ELFA Equipment Leasing & Finance - October 2014 : Page 38
Hiring Goes Holistic
Susan L. Hodges
Today’s recruiting, hiring and retention go way beyond salary
IN THE CURRENT VERNACULAR, you could say Volvo Financial Services “has it going on.” Based in warm and sunny Greensboro, N.C., the captive company provides a full range of financial products to Volvo Group customers, employs a growing number of people and pays competitively. But when it comes to hiring and keeping talent, Jes Schneider says being successful and competitive in the marketplace is just the starting point. “If you’re competitive, then you have to rely on being a great place to work,” says Schneider, Vice President of Human Resources for Volvo Financial Services Region the Americas. “That’s the intangible a lot of people today are looking for.”
Schneider says being a great place to work means many things. “Do you have a participative management style? Are your employees engaged and active? Do you take employee development seriously? Those are the questions Millennials and Generation Y’s are asking,” he says. “While older people may be more motivated by a paycheck, younger people are typically looking for companies that have a vision. It’s becoming table stakes for organizations to look at life-work balance and workforce flexibility and have policies around them they can use.”
Candidates Behind the Wheel
So long, 70-hour work week. Hello, working from home at least one day a week and performance reviews every six months that include career counseling. Top talent already has a job at one or more of your competitors, and if you want those go-getters, you’ll have to offer more than a 5% increase.
“The market has shifted to a candidate-driven market again, like in 2006 and 2007,” says Larry Hartmann, Managing Partner, ZRG Partners, Inc., an executive recruiting firm in West Orange, N.J. A few years ago companies had their pick of candidates and could attract talent with lateral pay moves. No more, says Hartmann. “Asking someone to move for a 5% increase isn’t worth it,” he says. “Someone considering a lateral move would be looking for more like 30%.”
In comparison, hires in their 20s may not ask for substantial pay jumps. They may, however, inquire instead about specific opportunities for career advancement, flexible work schedules and Safe Harbor 401(k) plans. “They want to know when the [company] match occurs and how much it is,” says one recruiter who asked to remain anonymous. “And since we have an immediate vest that you can get into two to three weeks after you start, this attracts a lot of people.”
Where to look for new talent if you’re willing to pay this patchwork of compensation? Try the Internet and/or a firm that specializes in HR outsourcing. That’s what Hitachi Capital America (HCA) in Norwalk, Conn., is doing. “We’re moving away from using agencies,” says Joni Kovac, Vice President of Human Resources at HCA. “We’ve outsourced a lot of recruiting to a local firm that has experts who source candidates on the Internet. It really cuts down on our recruiting costs.”
And candidates are flocking. With just 109 employees in the U.S. and another 85 in Canada, HCA is a small shop—and one Kovac says has a nice worklife balance. “A lot of people here work at home; we have a lot of flexibility; and a lot of our quality here is hard to quantify,” she says, adding, “This is a great environment because you’re not running around with your hair on fire.”
HCA is not only attracting new talent—both young and more senior—Kovac says the company has very low turnover.“We do lose people from time to time, but we don’t lose many to competitors,” she says. “Most are running the other way because it’s hard to last if you can’t have some sort of balance.”
At the same time nonfinancial benefits are changing, industry financial compensation is on the upswing. ELFA’s 2014 Equipment Leasing and Finance Compensation Survey found that pay rose modestly across the industry in 2013 for the fourth consecutive year. Increases tended to be larger at the more sen ior levels (particularly in direct origination and infrastructure). Generally, banks awarded higher compensation at median relative to captive and independents, particularly for senior roles.
A nonindustry-specific but still informative study by the Association for Financial Professionals shows that in 2013, financial professionals generally realized a 3.8% gain in base salary, up from a 3.4% increase in 2012. Yet bonuses went down last year, with 71% of the 2,800 surveyed companies paying bonuses, compared to 73% in 2012 and 75% in 2013.Off setting the decline in bonuses were increases in paid time off , with 32% of respondents awarding an additional five days off (for a total of 20 days) after one to four years of employment.
But ZRG’s Hartmann says what worked one or two years ago isn’t necessarily working today. “Equity-restricted stock is back in the game, and long-term options that went away in 2009 to 2011 are coming back as a way to retain people,” he says. “Companies used to be able to sell stability, saying they’d been in the market for years. But that’s no longer working.”
What is working, says Schneider, are partnership development programs in which employees are responsible for guiding their own careers while the company provides tools That allow it to happen. “We have personal business planning here, planning objectives and development, and the employee takes the reins on that and lays out what he/she wants to do,” Schneider explains. “Then the boss weighs in and they form a development plan together.”
If that sounds a bit like “Father Knows Best,” keep reading because Schneider says Volvo Financial Services has been doing this for a while now. “Most companies our size adopted this approach five years ago or a little more,” he says, adding, “I think it goes to the point of having a vision of the employee’s future.”
Measuring employee engagement is newer. In return for deepening interest in the future of their workers, some firms are actively measuring and tracking employee engagement.Is the employee willing to go the extra mile to put in incremental effort to get the company in the top 5% of competitors?Companies want to know. “Lots of vendors are selling employee engagement surveys,” says Schneider, “and companies are making this part of their management process.”
The trend seems understandable: Firms can examine their employee engagement scores and compare them to competitors’ scores to find out if they’re among the highest performing companies. “And you want to be at or above their norms,” says Schneider. “There are external benchmarks to measure that.”
Yet employee development—and engagement—hinge at least partly on training. To make training less expensive, more effective and more social, many companies now do it in groups. “It’s not as impactful to bring in one or two people for training,” says Hartmann. “You need an atmosphere that makes it more successful. It’s good to have groups when you’re training and when you’re hiring.”
Kovac agrees. New hires at HCA are assigned a buddy who has done the job of the new hire or is doing it currently. More formal training is almost always done in groups. “We put about 60 people through [spreadsheet] training recently, and we’ll have a vendor come in and train about 30 this fall in how to better understand financial statements,” Kovac says. “We also have lots of training employees can take that’s specific to trucks,” she says. “We try to take a variety of approaches.”
At Volvo Financial Services, onboarding, technical skills training and employee development are viewed together in a combination that Schneider calls “the Employer Value Proposition.” “That’s when you have a company people want to work for and the company is focused on development, engagement, teamwork, flexibility and life-work balance,” he says. “When you put those things together, you hope employees will look at you and say you have a good value proposition.”
Inside that value proposition is paid time off, and to ensure that employees stay long enough to earn more of it, Hartmann advises investing to help newer hires fit in. “At the C-suite level, companies are bringing in executive coaches to help people integrate in and be more successful,” he says. “It’s not enough just to hire them; you have to be at market with compensation, recognize and appreciate people and develop personal capital through team development and awards.Send your top performers to Cabo San Lucas for four days to spend time with family. Invest to make people feel loyal beyond the company because people are loyal to people, not to companies. So spend time and money on trips with the goal of team-building and retention.”
And as your team grows and develops, Kovac suggests promoting from within. “It’s important always to look at your team,” she says. “Look at every employee, where they are, where they are positioned to go, what training they need to help them get there and what exposure they might need as well. Take a proactive approach, and promote heavily from within. It’s very important to give people challenges that will help them want to be there and grow with the company. Otherwise, they won’t want to stay.”
But some will stay, says Schneider, perhaps due in part to family situations that keep them in place. “A spouse may be employed and not have the flexibility to move,” he says. “And people with older parents may feel the need to stay and take care of them. As Baby Boomers near retirement and their parents live longer, this is an issue. I’d say our turnover has been lower since 2008.”
Recruiters concluded that both new hires and longerterm employees can bring continuing value to firms that seek it—new hires through new skills and fresh perspectives; longer-term employees through mentoring, competence and application of corporate memory. So view your human capital holistically and expect to benefit.
Susan Hodges writes about equipment finance and other business topics from her office in Evanston, Ill.
“Best Practices in Industry Recruitment and Training: Building the Future of our Business” at the 53rd Annual Convention on Oct. 20 at 2:30 p.m.
Compensation Survey Reveals Industry Trends
Get the latest data on compensation in the equipment finance industry in the 2014 Equipment Leasing and Finance Compensation Survey from ELFA and McLagan. The survey measures compensation rates for the 2013 fiscal year as reported by 60 equipment finance companies representing a cross section of the equipment finance sector, including independent, bank and captive leasing and finance companies. Firms provide data for more than 90 executive, front-office and support positions, including a breakdown of salary, incentives (including cash bonuses and commissions), long-term awards and total compensation by company type. To purchase a copy of the report, please contact Bill Choi at email@example.com or 202.238.3413. Note: Survey results are available for purchase by firms who commit to participate in the 2015 survey.
THEN & NOW
HOW HAS RECRUITING CHANGED IN THE PAST 25 YEARS? Equipment Leasing & Finance magazine asked three veteran recruiters to share their insights: Jon Gerson, President of Executive Solutions for Leasing and Finance; Bob Wax, Co-President of Kingsbury Wax Bova; and Denver Wilson, President of Sales Consultants of Northwest Arkansas.
The industry has matured. Twenty-five years ago, equipment finance was a younger and more entrepreneurial and risk-taking industry. Today it’s a much more commoditized world. As the industry has matured, it has gotten smaller, and so has the talent pool—increasing competition.
Fewer “outsiders” are entering the business. When the industry was in its infancy, more companies recruited from other industries and then rigorously trained new hires in equipment finance. Today, many companies are looking for candidates with industry experiences whose skills match a formal job description, and are not as flexible when considering candidates.
Networking has expanded. Years ago, networking was done face to face.Today social networking and the Internet help people stay in touch more than they used to. However, networking in person—being able to talk to people, shake their hands and look them in the eye—continues to be instrumental, especially for industry executives.
Stability is an important consideration for candidates who have been rocked by the recession. “It’s been harder over the last six years to land somewhere new than it was at any other point in the preceding 19 years,” says Gerson.“It used to be mostly about money—now it’s about money, of course, but also the stability of the company, the tenure of their employees and noncompensation-related perks—like company culture, familial support, flex hours, etc.”
Ready for risk? During the downturn, people were very reluctant to make job changes. Now that the economy has improved, people are more willing and prepared to make job moves and take more risks for positions that have great potential for growth.
Being unemployed is not the stigma it once was.“When I first started, if you were unemployed, it was really hard to get a job,” says Wax. “With all the consolidations, acquisitions, mergers, etc., that’s no longer the case.”
Degrees abound. Year ago, it was less important if you had a degree. “Now it’s an industry full of MBAs and CLPs,” notes Gerson.
LinkedIn rules. Today recruiters are using LinkedIn to identify and connect with prospects. Employers are connecting with candidates online, interviewing them via video conferencing, and, in some cases, using these and other tools to fill positions much more quickly than in the past.
Some things never change. “Despite all of the technological advances over the years, recruiting is a very personal business,” notes Wilson.
TIPS FOR YOUR JOB SEARCH
LOOKING FOR A NEW POSITION? Here are some top pointers from Gerson, Wax and Wilson:
Don’t leave any stones unturned. “It’s very useful to have a couple different avenues in your job search,” advises Gerson. Have a robust Internet profile (on LinkedIn and the ELFA Career Center), connect with different people you’ve worked with over the years and contact a couple recruiters. Look everywhere you can for job positions.
Use LinkedIn to your advantage. “Make sure your LinkedIn profile is an exquisite description of everything you’ve ever done in the most glowing way,” advises Wax. Also, make your LinkedIn circle as big as possible and continue to add information to LinkedIn—your connections will see your updates and know you’re out there.
Use keywords. Have a well-written resumé and LinkedIn profile that use strong keywords. In the past, a human being read your cover letter. Now larger organizations have resumé scanning software that looks for keywords.
Be proactive. Just because you submit a resumé, an employer will not necessarily call you. Don’t be afraid to pick up the phone and proactively find out more about a position.
Get engaged with ELFA and the Foundation. Volunteer and let other people in the industry know about you. Get on a panel at industry-specific conferences and write articles to increase your visibility. “The more people who know you, know what you do and know you do it well, the greater the chance you’ll be contacted,” notes Wax.
Read the full article at http://www.mydigitalpublication.com/article/Hiring+Goes+Holistic/1817474/226293/article.html.