7 Questions You Must Ask Before Purchasing an LMS

by Gavin Woods, Client Account & Sales Manager 

The right learning management system (LMS) can be a powerful tool that empowers your learners and your learning team, and brings real tangible benefits to your organisation. But it’s essential you buy the right solution for your organisation.

In this presentation, Gavin Woods outlines 7 key questions you must ask before purchasing a learning management system (LMS).

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What is Succession Planning?

In the last of our guest blog posts on talent management, Steve Curtis, EMEA Channel Director at NetDimensions talks about performance appraisals and PDPs.

Two people passing a baton

First of all a statement on Succession Planning; this statement might not be true, but it is my firm belief after many years of working with businesses all around Europe. It is this…

Succession Planning is the single most important and critical piece of functionality in the Talent Management suite – however it is:

1) the last one that you should implement, and
2) possibly the hardest piece of functionality to get right.

Sorry if this is in bold – I would probably put it in flashing lights as well if I could…

Consider this – how many times have you seen companies lose their way and quickly lose market share, profits and shareholder value when the wrong person is appointed into a critical position? How many times have you read about the time it has taken to appoint someone else into a critical position, and seen the impact that this delay has had on all the above, and on the other side of the coin, how many times has success of a business been linked directly to the critical talent that is the driving force or forces behind the company.

Often this is the CEO or Managing Director of the group, but just as often it is the Chief Financial Officer or the technical boffins in the company that are the financial and the creative brains and therefore just as critical to the performance of the company.

Succession Planning is therefore about one major thing – making the right decisions about who inside the company is able to step into the critical positions at the right time. The right time might be an emergency – what happens is the CEO falls ill? What happens if a critical technical person decides to resign to pursue something different? There are many circumstances that will lead to businesses losing people that are fundamentally critical to the business, and in a large company there could be hundreds of critical positions.

Another what happens if the business doesn’t have a replacement, capable of stepping into a critical position? The business will have to go outside to the market to recruit the right person, and this will have several large negative impacts:

Immediate Financial Cost
Critical roles will almost certainly have a large salary and benefits package attached to them, and therefore head-hunter and associated costs will be high. Most head-hunters charge companies based on the value of the employee, and often they will charge the equivalent of between 6 months and 1 full year of the person’s salary that they are recruiting – so if headhunting a new critical person, the immediate impact is likely to be a 6 figure sum disappearing off the bottom line revenue of the company. Large businesses with more than 25,000 people use head-hunters many times in a year, but used correctly, Succession Planning could reduce this significantly by better identifying and preparing worthy successors from inside the business. It has a potentially massive immediate impact on the profitability of the company.

Time to recruit
Recruiting the right person is likely to take months, and while this happens the business will have issues of various kinds, with the most obvious one being drift – without the business or technical lead in place the business will not perform as it should, and this could have a high cost over the months that the business is lacking it’s leader(s).

Time to train
People who are recruited from outside – even though they might be very skilled – still need time to get up to speed with the way the company operates. This will have a negative impact and the business will struggle while the new head takes time to start to add value.

Dissatisfaction in the existing workforce
If the company does not promote from within whenever it can, then it can cause deep unrest and dissatisfaction and can often lead to other critical members of the workforce leaving the business.

So to summarise on these points – there is a real and valuable business case for the management of succession planning – and therefore it is often seen as the most strategic and valuable part of the Talent Management suite by senior people in the business.

Succession Planning is also about doing planning for the 1 year, 2 year, and more replacement of critical talent. Planning worthy successors from inside the business takes time – so if the business starts to look at potential successors for critical senior positions what types of information do they want to have available and therefore analyse?

  1. Competencies – if a potential successor is there, how many gaps does he or she have in their competencies when you evaluate their scores on these against the competency requirements for the critical job position?
  2. Performance appraisal ratings – What have the recent performance appraisal rating been, and therefore is the potential successor a hi-po (High Performer)?
  3. Career expectations – does the person want to make the next move and take on this extra responsibility? Some people for outside reasons may have the skills but may not want the extra burden.

This is why Succession Planning and Succession Management has to be one of the last components of Talent Management to be implemented – it is useless without the metrics gained from time spent using the other components. Without this there will be insufficient data to do the analysis and then groom the identified successors.

How does a business use Succession Planning to prepare the right individuals?

The first and most critical step in Succession Planning is to identify competency gaps and appropriate training that will allow potential successors to close gaps in their competencies relative to their job position.

This will allow the business to get the internal workforce ready to take on those critical positions quicker. Communicate opportunities to the people concerned, and make sure that they are comfortable to move up if and when needed.

Succession Planning is a vital part of Talent Management and should be a very easy sell to senior people such as the HR Director and the CEO.

Performance Appraisals & PDPs

Continuing his series of guest blog posts on talent management, Steve Curtis, EMEA Channel Director at NetDimensions talks about performance appraisals and PDPs.

Person sitting on a correct tickPerformance Appraisals
So onto Performance Appraisals – I don’t know about you, but I think a lot of managers don’t really enjoy performance appraisals. In my humble experience managers in some larger organisations will complete a performance appraisal because HR tell them that they have to, but they will put as little effort into the thing as possible and in reality their views in the appraisal will be far too subjective. If they like the person, then the appraisee will get a good rating, and if they don’t it’s highly unlikely that that person will do well, irrespective of their ability to do the job.

So this then is the conundrum of HR – most HR managers understand this, and so want to achieve two things:

  • Remove subjectivity and replace it with objectivity.
  • Make the process as easy as possible for all concerned.

Every company I have worked for in the software world has used a different form for performance appraisals, and since I have worked for a number of companies for more than 5 years, I have seen performance appraisal forms change inside a company a few times as well. This is the challenge for the software business that wants to supply this functionality to clients – they will have one way of doing it, and often they will want you to replicate this in software – which is difficult to do without customisation.

Constituents of a Performance Appraisal
I’m not going to tell you in this blog what a performance appraisal is – I’d actually be quite worried if you don’t know this….however let’s for a minute consider the type of things that different companies might (or might not) want inside a performance appraisal.

  • A review of the past period – often 6 months or more often 12 months – including a competency review – has the appraisee got better in the competencies related to his or her job during the period?
  • A review of objectives and progress – most HR groups want their employees to be set objectives at the start of the period and then the performance appraisal is the formal assessment of progress against those objectives. Objectives can be personal in nature, or can be linked to department, business unit, or company objectives.
  • A review of the next period – setting and agreeing some objectives for the next period. These again can be supplemented during the period if needed.
  • An overall rating – some organisations want an overall rating for the appraisee.
  • A skills review – what skills does the appraisee have that do not directly tie to their current role?

Some organisations might have more than this, but some will have less. Some will separate the objective setting for the following year, and want to put this into a separate area and time. Evaluating a person’s performance in a given year may sound easy, but with management changes happening quite often in large organisations, and changes of role, these can make performance appraisals a complex area to try and handle in the real world, and to try and automate this in software can be even harder.

Benefits of Automating Performance Appraisal Management
For Talent Management what is the implication of a good process here – what are the benefits of automating this area?

  1. Automatic storage of a person’s potential improvement over time.
    Paper records in HR are an administration overhead and time consuming to manage.
  2. Automated management of the workflow process.
    Who does the appraisal or part of the appraisal need to go to and when?
  3. Conformance with regulatory requirements.
    Managing performance appraisals in this way means that the business can much easier conform with any government regulations in the area.
  4. An ability to look wider across the business and report on the critical talent much easier.
    Having this data across the business often means that it is much easier for the business to select talent pools – groups of people who can be accelerated and become the future leaders.
  5. An increase in objectivity.
    Software should allow other people to be involved in the appraisal process for more critical or senior people. This gives the business the ability to have a 360 degree view at appraisal time. Think about these things when you go to companies and talk to them about this.

The PDP and its Relationship with the Performance Appraisal
So now you understand what a performance appraisal is, what is a PDP? A PDP is a Personal Development Plan. At the start of a period (this may be for instance when the performance appraisal for the last year has just been completed), the business will want each user to know what he or she needs to accomplish in the next period. This goals setting can include goals that the individual wants to achieve (personal goals), department goals, business unit goals etc. Goals should be capable of being pushed down through the organisation hierarchy to the individual.

So why would an individual want or need a personal goal? Perhaps they want a promotion or want to move roles into a more senior position. It might be that some of the competencies required to be in this position are ones that the person needs to have training in order to improve his or her rating. Personal goals always need agreement from management but are often a critical element of the PDP.  The PDP is a living breathing and evolving document during the period, and the goals from the PDP then drop into the Performance Appraisal at the end of the period, and the user is formally rated against those goals at that time.

Does this Have an Effect on Compensation?
A pretty obvious question, but one you need to be aware of in software terms. Compensation is often directly or indirectly tied to ratings and scores from performance appraisals. Objectives set for the period often have bonus pay linked to them, and so if you remember the Gartner diagram from my second blog in this series (Talent Management 2: Competencies, Ratings, Scales & Pitfalls) compensation management is a part of Talent Management, and you will sometimes get request from businesses to link the performance appraisal process through into a compensation product.

There is a lot more to Performance Management but that will do for now. A lot to think about – but think of it from the viewpoint of the person who is wanting to buy – what the HR director wants will be different to the CEO, and different to the business unit manager. We’ll discuss that a little more next week.