CFS (Convenience Food Systems) is a global conglomerate of 15 companies that manufactures and distributes food packaging and processing equipment. Operating in an ever-changing business climate, and with some 2000 globally dispersed employees, CFS faced growing talent management challenges common among manufacturers, such as goal alignment, development and retention. Since adopting Halogen’s talent management solutions, CFS has realized the following benefits:
- Employee turnover rates dropped from 10.7% to 4.9%
- Evaluation completion rates increased from less than 30% to 92%
- Participation in training increased markedly
- Goal alignment became efficient and clearer
- Product and support sales grew
- Account receivables improved
- Streamlined talent processes unified the company globally
Manufacturer Faces Multiple Challenges in Global Economy
Today’s food industry is characterized by increasingly demanding consumers. In highly developed markets consumers want easy meal solutions, smaller portions, convenient packaging, fresh distribution and safe products. In emerging markets, trending is towards a growing fast food industry, retail modernization and frozen distribution.
In 2007 Scott Mottern joined the company as Regional HR Manager of the Americas. About 30 minutes into his first day on the job he detected a problem; Mottern discovered the organization’s employee appraisal process was an antiquated paper-based system.
“From my own experience and in conversations with my colleagues I haven’t come across one paper-based system that works,” says Mottern. “I immediately thought of the advantages I’d seen at my previous company using Halogen.”
A firm believer in implementing the online-platform for appraisals and anything else talent management oriented that can be put online, he was confident the payback was there.
Quite frankly, Mottern recollects, all that was required to build a business case was to ask the executive team when they’d last had an appraisal. The silence in the room was sufficient enough for everyone to know the issue needed to be addressed.
Antiquated Approach Hard to Digest
Examining the existing manual process it became evident stakeholders — executives, managers and employees — felt it was fragmented and inconsistent. Annual appraisals were perceived as a chore rather than a strategic enabler. A company-wide survey found 54.5 per cent of respondents did not understand the measures used to evaluate their performance. Nearly one-third indicated their manager never or seldom clarified goals and assignments. A significant 43.8 per cent stated their most recent performance review results were never shared with them by their manager. Most tellingly, completed review rates were less than 30 per cent corporate wide. The performance appraisal system was broken completely.
To compound matters one of the biggest talent management issues affecting manufacturers worldwide, CFS included, is the risk of losing knowledge and skills acquired over years and years of experience. With an aging, retiring population this was very real and top priority for the company. A system was needed to help identify and retain high potential employees and to facilitate a knowledge transfer between subject-matter experts approaching retirement age and the next generation.
Delicate Preparation Addresses Changing Tastes
CFS purchased Halogen eAppraisal™ at the end of 2007. Originally rolled out in the Americas region, the first wave of online appraisals was conducted in March 2008. In the three months leading up to the launch Mottern and his team set up the system, redesigned forms, decided on competencies and created training for supervisors.
HR understood that an effective employee performance management strategy must including corporate goals that all employee goals are connected back to. They conducted a goal deployment exercise that defined how the company’s overall business goals translate to each division and eventually to individual employees. From the employee side CFS adopted a seven-competency profile that was segmented for each job role. These competencies were defined based on the characteristics of top performers as well as the values of the company.
Training with employees and managers quickly demonstrated the many benefits of the new online performance appraisal. Key messages stressed ease of use and speed, how supervisors can monitor employee progress and how this information in turn simplifies future conversations where supervisors can point back to mutually agreed upon goals and developmental plans, and facilitate discussions about what the individual has done to make things happen.
“Our objective was to make performance and development an ongoing discussion. When employees see how their performance ties into their career development it makes it easier to get buy-in and enables us to align individual efforts with the goals of the organization,” Mottern explains.
Based on Mottern’s regional success CFS decided to adopt automated employee performance management internationally. Traditionally resistant to change, the organization’s European Work Councils readily embraced the initiative. Employees were also onside noting that they were finally getting an appraisal and through development plans could improve and move up in the organization if they so chose. “Both of these things were pleasant surprises,” says Mottern. Global adoption was completed in 2010.
Palatable Solution Harvests Nutritional Value
Immediately following implementation, CFS saw an increase in requests for training, coaching and discussions around development and career paths. Participation in training offered in the Americas grew from 13 in 2008 to 57 in 2009 to 109 in 2010.
Turnover dropped from 10.7 per cent in 2008 to 4.9 per cent in 2009. “I definitely believe there was a correlation between improved communication and retention,” says Mottern.
Overall, performance review completion rates increased from 57 per cent in the 2008 regional rollout year to 92 per cent in 2010.
Mottern cites a constant year-round dialogue as opposed to once-a year evaluations as “one of the greatest advantages associated with eAppraisal. Not only do employees have access to their developmental plans, their goals and their performance journals, the supervisors can also check on how their employees are doing and if need be, have conversations.”
Additionally the online system offers HR the ability to send out periodic reminders to check actions against targets. As the facilitator HR’s role is strictly to encourage supervisors to have conversations with their employees and vice-a-versa.
As a result of HR’s goal deployment exercise Mottern sees markedly improved buy-in. Critical from an engagement and alignment standpoint, employees “know that what they’re doing today and tomorrow is actually impacting what their team or their department is accomplishing as well as what the organization will be seeing at the end of the quarter, at the end of the year.” Even with the down economy in 2009, particularly in the U.S. Mottern says CFS saw growth in new equipment sales, growth in customer support sales and improvements in account receivables.
Having Halogen eAppraisal also enables CFS to easily and effectively leverage employee performance data to make succession decisions across the entire organization. Individuals around the globe can view, update and track their progress against goals, jot down ideas, record achievements and milestones. CFS management can view these details to help make better talent-driven operational decisions. “We’re identifying where we have some opportunities and those individuals that are able to achieve their goals which may indicate high potential possibilities for them. Based on some of the appraisal scores, we’re able to pin point where subject-matter experts may be residing that we simply didn’t know about. For that matter we’re also flagging some of the new people that are coming in who offer valuable knowledge, experience and insight. Again, having those conversations with our employees is tremendously helpful from a human resources standpoint.”
Long Shelf-Life Ahead
From all accounts the company is very satisfied with its investment and is now exploring Halogen’s automated succession management and compensation management modules. The one thing CFS doesn’t want to do, though, is throw too many things at its workforce too quickly. Phased implementation is the approach. The organization’s top 100 performers from across the globe will be the first pilot group with implementation gradually rolling out worldwide.
A frequent visitor to the Society for Human Resource Management (SHRM) website, Mottern notices several people ask about online talent management and he regularly shares his insights. “My response is always the same. For me it’s just so much easier. It totally eliminates the hassles you have with a paper-based system. It’s real time. I get all the reporting I need. I get all the facts and figures. I can see who is performing and who is not, and who I need to kick in the behind to get them going. There’s total visibility about what’s going on with my process. I’ve done this for about five years now — I use Halogen and I love it.”
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