U TA O R G C O N S U LT I N G 5 3 3 4 T E A M
December 4, 2003
Dr. David A. Mack
University of Texas at Arlington
302 Business Building
817 272 3085
davemack@uta.edu
davemack@flash.net
RE: Consulting Project
Dear Dr. Mack:
Our team contracted to perform a consultation with XXXXXX Systems, an international technical
consulting firm based in Smalltown, USA. We were asked by the Human Resources Department at the corporate
headquarters to conduct a study concerning Succession Planning (SP). Jim Pary, Human Resources Planning and
Program Manager led the client team, which had been given a mandate last year by CEO John XXXXXX, to form
an initiative on this topic.
Their team desired information on best practices, and a model that would identify those practices that
would “fit” with the needs of their culture and would help develop existing elements of their current training,
leadership, performance, and “high-potential” practices. The XXXXXX Systems team understood the requirements
for our class assignment, and was willing to assist us in performing a survey to measure employee and management
characteristics. We agreed that identifying cultural and preferential attributes, as well as profile information, would
help identify the best practices elements that would be most likely to succeed in the XXXXXX Systems culture.
We have done two reports for this assignment: one for you in light of the class parameters and which we
present here, and one for our client, which includes a great deal of reference and resource material on the subject of
Succession Planning, and spans several notebook binders in addition to an expanded report of our study. Although
this increased amount of work has been very laborious, we hope that the extra effort and care we took will reflect
well on UTA’s graduate program. As you have said many times in class, in the end all you have is your reputation,
and we submit our report with the confidence that we have done our work honestly and according to good research
guidelines.
Our engagement with the client taught us a great deal about the behavioral side of understanding
management initiatives. If we, as well as our client, have come away from this project with a better concept of the
human side of programs that look good on paper, but need the fit of cultural motivation with system design in order
to “work,” then we have been successful.
Sincerely,
UTA Orgconsulting5334 Team
John Doe
Jane Doe
Sam Smith
Tina Smith
Bill Jones
Orgconsulting5334@yahoogroups.com
Orgconsulting5334@yahoo.com
SUCCESS ATTRIBUTES THAT RELATE TO SUCCESSION PROGRAMS
FOR XXXXXX SYSTEMS
DECEMBER 2003
University of Texas at Arlington
College of Business Administration
Orgconsulting5334 Group
John Doe
Jane Doe
Sam Smith
Tina Smith
Bill Jones
orgconsulting5334@yahoogroups.com
Special Thanks to
Dr. David A. Mack, Instructor, University of Texas at Arlington
Jim Pary, Human Resources Planning and Program Management, XXXXXX Systems
Dan Smit, Director of Human Resources Global Infrastructure Services, XXXXXX Systems
Dr. Dennis Tall, Member, Boston University Executive Development Round Table
Dr. William Rothwell, Author, Pennsylvania State University
Dr. Whiteside, Instructor, University of Texas at Arlington
TABLE OF CONTENTS
EXECUTIVE SUMMARY
Page 4
INTRODUCTION
Page 5
BACKGROUND OF THE TOPIC OF SUCCESSION PLANNING
Page 7
APPROACH TO THE STUDY
Page 12
LITERATURE REVIEW
Page 17
RESEARCH WITH THE CLIENT
Page 23
SURVEY METHODOLOGY
Page 27
FINDINGS
Page 33
CONCLUSIONS
Page 45
REFERENCES
Page 48
APPENDIX
Page 52
PowerPoint, Survey Response Document, and Excel Results Database are under separate cover
EXECUTIVE SUMMARY
By using several research methods, we discovered that there were four stages that needed
to be assessed for a successful succession planning (SP) program: 1) foundation of culture,
communication and strategy, 2) process of mapping, best practice identification, and
involvement, 3) system of modules, infrastructure, software and mentoring, 4) program of
implementation, measurement and results. The strategic goals of the company must be identified
for the workable design and execution of Succession Planning. Additionally, candidate
development must be aligned with business development and constructively support the cultural,
leadership and communication elements. By nature, such programs continue to evolve with the
business need over the long term and permeate through all levels of the company.
INTRODUCTION
The Client and the Study
Overview of the company. XXXXXX Systems Corporation was founded in 19XX and is
a provider of information technology (IT) services and business solutions. The company is
headquartered in Smalltown, USA and employs more than 10,000 associates worldwide. In
2002, the company reported $1.3 billion in revenue. Despite its rapid growth and success, the
company acknowledges its vulnerabilities. Pressures from the explosion of digital technology in
every facet of current business, rapidly fluctuating economies, and global influences continue to
serve as catalysts for change in the industry. XXXXXX Systems’ revenue growth continues but
not at the levels previously attained; its earnings per share has fallen 18% over the last 12 months
(Appendix D). XXXXXX Systems understands that leadership is crucial to navigating these
pressures and turning them into advantages. To this end, the company has instituted People Day,
a day to formally review the “state of affairs” of its leadership pool. To help facilitate this task
CEO Joe XXXXXX has directed the corporate Human Resources Department (HRD) to develop
a Succession Planning program.
The Human Resources Department. Dan Amber, Vice President of Human Resources and
Best Practices, has led the Human Resources Department since 2002. Amber graduated from
West Point and has a primary background in real estate planning and project management.
Additionally, he has held several leadership roles as part of Joe XXXXXX’s other ventures.
Since joining the Human Resources (HR) organization, Amber and his HR management team
have been charged with developing a mechanism for identifying, developing and deploying the
company’s “best talent” to fill key leadership positions now and in the future. These tasks make
up what is commonly known as Succession Planning: the systematic effort by an organization to
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ensure continuity of prepared leaders to fill key positions in the near and long term. After a year
of struggling with the initiative, the Human Resources management team perceived that they
were not making sufficient progress. They began discussions with our team to help them with
this initiative.
The business problem. XXXXXX Systems' current process for identifying internal talent
to fill key positions is largely ad hoc, subjective, and does not adequately support business needs.
The Human Resources Department needed to identify and develop a sustainable succession
planning process based on current and future needs of the organization. The problem for the
department has been to understand what components and design pieces are important to such a
program, and how to answer the challenges of industry and functional needs reflected in the
company’s varied services portfolio.
The objective of the study. Our objective was to discover what a good program would
look like and how the company might be able to implement and tie such a process to existing
people strategies and initiatives (Appendix A). As cultural variables have a profound effect on
the design, development and success of internal programs, we worked to discover what those
variables were. We set out to learn about the topic and discover the variables through:
1) The study of best practices and elements in the industry via research in literature.
2) The study of the company’s program resources and culture via client interviews.
3) The administration of a survey of the client and company population affected by
succession and program issues.
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BACKGROUND OF THE TOPIC OF SUCCESSION PLANNING
History
Frame of reference. The study of organizations and strategic behaviors is a young
science and “succession” topics have only become popular in the last 15 to 20 years due to
highly public and disastrous leadership transitions at successful companies like General Motors
(Robert Stempel), AT&T (Robert Allen) and Eastman Kodak (Kay Whitman) (Charan, 1999).
The potential for leadership disasters appears to be inevitable for those who are unprepared.
Rapid changes in operations, business processes, information based work, and portfolio
diversification from mergers and acquisitions challenge the ability of top management to guide
their companies and train the visionaries that will take over in the future. The transfer of “how to
get work done” processes is being lost with the aging and retirement of senior management and
the mobility of the younger workforce. Leadership is in crisis (Rothwell, 2001).
Relation of strategy and risk management. In the five-year period from l992 to l997, 125
of the Fortune 500 CEOs-one out of four-stepped down from their position (RHR, 1999). A 2000
study sponsored by Anderson Consulting and the Economist Intelligence Unit found that only 21
percent of CEOs say they and their colleagues are prepared to lead the corporation of the next
century (Lorsch, 2003). A 2002 study of 2500 public companies conducted by Booz Allen
Hamilton revealed that involuntary successions increased by more than 70 percent over 2001
(Bowes, 2003). More recently, CEO and other key leadership departures at such companies as
Enron, WorldCom, McDonald’s, Tyco International, AOL Time Warner and Kmart have
underscored the importance of managing leadership risk. The management of such risk is in
early identification of successor “candidates” or “high-potentials” (hi-po’s) that can be groomed
and given experience in understanding the larger context of running the corporation. This would
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insure a consistent leadership presence and help alleviate gaps that might cause a successful
company to falter.
Drivers for Succession Planning. The interest in succession planning has grown to
include an understanding of “leadership” behaviors and core competencies that aspiring
individuals must possess. Additionally, researchers and companies have realized that
“succession” value does not reside only for top positions, but throughout the operations of an
organization. “Organizations are often faced with the need to replace key management staff on a
very short notice due to rapid change of mergers, acquisitions, downsizing, rightsizing, and reengineering. Also, there is [an] increasingly competitive market for skilled and talented
individuals” (Orellano, 1997). Without the development of leadership throughout a company, not
just at its helm, the implementation of strategy for survival and advantage is threatened.
The performance link. A growing body of research suggests that succession planning
impacts the bottom line. “Companies with above-average bench strength are four times more
likely to outperform their industry peers than companies with below-average bench strength.
Similarly, companies with below-average bench strength are four times more likely to underperform compared to their industry peers than companies with above-average bench strength”
(CLC, 2001). A 2003 study by Hewitt Associates revealed that top companies that regularly
focus on leadership development “outperform their industry peers in both financial growth and
returns and consistently perform at or above the 50th percentile, relative to the industry, in total
shareholder return” (Hewitt Associates, 2003). “We are indeed entering a very new economy,
where historical reliance upon developing economies of scale and scope to gain competitive
advantage, under an Industrial Age model, have shifted to gaining ‘economies of expertise’ in an
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Information Age model; the role of the corporation today is to manage its knowledge base”
(McCarthy, 1999).
Key Organizational Players
Boards, executives and employees. According to top succession planning specialists such
as Ram Charan and William Rothwell, SP is not just an activity of going through the motions of
filling vacancies with available recruits. It is a process of active engagement by boards and top
executives who build a foundational strategy for the company and set the tone for mentoring and
guiding development of managers. This mirrors their guidance and development of the business
venture itself. The “failure” of companies is tied directly to the actors responsible for
understanding the needs behind crucial positions within the company. Agility and wisdom in
operations, marketplaces and citizenship of “successful” businesses is tracked directly to the
business and organizational integration of leaders and their direction in developing the talent and
managers of the business (Charan, 2001a, 2001b, 2002; Rothwell, 2001, 2002). The ability of
leaders themselves to understand the changing environment of their business’s development and
hence, their own role is crucial to success (Schaefer, 2002; Welch, 2003).
Human Resources departments. In most organizations, HR has been tasked with leading
and formulating strategies and designing programs that encourage the creation, dissemination
and application of knowledge to the organization’s advantage. An organization’s intellectual
capital has increasingly become a key source of competitive advantage. This reality makes
effective management of intellectual capital a core organizational capability. Human Resources
departments have been struggling to become strategic business partners. The issue of succession
planning has presented a pivotal opportunity for HR to demonstrate its value to the organization.
Unfortunately, a large majority of HR departments are not prepared to take on the more strategic
9
role of managing “people risk” and leveraging the company’s intellectual capital. This is
because HR organizations have been overly focused on streamlining the costs of HR activities
and improving the effectiveness and efficiencies of traditional HR processes related to payroll
and benefits administration. However, failure to step up and demonstrate their value to the
bottom-line will result in more outsourcing of HR functions (HR Report, 2002).
XXXXXX Systems Human Resources department as internal consultants. This leadership
transformation is exactly the dilemma that the XXXXXX Systems HR team faces. It is
challenged with becoming a strategic business partner. Like other functional units, HR is
expected to demonstrate an understanding of the business and to use this understanding to
develop and leverage the company’s key source of competitive advantage- its people. This
elevated role of HR is not to suggest that senior leadership is removed from being involved in the
decisions of people. However, what it does suggest is that top leadership is placing a greater
degree of reliance on HR’s ability to consult in the areas of people strategy and leadership
development so that executives can make good business decisions around talent deployment and
business operations, decisions that can have significant consequences for any company (Murray,
2002).
Definition of Terms
Working definitions are as follows:
1. Succession Planning (SP) - is the systematic effort by an organization to ensure
continuity of prepared leaders to fill key positions in the near and long term.
2. Best Practice (BP) – is a method, procedure or activity that contributes to the highest,
most resources-effective performance of a discipline.
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3. High Potentials (Hi-Po) – Exemplary performers perceived to have high potential for
future advancement into higher levels of leadership. Key source of replacement for
critical positions.
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APPROACH TO THE STUDY
Team, Client, and Research Components
Team Interaction. As a team, we had no previous background or experience with the
topic, but one member of our group is a Human Resources Manager who is familiar with the
subject area of Succession Planning and with the terminology used for evaluation and placement.
She facilitated our learning the context of the topic and of understanding the components of the
topic. While the industry depth on this particular topic was fairly shallow, each member brought
areas of expertise: human resources, marketing, technology, ethnography, finance, economics,
research, leadership, and process flow that were beneficial to the study. In order to take
advantage of these areas of expertise, each team member was assigned a lead role in one or more
aspects of the study. One team member was responsible for literature review of best practices.
This involved reading and analyzing case studies of companies identified as leaders in this topic.
Another team member led the survey design and identification of factors that could be used as
part of our correlational research. Other team members took on lead roles in statistical analysis
of data and development of process maps and tools for use in succession planning.
All members had experience with digital communications and we relied on this heavily
for accomplishing the work. The team created a Yahoo group site and email account for uniform
communication and to archive working files and research articles. This allowed us to pass
information through a single email notification, kept our boxes from filling up with attachments,
and allowed the team to access documents from a central repository. We met at least weekly as a
whole and also in small groups, either in chats, emails, or in person on campus.
The project segmentation was designed to create efficiency. However, such a structure
relied heavily on members not assigned to a particularly aspect of the project to remain involved
12
and take ownership for understanding all aspects of the project. Likewise, team leads needed to
consistently communicate the status of their efforts and quickly recognize when “they were
stuck” so that work allocation and job roles could be realigned and addressed early in the
process. Unfortunately, this result was not consistently achieved and issues of “not my area”
and feelings of being “left on one’s own” and “overburdened” became a regular source of
conflict within the team. Because the group did not elect an overall Project Lead, there was also
a greater need for unanimous consensus building on each aspect of the project, thus delaying
some critical decisions. Despite the team challenges, the group maintained a high interest in the
subject matter and a strong commitment to delivering a product to the client and a research paper
that reflected our achievement in this area.
Client Interaction. We decided that throughout our study we would maintain a high level
of dialogue with our client. This included bi-weekly meetings that were held on-site with the
client. The purpose of the meetings was to 1) collect data, 2) communicate our progress, 3)
summarize our findings and 4) engage the client in feedback and dialogue that would help to
further refine our study and create effective client relations. The onsite meetings were only an
hour long and both the client and the team agreed that the meetings would occur every other
Wednesday regardless of whether full attendance could be achieved on both sides. This decision
had consequences as key members of the team and the client were missing from meetings
involving critical discussions. Additionally, although most functional heads (e.g. Staffing,
Operations, Talent Management, Best Practices) were regular participants in the meetings, the
head of Human Resources was only able to attend two of the bi-weekly meetings, and therefore
was unable to take an active part in facilitating thought provoking dialogue on the issues of
succession planning in the meetings. Despite the drawback, the regularly meeting times helped
13
to create needed structure for a study with a very aggressive timeline. In addition to the biweekly meetings, the client received weekly project status reports via e-mail every Monday.
Email and phone communications between the client and team contacts also occurred as needed.
Topic of Succession Planning and XXXXXX Systems Implementation
The four stages. Our client initially outlined the topic in broad terms from the needs to
address succession as a more progressive alternative for replacement systems and for the
identification of promising managerial candidates. There were also needs to address the variety
of pressures from vertical needs, technology and economic changes, and portfolio diversification
which the company had undergone in recent years. The client also wanted to address the need to
move the company from an entrepreneurial management strategy to a professional management
strategy for long term growth. Finally, they wanted to address the desire to build a reputation for
XXXXXX Systems as a leadership platform flagship. As the study progressed, we narrowed the
topic to the issue which yielded the most significant, action orientated results for the successionplanning subject. We formed four stages through which the subject could be tackled to start
achieving the broader goals.
1) Foundation of identifying culture, communication and strategy.
2) Process of mapping, best practices and involvement.
3) System of modules, infrastructure, software and mentoring.
4) Program of implementation, measurement and results.
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An important issue was the discovery that successful programs are not “out-of-the-box,” but
continue to be refined, and grow with the business and the development of the leaders and
candidates who participate in the program.
Research steps and sources. The research was divided into three parts. The first part
consisted of an extensive literature search on topics of succession planning and leadership
development. This allowed the team members to learn the history and rationale for succession
planning, the terminology, trends, problems and solutions, as well as some of the environmental
factors that companies, executives, employees, and HR departments face. The second involved
interviews with members of the client team, academic experts, and Human Resources association
specialists. This allowed the team members to understand what issues existed in the client’s
world, and gain a general understanding of implementation across the field. We gained valuable
insight about the ties between culture, business strategy and how components of programs
worked for different company environments and needs. The first two parts of our study helped us
toward the formation of our hypotheses, and the development of foundation and process material
for the client. Third, we performed a survey in the form of a questionnaire by which we gathered
data on demographic, business profile and workplace elements so that we could test our
hypotheses. This helped us to develop a simple cultural and workplace profile of the client that
would aid identification of best practice implementation for their particular needs.
Goals. Our team goal was to perform a valid behavioral study of a business management
dilemma using authentic engagement practices and scientific methodology by consulting. We
sought to use the individual talents of our team members to accomplish a professionally oriented
survey and report on our topic. Our client’s goal was to have the study done by the time of their
annual “People Day” in December, and they specifically requested additional research on the
15
topic of best practices accompanied by process mapping of succession planning programs. This
was above and beyond the scope of the class assignment, but requested in order to facilitate their
understanding and their ability to communicate and substantiate study results for the top
management, who had originally given them the SP mandate. We attempted to answer this extra
request; we understood that our work could have a positive or a negative impact on the eventual
success of planning and implementation. Our study could serve as a good foundation for future
decision-making. Therefore we did a great deal of literature and association research and
interviewed experts in the field as well as XXXXXX employees to get a grasp of the motivationneed for our approach to the study of the topic. We also attended a major HR-Association
function on the topic of Succession Planning with our client, at their invitation, and through their
sponsorship.
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LITERATURE REVIEW
Development of the Literature Based Research
Sources and activities. We studied numerous papers and publications to find out what
succession planning is, and to assess the best practices of companies in an attempt to arrive at a
benchmark of sorts. We successfully subscribed to or gained permission to human resource
association archives (CLC; SHRM) and gained access to primary sources of research through
private academic and professional databases (Questia; Best Practices LLC) and pricey
membership-only leadership council publications (BUEDRT). We read books, and called on
friends, associates, and family, who worked in the Human Resources field or for companies that
used software solutions such as PeopleSoft, for input. We also perused several hundred articles
via the Internet and on-line archives of the University Library system. We collected many of
these studies in notebooks for our client’s future reference, and summarized others for inclusion
into their copy of our report. Although we thought about performing a metastudy, we discovered
that other scholars had already done this and decided to simply reference those works for our
client’s future use. We pulled out lists and examples of programs, motivations, and rationales
from all of this data. We contacted academic leaders in the field and corresponded with them to
request clarity on issues and direction to pertinent information.
The list of dozens of companies covered in these studies includes Saturn, Lucent, AT&T,
Shell, Bell Atlantic, Verizon, Clorox, GlaxoSmithKline, Eli Lilly, RBC Financial Group, GE,
Wellpoint, FedEx, Delta Air Lines, New York Life, Hewett Packard, and Capital One (CLC,
2002; BP LLC, 2003; BP LLC, 2002; CEI, 2003; Palus, Horth, Selvin, Pulley, 2003; Kiger,
2002; Zemke, 2002; Gale, 2001; Zelsman, 2000; O'Connell, 1996).
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The amount of recent literature on this topic was overwhelming with much of the
emphasis on creating a business case for succession planning, listing attributes of leaders, and
understanding the required steps in succession planning (Burns-Martin, 2002; HR Focus, 2003;
McMaster, 2002; Melymuka, 2002; Schafer, 2000; Woolf, 2001). A further narrowing down of
the research topic for hypotheses development would occur as a result of client interviews.
Key findings. One of the key challenges in our study of succession planning was the
variety of models, terms, definitions and opinions on the topic. The focus of our literature
review efforts was to capture a universal definition of succession planning and common
processes that appeared to be most critical to the development of a succession-planning model.
Additionally, we aimed to look beyond processes but to look at organizational and culture factors
that were critical to creating a supportive environment for successful implementation of a
succession planning program.
Our study began to take form as we came to understand that succession planning is not
just about replacement planning. While the term “succession planning” would suggest a focus
solely on “successors,” the real focus for organizations is on training and development activities
for emerging leaders. “The chief aim of replacement planning is to minimize injury from the
immediate and unplanned loss of the key job incumbents. Succession planning goes beyond this
because it focuses on proactive steps and attempts to ensure the continuity of leadership by
developing internal talent through planned development activities” (Rothwell, 2002). The
ultimate goal of succession planning is to “promote the best and the brightest across the
corporation…having the right person in the right place at the right time for the right job”
(Roberts, 2002). Succession planning emphasizes learning and development activities. A 2002
study of over 150 companies by Hackett revealed that the most significant by-product of
18
succession planning was the “best practice learning and development activities that produced
significant and measurable benefits” (Hackett, 2002). Many organizations have recently moved
away from the traditional term of succession planning to “talent management,” a term that is
more inclusive of the many activities that are necessary in identifying, developing and retaining
talent (Falmer, 2002). This broader understanding of succession planning allowed the team to
look beyond the issue of knowing who would replace someone, and to look at the supportive
factors needed to develop and retain talent throughout the organization.
Models. A succession planning model should reflect the organization’s goals and values.
Our reading revealed three common models. These models are often further refined to reflect
organizational differences.
The “traditional” model involves CEOs and other top executives identifying their own
replacements. It is typically a secret process to the degree that top management will not openly
talk about candidates selected. Manual systems and replacement table formats are used to chart
their selections. Human Resources departments may or may not be involved, and HR processes
such as performance appraisal systems and management development are not typically included.
Assessments from peers, customers or subordinates are also not part of the selection criteria. The
approach focuses on targeted positions and doesn’t emphasize personal career development or
team development (Orellano, 1997). The traditional model is often the beginning of most
succession planning programs; however, many organizations quickly recognize that such a
model does not meet long-term business objectives. As a result, many organizations curtail their
succession planning efforts (Bowes, 2003).
The “integrative approach” includes both succession planning and succession
development. It incorporates systematic processes and automated tracking systems to assure
19
objectivity and consistency. It is future-oriented and consistent with the strategic planning
process. It is also flexible and responsive to change and linked to other human resources
planning activities (Orellano, 1997).
The succession planning “pools” model is very similar to the integrative approach.
However, it stresses the identification of high potential candidate pools. High potentials are
defined as exceptional performers identified as having the ability to be promoted into
increasingly higher levels of leadership such as senior management. They possess the personal
and leadership characteristics required of leaders in the organization. These characteristics are
often lumped into a broader category called “competencies” (Wolfe, 1993).
Competencies
refer to the skills, experience and behaviors necessary to perform a job. Most organizations that
use competencies have “core” competencies that apply to all employees, i.e. honesty and
integrity, and specific competencies that apply to particular positions or position levels, i.e.
managers, supervisors (Green, 1999). Hi-potentials are usually selected by a task force of senior
managers, often with the assistance of Human Resources, who set aside a day or more to go
through a list of all employees above a certain level and to assess which individuals should be
identified as high potential. To facilitate decision-making, they will often agree on some criteria
by which to select the individuals, and may have the person’s most recent performance appraisal
as an additional resource. In some cases, candidates may be further narrowed down through an
assessment center process or through an interview/evaluation process. Once the pool has been
identified, those who make the list will generally receive some special attention. How much
attention candidates receive depends on the organization’s willingness to make a financial
commitment to the program. Often the HR department puts together a “fast track” program
through which they assist the person to develop an individual development plan (IDP). They
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may provide some group training and they may institute a mentoring program, and identify
certain training programs these people should attend. Senior managers may select candidates for
assignment to special projects or task forces in order to aid decision-making development and
understanding of broader needs of the business. This approach recognizes the value of providing
a broad background for the high potential employees, rather than a single functional stream of
experience. However, the process is only effective if the committee or task force is diverse and
open to organizational diversity (EOWA, 2003). Most companies identified as “best practice”
organizations for succession planning utilize this approach (Best Practices LLC, 2003).
Direction of findings. The team began to focus its efforts on determining how a
succession planning pool approach could be successfully implemented for XXXXXX Systems.
This required a further review of case studies and articles that addressed the specific processes
and characteristics of companies that utilized this approach. We identified several “success”
factors that were instrumental in the development of a succession planning program. These
success factors are:
1. Organizations have senior leaders that believe development is a major leadership
activity and senior leaders model this activity.
2. More organizational resources are dedicated to training and development.
3. Organizations possess a culture that has a higher tolerance for risk allowing emerging
leaders to develop without severe penalties.
4. Organizational cultures stress individual ownership for development.
5. Organizations tie succession planning to other strategies that are designed to increase
organizational commitment such as diversity, employer of choice, and corporate
citizenship.
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6. Core values and common leadership criteria shared and understood by employees.
7. Strong commitment to promoting from within.
9. Aggressive management of poor performance and behaviors that conflict with
company values.
10. Meritocracy. Compensation and other rewards are based on results and leadership
behavior including self-development.
11. Best Practice organizations perceive Human Resources as a strategic business partner.
12. Leverage of technology for better metrics and integration with other HR systems and
programs.
At last, we started to see some organizational behavior elements that could make or break
the initiative of succession planning. Our next aim was to gain a better understanding of the
culture and organizational dynamics at play within XXXXXX Systems. This would be done
through the informational interviews.
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RESEARCH WITH THE CLIENT
Group Meetings and Client Communications
We were able to have ongoing contact with various client team members via emails,
before and after scheduled meetings, and at the HR seminar that both groups attended together.
These informal discussions helped us understand the needs and direction of the client outside of
the agenda driven meetings. During meetings we were able to go into depth on agenda items to
achieve better development of ideas and to freely engage in questions and answers. We were
glad to see that although client team members had tight schedules, they often would alter
schedules to attend meetings. We appreciated the openness of communication and the motivation
of the client team members to their mission and concern for development of the company’s
future through its people. We discovered that the client team members were talented and
committed to achieving not just “good,” but “best” results, and that they had done “best” rated
work in separate projects related to the SP initiative. We usually only had to broach a topic once
in order for its substance to be picked up and grasped, and observed that information was
integrated very quickly, which made progress during the study more attainable.
Interviews
People and questions. The team conducted face-to-face or telephonic interviews with 12
key members of Human Resources organization. This included the VP, of Human Resources and
the functional heads of Training and Organizational Development, Performance Management,
Staffing, Employee Relations, Compensation and Benefits, Operations as well as the HR
Business partners for XXXXXX Systems horizontal and vertical business units. An interview
was also held with "Executive Business Sponsor," Jim Johnson, SVP, Global Information
Systems. Interviews lasted from 45 minutes to 90 minutes and included three questions that
23
were asked of all interview participants. The other questions were specific to the interviewee’s
functional area. The three standard interview questions were: 1) What processes and criteria do
you currently use to identify successors? 2) What jobs are considered to be most critical for the
identification of successors and why? 3) What do you see as the biggest challenge to
implementation of a succession planning program at XXXXXX Systems? The findings from
these questions and others provided considerable insight into the client and the XXXXXX
Systems culture, and the group began to gain a true understanding of the business problem at
hand.
Key findings. The interviews provided additional insight into the client’s grasp of the SP
business problem. Initially, we were told that the company did not have very much in the way of
any succession planning practices. A candidate pool list had been compiled over the past year,
but the Human Resources team acknowledged that the list carried very little credibility. The
process for identifying successors was strictly left up to the current incumbent who often selected
replacements that “they got along well with.” Only one of the successors identified in the pool
of 75 actually went on to fill a higher leadership position, although several positions became
available during the year. John Thompson, SVP of Global Information Systems and Executive
Sponsor explained that often times there is a gap concerning who the incumbent believes should
be his/her replacement and who the incumbent’s manager believes the replacement should be.
Other times, a potential’s movement into an open position could create a weakness, as the
potential’s former position had no “replacement,” so the movement did not happen.
One area that the Human Resources team struggled with was identifying a common set of
characteristics that could be utilized for the identification of high potential. They pointed out
that it took almost 6 months to get the executive team to commit to a common set of core values,
24
i.e. Initiative, Adaptability, etc. that could be communicated to associates throughout the
organization. Part of the struggle appeared to be the ability to effectively communicate the
importance of such efforts and gain management buy-in. The head of Human Resources’ lack of
experience in the field of organizational design or development may have some bearing. He
acknowledges that he is the only participant in discussions of succession planning and talent
development with executive members. However, members within his team, who are the subject
matter experts, expressed the desire to be included in such discussions.
Despite these challenges, some HR business partners have developed useful succession
planning models for their respective clients or business groups. The manager of organizational
training and talent management also recently developed a model for a corporate succession
planning program. It appeared to us that there was very little shared knowledge of what various
HR business partners were doing in this area. Instead such initiatives were treated as fairly
“clandestine” as though attention to the endeavors was unwanted. When pressed for details, we
received disclaimers first that activities were widely variant and un-standardized, but later found
these initiatives to be pockets of highly integrated formats. Interestingly enough, a review of the
models found them to include many “best practice” components. In fact, combining aspects from
each would likely create a succession planning model that is equally as impressive as those the
team had reviewed through the best practices literature. Our report to the client team that they
were actually “ahead” of the game, and doing very well in their efforts was met with surprise.
We realized that through our discussion, the consultant’s role of objective support was an
important component to the client team opening up and taking ownership of the work that was
happening across the organization.
25
This finding further underscored the need to look at why a formal succession plan had not
been established. The Human Resources team provided excuses related to concerns about
auditing, retention and recruiting, about measurement systems, automation, competitor practices,
management flexibility needs, etc. There appeared to be a tremendous need to deliver a
“perfect” process that would not be subjected to upper management scrutiny or criticism. In fact,
the issues raised by the HR team are those that every organization faces but this is where the best
practice companies press on and succeed. They understand that continual development of the
program is inherent for SP. What is the defining difference?
26
SURVEY METHODOLOGY
Hypotheses
Developing the research hypothesis. We had to look at the cultural landscape and assess
how the management and potential candidates interacted with jobs, and assess who was
perceived as really guiding the leadership program. We had to assess how the behaviors of
leadership were demonstrated: assertiveness, risk-taking, and aspiration, and if there were gaps
between what was desired and the existing cultural performance. We also had to assess what
attitudes and attributes might be associated with employee perception and buy-in to a selection
program that might have relocation or job rotation involved. We needed to see if managers and
employees trusted the company to design career tracks and to offer training, if employees took
training, and if they would risk committing their future to the company instead of moving on.
How might these things relate to a particular strategic related track of leadership/operations and
leadership/administration tied between individual and company achievement? Was there an
artifact below the surface that threatened to derail progressive changes? If we could quantify
these intangible attributes, we might be able to shed some light on what types of interactive
climate would help the HR department consult with leadership about leadership’s role and
sensitivities through the ranks. A program that addressed our findings could be designed to
XXXXXX Systems’ specific company culture, and problematic gaps could be addressed for
improvement. In a nutshell, we were designing a small-scale example of discovery that could
enable the selection of a best implementation method for development by the leadership—itself a
Hi-Po type of selection program.
To reflect the desired XXXXXX Systems attribute of initiative, we wanted to measure
assertiveness—the willingness to be self motivated and self actualizing, and that relationship to
27
success, as measured by career movement. We wanted to measure employee’s adaptability and
willingness to take risk such as moving or taking short term job assignments as might be
requested by the company for an IDP, in the belief that the company had a long term plan for
their careers. We wanted to test for the aspiration employees had for career development and for
initiative toward training and development, and of their perception of job involvement and/or
work involvement as it related to the job and to the organization. We surmised from our research
that commitment and perception of corporate citizenship was related. We also wanted to see if
there were links between age demographics and the various concepts we were investigating.
Therefore we developed the following hypotheses:
Hypothesis1. Assertive employees are successful in the company.
Hypothesis 2. Employees are more likely to take risk when they trust in the
company.
Hypothesis 3. Employee aspiration is related to commitment.
We also added several scales that were suggested by HR specialists to assess
organizational culture and perceptions. This information would be useful for the design of the
XXXXXX Systems program, and help the client team and leadership understand gaps and
strengths in communication, career path implementation, and employee interests across the
company’s various industry involvements.
Survey for the Scientific Stage of the Study
The last phase of our research involved a questionnaire. Our team spent a lot of time in
discussion about the development of concept variables, what measurement variables we could
use for testing, and on constructs. We spent hours drawing on the white board, discussing
behavioral characteristics and the cultural framework we were experiencing at XXXXXX
28
Systems. We had difficulty finding scales that were tailored to our research, and realized that we
were on “new” ground in our examination of the behavioral relationships between SP and its
successful design, implementation—and eventual usefulness. After all, the ultimate goal is to
increase company performance, competitive advantage, and sustainability. It would be a waste of
resources if it were just another resented “HR system” that collected evaluations and alienated
line managers and employees. We needed to assess the XXXXXX Systems situation: who is in
charge of SP, and why isn’t it already being done?
The questionnaire was designed to test for cultural and organizational factors that could
serve to support or deter successful implementation of a succession planning program. The
factors identified were based on common characteristics of companies identified as developing a
“best practice” succession program. These factors were compared against the feedback from the
client interviews and the data found in books and articles related to succession planning. The
questionnaire included a set of fixed format and self report items that respondents could
complete on-line and at their own pace.
A random sample of 200 participants was identified throughout the corporation. Based
on instructions provided by the team, the client conducted the sampling. A communication was
sent out from Dan Amber, VP of Human Resources, to participants informing them that they had
been identified to participate in a questionnaire concerning career development and succession
planning. The communication expressed anonymity and indicated an academic research team
would analyze the data. The communication also included an electronic link to infopoll.com that
respondents could select to complete the on-line survey. Participants were given 48 hours to
respond to the survey (Appendix E).
29
The team purchased the use of the survey site for the purposes of this study, and
considered the $20.00 share for each member as a part of the student materials fee for the course.
Use of an independent site was deemed useful to assure privacy and error-free data collection. It
also allowed digital tabulation, graphical views of the data, and tech support. This allowed
freedom from manual tabulation, missing or erroneous data entry by the researchers, and a digital
record that could be downloaded for documentation purposes.
Developing the Survey
A master list and answer key of survey scales was assembled by one of the team
members. Three other team members and one member of the client team narrowed the material
down to an 87-question instrument. A pilot was performed to test the workability of the site, and
to check the appropriateness and technical presentation of the questions. Qualitative and
quantitative questions used likert, yes/no, drop-down menus and comment box fields for
answers. Some questions were in scales to be tested as sets; some questions were single
measures. Comment boxes allowed interview style input to expand on descriptive information.
The survey is divided into six parts. Each part measures various sets of variables linked to
the initial hypothesis and to organizational description.
Part A (Information about your Workplace) concerns business profile, Assertiveness,
Aspiration and Success.
Part B (Information about type of Organization Preferences) deals with Employee
Satisfaction and High-involvement work practices (HIWP).
Part C (Information about Corporate Citizenship and Business Benefits) deals with
corporate citizenship and Commitment, Risk and Trust.
30
Part D (Information about Getting the Work Done Preferences) deals with Employee
perception of leadership.
Part E (Information Ranking Management Programs) tests Succession planning and
management program against best practices.
Part F (Information about You) concerns demographics.
Concepts and Measurements
Assertiveness-initiative and success. Measured by input, progressive number of
assignments, positions, speak-up, self actualization, self control, self-motivate, role time,
progressive number of assignments, positions, projects, roles. lateral or vertical moves, time.
Risk-adaptability and trust. Measured by willingness to make changes, perception of
potential, support, willingness to work in non-direct queue, willingness to relocate, rotate, accept
special assigns, believe company has career track, believe company has employee best interest.
Aspiration-job involvement and commitment. Measured by training/development, career
goals, workplace, personal, and environmental measures, number of roles, eventual position,
perception that company has career paths in industry and for individual, HIWP.
Age relationships. Risk, aspiration, assertiveness.
Sample Selection
The population is the employee base of XXXXXX Systems. The company runs surveys
on a random selection sample of 1/12th of its population every month. Through a similar random
selection process, a sample of 200 employees at Account Leader level and above (1/7th of the
population), was sent the link to the online survey.
Data Collection
31
At the initial cutoff time of 48 hours, 69 people had responded. At the 5-day mark, 94
people had responded. This represents a 35 percent and 47 percent response rate, both of which
are considered high. We believe that the introductory letter by the VPHR and the regular survey
practices of the firm contributed to this high rate.
Data Analysis
As some of the data was descriptive and all of it was viewable via graphical and
percentage form; we were able to make visual confirmation of trends. We were able to see that
some questions, such as awareness of available training had nearly 100 percent similar responses
for a single answer or a shared trend of answer. This allowed refinement and cleaning of the
data, and better selection of specific sets of questions for our statistical analysis. Because we
were dealing with some untested questions, we also had to review how the testing results might
affect our interpretations and we refined the analysis to a smaller number of results. This had
been expected, and was one motivation for a variety of question types and sets. We had hoped to
find at least one strong set of data which could be tested for correlation. One member of the team
put together a Variables Key Document (Appendix B) and another member ran the data sets on
NCSS software and Excel to find Pearson Correlation Coefficient “r” values and other statistical
information (Appendix C). We had some help from a UTA statistics instructor, but due to time
constraints, did not run as many tests as we would have liked. However, we found some
interesting results, which corroborate the findings from the interviews, research and general
descriptive data.
32
FINDINGS
Explanation of Data
As Dr. Whiteside stated to the statistics sub-team, the data from this survey could yield
volumes of study; although there are many factors, which could be analyzed, and relationships
discussed, we will cover just a few here. Also, as we began analysis with 69 responses, reran
testing at the 71 mark, and ended up with 94 for the week, we will round descriptive percentages
to show trends only. Statistical correlations are noted and discussed separately. We refer readers
to the response document and excel spreadsheet, both under separate cover, for further analysis.
Correlations should be in the .40-.60 range to measure high, and show a good relation between
variables. A negative correlation, -.25 for example, would mean that in the presence of one
variable, the other variable has an opposite tendency, for example, the higher an attribute is, an
other would be opposite—lower.
Analysis. 60 percent of the employees surveyed have referred other people for
employment within past 12 months and 90 percent of respondents believe that they were able to
provide input for strategic decisions. These figures show that employees perceive that they are
able to speak up and that the company values their input. Assertiveness correlation is .24
although, which is not high.
Success Factor. 61 percent of the employees have been working in same role for the
duration of their employment with the firm. 40 percent of employees have been with XXXXXX
systems for a period of 1-5 years.
62 percent of them held 2-5 roles within this time span. 34 percent were assigned 2-5 projects.
This shows a trend against success as measured by a progressive number of positions or
assignments in relation to the tenure at the company. A correlation of .35 for success as
33
measured by role and tenure data is not high, but due to the short tenure of 2-5 years, and in light
of possible acquisition, could be indeterminate (SET 1 Appendix C). Specific correlation for
number of roles and tenure was .28, and number of progressive assignments and tenure was .18,
both of which are weak for assertiveness to success relationships. Assertiveness showed a
correlation of .24 for career change and choice, also not high, but possibly affected by factors
such as the economy and reputable employment with a high-level firm (J/8, I/7 Appendix C).
About 54 percent of employees agree that they are satisfied with their jobs and 27 percent
of the employees are satisfied with the organization at present time. The correlation between job
and satisfaction measures is .26, which is not high, and confirms the need for the organization to
pursue development (AF/25-1, AI/25-4 Appendix B, C). As it is positive, it shows that job
satisfaction is related to organization satisfaction. A negative correlation would have shown one
of the satisfaction measures matched to a strong dissatisfaction measure. Due to the low .26, with
higher results for job than organization satisfaction, we might interpret frustration into the
analysis, especially in light of the scale’s source comments:
Employee satisfaction was measured by averaging into a single scale employee
response to two questions from the 1997 survey (Veterans Health Administration
(VHA) 1997 internal performance data from all 146 of its US healthcare
facilities.): responses to the two items were significantly correlated at the facility
level (r = .81), and together produced a highly reliable scale (Cronbach’s alpha r =
.86) (Harmon, et al, 2002)
Questions (AG-AQ/25-18 to24 Appendix B)
. . . were more reliably used together than independently (Cronbach’s alpha r =
.96 at the facility level, compared to an average pair-wise correlation of .73).
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Descriptive Statistics and Correlation Coefficients for Study Variables
Variable
Mean S.D.
Satisfaction Scale
3.24
0.15
High-Involvement Work Practices
2.87
0.14
Satisfaction.
.78*
Notes: * Denotes that the correlation is statistically significant at p < .05
For simplicity here, the ten items comprising the HIWP construct were averaged
into single scale score (Harmon et al, 2002).
This correlation could show commitment, and should be run by a future study. The team was not
able to assess this question, nor the scale for corporate citizenship due to time constraints
(Maignan, Ferrell, Hult, 1999).
The correlation between training taken and belief that the company had a career track for
the industry and for the individual was very low: .06 (SET 2 Appendix C). Interpretation in light
of interview and survey comments would suggest that employees take training only for
immediate job need, and not for job development. With about 60 percent of the respondents
reporting that they take training, aspiration seems high. However, in light of the nearly 100
percent awareness that training is available, a 40 percent rate of no training taken, coupled with
the 91 percent of respondents who have some college to masters degree may mean that a
population who understands the importance of development sees no tie to improvement at their
current company. Risk, as measured by relocation willingness and trust, as measured by belief in
a role path at the firm was very weak: .01. The relationship of age to relocation was higher, at
.02, but this is still very low.
According to the guidelines provided by Dr. Rothwell on the perception of the level of
management programs, the score is 28.9: needing improvement, but some components in place.
35
The Rothwell scale for getting work done preferences results was not analyzed (27 Appendix B).
Data on level of management programs listed at 26.9 out of 50.
SCORES
50-40 Congratulations. The succession planning and management program in your
organization conforms with best practices.
39-30 Pretty good. Your organization is on the way toward establishing a first rate
succession planning and management program.
29-20 Okay. While your organization could make improvements, you appear to have
some of the major pieces in place for a succession planning and management program.
19-10 Not good at all. Your organization is probably filling positions on an as-needed
basis.
9-0 Give yourself a failing grade. You need to take steps immediately to improve the
succession planning and management practices of your organization (Rothwell, 2002).
Demographics
The sample group of employees at XXXXXX are mostly male (81percent), with almost
2/3 having at least some college, 31 percent having a master’s degree. Almost 70 percent are in
their mid thirties to late forties. Business profiles shows respondents from all levels and
functions of the business, including the COO, and from vertical and administrative teams across
industry units that represent global diversity of location, teams, and account sizes.
Acceptance or Failure to Accept Hypothesis
There is a disconnect between what the employees perceive and provable job satisfaction.
The satisfaction result failed to show significant employee satisfaction, though comments show
willingness for improvement. The output shows the employees (that are left after downsizing)
36
both aspire to training and development and to career pathing. However, they do not currently
expect to find career pathing or commitment at XXXXXX Systems, and in light of high levels of
aspiration, may go elsewhere to continue their development and job involvement (exactly what
has borne out from our interview data, also see respondent comments.) Also, it appears that
success is not found in a strong relationship with assertiveness and the results do not support a
correlation between job involvement/aspiration and commitment at the company. We did not
have sufficient correlation between risk and trust. Therefore, we fail to accept:
Hypothesis1. Assertive employees are successful in the company.
Hypothesis 2. Employees are more likely to take risk when they trust in the
company.
Hypothesis 3. Employee aspiration is related to commitment.
Other Analysis of Some Data Elements and Comments
Rotation/relocation. Employees generally want rotations but not relocation. If relocation
is part of HR strategy, then the incentive for relocation is probably not high enough, and the
benefits of relocating need better communication. Although employees may believe their career
development should include job rotations (86 percent), they don’t see it as likely (only 70
percent expect to make 1-2 lateral moves in the next 5 years).
Unless living in Dallas on a long term contract associates are commodities that are
useful only as long as their current engagement - particularly due to off-shore work, lack
of relocation assistance, lack of tolerance for bench time, availability of cheap local staff
at new employment locations.
Some of the answers I provided are due to the location I'm employed in (Switzerland). I
generally feel that XXXXXX Systems promotes diversity, but does not really understand
it. This leads to non-American associates not feeling close to the company. XXXXXX
Systems is an exciting company to work for, but I'm convinced that XXXXXX Systems
would be more successful would they have stronger corporate presence in regions
outside the US.
37
Career aspirations. We learned from the HR department the each employee has an IDP
entered in the Performance Link tool. But the survey reveals otherwise. An IDP is extremely
important both as a retention tool and as a system for implementing SP. All employees must
have an IDP although only some of them will be a part of SP. The IDP discussion must, in
general, allow employees to aspire, believe they can reach their goals at PSC, while also
remaining realistic.
Note that although 70 percent said PSC did not have a development plan for them, close
to 68 percent believe they can develop to the position they aspired to, within PSC. This is a clear
indication of initiative and other related characteristics.
Although we have been exposed to the fact that there is a continuous need for people in
certain positions like an Account Manager, the survey reveals that there are other positions that
people aspire for but do not believe they will reach in XXXXXX because there are “too many
people in the queue.”
Typical comments include:
no room
Too few roles and incumbents who are not likely to move out of those roles any time
soon.
No room for any other position due to location size
too many people in the queue already
Limited number of roles
I believe the role is filled for many years to come.
XXXXXX Systems is a great 'training ground' for up-and-coming leaders, but once you
reach the Director level, there is very little room to grow.
Other issues that came up repeatedly as a reason for not believing they can reach their position
goals (note comments are included from all parts of the survey):
Hiring from outside
It appears to me that there is a huge leap from most roles in the company to an Account
Manager role. It is easy to find external fills because the unknown is more exotic. As a
38
result, an internal associate can't hold a candle to an external resume which is easily
fudged. Our internal associates often wallow in dead end positions. Frequently changing
positions can be viewed as risky due to recent and numerous job reductions.
Lack of a career plan
There are a few clear career paths established in some areas, but we seem to still depend
on the associate to pretty much manage their own career. True leaders in a company
need to recognize strengths and/or weaknesses in associates, and challenge people with
projects and opportunities that enable them to grow, to work outside of their comfort
zone.
There is NO focus on career development or succession planning, as this account is
struggling to transition all of the work as it stands today.
Lack of IDP plans, lack of comments throughout the year in performance link, occurring
at the highest levels.
We as a company overall don't have a detailed strategy / business plan that
communicates crisply, concisely our offering set. Nor do we have a process that
communicates to the associates the upcoming skills necessary to help grow our company.
Discrimination
Women are not promoted
My impression is that I do not have the proper last name
Performance is not recognized or rewarded
We as a company are not rewarding our associates quickly for great things they do. Even
a timely, token reward would be appreciated. But it seems we have forgotten that.
Our main problem is not making senior leaders fully accountable for results. Time and
time again, results are missed and senior leaders get huge rewards akin to a "good old
boys club".
We still seem to want recycle some leaders in the company instead of promoting those
that show strong signs of leadership, good people skills and that may new, fresh creative
solutions and deliver on opportunities to grow the business. There are good people within
the company that don't necessarily gauge or look to gain attention from the number of
courses they have taken or that's written-up/tracked on an IDP.
Not a meritocracy
Have to be within a chosen few
39
Our company does a very poor job at rewarding their highest performers. We tend to be
socialistic in our approach to compensation. We don't differentiate!!!
GREAT PERFORMERS at their salary max should be given bigger bonus's [sic] 15-25
percent. That how Wall Street firms keep talent. We don't have a clue!
Training and development. Training should be a part of every employee’s IDP and each
employee should receive training according to the needs of the current role as well as their
development needs. As noted in the following comments on why employees feel they cannot
reach the position they desire, T&D is an important for employee growth and the retention
interests of the company:
Lack of investment in people
Limited training dollars
I do not think XXXXXX Systems would support the type of development courses required
to move into this next level of leadership.
Training budgets have been slashed. Internal training is available and is very high
quality but is limited. Budgets to attend trade show to do valuable learning and
networking have also been slashed.
While we may have a good focus o n technical training, I feel we may lag behind in
personal/professional development.
The fact we don’t bake in dedicated people management as part of costs of certain
services. We don’t absorb costs to put an extra person on an account to learn and be
mentored because it would be an additional cost/investment. All these add up to low
commitment for people management development. Role playing and formal classes’ isn’t
the same as learning live under an experienced leader/mentor.
Leadership and Direction
We are no longer being led, we are only managed. Also, we have no real strategy that the
associates of this company can rally behind.
The company still does not have a clear direction and most of all is reluctant to
undertake DRAMATIC change, which in order to survive will be required in the next 2-4
years.
40
I do not think XXXXXX Systems has the vision or Sr Leadership necessary to change the
direction of their business strategy. And, unless that change occurs, we never see the type
of real growth needed to support continued leadership development. XXXXXX Systems is
a great 'training ground' for up-and-coming leaders, but once you reach the Director
level, there is very little room to grow.
We as a company overall don't have a detailed strategy / business plan that
communicates crisply, concisely our offering set. Nor do we have a process that
communicates to the associates the upcoming skills necessary to help grow our company.
The economy
Not until business becomes more stable
“No, at least not in the Industrial Segment. Sales aren't strong enough for me to point a
person to this area.
Because it's down sizing
Yes, only if we were hiring and/or signed new business. Otherwise, I do not even discuss
it.
Risk, uncertainty and the significant RIF's that have taken place over the last 24 months;
Lack of corporate investment, minimalistic European operations outside UBS;
Geographic withdrawal related to lack of investment; no alignment between corporate
structure
This organization is unique as we are located in Lake Mary FL and currently downsizing.
There are NO other jobs in the area; therefore we are releasing associates on a monthly
basis.
Downsizing and its effects on morale and business
It feels like the pride in (and dedication to) the company is slipping away. Most
associates are very oppressed by the workloads and expectations given them. We have
given too much focus to reducing expense. I don't know how we can avoid that being
public, but the associates are bearing this company on their shoulders and unless they
see a light at the end of the tunnel, we'll lose the best of them as the economy rebounds
and other companies that are in better shape, with better models, begin to grow.
I am proud to work for XXXXXX Systems however three of my best friends were
downsized. In addition, a former boss who is now a VP at a Fortune 500 company was
unceremoniously let go and now bad mouths XXXXXX Systems at every opportunity. We
will never get work at his company. This is life but I think we need to remember the full
impact of downsizing and use it only as a last resort.
41
Other Constructs and Factors Covered in the Study
Due to the newness of the study subject: behavioral aspects that contribute to
implementation in an organizational setting, future work on constructs is recommended.
Many questions give a descriptive view and allow a cursory insight into issues that may
need to be considered and expanded on for strategic, operational, pathing, and management
efforts.
Due to the newness of the study subject: behavioral aspects that contribute to
implementation in an organizational setting, future research is recommended, with stress on
demographic and business profile data that is pertinent to the specific business environment. As
much research has been done with non-technical, low-skilled, student, non-information systems
types of populations, some previous studies may not adequately reflect intended business
environments, employee, or management/leadership parameters.
Gender: due to large number (almost 80 percent) of male respondents, and belief of
researchers that females in the tech industry have a tendency to align in general with assertive
behaviors inherent in technical fields, this study did not pursue correlations based on gender.
Future refinement and specific questions are recommended for gender relationships, especially
for recruitment and pathing purposes.
Education: due to large number of respondents with some college or a degree, this study
did not pursue correlations based on education. Future study might include types of major/minor
pursued related to constructs and influence of non-academic certifications and
professional/association credentials.
Comment sections: taxonomy and social network studies are recommended for future
research to assess values, communication and organization structure components, also for
42
assessing strategic inherency in business process implementation. Coding of comment sections
was not done, due to time constraints.
Question Descriptions
1-2) Future study recommended for differences between vertical responses, and specific
industry/team perceptions. Differing client environments and operations may need to be assessed
for communication and mission enhancement, as well as pathing design.
3-22) Role and tenure have scales available in academic studies. Role parameters,
project, assignments, and “grades” may have differing meanings across so many vertical and
industry types. Time factors for job engagement, and changes in work style (i.e. tendency to
move to extreme programming and away from waterfall development cycles) may have
influences in future innovation and work flexibility. Career move normality should be assessed
for trends and relation. Training and development and pathing issues may relate to workplace
communication, economic pressures and general tendencies for shorter term learning cycles due
to rapid technology changes, increased pressure for innovation, and flexibility, also reflect open
and flatter communication and organizational designs.
23-29) Constructs of “corporate citizenship” has been found to have vital relationships to
performance, market position, employee satisfaction, change management, strategies of
“employer of choice”, worker empowerment, community support, legal adherence, stakeholder
confidence, innovation, and other internal and external factors. Future study is recommended in
this area in order to further define best practices, behavioral, and strategic alignment.
33) Taxonomy, intrinsic and extrinsic motivations, symbol/story-telling, knowledge
movement (implicit, explicit, tacit), and social network, etc, coding is recommended for
comment section items to assess issues for future research.
43
Limitations and Lessons Learned from this Research Study
We had trouble getting a grasp on the changing information inputs from the company
related to the elements, personnel, and needs they had or perceived they had. The desires of the
client to have a model and process maps ready for their December event overshadowed our
initial survey-based study. Attention was continually placed on the “deliverables” of a plan for
implementation, rather than a study of the company and the behavioral variables involved in
their problem. Although the company had sufficient program design work done, we were
expected to compile and organize this work for them, and our survey work became a secondary
and last minute exercise by both teams. We also had trouble morphing our understanding from
lists of activities and steps as found in publications, to the behavioral side of why and how such
programs are or are not implemented even in “willing” companies—and why there is such a high
failure rate of programs of this kind.
We had substantial trouble working with the testing part of our study due to the inherent
conceptual nature of behavioral research that contrasted with the systematized subject matter and
directions of the program topic and array of popular “easy fit” solutions. The attention of both
teams was on the system itself, not on the organizational behavior of the employees, managers
and leaders. The students were pulled into a “pair of hands” position by the design and process
mapping activities. This may be in part due to the lack of pure management/leadership
experience/autonomy on the part of the team members, of the socio-cultural desire to please the
client and to “do a good job,” and the difficult nature of focusing on intrinsic and extrinsic
factors and reporting on them.
44
CONCLUSIONS
Linking Survey Results to Other Research Findings
In the course of performing our study, we found that we had stumbled on a new area of
behavioral research for which there were few sources and studies: that of the discovery and
matching of strategic-cultural business profiles for successful SP Process implementations. We
discovered that although succession planning and activities are becoming broadly pursued, there
is a high rate of failure or attrition in compliance. We believe that this is due to the lack of
attention to the foundational step of culture, communication and tie to business strategy.
Summary of Study
The study was able to identify components for best practice succession planning
programs, and cultural characteristics for organizational matching which could help lead to
successful implementation. The team also designed form types and outlined a connection of
current modules, which could be used in a pilot program, and assembled data and resources for
future use by the XXXXXX Systems HRD and Corporate Executives.
Recommendations:
1.
Create clear business case and build on executive buy-in.
2.
Link succession planning outcomes to business objectives in order to ensure the right
people, in the right place, at the right time.
3.
Succession Planning should complement and leverage HR strategies and programs
like recruitment, training & development, and performance management.
4.
Identify key roles and responsibilities of Board, CEO, Senior Management, Line
Managers, Employees, Succession Planning Executive Sponsor and Talent Review
Committee.
45
5.
Identify key critical positions and develop profiles that describe the skills, experience
and competencies needed.
6.
Identify individuals with potential to go into these roles. Factors to consider include
career aspiration, performance results and leader attributes which will be used with
other assessments such as panel interviews, 360 multi-rater assessments to assess
potential.
7.
Document gaps and planned development via Individual Development Plan.
Comments from the Client
We gave the final presentation to the client at their corporate headquarters on December
8, 2003. In attendance were: Dan Amber, Vice-President of Human Resources; Jim Pary,
Manager of Best Practices and Operations; Charles Arroll, Manager of Staffing and Employee
Relations; Buzz Mile, Manager of Talent Management; Don Randle, Senior HR Business
Partner; Dan Cism, HR Business Partner; Kurt Blaste, HR Business Partner; and Danea Tallson,
Training and Development. We discussed information concerning the study, our findings and
recommendations. We also submitted and demonstrated software tools by which necessary data
could be captured and processes successfully implemented. This includes input forms developed
via an Access data base. The input forms were developed based on process items we discovered
from the informational interviews as well as components we discovered in our best practice
research. We utilized the cultural needs we discovered to design a preliminary system that
would facilitate executive buy-in and communication across the company. The delivery of
information research, best practices documentation, succession planning model and
organizational profile as discovered by the scientific analysis was successfully met within the
agreed upon time frame of People Day, December 12.
46
Additionally, we were able to evaluate for the client that we saw the potential for success.
The key points of success include:
The company already had pockets of succession planning initiatives in line with
best practice research.
They were ahead of other companies in initiating this type of program because
they now had an understanding through this study of the cultural and
organizational components important to success. Lack of understanding in this
area is a frequent reason for why many succession planning efforts fail.
They have executive support to appropriately dedicate time and resources to the
effort.
Due to our study, the client recognized the importance of aligning the succession
planning process to the company’s strategy.
We received very high levels of comments. One attendee said “You know you have
succeeded in the presentation when the client is discussing and refining the forms in the
meeting.” We were pleased that the Vice-President of HR adapted the material into action items
during the meeting. Additionally, we received numerous positive feedback from the client to
include:
“You successfully captured organizational needs and cultural components.”
“You achieved a simple, workable solution that exceeded our expectations in terms of
quality and thoroughness.”
Several comments expressed accommodation for the level of work for the team and a
request for contact information to send positive evaluation to Dr. Mack.
Several members requested that we consider future employment with the company.
47
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HR Report Issue 272, April 2002. HR Report.
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2003
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Melymuka, Kathleen. October 28, 2002. Bench Strength. Computerworld. Vol. 36 Issue 44.
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Rothwell, William J. May/June 2002. Putting Success into Your Succession Planning.
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Review.
Stein, Nicholas. May 2000. Winning the War to Keep Top Talent. Fortune.
Stein, Nicholas. May 29, 2000. Keep Talent. Fortune.
The Lost Art of Succession Planning, www.rhrinternational.com, RHR International Company,
1999
Welch, J. 2003. Jack: Straight from the Gut. Warner Books.
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Woolf, Barry. September/October 2001. In Quest of Leaders Searching Beyond the Board Room.
Rural Telecommunications. Vol. 20 Issue 5.
Wolfe, Rebecca. 1996. Systematic Succession Planning: Building Leadership from Within. Crip
Publications.
Michelle Zelsman. May 7, 2001. Succession planning preps IT staff. InfoWorld.
http://www.itworld.com/Career/4048/IWD010507casuccession/
51
APPENDIX
Appendix A. Proposal for XXXXXX Systems
Appendix B. Variables Key Document
Appendix C. R–Square Values of the Variables
Appendix D. XXXXXX Systems Financial Analysis
Appendix E. Survey Questionnaire
52
Appendix A. Proposal for XXXXXX Systems
Project Proposal for a Succession Planning Program for XXXXXX Systems
Fall 2003
Orgconsulting5334 Group
UTA MBA Candidates
John Doe
Jane Doe
Sam Smith
Tina Smith
Bill Jones
Dr. David A. Mack
Tina Smith
Contacts
davemack@uta.edu
orgconsulting@yahoogroups.com
Table of Contents
Executive Summary
Where the Company is
What the Study Seeks to Achieve
Our Consulting Team
Activity Summary and Tentative Schedule
817 272 3085
972 455 7900
Page 2
Page 2
Page 3
Page 4
Page 5
54
Executive Summary
Succession planning is noted by business experts as an important part of a successful company's strategic
plan, incorporating the vision of where the company will be going in the future, while strengthening the
company in the present through its most valuable resource—its employees. XXXXXX Systems has wisely
been active in developing and nurturing its human capital with training and development programs based
on leadership building. The company wants to assure a continuing sequence of qualified people to move
into tactical and strategic positions within the organization—by identifying promising people, and by
developing career paths. Currently, systems in place use standard subjective methods for ranking and
replacement, but top management and the HR department desire a more objective system that reflects best
practices and reflects XXXXXX Systems’ unique competencies, varied business unit needs, and overall
high industry reputation.
Together with XXXXXX Systems managers and employees, Orgconsuting5334 will gather internal and
external data toward developing a user-friendly model for XXXXXXsystem’s succession planning process.
We will research the company, investigate best practices and identify how our client could benefit from
them.
ComponentsFindingsProgram
|
|
|
attributes, goals, values, profiles
macro and micro environment
templates, tools, methods
interviews, surveys, testing
academic research
communication, training
company resources
industry practices and trends
leadership
vision and change
competencies, future
name, module building
Where the Company is
A successful succession planning (SP) program needs (*):
1.
2.
3.
4.
5.
buy in from Senior Management
a specific goal
a program design
assessments and templates based on chosen attributes
reporting and tracking
6.
7.
8.
9.
10.
manager training
program pilots
program evaluations and flexibility
revision and feedback to assess feedback
measurement and celebration of success
The company has already anticipated and made inroads in many of these needs:
 1), 2) 10) XXXXXX Systems has received a mandate from top management to identify candidates for
development and career path direction, toward advancement in the management and leadership of the
company. The company has had recent success in developing an employee to fill a key Account Manager
role. In addition, the company currently holds an annual People Day to highlight Human Capital
Development and successes.
 6) 8) 9) XXXXXX Systems currently has a leadership training and development program with which to
meld such a program. The high caliber of talent, skill, service level of its employees, and management’s
leading identification of many elements necessary for designing and implementing an SP program initiative
point to the growth of a successful program.
Elements of this study will help identify goals, components, design, reporting, and pilot models as discussed by HR:
 User-friendly templates for us to utilize in the organization and administration of succession planning
events to keep the managers on track. This includes "replacement" planning (org chart style possibly) and
well as "developmental" planning (talent profile outlines based on competencies).


Reference to and examples of "best practice" processes that appear to be successful and sustainable to
enhance both the tactical and career-path desires of our organization, utilizing the tools provided above.
The focus in this cycle is to provide a consistent model that can be used throughout all business units that is
easily communicated, populated, and executed to drive cross-functional successions in conjunction with
our "Leadership Matrix". (TK)
(*) Thanks to Tracy Burns-Martin for the list concepts. “How To.”
T+D. November 2002, Vol. 56 Issue 11.
What the Study Seeks to Achieve
The Deliverable
Orgconsulting5334 and XXXXXX Systems managers are undertaking a study using behavioral science methods and
human resource best practices in order to test for key success factors required of a program that would be tailored to
the company’s needs and values as a service company in the information technology field. The deliverable must be:
 Adaptable across the particular needs of its horizontal, vertical business segments, global, and
administrative infrastructure, yet useful in areas of specialization of leadership development.
 Easily communicated, performed, monitored, and audited
 Designed to use the core competency of XXXXXX Systems’ intellectual resources and technological
expertise.
 Aligned with strategic plans and key HR components like Training and Development, and Staffing and
Recruitment. Also tied to other annual review processes like performance assessment.
 Expandable for future management needs, and ensure that talent is identified and developed for currency
and flexibility.
How the Deliverable will be Achieved
Orgconsulting5334 and XXXXXX Systems will perform the study by:
 Collecting data pertinent to: 1) the values and competencies of the company and 2) what it sees as its vision
and its goals for leadership achievement. This will take place through interviews, surveys, print and
Internet research.
 Collecting data about current business and industry practices to identify best practices, and locating surveys
that are matched to testing for attributes related to XXXXXX Systems design goals and “best practices”
recommendations.
 Tabulating results of testing and collected data, and identifying promising models which are reflective of
“best practices”, but exhibit XXXXXX Systems’ competitive advantage.
Some research phases have already begun in preparation for this proposal, and some research phases will occur
simultaneously with each other. Replication may be warranted for further validity as the study progresses and the
HR and consultants identify promising directions in the study. Each phase will cover a basic period of 1-3 weeks.
Reporting meetings are tentatively scheduled every 2 weeks with HR and consultants. The purpose of the meetings
will be information sharing, feedback, progress identification, and discussion for development of next actions. By
doing this we believe all parties will be better informed and able to constructively participate. We anticipate intense
collection and assembly of components in the short study time of 2 months, but feel that the high quality of the
dialog and resources point toward positive achievements.
Currently, we have identified that XXXXXX Systems has the following assets:
 Some sub-level models in development
 Follows a standard of subjective management ranking and review
 Elementary profile criteria
 Highly motivated management and high talent base for candidates
 A window of opportunity
 A successful T&D program
Issues and concerns include:
 Retention and career track in light of cyclical economy
 Recruitment and reputation as a top industry employer
 Desire for a more objective system
56

Widely varied needs across company levels and divisions for profiles and tracks
The time frame for the study is Fall 2003, with closing presentations scheduled at UTA and XXXXXX Systems in
December 2003. We do not anticipate costs for study related outsourced advice, items or activities; some tools or
expertise will be used with written authorization by the particular expert or company due to the specific academic
purpose of this study.
Our Consulting Team
Orgconsulting5334 is comprised of 5 Masters Candidates, under the guidance of Dr. David Mack, Assistant Dean of
the School of Business, University of Texas at Arlington, and Specialist in Business Management Consulting.
The consultants are:
XXXXXXXXXX
MBA, MS in Technology, Computer Science Certification
Sales and Marketing Telecom Industry
Primary contact with Dr. Mack and team facilitator, research coding
XXXXXXXXXX
MBA in HR Management
Seasoned Human Resources Professional
Primary contact with XXXXX (PS) and study facilitator, HR coding
XXXXXXXX
MS in Information Systems
Engineering Planner/Analyst General Motors
Interview and process documentation, data documentation
XXXXXXXXXX
MBA in Finance, MBA in Economics
Finance, Economics, and Public Relations
Statistician and document outlines, survey administrator
XXXXXXXXXXX
MBAO with Executive Management Certification
I.T. and Business Process Management Consultant
Research strategy and instruments, document editor
Our members say:
I’m looking forward to working with XXXXXX Systems because it is in an industry I've always had an
interest in and it's a great opportunity to work with such an industry leader. The HR leadership and business
partners have a great enthusiasm for creating a learning organization. (RP)
XXXXXX Systems is known as a leader in the types of services it performs for its clients, and I believe
they have a head start on tackling issues about which other companies are just now becoming aware. I’m
very impressed with the fact that they identified early the need for leadership targeting, and I’m looking
forward to being a part of their spearhead into this important strategic initiative. (SR)
I’m looking forward to working for and with XXXXXX Systems so as to provide this prestigious company
with findings that will help it to solve problems they are facing. It gives me great pleasure that the
executives at XXXXXX Systems are extending full cooperation. Our plan of action has become very
focused because people at XXXXXX Systems are dedicated to this cause. (AR)
We are excited to work with XXXXXX Systems on this study, and believe that the dialog of study, feedback, and
ideas will not only identify the desired components for a an SP program, but reinforce and advance the current
successful skills and programs XXXXXX Systems people have been developing to this point.
Respectfully Submitted,
Orgconsulting5334 Group
57
University of Texas at Arlington
September 30, 2003
Attributes and Goals
Instruments
Tools, Methods and Survey
Best practices and Industry Info
XXXXXX Systems Program
Management/Company/Division Needs
Model and Design
Model and Design
_____________________________________________________________________________________________
Activity Summary and Tentative Schedule
Project Scope: A Succession Planning Model which:
– Can be used to identify key competencies & employees
– Ties into Training & Development
– Is based on
 Best Practices
 Primary and Secondary Research
Project Phases
1. Secondary Research Phase
10-01-03 to 10-15-03
 Methodology
 Best Practices
 Survey Instruments
2.
Interview Phase
10- 06-03 to 10-15-03
 Identify employees to be interviewed
 Find out what they want to see in the SP model
– How are key attributes identified?
– What criteria should be used to identify the key people?
3.
Survey Phase
10-15-03 to 11-03-03
 Design and/or select surveys based on Phase 1 & 2
 Conduct Surveys
10-20-03 to 11-03-03
4.
Survey Tabulation Phase
 Results
– Based on Phases 1 & 3
– Report on survey progress
 Matching
– Based on Phases 2 & 4
– Report on design progress
5.
Analysis and Recommendation Phase
11-17-03 to 12-01-03
 An SP model and name reflecting XXXXXX Systems culture (#)
 Tools identification and component checklists
 Communications strategy
 Ties to T&D
 Next Steps
 Presentation Material
11-03-03 to 11-17-03
(#) Thanks to Dr. William Rothwell of Penn State for this advice via an email interview 0903
Project Communication
– Weekly Status: E-mail reports on Mondays
– Project Phase Transition Meetings (10-06-03, 10-15-03, 11-03-03, 11-17-03, 12-01-03)
– Small team interactions weekly onsite and via E-mail with focus HR and Management as
determined within phase activities
58
–
Each Phase to be accomplished with data collection, information sharing, feedback, and refocus of
direction
59
Appendix B. Variables Key Document
Ax=Assertiveness
Sy=Success
Rx=Risk
Ty=Trust
Asx=Aspiration
Cy=Commitment
v
xls/q decimal for q x
y
r
cumulative score for set
item
-------------------------------------------------------------------------------------------------------------------------------------Ax
E/3
E/3
F/4
r
role length
Sy
F/4
XXXXXX
length
Ax
G/5
G/5
F/4
r
# roles
Ax
H/6
H/6
F/4
r
# proj/assign
-------------------------------------------------------------------------------------------------------------------------------------Sy
I/7
career change
Ax
J/8
J/8
I/7
r
choose change
-------------------------------------------------------------------------------------------------------------------------------------Asx Q/10
training taken
no=”1”
“1”
Z/19
r
yes=”2”
“1”
AA/20
r
“2”
Z/19
r
“2”
AA/20
r
Cy
Z/19
PS track ind’y
Cy
AA/20
PS track you
-------------------------------------------------------------------------------------------------------------------------------------Rx
T/13
T/13
V/15
r
relocation
Ty
V/15
yes PS role
-------------------------------------------------------------------------------------------------------------------------------------Cy
AF/25-1
#
satis-job
Cy
AI/25-4
#
satis-org
Cy
AFAI/25
#
AF/25-1+ AI/25-4
satis-scale
AF/25-1
AI/25-4
r
------------------------------------------------------------------------------------------------------------------------------------Asx S/12
#
rotation
Cy
25-environ
#
Asx
25-self
#
Cy
25-HIWP
#
25-self
S/12
HIWP-percep
AG2 AH3 AJ5 AK6 AL7 AM8 AN9
HIWP-indiv
AO10 AP11 AQ12
HIWP-scale
AG2 AH3 AJ5 AK6 AL7 AM8 AN9 AO10 AP11 AQ12
25-environ
25-HIWP
------------------------------------------------------------------------------------------------------------------------------------CH/30 age ranges
#
demographic
CH/30
Q/10yes”2”
CH/30
S/12
CH/30
T/13
CH/30
V/15
CH/30
25-HIWP
------------------------------------------------------------------------------------------------------------------------------------26-int func coord
#
org- percep
AR1 AS2 AT3 AU4 AV5
Cy/26-commit
#
commit-scale
BI18 BJ19 BK20 BL21 BM22 BN23 BO24
26-int func coord
26-commit
(pub’d range .57-.61)
------------------------------------------------------------------------------------------------------------------------------------27-all
org does work
27-we do
#
we control
BP1 BT5 BV7 BW8
27-they do
#
they control
BQ2 BR3 BS4 BU6
27-we do
27-all
27-they do
27-all
-------------------------------------------------------------------------------------------------------------------------------------
61
Appendix C. R-Square Values of the Variables
R –SQUARE VALUES OF THE VARIABLES
X
E/3
G/5
H/6
Y
F/4
F/4
F/4
R
0
.276
.167
J/8
Q/10
I/7
Z/19
AA/20
.234
.045
.056
Cumulative r score
.346
SET 1
.062
SET 2
T/13
V/15
.008
AF/25-1
AI/25-4
.26
CH/30
CH/30
CH/30
CH/30
Q/2
S/12
T/13
V/15
.002
.065
.002
.025
.085
SET 3
Cumulative stats for SET 1
Run Summary Section
Parameter
Dependent Variable
Number Ind. Variables
Weight Variable
R2
Adj R2
Coefficient of Variation
Mean Square Error
Square Root of MSE
Ave Abs Pct Error
Value
C10
Parameter
Rows Processed
3 Rows Filtered Out
None
Rows with X's Missing
0.3462 Rows with Weight
Missing
0.3234 Rows with Y Missing
0.2213 Rows Used in
Estimation
0.440948 Sum of Weights
0.664039 Completion Status
20.014
Value
92
0
2
0
0
90
90
Normal
Completion
STATS FOR E/3 And F/4
Regression Statistics
Multiple
0
R
R
0
Square
Adjusted
-0.01136
R
Square
Standar
0.811844
d Error
Observa
90
tions
ANOVA
df
SS
Regressi
on
Residual
1
88
Total
89
MS
0
F
0
0
Significance F
1
58 0.65909
1
58
Coefficients Stan t Stat P-value Lower Upper Lower
dard
95%
95%
95.0%
Error
Intercept
3 0.27 11.0858 2.19E- 2.46221 3.53779 2.46221
0615
7
18
OS1Q3
0 0.13
0
1 -0.26852 0.26852 -0.26852
512
2
Upper
95.0%
3.53779
0.26852
2
STATS FOR J-8/I –7
Regression Statistics
Multiple
0.15292
R
R
0.023384
Square
Adjusted
0.012287
R
Square
Standar
0.585598
d Error
Observa
90
tions
63
ANOVA
df
Regressi
on
Residual
Total
SS
MS
F
Significance F
1 0.7 0.72258 2.10710 0.15017
225
1
8
2
81
88 30. 0.34292
177
5
42
89 30.
9
Coefficients Sta t Stat P-value Lower Upper Lower
nda
95%
95%
95.0%
rd
Err
or
Intercept
2.370968 0.2 8.31097 1.07E- 1.80403 2.93790 1.80403
852
9
12
5
81
OS1Q8
-0.19355 0.1 -1.45159 0.15017 -0.45853 0.07142 -0.45853
333
2
8
36
Upper
95.0%
2.93790
5
0.07142
8
STATS FOR T/13 AND V/15
Regression
Statistics
Multiple R 0.092582
R Square 0.008571
4
Adjusted
R Square 0.002695
Standard 0.474683
Error
8
Observati
90
ons
ANOVA
df
SS
MS
F
Significance F
Regressio
1 0.17142 0.17142 0.76080 0.38545
n
9
9
7
Residual
88 19.8285 0.22532
7
5
Total
89
20
64
Intercept
OS1Q13
Coefficie
nts
1.438095
2
0.057143
Standar t Stat P-value Lower Upper Lower
d Error
95%
95%
95.0%
0.13011 11.0527 2.56E- 1.17952 1.69666 1.17952
2
4
18
5
6
5
0.06551 -0.87224 0.38545 -0.18734 0.07305 -0.18734
3
Upper
95.0%
1.69666
6
0.07305
STATS FOR AF/25-1 AND AI/25-4
Regression
Statistics
Multiple 0.50971
R
4
R
0.25980
Square
8
Adjusted 0.25139
R
7
Square
Standar 0.86516
d Error
5
Observa
90
tions
ANOVA
df
Regressi
on
Residual
Total
SS
MS
F
1 23.1200 23.1200 30.8880
1
1
5
88 65.8688 0.74851
7
89 88.9888
9
Coefficie
nts
Intercept 0.98541
2
OGS2Q 0.58400
1I1
3
Significance F
2.88E07
Standar t Stat P-value Lower Upper
d Error
95%
95%
0.41072 2.39921 0.01854 0.16918 1.80164
4
5
0.10508 5.55770 2.88E- 0.37517 0.79282
2
07
8
7
Lower
95.0%
0.16918
5
0.37517
8
Upper
95.0%
1.80164
0.79282
7
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Appendix D. XXXXXX Systems Financial Analysis
XXXXXXXXXX
Analysis of XXXXXX systems Corp (PER):
This is a chart for the historical share price of XXXXXX from Jan 02 – Oct 03. The share price
of the company gradually went down from $20.42 (Dec 01) to $10.69 (July 02). There has been
negligible fluctuation in the share price since July 02 to date.
Key ratio analysis
Price/earning: 20.66
The stock's price divided by its earnings per share. In general, the higher the P/E, the faster and
more consistently the market expects a company's earnings to rise. Here XXXXXXs earning per
share is $0.51 approx. Its competitors have a P/E, computer science corp(csc). of 15.40 and
Electronic data corp (eds). n/a. We can say that the market has faith is XXXXXX’s share and
expects its earnings to rise in near future.
Price/sales: 0.86 (csc:0.60 , eds:0.49)
The lower the P/S, the better when looking for value in a company. XXXXXX’s higher P/S ratio
indicates that its share his over valued in market as compared to its peers. Its not alarming as
0.86 is still small enough.
Return on equityt: 8.96%( csc: 10.69%, eds: -0.27%)
A trend of rising ROE shows management has become increasingly efficient at investing the
shareholders' stake in the company. XXXXXX’s Roe indicates that the firms management is
doing a good job (though not exceptional) managing shareholders interests.
66
Total debt/equity: 0 (csc: 0.548, eds: 1.171)
Debt levels provide vital clues to a company's future. While borrowed money can help
companies grow faster, too much debt, particularly during an economic slowdown, can cripple a
company's earnings or even send it into bankruptcy. A good measure of debt is debt to equity,
figured by dividing a company's long-term debt by its shareholders' equity. XXXXXX has no
debt obligations this may be good as the firm is not at risk of defaulting but no debt also means
that firm is not expanding but in XXXXXX’s case they might be able to generate enough
revenues so as to support their expansion. They might not need any debt for their growth.
Thoughts:
For the six months ended 6/30/03, revenues rose 6% to $696.4 million. Net income before acct.
change fell 50% to $19.8 million. Results reflect higher Government Services revenue due to
acquisitions, offset by lower operating margins. XXXXXX is a growth stock. Right now
investing in its stock would have fence level of risk. Its share price might shoot up due to recent
and future developments but it’s not recommended as an outperforming stock whose value is
going to shoot up in future
67
Appendix E. Survey Questionnaire*
XXXXXX Systems Workplace and Industry Survey
This survey is being used to understand current perceptions on training, career development and
other workplace issues within XXXXXX Systems.
Please answer all multiple choice questions to the best of your ability.
If you have difficulty answering a question or section of questions, or have any questions about
what a question or section means, please note this in the comment box found at the end of the
survey. You may also add comments that do not relate to the content found on the survey.
Confidentiality
We value your attention to the survey and want to confirm that an academic consulting group is
conducting the survey. All answers will be gathered and tabulated by an independent firm to
ensure the anonymous nature of the responses and the anonymous identity of those who
participate.
Thank you in advance for your time and your responses.
A. Information about your Workplace
1)1.1. What is your Industry? Please select from the drop down menu.
Consulting Services
Corporate
Financial Services
Global Infrastructure Services
Global Software Services
Government Services
Healthcare
Industrial Services
Strategic Markets
2)1.2. What is your Team?
3)1.3. How long have you been in this role?
Under 1 Year
1 - 5 Years
6 - 10 Years
11 -15 Years
More than 16 Years
4)1.4. How long have you been with XXXXXX Systems? (Add time with merged or acquired
company to time with XXXXXX Systems, if applicable.)
Under 1 Year
1 - 5 Years
6 - 10 Years
11 -15 Years
More than 16 Years
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5)1.5. How many roles have you held during this time? Time refers to the response you selected
under question 1.4.
1
2-5
6 - 10
11 - 15
More than 16
6)1.6. How many projects or assignments have you been assigned to during this time? Time
refers to the response you selected under question 1.4.
1
2-5
6 - 10
11 - 15
More than 16
7)1.7. How many career changes have you experienced in your lifetime?
None
1-5
6 - 11
12 -16
More than 16
8)1.8. How often have you chosen to change employers and done so?
None
1-5
6 - 11
12 -16
More than 16
9)1.9. Does XXXXXX Systems offer training courses in the following areas? Please check all
that apply.
Technical
Professional Development
Management/Leadership Development
Other
No Training Offered
10)1.10.
How many of these courses have you taken in the last year? Complete if you
indicated training courses were available in question 1.9.
None
1-5
6 - 11
12 -16
More than 16
11)1.11.
Would you request training or would your manager suggest training, or both?
I request
Manager suggests
Both
12)1.12.
Do you believe your career development should include job rotation?
Yes No
I don't Know
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13)1.13.
Do you believe your career development should include job relocation?
Yes No
I don't know
14)1.14.
What is the highest position or role you would value from in your career?
15)1.15.
Do you believe you can develop to this position or role at XXXXXX Systems?
Yes No
16)1.16.
If you answered 'YES' to question 1.15., how long do you believe it will take you
to achieve this position or role?
Under 1 Year
1 - 5 Years
6 - 10 Years
11 -15 Years
More than 16 Years
17)1.17.
If you answered 'No" to question 1.15., why not?
18)1.18.
How many lateral moves would you like to make in the next five years?
None
1-2
3-4
5-7
More than 8
19)1.19.
Do you believe XXXXXX Systems provides clear growth and development
career tracks within your industry?
Yes No
20)1.20.
Do you believe XXXXXX Systems has a growth and development track
specifically for you?
Yes No
21)1.21.
Would you refer XXXXXX Systems to prospective employees?
Yes No
22)1.22.
If you answered "NO" to question 1.21., please indicate why not?
23)1.23.
How many people have you referred for employment with XXXXXX Systems in
the last 12 months?
None
1-5
6 - 11
12 -16
More than 16
24)1.24.
Are you able to provide input for strategic decisions in your current role?
Yes No
B. Information About Type of Organization Preferences
For each item, select the number that best describes your level of agreement.
1=Strongly Disagree; 2=Disagree; 3=Neither agree or Disagree; 4=Agree; 5=Strongly Agree
25)2.1.
For each statement, please indicate your level of agreement or disagreement.
1
2
3
4
5
1. Considering everything, I am satisfied with my job.
2. Employees are rewarded for providing high quality products and services to customers.
70
3. Managers let employees know how their work contributes to the organization's mission and
goals.
4. Considering everything, I am satisfied with the organization at the present time.
5. Employees are kept informed on issues affecting their jobs.
6. Sufficient effort is made to get the opinions and thinking of people who work here
7. Employees have a feeling of personal empowerment and ownership of work processes.
8. A spirit of cooperation and teamwork exists.
9. There is trust between employees and their supervisors/team leaders.
10. I am given a real opportunity to improve my skills in the organization.
11. I feel encouraged to come up with new and better ways of doing things.
12.. Conditions in my job allow me to be about as productive as I could be.
C. Information About Corporate Citizenship and Business Benefits
For each of the following statements indicate your level of agreement or disagreement.
1=Strongly disagree; 2=Disagree; 3=Uncertain; 4=Agree; 5=Strongly agree
26)3.1.
For each statement, please indicate your level of agreement or disagreement.
1
2
3
4
5
1. All of our business functions (e.g., marketing/sales, IT, manufacturing, R&D, etc.) are
integrated in serving the needs of our target markets.
2. All of our business functions and departments are responsive to each other's needs and
requests
3. Our top managers from every function regularly visit our current and prospective customers.
4. We freely communicate information about our successful or unsuccessful customer
experiences across all business functions.
5. Our managers understand how everyone in our business can contribute to creating customer
value.
6. The managers of this organization try to comply with the law.
7. Our companies seeks to comply with all laws regulating hiring and employee benefits.
8. We have programs that encourage the diversity of our workforce (in terms of age, gender, or
race).
9. Internal policies prevent discrimination in employees' compensation and promotion.
10. The salaries offered by our company are higher than industry averages.
11. Our business supports employees who acquire additional education.
12. Our business encourages employees to join civic organizations that support our community.
13. Flexible company policies enable employees to better coordinate work and personal life.
14. Our business gives adequate contributions to charities.
15. A program is in place to reduce the amount of energy and materials wasted in our business.
16. We encourage partnerships with local businesses and schools.
17. Our company specifically supports local sports and cultural activities.
18. Employees feel as though their future is intimately linked to that of this organization.
19. The bonds between this organization and its employees are very strong.
20. Employees would be happy to make personal sacrifices if such sacrifices were important for
the business' well-being.
21. In general, employees are proud to work for this organization.
22. Employees often go above and beyond the call of duty to ensure the company's well-being.
23. Our people are very committed to this firm.
71
24. It is clear that employees are fond of the firm.
D. Information About Getting the Work Done Preferences (For Managers)
If you are responsible for hiring and directing the work of others, please complete this section as
well as the next section (Section E). If you are not involved in hiring and directing the work of
others, please go to last section (Section F- Information about You.)
27)4.1.
What factors do you consider for getting work done when a vacancy occurs?
Yes No
1.Replacing the position from inside the organization?
2. Replacing the position from outside the organization?
3. Outsourcing the work?
4. Shifting the work to another department that has less to do?
5. Eliminating the work entirely?
6. Using contingent or temporary workers to get the work done?
7. Reorganizing the department to re-allocate the work responsibilities among the existing
workers?
8. Forming a team so that team members can spread the work among themselves?
E. Information On Talent Management Programs (For Managers)
If you are responsible for hiring and directing the work of others, please complete this section. If
you are not involved in hiring and directing the work of others, please go to the last section
(Section F- Information about You.)
28)5.1.
For each of the following items mark the number on the scale that indicates the
level of management programs at your company.
Very Poor
Poor Neither Poor nor Good
Good Very Good
1. Clarified the purpose and desired results of the succession planning and management program.
2. Determined what performance is required now for all job categories in the organization by
establishing competency models.
3. Established a means to measure individual performance that is aligned with the competencies
currently demonstrated by successful performers.
4. Determined what performance is needed in the future by establishing future competency
models for all job categories.
5. Created an ongoing means by which to assess individual potential against future competency
models
6. Established a means by which to narrow gaps through the use of individual development plans
(IDPs).
7. Created a means to follow up and hold people accountable.
8. Created a means by which to document competence and find organizational talent quickly
when needed.
9. Created and sustained rewards for developing people.
10. Established a means by which to evaluate the results of the succession planning and
management program.
29) void space
F. Information About You
72
30)6.1.
Age
Less than 25
25 -36 Years
37-48 Years
49-60 Years
More than 60 Years
31)6.2.
Education Level
High School
Bachelor's Degree
Master's Degree
Ph.D
Other
32)6.3.
What is your gender?
Male
Female
Thank You
We are appreciate the time and care you have taken to fill out this survey.
You may add any additional comments in the comment box below.
33)7.1.
Please include any additional comments here:
------------------------------------------------------------------------------------------------* Note: “#)” in front of Question number is keyed to Appendix B. Variables Key
73