Talent Development

Overview

Activities and Processes

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 Overview

Talent development is the practice of attracting, retaining,

developing and promoting outstanding talent.

It comprises all of the processes and systems related to

retaining and developing a superior workforce.

The goal of talent development is to create a high-

performance, sustainable organization that meets its
strategic and operational goals.

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 Here’s what some folks will ask.
“But what if we invest in developing our
talent and they decide to leave?”

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 Here’s what everyone should ask.

“What happens if we don't and they stay?”

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 A great job is a job in which you believe the organization
cares about your development.

A great job is a job where you can use your strengths everyday.

A great job is a job where you believe your work makes a

contribution to something worthwhile.

A great job is a job that prepares you for your next one.

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 Risks of Neglecting Talent
Failure to sustain growth
• Without the right talent in key areas, we run the risk of missing out on
emerging opportunities.
Failure to attract emerging talent
• Talent will go where talent can thrive.

Failure to secure succession

• We need to constantly be planning ahead – identifying and nurturing
future leaders. “Great jobs are those that prepare you for your next one.”

Failure to retain top performers

• We need to be able to offer the necessary challenges and career
development to motivate/retain top performers

Failure to weed out poor performers and “culture disruptors”

• Poor performers and/or consistent disruptors undermine productivity and
erode morale.

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 Talent Development Process
1. Employee Recruitment
• Verification of job duties
• Recruiting / Screening applicants
• Orientation vs. Onboarding

2. Performance Development
• Job description
• Performance Plan
• Performance Reviews/Feedback
• Performance Improvement Plan
• Performance Appraisal

3. Professional Development/Training
• Requisite / Employee-desired
• Performance Support
• Adaptive Capacity

4. Succession Development
• Moving people into new positions or helping expand horizons
• Off-boarding
5. Compensation
• Direct (salary/wages)
• Indirect (benefits/leave, etc.) 7
 1. Employee Recruitment
Verification of job duties
Prior to filling an existing (vacant) position, an organization
committed to talent development should take the time to
assess/review all the requisite job duties of a position and if
adjustments or changes are necessary, make them prior to
posting the job.
The same process should be used when creating new
positions.

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Recruiting/Screening applicants
An organization committed to talent development will often
enlist a team to assist in reviewing job candidates.
These teams collaborate in most facets of the process;
screening applications/resumes, helping with developing
interview questions, participating in the interviews, and
offering individual feedback on candidates.
The organization’s ED and HR typically comprise the core team
with other employees (Directors, Managers) involved as
appropriate.

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Orientation
• Transactional in nature
• Usually completed within the first week
• Addresses the organization’s needs
• Focused on completing paperwork

Onboarding
• Strategic by design
• Integrates multiple functions and individuals
• Addresses employees’ needs
• Maximizes employee engagement and retention

Onboarding is the process of “bringing” the employee into the

organization and ensuring they have what they need to be successful.

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 2. Performance Development
Job Description
In talent development organizations, every single employee –
regardless of full or part time – should have a specific-to-their-
job description.
The job description should outline specific roles and
responsibilities, requisite competencies, and performance
measures.
The employee, his/her immediate supervisor, his/her
Department Head, HR, and in some cases, the Executive
Director should all participate in the development or
refinement of job descriptions.

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Performance Plans

The performance plan is an instrument that facilitates the

identification and development of goals as well as the
measurement of progress by the employee and supervisor.

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Performance Reviews
Each employee/supervisor is expected to engage in
intermittent performance reviews; typically coinciding with
important benchmarks established in the Performance Plans.

The purpose of the reviews is to provide/solicit feedback, offer

commentary and advise/counsel each other on individual
performance and overall job capability.

Typically, a uniform instrument is created to help document

the performance reviews.

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Performance Improvement Plan

If an employee’s overall performance is unsatisfactory, a

supervisor may opt to implement a Personnel Improvement
Plan (PIP).

The objective of the PIP is to provide the employee with

further clarity of expectations, specific goals to be achieved,
and a timeline for completion.

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Performance Appraisal

Final performance appraisals are completed for every

employee at the end of the performance period (typically
coinciding with the employee’s anniversary date).

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Performance Feedback
After the Performance Appraisal is received, the Executive
Director and HR can – if warranted - review the Appraisal
along with the appropriate Department Director.

Where appropriate, additional encouragement, reinforcement

and/or follow-up by the Executive Director and/or HR to the
individual employee is conducted.

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 3. Professional Development/Training

In talent development organizations, all employees are

encouraged to seek out professional development
opportunities.
In some cases, professional development is a requisite of the
job. Where not required, it helps keeps staff current on
critical program and/or policy issues. In other instances, it is
linked to performance support (i.e. correcting behavior or
enhancing capability).

Adaptive capacity (i.e. cross-training) is an important

professional development tool because of its ability to help
expand the employee(s) knowledge base.

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 4. Succession Development

An important part of any talent development strategy

involves identifying and nurturing staff who are looking for
opportunities to learn and grow.
Doing so lessens the potential negative impact of unforeseen
employee separations while helping others prepare for more
challenging opportunities that may be on the horizon.
Remember what we said earlier…
“A great job is a job that prepares you for your next
one.”

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 Off-Boarding
In the case of voluntary separations, off-boarding helps the
organization understand why an employee decided to leave.
Sometimes this feedback can provide insight in TD systems
that need to be improved.
For the organization, off-boarding assists with the transfer of
the position to subsequent employees. Off-boarding also
helps protect or preserve any physical property and helps
ensure compliance with and control over security and access
issues.
For the employee, the off-boarding process provides
important separation information (final payment procedures,
retirement/other benefits, etc.) upon their departure. It also
provides an opportunity for the employee to wrap up any
critical tasks/projects and gives them a sense of closure.
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 5. Compensation

Compensation is a valued component of talent development

because it provides employees with a tangible reward for
their contributions as well as a source of recognition.
For organizations committed to talent development, a quality
compensation system is one that encourages productivity,
focuses on outcomes, and rewards achievement of results.

If implemented correctly, it should also reduce unnecessary

turnover.

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Quality compensation systems typically factor in the following
4 elements:

1. Whether the rate of pay within an organization is to be

above, below, or at the prevailing market rate.

2. The pay level at which employees are recruited and the

pay differential between new and more senior employees.

3. The ability of the compensation system to gain

acceptance while motivating employees to perform.

4. The intervals at which pay raises are granted and the

extent to which merit and/or seniority influences raises.

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 When designing a compensation system, an organization must first identify
what it wants to compensate; the job or the individual in the job.

Organizations that compensate the job do not take into account individual
performance when determining pay. Compensation is set and adjusted
based on the organization’s preferred position within the marketplace
and/or to ‘keep up with’ inflation.
Conversely, organizations that compensate the individual in the job
recognize and reward performance. Similar to compensating the job, pay is
initially based on the organization’s preferred position within the
marketplace...
…but unlike compensating the job, compensating the individual in the job
considers intervals at which pay raises are granted and the extent to which
merit influences pay raises.

Organizations committed to talent development understand how important

both market position and individual performance are in terms of their ability
to attract, retain and develop talent.
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 Prevailing Market
All quality compensation systems – whether focusing on the job
or the individual in the job – should be based on a preferred
positioning within the prevailing market.

To do this, an organization must first identify what its relevant

prevailing market is and second, where it wants to position
itself within that market.

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 Prevailing Market for Texas COGs

For Texas COGs, the relevant prevailing market has ostensibly been defined
by Texas Local Government Code Section(s) 391.0117 and 391.0095(c)
which mandates “the salary schedule adopted by the COG may not exceed,
for classified positions, the state salary schedule for classified positions as
prescribed by the General Appropriations Act adopted by the most recent
legislature.”

In the majority of cases, where within the prevailing market an organization

prefers to position itself is an organizational matter.

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 Compensating the Job

Cost of living adjustment (COLA) is an example of compensating the job.

There is no correlation between COLA and performance. COLA doesn’t care
about performance or individual merit. As a compensation tactic, it treats all
jobs the same.

That’s not to say COLA isn’t a legitimate or appropriate component to a

quality compensation system. It most certainly is; particularly to
organizations that prefer to compensate the job and/or that are looking to
implement an across-the-board prevailing market adjustment.

Even among organizations whose compensation system is more targeted to

the individual in the job, COLA still has its place, albeit a lesser degree to
other merit-based or pay-for-performance options.

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 Compensating the Individual in the job.
This approach is typically referred to as “pay-for-performance” or
“merit-based” compensation. It is the compensation system that many
talent-focused organizations employ.
Why?
• Because it’s focus is on the individual rather than the job
• Because it maintains a relationship between pay and performance without a
direct link
• Because is keeps the focus of the annual appraisal on individual performance
and away from $ and ¢

To work, a merit-based compensation system must...

• Be externally competitive
• Be internally equitable
• Incent and reward performance

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What factors influence compensation? There are 7:

1. The value of job to the organization (Salary Grade)

2. Position with in the Salary Grade (proximity to MIN, MID, MAX)
3. Competence (skills demonstrated to prove ability to perform)
4. Performance (documented accomplishments, goal achievement)
5. Experience (# of years in a related skilled position)
6. Education/Credentials (specific to the job)

7. Economics ($ available)

Each of these factors working together =

TARGET PAY
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Adopting a ‘Target pay-based’ pay for performance system will
give an organization more flexibility when it comes to
determining individual pay because it’s focus in on the
individual doing the job, as opposed to the job itself.

Remember. Performance is but one of seven distinct factors

influencing compensation. There is no direct correlation
between an individual’s performance and their compensation.

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 TCOG Compensation System
There are 3 “Target Pay Zones” associated with our proposed Pay for
Performance compensation system

Target Pay Zones

Entry Level Competitive Level Advanced Level

77% to 91% 78% to 113% 79% to 123%

{We already established that every position at TCOG has a MIN, MID and MAX. The
average % of separation from MID for all these positions is 77% (MIN) to 123% (MAX).}

Compensation within each Target Pay Zone will be based on 3 factors:

1. Level of job capability (talent/skills/ability to perform)

2. Education/Credentials (unique to each job)
3. Job-related experience (combined period working on job-related activities)

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 Here’s a visualization of a Target Pay Zone structure in play.
(2 different employees – same Salary Group)
Employee 1: Employed for 2 months. No prior job-related experience. Standard
education/credentials. Where on the Pay Range chart would this person be?
Employee 2: Employed for 25 years. Same At Standard education/credentials but
has Fully Developed job capabilities. Where on the Chart would this person be?
Every Target Pay Zone has its own MIN, MID, and MAX.

Pay Range
MAX
MAX
Employee 2
MID
Target Pay Zone
MIN
Pay MID

MAX
Employee 1
MID
MIN Target Pay Zone
MIN

Job Capability, Experience, Credentials

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 The first step in implementing a pay for performance compensation
system requires identifying where each individual employee’s current
compensation is relative to their designated Target Pay Zone determined
by their Years
Years of
of Experienceand
Experienceand degree of Job Capability.
Target Pay Zones

Years of Job-Related Experience Job Capability Job Capability

-Technical skills
-Interpersonal skills
Needs -Job knowledge
Fully Developed Advanced -Writing skills
Development
-Verbal skills
0 to 4 years 77% to 79% 78% to 84% 79% to 86% -Dependability
-Decision Making
5 to 9 years 77% to 81% 85% to 91% 88% to 95% -Etc.
10 to 14 years 77% to 84% 92% to 98% 97% to 105%
15 to 19 years 77% to 86% 99% to 105% 106% to 114%
20 to 24 years 77% to 88% 106% to 112% 114% to 121%
25 years and greater 77% to 91% 106% to 113% 114% to 123%

Target Pay Zones are calculated as a percentage to the MID point of an

individual Salary Group.
Question: Using the chart above, what target pay range would you expect an
employee to be at assuming she was a consistently good performer with 12+ years of
job-related experience?

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 The chart below illustrates how to determine where an employee’s compensation
is in relation to their Target Pay Zone.
Employee Name Maureen Brendon Megan Shannon
Job Title CEO CFO CIO Manager
Date of Hire 9/10/2018 12/1/2008 1/4/2010 3/10/2014
Current Compensation $110,000 $74,616 $63,229 $48,366
Salary Group B30 B26 B22 B20
Longevity at current salary group 0.65 12.83 4.46 5.09
MIN $ $101,630 $69,415 $51,614 $45,158
MID $ $136,756 $93,406 $68,047 $59,473
MAX $ $171,881 $117,397 $84,479 $73,788
Education/Credential Level (specific to current job) At standard At standard At standard At Standard
Latest Evaluation of Job Capability Fully Developed Fully Developed Fully Developed Fully Developed
Target Pay Zone (TPZ)
MIN % 78% 92% 78% 85%
MID % 81% 95% 81% 88%
MAX % 84% 98% 84% 91%
MIN $ $106,984 $73,071 $53,233 $50,658
MID $ Target Pay Zones
$110,784 $75,667 $55,124 $52,311
MAX $ $114,585 $78,263 $57,015 $53,963
% Difference between CurrentYears
Pay and TPZ MID
of Job-Related 1
Experience -0.71% -1.39%
Job Capability 14.70% -7.54%

Needs
Fully
Fully Developed
Developed Advanced
Development
0 to 4 years 77% to 79% 78%
78% to
to 84%
84% 79% to 86%
5 to 9 years 77% to 81% 85% to
85% to 91%
91% 88% to 95%
As shown, the chart illustrates where each employee’s
10 to 14 years 77% to 84% pay 92%
is into
92% torelation
98%
98% to97%
their
theto MAX
respective
105% of theirTarget
respective Target
Pay Zone.
Pay Zone.
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This determination is critical because it’s the basis from which adjustments to
an individual employee’s compensation can be anticipated, budgeted for, and
– under the appropriate resource (Grants) and authorization (Governing
Board) conditions - implemented.

The determination can also be used by supervisors to more effectively

communicate to their direct reports some of the areas or activities they should
focus on or what specific skills they should master in order to help them move
upward through their respective Target Pay Zone.

The appropriate forum for these discussions?

Performance Planning and Reviews

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 Let’s pause for minute and do a ‘gut-check’ on where we are relative
to our merit-based or pay for performance expectations.

Goal 1: For pay to be market competitive

YES: TCOG’s compensation system conforms to the prevailing market parameters established
by the Legislature and as documented by the Texas State Auditor’s Office State Classification
Team
Goal 2: For pay to be internally equitable
YES: The Target Pay compensation system we’ve developed should help alleviate most
compensation inequities. Under the system, compensation will be set or re-set in accordance
to objective criteria.

Goal 3: For pay to reward performance

NOT YET: So far, our discussion regarding compensation factors has focused on job capability,
years of experience, and education/credential level. Individual employee performance – as
measured by a Performance Management Program – hasn’t yet been factored in.

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 So what about Performance?
Remember what we said about quality compensation systems– a quality
compensation system is one that motivates employees to perform.

Because it’s focus is on the individual, our Target Pay compensation system will
include a merit-based component. Merit pay will be targeted toward employees
that meet or exceed established performance measures. Employees that fail to
meet an acceptable level of performance will be ineligible for merit consideration.

As always, implementation of pay-for-performance is subject to resource availability

as authorized by TCOG’s Board of Governors.

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Under the proposed system, the % range that an eligible employee will receive
merit consideration will be based on two things.
(1) The employee’s performance score based on the annual performance appraisal…

Job Performance Rating

Exceeds Standards
Meets Standards
Needs Improvement
Fails to meet standards

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… and (2) the employee’s position relative to their Target Pay Zone.

Merit Pay Table

Current Pay is -10% Current Pay - 10% Current Pay is
Job Performance Rating or more below MID or equal to MID greater than
TPZ TPZ MID TPZ
Exceeds Standards
3.51% to 4.00% 3.26% to 3.50% 3.01% to 3.25%
(4.00 - 5.00)
Meets Standards
2.76% to 3.00% 2.51% to 2.75% 2.25% to 2.50%
(3.00 - 4.00)
Needs Improvement
(2.00 - 3.00)
Fails to meet standards
NOT ELIGIBLE
(0.00- 1.99)

Under this Target Pay Zone model, merit range %s are structured so as to accelerate
advancement for those below their designated TPZ MID.
Merit range %s slow for those at or above their designated TPZ MID.

Employees whose performance doesn’t meet standards are ineligible for a merit increase

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Determining which merit pay range an employee falls under begins by taking the
earlier Target Pay Zone Chart and incorporating data from the Merit Pay Table.

MIN $ $106,984 $73,071 $53,233 $50,658

MID $ $110,784 $75,667 $55,124 $52,311
MAX $ $114,585 $78,263 $57,015 $53,963
-0.71% -1.39% 14.70% -7.54%
Performance Rating 3.000 3.374 3.337 3.217
Merit Range 2.51% to 2.75% 2.51% to 2.75% 2.25% to 2.50% 2.51% to 2.75%
Calculated Merit Increase (%) 2.51% 2.60% 2.33% 2.56%
Calculated Merit Increase ($) Merit$2,761.00
Pay Table $1,939.85 $1,475.93 $1,239.18
Adjusted Compensation $112,761.00 $76,556.24 $64,705.43 $49,605.54
Current Pay - 10% Current Pay is
Current Pay is -10% Current
Job Performance Rating or more below MID or or equal
equal to MID greater than
TPZ TPZ MID TPZ
Meets Standards
2.76% to 3.00% 2.51% to 2.75% 2.25% to 2.50%
(3.00 - 4.00) 38
 Implementation
Its important to remember that the implementation of pay increases – whether job or
individual-in-the-job focused – is entirely contingent on (1) resources being available
and (2) GB authorization.
Understand too that every decision on resource allocation is ‘cause and effect’
meaning increasing the budget ‘here’ often results in a corresponding decrease
‘there.’ Too much ‘there’ and we risk compromising the organization. It is both
Management’s and the GB’s responsibility to make sure that doesn’t happen.

Recap. Implementation of our compensation system involves two phases.

The first phase is tied to the employees’ position within their TPZ with adjustments
being made either to account for and correct significant anomalies or in response to
achievement of job capability benchmarks.

The second phase is the pay for performance component; where merit pay is
considered based on measurable individual performance. Either/both are possibilities
with either/both subject to resource availability.

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