Attracting IT Talent: The Human Factor - ' IBM'

As the vice president of global talent at IBM Corp., Karen Calo's job is to make sure the $91 billion computing behemoth stays on track in planning for its present and future workforce, and to make sure those plans are clearly aligned with the company's business strategy. As a 26-year veteran of IBM, she too has seen the changes that have taken place among employees, especially younger ones. "People coming off college campuses when I joined IBM 26 years ago were interested in a career with a company for life. But that's changed. Companies can no longer guarantee employment for life, and employees don't expect it. Young folks today are interested in working in a place that offers cool work where they can develop their skills, but I don't think they expect to be at the same place for 10 or 15 years. So the challenge for IBM is to figure out how to get the top performers to stay longer than they might think they want to."

While IBM faces many of the same problems other corporations are dealing with as they confront the 21st-century workforce, Calo notes that the company has a history of strong retention. Take the baby boomers: "Our statistics today aren't showing a huge amount of brain drain from baby boomers retiring," says Calo. "I like to credit that to the fact that people remain loyal to IBM, particularly older employees." And IBM provides a fair amount of flexibility in terms of part-time work and telecommuting. "In fact, about 40 percent of our workforce doesn't even go to an IBM office every day," she notes.

In order to achieve its retention goals, IBM's HR executives work closely with IT to develop systems that give managers an end-to-end view of the company's human capital—quite a job for a company with more than 330,000 full-time employees. One such effort involves a custom-built database of the company's workforce, called Professional Marketplace, that allows managers to assess who has what skills. "That allows us to identify where we have skills gaps, and compare that with our business plans," says Calo. "Who has a particular skill? Who has most of that skill, and can we put together a learning program to give those people what they need? How many people do we need to hire from outside?"

Much of the ability to make these kinds of decisions depends on IT to set up the HR analytics systems that can generate the kinds of high-level metrics to give managers visibility into the changing nature of IBM's workforce. "We've rolled out a new initiative, in partnership with IBM's IT department, that gives us an end-to-end view of our human capital," says Calo. "In fact, some of the ideas for it come out of our supply-chain business. It's a large, complex system that gives us a suite of tools to help manage this problem."

Calo notes that HR metrics come in two flavors. There are more traditional metrics such as employee satisfaction, hiring and attrition rates. And then there are such metrics as labor costs in relation to revenue and profit per employee. Such metrics, says Calo, allow executives to assess the company's workforce mix. "Is the company optimally situated, or do we need to plan further ahead? Should we hire more college graduates, despite the cost? What about contractors?" Calo asks.

Most important, such thinking is driven by the company's strategic planning, and by what's happening—and what's expected to happen—in the marketplace. Says Calo: "At IBM, human resources has always had a place at the corporate strategy table. And as we become more and more services-based, and more global, the role of HR continues to increase in importance strategically." Every spring, IBM executives determine overall strategy, and every fall, the discussion turns to how to execute those strategic plans. "And HR is right there, along with line leaders and executives from the finance department, dealing with questions like 'What's the right workforce mix for reaching those strategic goals?'"

The problem, says Troy Kanter, president of the human capital management division at Wayne, Pa.-based Kenexa Corp., a purveyor of HR software, is that "most companies don't really measure why people are leaving, and why people stay. If you can't measure it, you can't manage it." The critical element in any strategic HR plan is to determine which are the most important job families in your company, and then to make sure you really understand what drives the top quartile of performance within each family. "Model that, validate the model, build out the business case for it, and then use that model to build the entire strategic human capital management plan," he concludes.

The key, says Kanter, is to look at what drives engagement with the job for high performers versus low performers for each job family. Kanter points out bluntly, "As long as the bottom half of performers are the ones leaving, you're okay. With HR analytics you can make sure that your retention strategy focuses on the top quartile, and then use turnover as an opportunity to increase the overall talent level in the company."

Next page: Planning the Workforce of the Future

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