Changing corporate strategy is more difficult for utilities than for companies in many industries. Success calls for leadership on seven fronts.
HR Roundtable: Bridging the Talent Gap
Recruiters and HR consultants see utilities taking an increasingly comprehensive approach to addressing tomorrow’s personnel challenges.
higher salary won’t necessarily draw them to the job. They will be interested in meaningful work and career development.
A new generation of workers is looking for different things compared to what those who are retiring wanted. Utilities have a reputation as a place where you go to work for 30 years and then retire. That’s not necessarily what the younger worker wants.
Mihlmester (ICF Consulting): There’s a life-work balance issue that a lot of industries are starting to deal with in their benefits and policies. Some companies will provide extended paternity leave, not just maternity leave. Some employees would prefer having comp time instead of extra pay for working on a weekend. Maybe it’s not right for every situation, but companies are becoming more flexible as they try to manage recruiting and retention.
Fortnightly: Are companies changing retirement policies or benefits to retain workers?
Crowell (Mercer Management Consulting): Good work is being done to bring back retirees on a part-time basis or as contractors. There are some problems with pensions and union agreements, but companies are working around those issues so retirees can come back and still get their benefits.
Fust (Korn/Ferry): In the long term, it will require changes in tax laws to be able to utilize that retired talent as an effective resource. The way to address this issue is to acknowledge there are some areas where, from a public-need standpoint, you need the ability to tap into those resources without penalizing them for coming back.
Kamph (Interliance): People are talking about making changes to policies, but so far we haven’t seen anything really aggressive. The trend is that people are wanting to continue working longer, because the retirement benefits aren’t what they were.
Instead of changing their policies, many companies are just hiring key people back as contractors at a much higher cost. If they have critical skills and the company needs them, they are worth paying more to keep them involved.
Fortnightly: What do you see utilities doing to prepare for a talent gap in management and executive areas?
Fust (Korn/Ferry): As utilities are doing succession planning, they are recognizing that most of the talent they need doesn’t exist in their organizations, and they have to look outside. The process of evaluating that kind of talent is a pretty large challenge, and with every utility experiencing the same demographic issue, it gets even more difficult.
Talkington (Heidrick & Struggles): More than anything, utilities have increased their sophistication in career-path planning. Their practices are less ad-hoc and more proactive, and as a result they are developing people faster. Younger executives are reaching more senior roles than they have in the past.
Fortnightly: What do you see happening with executive- compensation plans?
Talkington (Heidrick & Struggles): To some extent total pay is going up, specifically compensation at risk and long-term incentives.
Also, employers are finding they have to replace the equity that executives are walking away from when they leave their company to join yours. If you are moving a 20-year career person, they may have hundreds of thousands