AccentureHumanCapitalDevelopmentFramework

DevelopedbytheAccentureHumanPerformanceServiceLine&

AccentureInstituteforHighPerformanceBusiness

ProjectOverview?2004Accenture.Allrightsreserved.WorkforceandHRPerformanceareatopExecutivePriority…Source:TheAccentureHigh-PerformanceWorkforceStudy2004…Yetfewexecutivesarehighlysatisfiedwiththeirprogressontheseinitiatives2?2004Accenture.Allrightsreserved.HighPerformancebusinessesarecharacterizedbyleadingedgehumancapitalcapabilities.HumanCapitalEfficiencyWorkforceAdaptabilityWorkforcePerformanceTalentManagementAbilitytoChangeEmployeeEngagementLeadershipCapabilityHighPerformanceFrameworkHigh

Performance

AnatomyMarketFocusDistinctiveCapabilitiesHumanCapital

Capabilities**Tier3ofAccenture’sHumanCapitalDevelopmentFramework3?2004Accenture.Allrightsreserved.ProductivityQualityInnovationCustomersKeyPerformanceDriversBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalSuccessionPlanningRecruitingWorkforcePlanningWorkplaceDesignRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyLearningManagementKnowledgeManagementHumanCapitalInfrastructureHumanCapitalCapabilitiesTier1Tier2Tier3Tier4WorkforcePerformanceEmployeeEngagementWorkforceAdaptabilityAbilitytoChangeTalentManagementLeadershipCapabilityHumanCapitalEfficiencyWorkforcePerformanceEmployeeEngagementWorkforceAdaptabilityAbilitytoChangeTalentManagementLeadershipCapabilityHumanCapitalEfficiencyChangeManagementRevenueGrowthROICorROE(FSonly)TotalReturntoShareholdersFutureValueIllustrativeBusinessMeasuresTheAccentureHumanCapitalDevelopmentFrameworkisatooltomeasurehowwellcompaniesmasterthesecriticalHumanCapitalCapabilities4?2004Accenture.Allrightsreserved.TheFrameworkproducesaScorecardindicatingperformanceonallelementsoftheframeworkalongwithadetailedassessmentoftheresults.RewardsandRecognitionEmployeeRelationsHumanCapitalStrategyLearningManagementKnowledgeManagementHumanCapitalInfrastructureChangeManagementWorkforcePerformanceEmployeeEngagementWorkforceAdaptabilityAbilitytoChangeHumanCapitalEfficiencyProductivityQualityInnovationCustomersKeyPerformanceDriversBusinessResultsLeadershipCapabilityHumanCapitalCapabilitiesTier1Tier2Tier3HumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalSuccessionPlanningRecruitingWorkforcePlanningWorkplaceDesignTier4TalentManagementRevenueGrowth ROICorROE(FSonly)TRSFutureValueIllustrativeBusinessMeasures3.63.03.02.7HumanCapitalEfficiencyTopQuartileBottomQuartileNote:Numbersrepresentsurveyresponses(means).Colorcodesindicateperformancecomparedtobenchmarks5?2004Accenture.Allrightsreserved.InitialimplementationsoftheFrameworkrevealthatfinanciallysuccessfulorganizationshavemorematurehumancapitalprocesses6?2004Accenture.Allrightsreserved.AnalysisofinitialimplementationsoftheframeworkhavealsoansweredimportantquestionsonthemindsofexecutivestodayWhatarethekeyactivitiesthatleadtoamoreengagedworkforce?(seeOutlookarticle,HarnessingthePowerofanEngagedWorkforce,February,2005)Aremyassumptionsabouteffectivelymanaginganddevelopinghumancapitalcorrect?Whatarethesurprisingfindingsthatgoagainstcommonwisdom?Whatprocessesmostimpactcriticalhumancapitalcapabilitieslikeworkforceperformance,workforceadaptability,andleadership?

(seeforthcomingAccenturewhitepaper,TheAccentureHumanCapitalDevelopmentFramework:Assessing,MeasuringandGuidingInvestmentsinHumanCapitalforHighPerformance)4.WherecanIinvestinpeopletogetmaximumvalueformydollar? (seeOutlookarticle,MakingtheRightInvestmentsinPeople,2004)7?2004Accenture.Allrightsreserved.Appendix?2004Accenture.Allrightsreserved.TheAccentureHumanCapitalDevelopmentFrameworkWhat: Adiagnostictool,thatmeasureshowwellacompanymastersit’shumanperformancecapability,andlinksthematurityoftheorganization’shumancapitalprocessestobusinessandfinancialoutcomes.Why: Enablesorganizationstosetstrategy,validatehumancapitalinvestmentsandredirectinvestmentsforgreaterbusinessimpact.How: Usesweb-basedsurveys,executiveinterviews,andfinancialandHRdataworksheetstocollectperceptualandfactualdata.

Who: Forusebyanyorganizationthatwantstouseacomprehensive,repeatable,metrics-basedapproachformanagingtheirhumancapitalprogramsandinvestments9?2004Accenture.Allrightsreserved.AccentureHumanCapitalDevelopmentFrameworkSurveyHouseHRBoutiqueHRScorecardsTheAccentureHumanCapitalDevelopmentFrameworkismuchmorecomprehensiveinscopethanotherframeworks.InnovationCustomersKeyPerformanceDriversRevenueGrowthTRSBusinessResultsHumanCapitalProcessesHumanCapitalCapabilitiesTier1Tier2Tier3Tier4EmployeeEngagementKeyPerformanceDriversRevenueGrowthROICTRSBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier4KeyPerformanceDriversRevenueGrowthROICTRSFutureValueBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier4KeyPerformanceDriversRevenueGrowthROICTRSFutureValueBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier4KeyPerformanceDriversRevenueGrowthROICTRSFutureValueBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier4InnovationCustomersKeyPerformanceDriversRevenueGrowthTRSBusinessResultsHumanCapitalProcessesHumanCapitalCapabilitiesTier1Tier2Tier3Tier4EmployeeEngagementKeyPerformanceDriversRevenueGrowthROICTRSBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier4KeyPerformanceDriversRevenueGrowthROICTRSBusinessResultsHumanCapitalProcessesCompetencyManagementCareerDevelopmentPerformanceAppraisalRecruitingWorkforcePlanningRewardsandRecognitionEmployeeRelationsHumanCapitalStrategyHumanCapitalCapabilitiesTier1Tier2Tier3Tier410?2004Accenture.Allrightsreserved.OtherdiagnosticapproachesdonottrackcompletelinkagesandmanydonotprovideevidencefortherelationshiptoshareholdervalueHumanCapitalDevelopmentFrameworkGallupQ12EngagementSurveyComprehensivemodelthatdistinguishesbetweencauseandeffect,orbetweenintermediatebusinessresults(tier2)andcurrentandfuture-orientedfinancialresults(tier1),andbetweenHCprocesses(tier4)andHCoutcomes(tier3).Assessesthematurityofanorganization’sprocesses,enablingtheHCDFtosuggestprescriptive,action-orientedadviceMoreaccurateassessmentsbasedoninputfromemployees,HRexecutives,businessleaders,internaldatabases,andexternalbenchmarksUsingstandardmeasuresacrossfirms,thetoolcanshowwhichHCprocessesmostimpactbusinessresults.Assessesonehumancapitalcapabilityonly:employeeengagement.Simpleandeasytoimplement12questionsurveyadministeredtoemployeesonly.Questionsareverygeneralandareunabletosuggesttherootcauseofloworhighlevelsofemployeeengagement,orsuggestaction-orientedadviceconcerninghowtoimproveit.Usingstandardmeasuresacrossfirms,Galluphasshownacorrelation(notcausality)betweenhighlevelsofengagementandsomeintermediateandfinancialbusinessresults.11?2004Accenture.Allrightsreserved.Otherdiagnosticapproachesdonottrackcompletelinkagesandmanydonotprovideevidencefortherelationshiptoshareholdervalue(continued)WatsonWyattHumanCapitalIndexHRScorecard/Huselid

Linkssomehumancapitalprocessesdirectlytofinancialresults.IsnotascomprehensiveinitscoverageofHCprocessesastheHCDF.DoesnotdistinguishbetweenHCprocessesandoutcomes/capabilities,anddoesnotincludeintermediatebusinessresults.AssessestheeffectivenessofHRprogramsbycollectingdatafromHRpersonnelonly.ThisenablessomeprescriptiveadviceaboutHRsolutions,butitfailstoassesstheeffectivenessoftheprogramsinsupportingemployees.Usingstandardmeasuresacrossfirms,theHumanCapitalIndexhasshowncorrelation(notcausality)betweenHCpracticesandfinancialresults.Doesnotusestandardmeasuresacrossfirms,andthuscannotofferusersvalidationthathumancapitalprocessesandcapabilitiesimpactbusinessresults.Rather,itoffersatooltobecustomizedfortheorganizationsimilartotheBalancedScorecard.Overtime,ifbothHCprocessesandbusinessresultsimproveinasingleorganization,alogical(butnotstatistical)connectionmaybemade.However,oneofthedevelopersoftheHRScorecard,MarkHuselid,haspublishedresearchthatshowsacorrelation(notcausality)betweensomeHCprocessesandfinancialresults.12?2004Accenture.Allrightsreserved.Dataiscollectedthroughwebenabledsurveys,executiveinterviewsandfinancialdataworksheets.TimeCommitmentAudience45minutewebbasedsurvey5–15HRExecutivesFactualdatacollection(maybedelegated)businessfinancialdata(accessfinancialController)HRdatawebsurveyProvideemployeeinformationforthosetakingthesurveyScheduleinterviewswithexecutivecommittee1.5days/weekfor3weeksthen.5daysfor5weekstohelpmanageeffortProjectManagerEmployeeswithoutsupervisoryresponsibilities(~70%):20minuteweb-basedsurveyEmployeeswithsupervisoryresponsibilities(~30%):30minuteweb-basedsurveyCrosssectionof50ormoreemployees30-45minutestructuredinterviewsAtleastthreeexecutiveinterviews,oneofwhichwillbewithanHRexecutivewhocanarticulatetheHRstrategy,andtwoofwhichwillbewithbusinessexecutiveswhocanarticulatetheorganization’sstrategy.Executives13?2004Accenture.Allrightsreserved.Identifystrengths,weaknesses,andprocessmaturityinkeyhumancapitalcapabilitiesSameasfirstexecutionplus…Company/IndustryDataCollectionFrameworkExecution1234567…. PredictiveQualityofHumanCapitalInvestmentsEstablishabaselineformeasurementthatmakesitpossibletotrackfinancialimpactsovertimeIdentifycausalitybetweenthetiers,notjustcorrelationDe