local pay rates for more than 200 cities to national medians at different pay levels. The results show geographic pay variations are less pronounced, but still evident, at higher pay levels. For a job with a median salary of $60,000 nationally, for example, pay varies from a low of $55,080 (?8.2%) in Baton Rouge, Louisiana to a high of $72,000 (+20%) in San Jose.

Pay variations by geography are even noted at $90,000. Among the cities included in Mercer’s study, cities like Little Rock, Arkansas and Omaha, Nebraska represent the lower end of the pay range at $84,510 and $86,580, respectively, while cities like New York and San Jose, California hold the top spots at $102,060 and $104,040, respectively.

Mercer’s geographic analysis highlights the challenges faced by many large employers with employees in multiple locations throughout the United States.

Sensitive compensation issues can arise, the survey found, when an employee transfers from a relatively high-salary area to a relatively low-salary area, or vice versa. Good quality information on salary variances helps employers handle these situations in an equitable and consistent manner.

Howard Levine, a senior compensation consultant with Mercer, says it’s important for recruiters and corporate employers to understand the difference between cost of living and cost of labor. Cost of living differentials reflect the difference between localities in terms of cost of goods, such as housing, groceries and transportation. Cost of labor takes into account the difference between localities in terms of cash compensation for the same work.

“Organizations must also be concerned about pay levels for employees in the same location,” Levine cautions. “Individuals moving from one location to another should be paid a locally competitive salary and expenses such as higher rents and home prices should be offset in the relocation package.”

“In the late 90’s, it was commonplace to hear about companies with recruiting campaigns that included extreme employee perks such as company cars, game rooms with foosball tables, huge sign-on bonuses, and chef-prepared lunches,” says Heather Galler, CEO of JobKite.com. “That ship has sailed.”

The JobKite survey revealed that 56 percent of the 263 responding companies have made some significant enhancements to the employee benefits they are offering for retention or recruiting purposes, with most geared toward improving the quality of employees’ work and home lives. Most notably, these benefits include telecommuting, increased vacation, and health benefits. The 147 responding companies that actually increased benefits over the past six months reported increased employee compensation in the following categories:

• Medical: 88 percent added health-related benefits, including life, vision, and better or increased health plans.
• Money: 69 percent have increased stock vesting, 401(k) funds, salary relative to market averages, sign-on bonuses, quarterly bonus plans, and/or relocation packages.
• Vacation: 41 percent are increasing the number of paid days off per year.
• Alternative working arrangements. Thirty-six percent are adding or enhancing flextime and/or telecommuting. One Fortune 1000 company says it launched a new telecommuting program on August 16, for example. Another has an informal telecommuting option to be used for unexpected events, and a formal program for modified or reduced work schedules. One-third of the employees using that program are men.
• Other: 8 percent plan to offer other miscellaneous benefits, including massages, monthly cookouts and gym memberships.

“As they shift their benefits to reinforce the work-life balance, companies are really making a smart move,” Galler says. “By focusing on making their employees happier and more balanced, companies only stand to gain through increased loyalty, productivity, and retention.”

• A Hay Group/Recruiting Roundtable Study found that the relative contribution of a star performer is more than three times that of an average performer.
• In March 2006, a Gallup Poll/USA Today survey found that 59% of managers said that finding and training enough good people to fill current and future requirements was their most pressing problem.

So, it’s safe to infer that the importance of talent and raising the talent bar is a given. On top of that, we’re competing with other companies in a global economy to secure the very best talent. What’s interesting is that you won’t find a lot of commentary out there about the hiring manager’s role in this process. Worse yet, to some degree, is that we’ve led hiring managers to believe that recruiting talent is a function of HR. It’s not! It’s quite simply one of the most important activities leaders do.

The Hiring Manager’s Role in the Recruiting Process

Several years ago, the Corporate Leadership Council surveyed approximately 8,000 recruiters to determine what’s most critical to effective recruiting. The most common answer was “the hiring manager.” In another recent study, the Council analyzed 30 factors to determine what’s most important when it comes to attracting and retaining employees. It found that base pay and the quality of the manager were by far the two biggest ways to attract and retain talent. Thus, without question, hiring managers are the key to hiring success; yet, ironically, one of the biggest challenges recruiters face is the hiring manager.

This can take the form of lack of clarity on the position, lack of time from the hiring manager, unrealistic expectations, or simply disconnects on procedures, roles, and responsibilities. Effective staffing models create a sustainable, scaleable, and repeatable process. As we recruit, we want to follow the same process across the organization so that we can measure our results, consistently deliver on those results, and continuously improve the quality of our hires. It’s interesting to note that hiring managers who wouldn’t dream of approaching their functions or businesses without following some type of standard operating procedure will often take a shoot-from-the-hip approach to recruiting.

As business partners to our hiring managers, we need to do three things: 1) Counsel and educate our hiring managers on the importance of their engagement in the recruiting process; 2) let them know that recruiting is a process, and educate them on their role within the process; and 3) make sure that they hold us (HR) accountable for delivering the best, diverse talent, and understand that they have a shared accountability in collaborating with us to recruit and retain this talent.

Seven Keys for Highly Effective Hiring Managers

Given this landscape, here are seven keys that hiring managers can use to unlock the door to efficient and effective recruiting:

1. Planning. Often our urgency to implement (recruit) translates into a lack of planning. This can lead to poorer outcomes in recruiting if we haven’t properly considered our organizational design, leadership team alignment, competencies, etc. Also, now’s a good time to look at your internal talent to determine if you’ll need to look externally in your search.
2. Three-way meeting. A good job description (which doesn’t often exist right now) is an important starting point. But, a meeting with the hiring manager, recruiter, and HR partner is critical in order to determine what the optimal profile is, discuss the current labor market, review any anticipated obstacles, and provide needed perspective for the recruiter on career paths, selling points of the position, experience, or history of the hiring manager.
3. Help your recruiter learn what “good” looks like. The recruiter’s role is to minimize the amount of time that it takes a hiring manager to recruit, source, and screen high-quality talent. In order to do this, the hiring manager needs to make an upfront investment to ensure that the recruiter understands what “great” looks like. Aside from the meeting mentioned above, this includes some simple but important steps, such as talking about the profiles of some of the best people in their department or, if possible, meeting with some of those top performers on their team. In addition, get detailed feedback on why a manager liked or didn’t like a specific candidate. The more this is done, the better the recruiter should be able to deliver the right talent to the hiring manager.
4. Avoid the Common Pitfalls. I could discuss a lot in this section, but let me give you the Big Three:
   • Changes to what’s originally laid out for the job. A lot of the heavy lifting in recruiting is done during the first two to four weeks of the recruiting cycle. It’s when recruiters work hardest to source and screen talent. Any changes a hiring manager makes after the three-way meeting described above creates a lot of wasted effort for recruiting.
   • The industry-experience trap. Industry experience is not only highly overrated, but it’s also the quickest way to sub-optimize the talent you recruit. If you think of the pool of top-quality, top-quartile talent, the minute you say they must come out of the food industry or the high-tech industry, you’ve reduced that pool of available talent by about 98%! The fact is that for the majority of our jobs, top talent with high learning agility can learn the nuances of our industry, but industry-experienced candidates who do not possess high learning agility will never become top talent or future leaders for you.
   • The most important metric isn’t time-to-fill. When you ask most hiring managers about recruiting metrics, the first one they mention is time-to-fill. To me, it’s the least important metric and one that you want to score average on - whatever that metric is for your industry, function, or job. Hold your recruiters to the highest standards for quality and diversity. A year from now, you really won’t remember whether it took seven or 10 weeks to fill that job, but you’ll live with the quality of the hire for a long time.
5. Communicate, Communicate, Communicate. By now, it’s clear that recruiting really is collaboration among the hiring manager, HR partner, and recruiter. To ensure that the partnership is most effective, communication needs to be ongoing and in-depth. At a minimum, a weekly update meeting should take place beginning within two to three weeks from the project initiation.
6. Removing Roadblocks
   • Time is the enemy. For recruiters, this is a given. The best talents have many options in the marketplace, and they’re not going to wait for lengthy interview cycles or cumbersome decision-making processes.
   • Make sure interview teams are all reading from the same page, and determine who makes the hiring decision. Using multiple interviewers can increase the quality of the hiring decision. But, it’s critical to ensure that all interviewers are all in agreement as to what the hiring profile is, and that they send a consistent message to the candidate on the position, company, and culture. Also, if you have seven interviewers, get all of their input - but don’t set the expectations that all seven have to endorse the hire.
7. Selling the opportunity. Remember that the best candidates are also interviewing us. They’re assessing how we measure up to their expectations in relation to the job, the vision and the caliber of our leadership, the quality of our hiring manager and of their peers, compensation, benefits, career path, and culture. As a result, everyone that participates in the interviewing process should devote some time to addressing these topics, selling the opportunity, and ensuring that the candidate experience is a good one for the interviewee.

As their subject matter experts in recruiting, staffing leaders need to help their hiring managers understand our processes and systems. Hiring managers are both customers and key contributors to this process. Their role is critical because at the end of the day we don’t own staffing - they do.

Chances are, many readers of this article completed the statement before reading the answer. Why, then, do so many companies continue a practice that sales executives deride? A vacuum of viable career options, unset expectations, and a culture of “earning your stripes” are just a few of the answers that plague sales organizations today. Unfortunately, there’s not much research based on the performance data of managers who have been promoted from top performing sales reps versus those who were either moderate sales reps or had no sales experience

However, there’s ample data to prove that the behavioral profiles of those who succeed in the two roles are dramatically different, meaning that those who succeed as sales managers are not the same as those who succeed in direct selling. A seller’s business attitude heavily influences his ability to succeed. If an individual possesses a progressive attitude about business in general by seeking to use new strategies and techniques in his role and always striving to reinvent his work, he has a leg up on other salespeople. On the other hand, a strong sales manager seeks a more conventional approach, in which success relies on what is proven instead of on the latest fad.

Another key difference is a star salesperson’s need for stress in his or her environment. For better or for worse, our data shows that higher levels of stress are conducive to top performing representatives, while more moderate levels are needed by managers. Spend one day in most sales organizations where a top performing rep has been promoted to manager and you’ll see a nearly manic environment in which tactical and strategic changes are the only constant. While the team may be able to adapt and change, these are not practices that lead to results. While the things that make a salesperson successful are related to culture, personality and cognitive skills are more important for a leader.

One example of these leadership skills is verbal reasoning ability. Without the ability to rapidly and effectively process and communicate information, the chance for success is diminished. This is connected to the importance of “mental flexibility” or one’s ability to “think on his feet.” While not as critical for the rep, the leader must be able to rapidly think through scenarios and adapt to a changing environment to maximize performance. Interestingly, as substantial as the differences are, similarities exist as well. Both top salespeople and top sales managers need something called “leadership impact,” which is willingness to take action when the situation requires it. Basically, can one take charge and lead naturally? Both star salespeople and star managers must possess this in abundance. A sales representative must lead the prospect, while a manager must lead the team. All of this discussion of behavioral characteristics really boils down to one simple fact: You must understand the differences between successful salespeople and managers to understand how to (or if you should) promote. What if the top performing salesperson is not the right fit for a management role? Are you necessarily going to lose him or her to another company’s sales management opening? Not if you’ve thought through suitable career path alternatives for the sales professional. You’ve got to have a place for top sellers to advance. Too often, the alternative to management is more cold calling with a higher commission level.

Other paths could include more strategic prospects such as national accounts, project-based leadership in which a sales rep manages an ad hoc sales team to land one client, or training and mentorship opportunities. Whichever components you include in your sales professional career path, it must be thought out and communicated. Too often, a senior sales executive or HR professional believes that these options exist while field sales reps have not been adequately sold on why this may be a smart career move for them. Selling your sales team on why progressing their careers along a sales professional line instead of management must start early - as early as the initial recruitment process. It comes down to setting adequate expectations at the start and following through with your actions. The reason why most sales people expect to one day be promoted to managers is precedent.

Unfortunately, this is still the most common practice in companies. “Sell your heart out and one day you’ll manage a team of your own,” is the motto. You can change this by informing all sales candidates, pre-hire, that this is not the practice in your organization. By carefully illustrating that there are other good paths for their careers besides management, and by showing clearly what those options entail, you can help the potential rep select the most appropriate role for him or her. When combined with constant reinforcement of this message at review time, a deliberate decision can be made by both rep and manager on the best course for the rep’s career. To promote the sales managers who will drive your company’s bottom line growth, you need to understand the unique role of the sales leader and what type of person is needed. You must then provide options to retain those who are great sellers but stand little chance of success as a manager. And, you must communicate and sell the alternatives to your current and future team members.

That’s according to the findings of a survey by Associated Industries of Massachusetts, the Commonwealth’s largest employer association, with more than 7,600 Bay State member businesses and institutions.

It’s also a big change from how the state’s employers were feeling about recruitment just a year ago, when only 13% of responding employers indicated they were doing any hiring outside of critical positions.

The association’s recently released 23^rd edition of its Massachusetts Compensation Survey Report reveals that 47 percent of responding employers are currently reviewing their compensation practices for market competitiveness as a top priority.

Other key pay-related practices for 2006 include managing low performers and placing more emphasis on communicating total compensation plans. The latter is a measure that could help recruiters sell candidates on new job opportunities while also helping human resource professionals point out the full value of employees’ pay and benefits plan.

The survey found that a majority of responding Massachusetts employers have budgeted 3% to 4% for increases in merit pay in 2006. (More information on?U.S.?compensation.) It also found that one-third of hourly and nonexempt employees are eligible for incentive pay, with slightly over half of exempt employees eligible for incentive pay.

Wage increases will vary by industry, with finance/insurance higher than the services sector.

The table below shows salary increase budgets in 2006 and 2007.

?

• Hay Group estimates employers lose 40% of annual profits due to turnover.
• Center for Creative Leadership estimates 40% of new hires leave within the first 18 months.
• World at Work estimates turnover costs ranged from 100-700% of a staffer’s annual salary.

Whatever the calculation, turnover can drain the bottom line. But, did you know that savvy employers can reduce this expense by doing a little research into data they already have at hand? But first, let me explain why to use retention data. Retention is concrete and seldom subject to the “no one in our company is perfect,” “everyone here is above average,” “forced ranked,” or “supervisory favorites” syndrome, which makes every employee look alike to an outsider. Retention is clear. The reasons for termination might vary, but there is no doubt about whether the employee is either here or gone.

Biographical Data

We all know intuitively that an applicant’s biographical data (the information often included in an application blank) probably contains clues that indicate a potential for turnover. Biographical data (or “biodata,” for short) represents the sum of our past experiences, job history, education, and a host of other factors that give vital clues to the potential for turnover and productivity. The secret is discovering what these clues are and how they combine. Think of biodata as another form of an interview. A well-conducted interview includes: 1) pre-determined job standards; 2) carefully crafted questions that gather examples of past job-related skills; 3) a standardized scoring guide; and 4) multiple interviewers who arrive at a hiring consensus. Research shows professional behavioral interviews predict as much as 10-20% of the variance in job performance. Biodata produces similar results. Like behavioral interviews, biodata uses examples of past information; but unlike interviews, biodata questionnaires take less time and actually add to the effectiveness of other methods. So, why aren’t they used more? I think it is because 1) it takes hundreds of people to provide enough data to identify meaningful patterns; and 2) it takes powerful statistics and expert knowledge to sort out relationships between biodata and turnover data.

Fancy Statistics

Imagine a large company with thousands of employees performing a similar job. It could be a call center servicing inbound or selling outbound customers, an operation that employs a nationwide network of unsupervised field representatives stocking retail shelves, or a service company that finds underground wires and pipes. The products or services are unimportant. The key words are “big numbers,” “similar jobs,” and “unacceptable turnover.” Now suppose we have biographical data on current and past employees hidden away in an HR database that contains gobs of data accumulated from the Internet, scanned application blanks, performance reports, and retention records. This is the mother lode! All we have to do is find the relationships. Where do you start? First find someone who:

• Has a sound background in exploratory statistics.
• Knows how to operate highly sophisticated exploratory analytical software.
• Can recognize the clues between trustworthy models and bogus ones.
• Is well-versed in the intricacies of psychometrics.

Now, we begin by defining the kind of retention we want to control. For example, there is early career retention (which often has to do with the ability to learn job requirements or discovering what the recruiter never told you); middle-career retention (usually associated with having skills to perform the position); and late-career retention (generally associated with job dissatisfaction).

As you can imagine, each category of turnover will have different causes. We next pick and choose the most likely biodata causing the turnover. It could be frequency of jobs held, level of formal or informal education, driving distance from work, or even prior experience with a similar job. Like turnover, we have to carefully sort through each piece of information looking for clues that differentiate between terminations and retentions. We might even run a few trials to narrow down our choices. This gives us a clear target and a starter-set of causal factors (or at least we think so). What’s next? Power up the software, analyze and examine, analyze and examine, and repeat until a robust model evolves. What does it look like? Well, it’s seldom as simple as looking at one factor. In fact, it is often a combination of several “ifs, ands, and ors.” Here’s an example of a turnover-prediction rule we built for a client recently (there are six rules for retention and eight rules for termination): Rule three of six (retention at six months):

• If the employee had prior experience using his car as an office;
• And he had more than five years’ prior work experience;
• And he scored 65 or above on generating new ideas;
• And his interpersonal skills were maximum;
• And his competitive drive on our hiring test was 25 or lower;
• Then, there is a 95% chance he will be employed.

Or this: Rule two of eight (termination at six months):

• If the employee had average experience in maintaining accounts;
• And had more than five years’ prior work experience using her car as an office;
• And her total work experience is four or five years;
• And her competitive drive on our hiring test was 25 or lower;
• And she scored 72 or above on a teamwork scale;
• Then, there is an 83% chance she would be terminated.

Of course, a smart organizational HR manager can immediately grasp how this data could be used: 1) as a special application form; 2) as part of a web-based screening questionnaire; or, 3) to predict an applicant’s probability of early termination. Assuming the analysis was done right, employers can have a significant impact on turnover by hiring only people with a high probability of retention.

Danger, Will Robinson, Danger!

As you can imagine, this kind of analysis is not for the faint of heart. Warning one: Backward-looking data analysis must always be scrutinized to eliminate information that does not cause turnover. For example, if we included weight among our turnover predictors, we might conclude that an employee’s weight affected retention rates. Perhaps fat people didn’t stay as long. That could have been true, but may not have been causal - it may have been coincidence. Bottom line? The data in the analysis must be thought through and not just dumped into the statistical blender. The second warning has to do with numbers. Making assumptions based on small numbers can lead to big mistakes. Take for example “terminated” or “employed.” Those are two categories. Now add “education,” “prior experience,” “job tenure,” and “driving distance from work.” These are four categories, making a total of eight cells. Trustworthy analysis mandates having at least 25 people in each cell or 8 x 25 = 200 people bare-minimum (more if there are more things to measure). The third warning includes the wrong-headed idea of only looking at one outcome (e.g., including only people who are terminated).

A one-sided analysis only tells us about one group. That’s nice, but, essentially worthless unless we know that the people who did not terminate were different from those who did. Trustworthy analysis requires knowing about both groups. The last warning is personal. It takes a courageous HR person to mount the charge to do things differently. There are plenty of risks imagined. But, how many HR departments can take credit for easily making a true and measurable bottom-line improvement? Think about it. HR might actually be viewed as a revenue center.

It’s quite fashionable these days to bash HR departments for all of their failings. Last year, Fast Company magazine infamously took this to an extreme, pasting the headline “Why We Hate HR” on their front cover. The shock and outrage from the inflammatory tone of the piece continues to this day (60% of readers “hated it” according to Hammonds), yet there has been widespread support for the points he brings up (91% of people polled during a recent online interview with Hammonds generally agreed with him). Hammonds’s silver lining here is that “HR is the corporate function with the greatest potential - the key driver, in theory of business performance. In a knowledge economy, companies that have the best talent win.”

One look at the New York Times article (registration required) on Microsoft and Google’s grapple for supremacy confirms that talent has driven corporate performance since the beginning of the industrial age. Yet, what constrains the function from getting respected in most organizations is a focus on being good at “administrivia,” and not “the more important strategic role of raising the reputational and intellectual capital of the company.”

Secede or Die?

Most of the bigger complaints in the article are aimed at the people who manage issues like pay, benefits, training, performance management, and retirement. Does that mean recruiting is really just guilty by association? Not exactly. Some of the same criticisms could apply to many recruiting departments as well: using efficiency-focused, rather than value-focused, metrics that demonstrate business impact; restrictive bureaucracy, often driven by fear of legal repercussions and compliance; a focus on activities versus outcomes; and a push for short-term cost efficiency over longer-term value. Yet, in many other cases cited in the article, recruiting is merely guilty by association.

In fact, several recruiting leaders I’ve spoken with are as frustrated with HR as the rest of their company - the policies, the restrictions, and the myopic thinking. What was surprising to me was that, among the talk of employee engagement, benefits, and mentoring programs, recruiting was rarely even mentioned in the article. So here’s a radical thought. Instead of being HR’s red-headed stepchild that’s locked away in the basement (only to see the HR team take all the credit for the big accomplishments of your team), it’s time for truly strategic talent management departments to secede from HR. To stop sitting at the “people-people” table and start sitting with the “businesspeople.” To take the initiative and show the business impact of effective employer branding, referrals, strategic sourcing, and talent-supply-chain management. To think and act like a profit center, not a cost center. And, to report directly to the CEO or vice president of corporate strategy, not the VP of HR. As the HR outsourcing tide continues to rise and swallow anything in its path, secession may be the best possible option for recruiting and talent management - perhaps the only functions in HR that a company should not fully outsource if it wants to maintain a competitive advantage in a knowledge-based economy.

The HR Death Spiral

As part of the HR silo, it is inevitable that recruiting will be vulnerable to HR outsourcing initiatives. Today, many companies (94% of them, according to a Hewitt Associates survey of large employers) are already examining how to reduce the administrative costs of HR by outsourcing administrative-heavy functions like compensation, benefits, and retirement. It’s still somewhat rare that recruiting falls under that same axe - partially due to the poor product offerings in this area from HRO vendors (who often repackage their same broken internal recruiting processes and tools), and at times to a realization that staffing is in fact a very strategic business function that is best done by in-house experts in each organization. But the writing is on the wall.

According to the same study, by 2008 many organizations plan to expand outsourcing initiatives to cover other HR activities like learning and development, health and welfare, global mobility, and, yes, recruiting. The real rub, however, is that companies that want to get strategic about talent are starting to hire businesspeople from outside the staffing world to run departments. This is a growing trend I have seen across the country. Other organizations have gone the other way, bringing in HR managers with little to no recruiting background to run staffing as part of a rotational program.

To avoid any of the above fates, I highly suggest you read Kevin Wheeler’s recent article, “Will Your In-House Recruiting Be Outsourced?” and John Sullivan’s excellent profile of Valero Energy (both of which fall into the “I really wish I’d written that” category). Both are excellent reminders of the type of thinking that will be needed for recruiting to become a vital business partner inside a company. It is unfortunate, but I have yet to see a convincing case study of a company systematically tying recruiting initiatives to increased revenue and profit, although I am hopeful that several exist. You will be forever judged by your current accomplishments, not by your potential. By becoming an inseparable part of your company’s business strategy, your job is likely secure. If you’re limited in your ambitions by ineffective or even hated HR leadership, it’s time to build your secession plan.