Barclays is a household name in Britain, with one of the most well know banking brands. More focused yet less know in the industry is Barclays Global Investors, a fund managing over $800 billion, headquartered in San Francisco with approximately 2,000 employees globally. We met with managing director Jeff Seretan, an ex-consultant and today Barclays Global Investors’ Head of Human Resources. From dialogue with Jeff, here are some interesting lessons for large and global employers. First of all, the most important distinction is in the strategic definition that Jeff gives to their HR practice:
- One-third strategic – people must meet business goals
- One-third financial – cost efficiency/ROI
- One-third administration – serving the corporation’s hiring managers
Let’s review these three elements more closely. Be Strategic
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Be strategic – it’s easily said but not easy to implement. Jeff sees there is a talent war as our friends at McKinsey coined it, and the (supposed) slowdown will not change his mind. Indeed, with 4.2% unemployment we still have 95.8% employed and a historic record low. In an economy depending so much on innovation, creativity and knowledge, human capital is and will remain at a premium. But more than trying to leverage the talent locally and win the talent locally, Jeff leverages the power of globalization. What does he mean by leveraging the talent globally? He means take the advantages of geographical benefits to the level of the entire company. For instance, Barclays Global Investors was struggling to build a quality team of IT professionals in California, but on the other hand had great success hiring quality contributors in Toronto. So they revised their strategy and adapted to their field experience, and built a complete team in Toronto. Retention Keys To be strategic it is also a must to have the human capital issue on the agenda of the management committee. Nevertheless, as important as being on the agenda is, it is imperative to have tactical applications. For instance, Barclays Global Investors has 25% of their managers’ bonuses based on their ability to retain key contributors! Undeniably, retention is critical for any corporation, especially for those that are financially responsible. As we’ve analyzed at iLogos, its impact is much more than you presume. However, although it is essential to know the financial impact, it is realistic to acknowledge the fact that employee turnover does occur, and understand the reasons and try to prevent it. Just as in medicine, the prevention of pathologies is much less painful than emergency treatments; recruiting is an emergency treatment when it has to replace unwanted turnover. One tool Jeff uses in response is to make sure there is a clear career growth path for all employees. The last two points that are critical in order to be a strategic business partner are to take full accountability, and “talk the talk.” By talk the talk, we mean report metrics that are followed and taken seriously by management. We mean speak “$$$” – which leads us to the second third of how Jeff sees his role. Be Financially Aware A recent Gartner study asked more than 400 senior managers, directors, or vice presidents of HR from large global companies their expected ROI for self-service HR technology. Close to an astounding 80% didn’t know!! Too often, the case is similar. If you want to be treated as a business partner, you have to speak the language of business. Time and again, during iLogos meetings with companies we realize that corporate HR is struggling to make a case for itself when it is often the source of many savings and streamlining for corporations. The Lesson: the client is who pays the bill; your ultimate client is the CEO. So get the metrics you need not only to measure the status of practices and programs, but also to evaluate their progress. Improve the traditional recruiting metrics, such as turnover, and time to hire and link them into the financial savings. Automate your process to improve efficiencies and data gathering. Get some true strategic measures such as revenue and profit per employee. Administration Finally, be a great administrator. This one doesn’t need a lot of detail; it’s what you know much more than the others and it is fundamental. Even so, I would like to emphasize that this is only a third of the role and that it is the combination of the right tools, the right metrics and the right state of mind that will position you to reach your targets. <*SPONSORMESSAGE*>