Talent Edge Weekly - Issue #68

Covers CHRO compensation, remote work, Verizon's human capital report, AI regulations and what it means for HR, and questions to ask HR tech vendors.

May 30, 2021

Welcome to this week’s issue of Talent Edge Weekly—the weekly newsletter for human resources practitioners, bringing together insights about work, the workplace, and the workforce from various sources.

If you find value in this issue or any of its resources, please share them with your network by using the social media icons at the top of the newsletter.

Have a great week, and I look forward to sharing more ideas in next week’s Edge!

Brian 

Brian Heger is a human resources practitioner with a Fortune 150 organization and has responsibilities for Strategic Talent and Workforce Planning. To connect with Brian on Linkedin, click here.

THIS WEEK'S CONTENT

  • CHRO Compensation and Fairness: What a Difference a Year Makes | HRO Today | Examines publicly available compensation data on 113 senior HR executives in the Fortune 500 to determine various insights, including gender pay gaps.

  • What If Remote Work Didn’t Mean Working from Home? | The New Yorker | Shares why firms might consider offering workers a close alternative to work-from-home: work from near home.

  • Build a More Responsive Employer Value Proposition (EVP) Management Strategy | Gartner's HR Leaders Monthly (June) Magazine | Offers ideas on how HR leaders can more quickly sense and respond to what employees value most in their employment. Includes 6 other articles.

  • Verizon's Human Capital Report | Verizon | Provides a practical framework and narrative for articulating human capital philosophy, supporting insights, and relevant measures via Verizon’s first-ever Human Capital Report.

  • What AI Regulations From the EU and FTC Mean for HR Practitioners | Toolbox HR | Offers tips on how HR leaders can employ ethical principles when evaluating AI-based HR technology in light of the European Union's proposed AI regulations and Federal Trade Commission's guidance on commercial AI.

  • 15 Questions To Ask HR Tech Vendors for Your Recruitment Solution | LiveHire | Provides and elaborates on the top 15 questions firms can ask HR tech vendors when shopping for new recruitment solutions; questions can be modified for various HR tech solutions.

  • Your View: Poll Results | Shares the results from 121 responses to last week’s poll question: What is your organization’s philosophy on asking workers about their vaccination status?

THIS WEEK'S EDGE

HRO Today published its second annual CHRO Compensation study earlier this year. It examined publicly available data on the Fortune 500 to gather compensation data on 113 senior HR executives from those firms, a 23% valid sample. They segmented the data into four bands (Fortune 50, Fortune 100, Fortune 200, and Fortune 500) and explored correlations to salary, total cash compensation, and non-cash compensation (stock options and grants). The factors also included market capitalization, earnings per share (EPS), earnings before income tax, depreciation, amortization (EBITDA), and total employee headcount. Among the insights: 1) Within the Fortune 50, males’ base salary exceeds females’ by 54%, or over $700,000; however, the total average compensation pay gap is only 2.5% more for males than females. Within the Fortune 500, males’ base salary is 21% higher. 2) Among firms in the Fortune 50, statistically significant correlations (.80) were found between CHRO compensation and company performance factors. Other ideas are discussed.

Cal Newport, the author of Deep Work: Rules for Focused Success in a Distracted World, adds a new slant to the “work from home” debate in this article. He posits that while working from home has many benefits, relocating workers to their homes for the long run might be unexpectedly misery-inducing and unproductive. This view is based on the premise that the "home is filled with the familiar, and the familiar snares our attention, destabilizing the subtle neuronal dance required to think clearly (e.g., pass the laundry basket outside our home office), which shifts our brain shifts toward a household-chores context. Cal offers a third option to consider: work from near home. Here, firms that allow remote work encourage these employees to find professional spaces near (but distinct from) their homes and directly subsidize these "cognitive escapes." He submits that this up-front investment to subsidize the ability of workers to escape household distraction will be recouped in both the increased quality of work produced and the improved happiness of the employees, leading to less burnout and reduced churn. As companies reduce their real estate footprint, could there still be a compelling business case for them to embrace and subsidize this work near home concept?

As employees’ preferences and expectations continue to shift, many organizations are re-evaluating and adjusting their employment value proposition (EVP) offerings — the set of attributes the labor market and employees perceive as the value gained through employment with an organization. This article, which begins on page 10 and is one of six articles in this monthly issue, submits that HR leaders need to adopt a more continuous and responsive way (vs. static and infrequent) of sensing and responding to what employees value most in their employment. As illustrated in Figure 1 (p.11), one strategy uses cues or triggers to detect a shift in employee expectations or experiences. These triggers include things such as the company’s financial performance, larger labor market conditions affecting the broader economy, and organizational culture change, to name a few. HR Leaders can use these cues with another resource I posted by Gartner, which includes a list of career risk triggers that prompt an employee to consider leaving a company. Both resources can be used as diagnostic tools to guide talent strategy and practices.

I have posted various resources regarding how the Securities and Exchange Commission (SEC) revised human capital disclosure rules to improve shareholder understanding of how human capital contributes to corporate value and strategy. More recently, I shared a summary from Intelligize that analyzed 427 Annual Reports on Form 10-K filed by companies in the S&P 500 between November 9, 2020, and March 5, 2021. One insight from that analysis is that relatively few companies provided meaningful numbers about their human capital. As firms continue to identify ways to share relevant human capital information, this first-ever Human Capital Report by Verizon provides a few ideas. The 40-page report offers a practical framework and narrative for articulating a human capital philosophy and supporting measures, such as Recruiting - (e.g., offer/ acceptance rate), Diversity - (e.g., gender and ethnicity of the Board and executive leadership), and Development - (e,g., # of people who take advantage of tuition assistance, dollars invested). This is a well-done report by Christy Pambianchi (CHRO, Verizon) and those who contributed. 

As interest in AI in the workplace increases, questions about how AI works to ensure fair and equitable outcomes have come under scrutiny. This article shares the HR technology implications of the European Union’s proposed AI regulations and the Federal Trade Commission’s guidance on commercial AI. The EU’s proposed legislation (more long-term) focuses on regulating AI’s potential risk to individuals. The FTC proposed legislation through a blog post that can help regulate bias and misleading AI advertisements immediately. As organizations await more guidance, this article provides tips on how HR leaders can employ ethical principles when evaluating AI-based HR technology, including Ask providers about the AI: How is the AI’s success measured? What justifies this as AI? What specific technologies does this rely on (NLP, open graph, emotion recognition, etc.)? What are its specific outcomes? Ask providers about ethics: How were the data and AI assessed for any bias or discrimination? What potential risks have the company considered when thinking about AI? How much transparency does the company provide regarding its AI? Other ideas are discussed. 

This article includes and elaborates on 15 questions firms can ask HR tech vendors when shopping for new recruitment solutions. These questions can be modified for HR tech solutions other than recruitment. Example questions include: How will this recruitment solution help us reduce our hiring costs? How will this recruitment solution help us achieve our performance targets (e.g., faster time-to-hire, better quality of hire)? Can you provide any data to show the positive impact of your technology on improved hiring diversity? Even when these questions are answered satisfactorily, I recommend that a firm interested in the HR tech provider conduct an "experiment" to test the providers' capabilities. During this experiment (some call it a pilot), the HR tech solution is tested in a small and controlled setting (e.g., a business unit) to see if a miniature version of the platforms' advertised capabilities and outcomes are successfully delivered. However, even with this approach, successful pilot experiments often do not scale as conditions present during the pilot may no longer exist in a larger rollout. Still, asking good questions and testing vendor capabilities upfront enables a firm to evaluate an HR tech solution more effectively before making a buying decision.

RESULTS FROM LAST WEEK'S POLL

One of our readers and HR Leader colleague's wanted to know:

Which statement best reflects your organization’s philosophy on asking workers about their vaccination status? Based on 121 responses:

  • 50% - Will ask AND require proof

  • 29% - Will not ask

  • 21% - Will ask BUT not require proof

If there is a poll question you would like to see in an upcoming newsletter, you can submit your question HERE.

MOST SHARED RESOURCE FROM LAST WEEK

The CEO-CHRO Partnership | Chief Executive Group | Explores survey results on how CEOs and HR chiefs are aligned–and misaligned–on the top 2021 human capital and talent priorities.

TWEET OF THE WEEK

BOOK RECOMMENDATIONS

DUE OUT NEXT WEEK: Remote Work: Redesign Processes, Practices, and Strategies to Engage a Remote Workforce | Chris Dyer & Kim Shepard | Book covers and answers questions such as: How can I develop a team if they're not in the same place? How can I build a company culture that has employees in an office, working at home, and in co-work spaces? How can I maintain organizational oversight if I can't see my employees?

OUR RESOURCE LINEUP

​brianheger.com provides free access to +1,000 curated articles, research reports, podcasts, etc. that help practitioners drive better business results through strategic human resources and talent management.

CHROS on the Go is a subscription that provides the easiest and most convenient way to stay informed about Chief Human Resources Officer hires, promotions, and resignations in organizations of all sizes and industries.

​Talent Edge Weekly is a free weekly newsletter that brings together the best talent and strategic human resources insights from various sources. It is published every Sunday at 6PM EST.