This paper is intended for all organizations that desire to be financially successful. It is also directed at Jim Rohr, CEO of PNC. PNC has fought through possibly the worst financial situation the banking industry has ever faced and not only survived, but flourished. PNC has done so because Jim Rohr and his executives have put the spotlight on its most important “asset,” “its people. ” PNC acknowledges that it must keep the “right people” for the job and it does so by selective hiring and striving to be the employer of choice.
Unlike many companies who focus on its financials first, PNC will never be faced with a choice of downsizing, if it continues to focus on its people first.? Company Background PNC as a company has recognized the importance of its people. PNC is currently working on developing its people through a large initiative which focuses on employee engagement. This initiative measures its success on Gallup scores derived from its employees’ opinions. Within the company there are many different departments, all which score differently on the Gallup survey.
Being such a large organization creates challenges it must overcome if it is going to continue to be an industry leader. Some of these challenges result from not hiring the “right people” to do the job. As a result, these decisions negatively affect others within the department which can also affect the company as a whole. Each department must work with Human Resources to perfect its hiring processes, in order to deliver the culture that PNC desires. Hiring the right people can improve productivity, which stems from having motivated employees that are dedicated to their company.
If PNC executives continue to push their department managers to improve employee dedication, it will lead to continued financial success for the company. Conceptual Background A rising trend in many unsuccessful companies has been to outsource jobs, cut employee benefits, eliminate traditional career paths, reduce training costs, and ease employee wages.
Shockingly, these are the same companies that state in their annual reports and speeches that the success of their businesses relies on the efforts, initiatives, commitments, and motivation of “our people, our most important asset. When faced with tough financial decisions, executives often do not live up to the mission of their companies. When asked the reason behind the decisions to reduce wages and cut jobs, the answer from executives often is “we had no choice. ”
1 The reality of downsizing often is that the companies did have a choice, although through a series of bad decision making and pour planning; companies have backed themselves into a corner. Studies have shown that companies do not have to pay low wages in order to be an effective competitor.
By adopting a people-based business strategy, companies can have significantly higher labor productivity and differentiate themselves from their competitors by building employees into assets. 1 Rather than relying on technology, patents, or strategic position, companies who focus on how they manage their workforce tend to have a sustained advantage over other competitors. Putting emphasis on employees and how they work, provide many cost advantages. These cost advantages are created through the increased productivity of its workers. Before productivity can be increased, employees must become motivated and dedicated to the mission the mission of the organization.
2 There are many factors that facilitate employees to become motivated. Motivation have be improved through job security, high wages, incentive pay, employee ownership, information sharing, participation and empowerment, self-managed teams, cross-training, skill development, and promotion from within. Before companies start embracing these practices, they first need to be very selective in recruiting good people for the job. 2 Companies have the “choice” of who they hire.
If a lot of resources and consideration is given to hiring the right people, companies will never be faced with tough financial decisions which lead to downsizing. Finding qualified candidates is important step in keeping the company away from making downsizing decisions. To find qualified candidates, companies should focus on job descriptions, recruiting, and interviewing. Posting open positions internally will help the motivation concept of promotion from within, although posting externally may sometimes be necessary to increase diversity within the company.
Interviews should only be conducted on candidates that meet the minimum requirements and the offer should be made to the person who displays the cultural values employers are looking for, while maximizing value and minimizing risk for the company.
3 Proctor and Gamble (P&G) takes the concept of “hiring the right people” very seriously. In 2009, P&G expected to receive 400,000 applications for entry level management positions, while only expecting to hire less than 1% of them. They plan to only select the applicants that are most likely to fit their culture.
P&G recruiting strategy starts on college campuses of schools where prior successful P&G employees came from. For the lucky few that get hired, their work life becomes a career-long development process. The company focuses on training these employees and that’s what separates P&G from the pack.
4 Similarly, Wegmans’ corporate values include caring, respect, high standards, empowerment and making a difference in the communities. The company has been recognized by Fortune as one of the best 100 companies to work for.
The Human Resource team wants “the very best. ” Wegmans hires people who “have the propensity to serve” and the skills to interface well with the public.
5 “Business is a game, and as with all games, the team that puts the best people on the field and gets them playing together wins. ” Hiring the right people starts with appointing the right people to run Human Resources. Human Resources create effective mechanisms, such as money, recognition, and training, to motivate and retain people.
Executives who proclaim that people are their “biggest asset,” should put their money where their mouth is and get HR to do its real job; elevating employee management to the same level of professionalism as financial management. Since people management leads to sustained financial success, what could be more important?
6 Focusing on people will eliminate the excuse of, “not having a choice. ” Applications PNC is currently a very successful company. It has persevered through a difficult, if not the most difficult time in the history of the United States economy. While many of its competitors are failing, PNC is expanding.
In my opinion, there are two reasons for its expansion; a strong business model focused on careful strategic growth, and excellent people management. CEO – Jim Rohr My message for CEO Jim Rohr is to continue to focus on what has got the company to where it is at today, which is, its business model and its people. This is not to be confused with being satisfied and relaxing; he must recognize that the gas pedal must remain on the floor it is going to remain ahead of its competitors. In order to remain ahead of its’ competitors, I urge Jim Rohr to keep treating his employees right, and to avoid layoffs.
In order to avoid layoffs, he must continue to focus on employee engagement. He must not forget the importance of Human Resources in this process and work with them to help each individual department hire qualified people that are “right for the job. ” Having qualified people who embrace the company’s culture, PNC’s employees are more likely to remain committed to doing quality work. Hiring people is a choice the company is given, and by being highly selective in its hiring process, PNC can afford to pay higher wages because it will get a greater return on its investment.
In my opinion, PNC is the employer of choice in Pittsburgh and can afford to be selective. I would tell Jim Rohr that he must keep PNC the employer of choice. To do so, I suggest offering high wages, great benefits, and keeping employee satisfaction it’s most important mission. If Jim Rohr hires the right people for the job, the company will continue to succeed financially. He then will never have to give the excuse, “there was no other choice,” that many CEO’s resort to saying when they reduce jobs. Mid-Level Manager As a mid-level manager at PNC, my most important responsibility is to keep employees happy and to increase their productivity.
Once I make the decision to hire an employee, it can be very difficult and damaging to my department, as well as the company if I hire someone who is not a good fit for the position. If I am lucky enough to hire each employee in my department, rather than coming into a situation where the employees are already in place, I must work together with the Human Resource Department to develop a plan of action.
The plan would first start with developing detailed job descriptions which accurately portray the skills needed to be successfully t the position. The old saying, “one bad apple can ruin the bunch,” would be my motto. I truly believe that even one bad hire, could disrupt the culture within my department. Once my group is fully staffed with capable, energetic employees who desire to fulfill the mission of the company, it would be my full time job to keep them happy and focus on the “big picture. ” Keeping my employees happy starts by understand what makes them happy. Typically, wages, benefits, and work-life balances tend to satisfy employees the most.
The Human Resources Department and I would continually monitor our compensation packages to ensure they are at the top of the industry. I believe when employees know they are important and they are treated as “assets” they will continue to deliver value for the company. By doing the things I mentioned above, I would be doing my part to execute the mission of the PNC. Also, as long as Jim Rohr continues to keep managers who are focused hiring the right people and keeping those people happy, trained, and productive, PNC will continue to be an industry leader. ?