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Title: Future Trends in Human Resources In Todays Global And Depressed Economy


1
Future Trends in Human ResourcesIn Todays
Global (And Depressed) Economy
  • KEN MOORE, M.S.
  • Adjunct Professor, SUNY- Albany
  • 518-374-1050 kmoore01_at_nycap.rr.com

2
TODAYS PROGRAM
  • Future Trends in Human Capital
  • Four Generations Working Together
  • Linking Human Resources and Corporate Financial
    Performance

3
IMPROVING YOUR BUSINESS LITERACY
  • Finance
  • Business
  • Core discipline
  • People

4
What Business Issues Are Affecting Trends?
  • Domestic Global Economy
  • Cost of Doing Business
  • Politics
  • Legal
  • Technology
  • Generational
  • Others???

5
Goals
  • Non - Financial Financial
  • Literacy Literacy

6
THREE H.R. TRENDS(As seen by Investor
Customer Employee)
  • Interdependency
  • Business Strategy Partnership
  • Talent Management

7
Trend 1Interdependency
  • ISSUES
  • Silo elimination Virtual management
  • Twice the work Complexity
  • Ambiguity KSAs - Teams

8
TREND 2Business Strategy Partnership
  • Outcome orientation
  • Understanding the business
  • Financial literacy
  • Operational transparency analysis

9
TREND 3Talent Management
  • Issues- Shifting Needs - Challenges

10
Trend 3Talent Management
  • Attract
  • Hire
  • Develop
  • Retain
  • Support
  • Fire

11
Trend 3Talent Management Issues
  • Older Workers
  • Generational differences
  • Virtual work Virtual management
  • Job design options (FT, PT, Shared)
  • Child elder care costs (FMLA)
  • Freelance consulting / contracting
  • Identifying KSA weakness shortages

12
Trend 3Talent Management
  • Shifting Needs of Talent
  • Generational differences
  • 9 5 vs. 24/7 mindset
  • Work life balance
  • Global workforce differences
  • Career and KSA development opportunities

13
Trend 3Talent Management
  • CHALLENGES
  • Workforce Analysis KSA development
  • (Ex. Soft vs. hard skills)
  • ROI metrics on One size management
  • Human Capital does not fit all
  • Virtual Participative
  • Management decision making

14
TREND SUMMARY
  • Focus is on organizational success
  • Being a business partner / ally
  • Managing talent wisely
  • Embracing proactive
  • change
  • Financial business
  • literacy
  • 5. Focus on what matters

15
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16
Four Generations
  • RECIPE FOR CONFLICT
  • RECIPE FOR OPPORTUNITY
  • Presented by
  • Ken Moore
  • 518-374-1050
  • kmoore01_at_nycap.rr.com

17
FOUR GENERATIONS
  • Veterans 1925 1946
  • Baby Boomers 1946 1964
  • Generation X 1965 1985
  • Generation Y 1985 2000

18
SOCIAL BUSINESS ISSUES
  • Age discrimination
  • Pensions health care
  • Business forecasting
  • Corporate social responsibility
  • Transparency of operations
  • Shifting demographics
  • Worldwide change (e.g. elder care)

19
VETERANS
  • lt 1925 1946
  • a.k.a.
  • Silent Traditionalist
  • Seniors Loyalists

20
VeteranInfluences
  • Depression / New Deal
  • World War Two Cold War
  • Post-W.W. II US dominance
  • G.I. Bill Levittown
  • Organization Man (Grey Flannel Suit)
  • GM vs. USA
  • Big band music

21
Veteran Accomplishments
  • Durable national infrastructure
  • Won World War II
  • Landed men on the moon
  • Miracle vaccines (polio, tetanus, TB)
  • The best and the brightest

22
VeteransDominant Work Values
  • Loyalty / Hard work
  • Respect authority / Adherence to rules
  • Commitment / Patriotism
  • Patience / Clearly defined gender roles
  • Doing without / Faith in institutions

23
Veterans Personality
  • Consistency Uniformity (TV dinners, Holiday
    Inns, McDonalds)
  • Conformers Dont rock the boat
  • Definitive sense of right wrong
  • Clearly defined gender roles
  • Conservative / Cash not credit
  • Traditionalist Uncomfortable with
    transparency / touchy-feely

24
Baby Boomer 1946 1964(78 million)
  • INFLUENCES
  • Television / Drugs
  • Civil Rights / Sexual revolution
  • Viet Nam / Watergate
  • Political assassinations
  • Challenges to authority
  • Rejection of the status quo
  • Beatles Hendrix - Woodstock

25
Baby BoomerAccomplishments
  • Equality
  • Civil rights
  • Social growth
  • Technology
  • New Frontier

26
Baby BoomersCore Values
  • Optimism Idealism
  • Personal immediate gratification
  • Look out for 1
  • Material success
  • Personal growth loyalty to career
  • Youth dislike of authority

27
Baby Boomers Personality
  • Growth Expansion New Frontier
  • Stars of the show focus on them
  • Teamwork Collaborate cooperate
  • Personal gratification recognition (atta boy
    atta girl)
  • Material vs. spiritual fulfillment

28
Generation X(46 million)
  • 1964 1985
  • Xers Gen X
  • Invisibles Lost
  • Slackers Baby Busters

29
Generation X Influences
  • Globalization / End of Cold War
  • Two-career parents / High rate of divorce
  • Computers Technology
  • MTV AIDS
  • Mass layoffs / Corporate mergers
  • Watergate / Nixon resignation
  • Three Mile Island / John Lennon
  • Oil crisis / Iran hostages

30
Generation XAccomplishments
  • IPOD / Blogs / Nintendo
  • Google / Yahoo
  • Jump starting Internet
  • Gulf War 1
  • Full ethnic integration

31
Generation XDominant Work Values
  • Skepticism
  • Superficial / Independent
  • Global knowledge / Local ignorance
  • Work - life balance
  • Informality / Flexibility
  • Corporate Social Responsibility
  • Observe, but not participate

32
GEN X PERSONALITY
  • Self-reliant Latch-key kids
  • Searching for surrogate families
  • Desire for work life balance
  • Like informality Matrix vs. Hierarchy
  • W.I.I.F.M.

33
Generation Y1985 2000
  • (35 million)
  • Cyber
  • Millennials
  • Nexters
  • Internet

34
Generation Y Influences
  • Technology Diversity
  • 9-11 / War on terrorism
  • Gangs Violence / Columbine
  • Globalization / Flattening of the world
  • Dotcom bubble burst
  • Sense of entitlement / Impatience
  • Soccer moms / Play dates

35
Generation Y Current Core Values
  • Optimism / Realism
  • Autonomy / Empowerment
  • Techno-savvy
  • Street smart
  • Transparency of work
  • Nomadic

36
Within the OrganizationDos
  • Focus on the business plan
  • Embrace diversity
  • Accept change
  • Answer the Why
  • Develop flexibility
  • Go back to school
  • Focus on what matters

37
Within the OrganizationDont
  • Stereotype
  • Assume we all think react alike
  • Be arrogant in your way
  • Assume you are more important and
  • have more wisdom than them
  • Lose sight of why the company exists

38
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39
Linking Human Resources and Corporate Financial
Performance
  • Presented by
  • Ken Moore
  • President, Ken Moore Associates
  • kmoore01_at_nycap.rr.com
  • 518-374-1050
  • www.kenmooreassociates.com

40
SUPPOSE YOU HAD ANINDIVIDUAL WHO COULD
  • Increase your profit
  • margins
  • Lower your cost
  • of goods sold
  • Improve your P/E ratio
  • Generate significant
  • competitive advantage
  • AND

41
  • Deliver flawless H.R. work

42
CEO Responses
  • OLD - Why are you wasting your time in H.R.
  • NEW - Why didnt I demand this level of
    performance from H.R. 5 years ago

43
CREATING THE PERFECT H.R. WORLD
  • SUPERIOR PROFITABLE
  • TRANSACTIONAL BUSINESS
  • SKILLS PARTNERSHIP

44
Transactional / OperationalH.R. Perfection
Seeks
  • Efficiency
  • Standardization
  • Data base systems
  • Compliance
  • Comprehensive, specialized knowledge

45
A Business Partnership Requires HR To Be
  • Profitability Direction
  • Productivity/Efficiency Focus
  • Competitive Advantage
  • Operational Sustainability
  • Performance Outcome Oriented

46
ECONOMIC ISSUESAFFECTING H.R. STRATEGY
  • Health care pensions
  • Recession energy
  • Too big to fail? too big to run?
  • Government activism
  • Bailouts Stimulus - Taxes
  • Corporate re-thinks
  • Mergers Acquisitions Chapter 11

47
Transactional / OperationalH.R. Perfection
Seeks
  • Efficiency
  • Standardization
  • Data base systems
  • Compliance
  • Comprehensive, specialized knowledge

48
Enhancing Our Professional Literacy Skill Sets

49
WHY FINANCIAL INTELLIGENCE ? ? ?
  • The language of business is Finance
  • The ability to critically evaluate company
    performance leading to enhanced HR decisions
  • (W.I.I.F.M.) - Career enhancement

50
ROADBLOCKS TO FINANCIAL INTELLIGENCE
  • I hate math
  • Not my job
  • Accounting finance departments hold on too
    tightly to the information
  • Executive level discomfort with financial
    transparency

51
Current Financial Metrics in HR
  • Revenue per FTE/HRE
  • Cost per hire
  • Turnover costs
  • Workers compensation costs
  • Benefit costs as a of payroll
  • 401k match?
  • Bonuses, raises, ESOP?

52
Keys to HR Financial Literacy

53
THE FINANCIAL FOUR
  • Cash management
  • Debt management
  • Asset management
  • Profit, equity share value management

54
In your home
  • Checking/savings account money in your
    wallet/purse - CDs?
  • (Cash Management)
  • Mortgage, credit cards, student
  • loans, car loans, etc?
  • (Debt Management)
  • Home improvements IRS deductions (Asset
    Management)

55
Profit, Equity Share Value
  • Do you have money left over at the end of the
    month (profit)?
  • Do you have more month left over at the end of
    the money (loss)?

56
Basic Financial Statements
  • BALANCE SHEET
  • INCOME STATEMENT
  • STATEMENT OF CASH FLOW

57
Balance Sheet
  • Assets Liabilities Equity
  • (Assets Liabilities) Equity
  • (Assets Equity) Liabilities
  • Assets What you own
  • Liabilities What you owe
  • Equity Whats left over

58
Income Statement
  • Revenue (What you earned)
  • minus
  • Expenses (What you spent)
  • Net Income (Your profit (loss)

59
STATEMENTS OF CASH FLOW
  • Cash flow from operating activities
  • Cash flow from investing activities
  • Cash flow from financing activities
  • Where did the money come from?
  • Where did it go?

60
Net profit marginPepsiCo
  • 2008 2007
  • Net income _____ _____
  • divided by
  • Total revenue/sales _____ _____
  • Profit margin _____ _____

61
Net Profit Margin - Pepsi
  • 2008 2007
  • Net Income 5,142 5,658
  • divided by
  • Revenue/Sales 43,251 39,474
  • Ratio 11.9 14.3
  • Is my company profitable? Y / N
  • Is PM going in right direction? Y / N
  • Rating (poor) 1 2 3 4 5 (excellent)

62
Comparative Net Profit Margins
  • 2008
  • PEP KO
  • Net Income / 5,124 5,807
  • Revenue (Sales) 43,251 31,944
  • Ratio 11.9 18.2
  • Pepsi Rating (poor) 1 2 3 4 5 (excellent)

63
PROFIT MARGIN IMPACT ON HUMAN RESOURCES
  • If profit margins increase
  • 401(k) match level
  • Salary benefits improvements
  • Investment in PPE (staffing, training, etc.)
  • If profit margins decrease
  • Layoffs closings
  • Reduced spending
  • Pressures on costs (do more with less)
  • Restructuring

64
Human Resources Impact on Profit Margin
  • Revenue enhancement
  • Low turnover Appropriate KSAs
  • Efficiencies Partnership
  • Business plan focus
  • Costs
  • Labor Benefits Payroll
  • Compliance Turnover Green

65
ACCOUNTS RECEIVABLE TURNOVER
  • 2008 2007
  • Gross Revenue _____ _____
  • divided by
  • Accts. Receivable _____ _____
  • Quotient _____ _____
  • 365 / quotient _____ _____
  • Your evaluation
  • (poor) 1 2 3 4 5 (excellent)

66
Accounts Receivable Turnover(PepsiCo)
  • 2008 2007
  • Gross Revenue / 43,251 39,474
  • Accts Receivable 4,683 4,389
  • Quotient 9.24 8.99
  • 365 / Quotient 39.5 days 40.9 days
  • Rating (poor) 1 2 3 4 5 (excellent)

67
Accounts Receivable Comparison Turnover
  • PEP KO DPS
  • R 43,251 31,944 5,710
  • AR 4,683 3,090 676
  • Q 9.24 9.67 11.8
  • 365
  • A.R.T. 39.5 37.7 30.9
  • Rating (poor) 1 2 3 4 5 (excellent)

68
Average Collection Period Impact on Human
Resources
  • Better
  • Improved cash flow for spending
  • Better interest rates for borrowing
  • Business stability
  • Worse
  • Value chain weakness
  • Additional pressure on credit staff
  • Performance evaluation and decisions

69
EFFECIENCY RATIO(Banks)
  • Non-interest expenses / Interest income
  • other income
  • KEYCORP TRUSTCO
  • 2007 0.654 (34.6) 0.469 (53.1)
  • 2008 0.836 (16.4) 0.527 (47.3)
  • Rating (Poor) 1 2 3 4 5 (Excellent)

70
EFFICIENCY RATIO IMPACTON HUMAN RESOURCES
  • Customer satisfaction
  • Staffing levels
  • Layoffs branch closings
  • Technology (ATMs, online banking)
  • Energy
  • Sales marketing
  • Bank business strategies

71
CURRENT RATIO
  • PEPSICO
  • 2008 2007
  • Current Assets 10,806 10,151
  • divided by
  • Current Liabilities 8,787 7,753
  • Current Ratio 1.23 1.31

72
FUN WITH NUMBERSOIL - 2008
  • SUN HES CVX
  • Net Income 776 2,360 23,931
  • Revenue 54,146 41,209 273,005
  • Profit Margin 1.43 5.72 8.77
  • TOT XOM BP
  • Net Income 19,936 45,220 21,169
  • Revenue 233,826 477,359 284,265
  • Profit Margin 5.53 9.47 7.44
  • AVG (1.435.728.775.539.477.44) / 6 6.39

73
FUN WITH NUMBERSINSURANCE - 2008
  • HIG AET MET
  • Net Income (2,749) 1,831 3,209
  • Revenue 9,219 26,600 50,989
  • Profit Margin -29.8 6.88 6.29
  • PRU CI UNH
  • Net Income (1,073) 292 2,977
  • Revenue 29,275 19,101 81,186
  • Profit Margin -3.66 1.53 3.66
  • AVG (-29.8 6.886.29-3.661.533.66) / 6
    1.29

74
Profit MarginFun With Numbers - 2008
  • XOM MCD MSFT GD
  • N.I. 45,220 4,313 17,681 2,459
  • R 477,359 23,522 60,420 29,300
  • P.M. 9.47 18.3 29.2 8.39
  • AET RAI WMT IHG
  • N.I. 1,831 1,308 12,731 262
  • R 26,600 9,023 378,799 1,854
  • P.M. 6.88 14.2 3.36 14.1
  • Oil company average 6.39
  • Insurance company average 1.29

75
WHAT HUMAN RESOURCESCAN DO
  • Create sustain a learning environment
  • Argue and demonstrate financial business
    literacy as competitive advantage
  • Plan budget for employee development
  • Promote continuing education programs
  • How-to books CDs
  • AMA SHRM courses
  • On-line programs
  • Internal external program experts
  • Association program tutorials

76
HR INITIATIVE
  • Link all HR work to support the companys value
    chain - as seen by the stakeholders
  • Eliminate the Silo mentality within the
    organization
  • And

77
RELAX HAVE FUN
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