Webinar presented to HCI (Human Capital Institute) on March 2, 2010

1. Transform Your Talent Management
Capability Through Effective
Strategic Workforce Planning:
A Case Study
March 2, 2010
Jan Ahrens John
Director, Strategic Workforce Planning
©2009 Regence

2. Agenda
The Current Landscape
Regence—Our Journey
Approach
Lessons Learned
Impact
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3. The Current Landscape
Strategic Workforce Planning (SWP)
SWP is a Relatively While workforce planning has been around for decades, only recently
New Practice has attention been focused on its strategic value:
92% of companies have some level of workforce planning, but only 21%
take a strategic, long-term approach to addressing their talent needs
Identifies Key Roles Enables senior leadership to understand and forecast future talent
and Workforce Data needs based on relative value to strategy execution:
to Drive 74% of executives consider workforce planning a priority in their
Performance organizations, while only 57% of HR professional perceive it as a corporate
priority
Only 25% of organizations are able to help business leaders forecast
revenue and operating budgets
Prioritizes Talent Informs the business and HR of the “build, buy, or borrow” actions
Management and investments needed to close critical talent gaps:
Actions and Almost 70% of the surveyed organizations are changing their talent
Investments management programs based on the results of their workforce planning
analytics
High performers had higher Engagement, EVP satisfaction overall, and lower
turnover intentions than the overall sample
Sources:
• Sibson Consulting, Rewards of Work Study, 2009
• Bersin & Associates, The Modern Approach to Workforce Planning, 2009
• HCI, Identifying Business Value in Workforce Planning—Articulating the Return on Strategic
Workforce Planning, 2008
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4. Three Types of Workforce Planning
21%
Strategic
Workforce Planning
Business Strategy
Business Strategy
Degree of People Investment
and Segmentation
and Segmentation
of Workforce
of Workforce
Workforce
Analysis
Workforce Data,
Workforce Data,
Basic Workforce
Analytics and
Analytics and
Data and Analytics
Forecasting
Forecasting
Traditional
Workforce Planning
Business Plan Business Plan Business Plan
Business Plan
and Headcount and Headcount and Headcount
and Headcount
Increased Value to the Business
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5. Keys to Making Strategic
Workforce Planning…“Strategic”
Driven by business strategy and objectives
Accurate and objective segmenting of the workforce
Consistent process and approach
Readily accessible analytics
HR capability to lead change
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6. Poll Question
If you were to implement strategic workforce
planning, which of the following challenges/barriers
would you experience:
Lack of resources
Little support from top management
Lack of business case
Lack of capability or defined methodology
Lack of tools and technology
Two or more of the above
Three or more of the above
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7. Agenda
The Current Landscape
Regence—Our Journey
Approach
Lessons Learned
Impact
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8. Who is Regence?
Regence, a member of Blue Cross and Blue Shield Association, is the
largest health insurer in the Northwest/Intermountain region, serving
members in ID, OR, UT, and WA
We have 2.5 million members accessing health care
across the country and around the world, and
process nearly 3.5 million claims a month
We have 6,200 employees and partner
with more than 52,000 providers and
2,400 facilities in nearly
1,000 communities
Our $8.9 billion company defines success by how well we
advocate for—and make a difference in—the health of our
members…a promise we have kept for more than 90 years.
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9. Where we were in 2008
Rising health care costs
Increasing focus on health care reform fueled by political
debates
Aging workforce—potential loss
of critical knowledge
Changing landscape—with more
competition from national players
Expanding product lines that
required new capabilities
Broadening use of technology to provide instant validation
Understanding the current workforce and the required future organizational
capabilities and talent was a top priority for the business and HR.
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10. New Problems Required a New Approach
Key Questions Targeted Outcomes
How do we identify which Understanding of our Current and Future
roles are most and least Talent Needs
critical in driving results?
Clear connection between the business strategy
What capabilities are and our people strategy
absolutely essential, and
what investments are Right skills in the right places to drive execution
needed? of our strategic objectives
How do we predict and Control of Workforce Dynamics
analyze the implications of Better insight into the internal and external
our internal workforce workforce dynamics to ensure we have the right
dynamics? people in the right roles at the right costs
How do we better
anticipate dynamics in the Talent Management as a Core Business
external labor? Process
Established and repeatable processes to do the
work, owned, and driven by the top of the
organization
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11. Our Journey
Announced pension Incorporated SWP
plan changes and into annual
more layoffs planning process
Launch SWP
Completed 19th Year 2
Researched Scheduled Installed web-hosted
consulting firms & Launched SWP Launched 3 additional 16 tool; rolled up enterprise- (and final!) SWP
selected Sibson engagement SWP pilots Divisions wide data for year one
‘08Q1 ‘08Q2 ‘08Q3 ‘08Q4 ‘09Q1 ‘09Q2 ‘09Q3 ‘09Q4 ‘10Q1 ‘10Q2
2008 2009 2010
Jan moves from Built internal Began Launched additional Analyzed input Roll out
Director OD to capability of announcing plans, provided just-in- by Strategic succession
Director SWP role HR staff layoffs time training for other roles in annual planning for all
HR staff Engagement Strategic roles
Survey
Initiated Diagnostic Developed initial
Baseline EVP collateral for
Assessment of HR Strategic roles in
3 Divisions
Building Accountability & Buy in: If you build it RIGHT…they WILL come.
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12. Agenda
The Current Landscape
Regence—Our Journey
Approach
Lessons Learned
Impact
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13. Our Approach
Upfront Considerations
What expertise did we need?
Decide on the appropriate subject matter partner—credibility and track
record
Ability to move fast was critical
Must transfer capability, we could not afford to be consultant dependent
Available as ongoing lifeline
How could we make SWP sustainable?
Ensure internal HR capability and business ownership for the long run
Require a repeatable, yet customizable process
Access to robust analytics—real time decision making
Where should we start?
Build support and address resistance early on
Start small and grow from there
Select pilots from both ends of the spectrum (large and core to the
business/small and more fringe)
Use our successes as leverage
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14. Our Approach
Conceptual Framework
Business Strategy
and Objectives
Actions and Investments
Strategic Workforce Planning
Talent Development Succession
Management 1
“Actions to develop
current and “Talent portfolio and Type
next generation Specific
talent”
decision process” 2
HR and Line
Role Number
Operating
Requirements Plans to
Differentiation
Differentiation
Integrated Execute the
Performance 4 Strategy
Management and Talent Acquisition Actions/
Rewards “Branding, Investments 3
sourcing, and Gaps and
“Reinforcements that
engagement” Priorities
drive accountability”
Strategic Workforce Planning serves as the headwaters to make
informed decisions on Human Capital Priorities and Investments.
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15. Our Approach
Conceptual Framework
Segmentation enables you to understand and
manage your human capital like a portfolio of assets.
Impact Talent Segment Investments Over Time
Roles that drive Strategic
Critical to driving long-term competitive
the strategy advantage, with specialized skills or knowledge Strengthen
Core
The “Engine of the Enterprise,” unique
to the company and core to delivering
Roles that on its products and/or services
support Protect
the strategy Requisite
Cannot do without, but whose value could
be delivered through alternative staffing
strategies (other than full-time headcount) Streamline/
Outsource
Roles Misaligned
impacted by Talent whose skill sets no longer align
the strategy with the company’s strategic direction
Redeploy
Segmentation strategically values talent and enables
prioritization of talent needs and talent investments.
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16. Agenda
The Current Landscape
Regence—Our Journey
Approach
Lessons Learned
Impact
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17. Lessons Learned
First Steps
Piloted with three different divisions
“Timing is everything:”
The BOHICA Syndrome
The Ugly Baby Syndrome
“Strategies? What strategies?”
“All of our roles are strategic!”
“Layoffs tomorrow”
“How can we…if we don’t know…?”
TIP #1: Be ready to be an ACTIVE cheerleader & change agent.
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18. Lessons Learned
“We are where we should be”
Rolled out consistent process for 19 Divisions:
Each Division has a plan
Over 105+ leaders involved
Over 35 talent requirements developed out of 110 strategic roles (8% of
workforce)
10 enterprise-wide actions and investments are being tracked
Emphasized collaboration—Divisions and functions worked across silos
Increased risk awareness (e.g., time to proficiency, build/buy decisions,
etc.)
Increased knowledge of workforce implications on business—web-hosted
tool
Gained ground: Old Way—“Think people first, position second”
Proactive applications
TIP #2: Link to the business and get the role requirements RIGHT.
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19. Lessons Learned
“We are where we should be”
Exhibit 7: Staffing Needs to Fill Talent Gaps Exhibit 8: Cumulative Quarterly Staffing Costs
Exhibit 5: Training Needs and Residual Talent Absorption (Ramping Up) Exhibit 6: Talent Gaps
TIP #3: Speak the language of business, let the data talk.
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20. Lessons Learned
What People Are Saying…
“ This is the first time we’ve ever talked about what we’ll need 3
years from now.”
“ Great tool for making strategic decisions…viable option to look at
future (e.g., Demographics, age, very telling).”
“ Opened a window that not all skills sets/people are
interchangeable. Helped us name premium roles.”
“ A discipline that comes with repetition”
“ Better understanding of the inter-relationships of my Strategic
roles in other divisions. I’ll manage their availability to cover the
most critical work.”
“ Looking at this data will change the way we run our business.”
“ Let’s use this again as soon as federal reform info comes out.”
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21. Agenda
The Current Landscape
Regence—Our Journey
Approach
Lessons Learned
Impact
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22. Impact
What is different today?
SWP is now included in the annual business planning process—prior to budget setting
SWP metrics are part of the Regence corporate balanced-scorecard
Talent requirements for the majority of current/new “strategic” roles are in place
Specific retention strategies have been created to address specific markets and talent
needs
Executive “pull” established for an enterprise-wide succession plan for all critical roles
A Differentiation culture is emerging vs. a “everything, for everyone, all the same”
culture
Consistent approach in place across all major divisions for developing external
sourcing strategies
Quantified that our “strategic” roles averaged .5 STD below other company
employees on engagement
Clear definition and agreements on which roles are most critical to the organization
Employee Value Propositions (EVPs) created for several “strategic” roles
TIP #4: “It ain't over till it's over.” —Yogi Berra
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23. Impact
Connection between Strategic Roles and EVP
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24. Impact
Connection between Strategic Roles and EVP
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25. Impact
Connection between Strategic Roles and EVP
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26. Final Words from a SWP Expert
“ Opportunities are never lost.
Someone will take the ones
you missed.”
“ Ignoring the facts doesn’t
Image Source: billypalooza, Flickr.com
change the facts.”
—Andy Rooney
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