Creating the Next Generation of Federal Human Capital - The 2014 State of Human Capital Management Report
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Creating the Next Generation of Federal Human Capital The 2014 State of Human Capital Management Report
Whitepaper
Participants
In addition to the more than 200 respondents
to the survey, this whitepaper contains five Table of Contents
interviews with federal leaders in human Participants in the Whitepaper.................................................. 2
capital management who provided valuable Introduction............................................................................. 3
feedback on the major trends discussed in The Findings............................................................................. 7
this report. All quotes, advice, and insights Part I: Greatest Need for Staff Development ............................. 7
quoted in this report came directly from these Part II: Top Priorities for 2014.................................................... 8
executives. Part III: Scope of Investments: Succession
Planning and Training..............................................................10
Part IV: Through Which of These Methods do
You Deliver Training Content ..................................................12
Robert N. Goldenkoff
Director, Strategic Issues Part V: Where We Are vs. Where We Need to Be......................13
Government Part VI: Top Barriers to Goals...................................................14
Accountability Office Going Forward: Shifting Culture to Foster Change...................15
About HCMG..........................................................................17
About Cornerstone OnDemand...............................................17
About WBR.............................................................................18
Peter Shelby
About WBR Digital..................................................................18
Associate Dean
Sources...................................................................................19
National Intelligence
University
“Succession planning is about preparing for
John Palguta
Vice President the future. If agencies are not doing that or
Policy of the Partnership are not doing it well, it could exacerbate the
for Public Service issues going forward as more and more folks
retire. The important thing to understand about
succession planning, where agencies often
miss the boat, is that it’s not a question of
David Krieg
duplicating what you are now and backfilling
Human Capital Officer
vacancies. It’s thinking about what your future
Internal Revenue Service
needs and what the requirements are. What’s
your mission going to be in the
years ahead?”
Yvonne Jones
Robert N. Goldenkoff, Director,
Director
Strategic Issues, Government
Government Accountability Office
Accountability Office
The 2014 State of Human Capital Management Report 2Introduction
Creating the Next Generation of Federal
Human Capital
Human capital – the collective talent, skills, and greatest impediment to achieving their goals,
capabilities of individuals who create value and apart from budget, was the management culture
productivity in an organization – is one of, if not the, of their organizations. In the survey, organized by the
most important drivers in a federal agency’s overall research team at HCMG and partner Cornerstone
success. As a wave of retirements continues to hit OnDemand, a talent management solutions provider,
the federal sector, developing an effective long-term only 20 percent of respondents reported their
strategy to address turnover, recruit and develop succession planning efforts as successful. In addition,
people with needed skills, and create the most value 49 percent reported that they are not looking to invest
with the talents of the remaining workforce is critically in specific succession planning strategies over the next
important. There is no one-size-fits-all approach when it few years. Human capital professionals are focusing
comes to succession planning, but the consequences of on individual, siloed projects rather than building
a lack of a concerted, unified effort could be dire. strategic, unified efforts toward planning for the future.
Lacking a strategic, integrated plan for hiring new
talent, evaluating and engaging current employees,
80
70 80% and developing future leaders could risk the core
60 foundation of human capital in federal agencies in the
50
years ahead.
80%
40
30
20 10% 10%
10
0
of government executives said that
the greatest impediment to achieving
their goals, apart from budget, was the
management culture 80
70
of their organizations.
60
20%
Only
50
40
30
Building and executing 20
10
strategy is imperative for
0
an effective succession planning
federal government agencies,
49%
but these efforts come with overwhelming challenges.
In the face of insufficient funding, budget uncertainty,
and increased regulation,
100
developing and retaining
the task of finding,
talent for the future is an
20%
80
of respondents reported their succession
uphill battle for the federal
60 sector.
40
planning efforts as successful. In addition, 49
At Worldwide Business 20
Research’s (WBR) recent percent reported that they are not looking
Human Capital Management0
for Government to invest in specific succession planning
(HCMG) conference, 200 human capital professionals strategies over the next few years.
answered questions about human capital management
in the federal sector. According to the responses,
80 percent of government executives said that the
The 2014 State of Human Capital Management Report 3I Can’t Get No “Job” Satisfaction
“Agencies aren’t doing effective workforce planning, Federal respondents reported job satisfaction at 64 percent,
succession planning, or are not investing in training a two percent decrease from 2012. Job satisfaction on the
and development,” said Robert N. Goldenkoff, Director, whole had the greatest decrease, with respondents only
Strategic Issues, Government Accountability Office giving a 59 percent rating of satisfaction In 2013 – a four
(GAO), in response to the survey results. “It raises the risk of percent decrease from the year prior. i This is in line with the
skills gaps which could affect the ability of agencies to cost- findings of HCMG’s survey wherein 76 percent of federal
effectively carry out their missions.” human capital executives reported that current programs
and procedures for employee management initiatives
The shortcomings in human capital management found in fall short of where they need to be. Human capital
HCMG’s benchmark are not only felt on the management management programs are not only viewed as falling
level. According to the 2013 Office of Personnel short by their agency executive assessments but also more
Management’s (OPM) Federal Employee Viewpoint Survey importantly, by employees.
(FEVS), federal employees reported declining satisfaction
76%
across all aspects of their employment: their work
experiences, their supervisors, and their agencies. Despite of federal human
their dedication to their work, with more than 90 percent
24% capital executives
reporting their willingness to put in extra effort to do their
job better, the 2013 respondents reported a significant 76% reported that current programs
decline in employee satisfaction. These responses extend and procedures for employee
a similar decline across a majority of 2012’s questions. management initiatives fall short
Predicting the Fallout from the Silver Tsunami
Workforce planning is especially important as agencies we will examine further, are derailing their projects’
are facing a wave of baby boomer retirements, referred overall success. As human capital managers work
to by government industry executives as “the silver independently on their own projects, instead of working
tsunami.” The size of the aging boom is staggering. in conjunction with one another, they are unable to
According to the 2013 GAO survey, roughly 30 percent connect their combined resources and bridge the gap
of federal employees on board at the end of fiscal year toward building a successful succession strategy.
2011 will be eligible to retire by 2016.ii Of those, 58
percent are currently high-ranking senior executives.
“Employee turnover, especially retirements,
With the silver tsunami in its early phases, workforce
planning has been top of mind for federal agencies. are trending upwards and the talent bench
That’s why the majority of respondents from the HCMG is thinner than it should be terms of finding
survey (71 percent) said that identifying/closing skills individuals ready to move up to higher levels of
gaps in their workforce is their number
0 10 20one
30 priority
40 50 for
60 70 80
responsibility or into management roles. None
2014, coming ahead of the other major components of
succession planning strategies: recruitment (60 percent) of this bodes well for employee engagement,
and training and development (53 percent). productivity, or efforts to manage well. That
doesn’t mean that it will be impossible to
An overarching concern among human capital managers improve in any or all of these areas, but the
is that strategies for succession planning100are not uniform
across departments or organizations within an agency. degree of difficulty associated with making
80
This concern is not unfounded as only four percent of improvements has certainly increased.”
60
respondents saw their succession planning efforts as
successful. Though ample resources are 40being applied John Palguta, Vice President,
toward the components of succession planning,
20 agencies Policy of the Partnership for
are not working together to combine their 0 efforts into
Public Service
a successful strategy. These “siloed efforts,” which
100
80
60 The 2014 State of Human Capital Management Report 4
40The potential loss of leadership and institutional have relatively inexperienced managers supervising
knowledge as a result of massive retirement waves employees [who are] still learning the ropes in some
underscores the importance of a strategic and efficient areas.”
approach to developing and retaining individuals
with the critical skills needed to lead the country in While identifying and closing
the coming years. That’s why 77 percent of HCMG’s 5%
skills gaps was cited by
respondents also cited adaptability to changing 18%
needs and leadership development as the greatest
need for staff development in 2014.
While succession planning should be top of mind
40%
37%
78% of respondents
as a top priority, only 45 percent
for federal agencies given the wave of retirements reported that they were actively
in coming years, HCMG’s survey found that only 38 working on it at this time.
percent of human capital managers cited succession
planning as one of their top three priorities. These same
respondents identified the individual components of According to HCMG’s research, it is clear that federal
succession planning as priorities, but not succession agencies are not adequately preparing employees to
planning as a whole. Siloed efforts are leading ascend into leadership roles and become the next
managers away from strategic planning and successful generation of agency managers and leaders. These
execution of their initiatives. This may explain why findings should serve as an important warning about
some organizations’ goals are not in line with the actual the long-term development of the workforce, the
investments that are being made. While0 10 identifying
20 30 40 50 60 consequences
70 80 of not aligning approaches within
and closing skills gaps was cited by 78 percent of agencies, and the risks of insufficient planning for the
respondents as a top priority, only 45 percent reported development of future leaders.
that they were actively working on it at this time.
The declining and alarming numbers in job
satisfaction, coupled with the upcoming wave of
100 retirements, speak to how critical human capital
“If the number of employees in the federal
80 management is for the federal government. The
workforce that are eligible to retire actually
60
research suggests that the siloed efforts currently in
place to build and cultivate the federal workforce are
do retire, federal agencies will be at risk
40 for
falling flat. Without developing and executing a more
achieving their missions. The twofold impact
20
predictable and responsible succession plan, agencies
on management is that government agencies0
risk losing their most talented employees and future
will have relatively inexperienced managers leaders.
supervising employees [who are] still100learning
Preparing current employees for future roles and
the ropes in some areas.” 80
additional responsibilities is especially important in
60 today’s human capital environment. If agencies can
David Krieg, Human Capital 40 begin to break down silos and integrate their resources
Officer, Internal Revenue 20 and efforts around talent management initiatives, they
Service 0
will be better positioned to take full advantage of the
government’s most important resource – its human
capital. So, what is standing in the way of this type
of preparation? 80 percent of respondents said
“If the number of employees in the federal workforce management culture.
that are eligible to retire actually do retire, federal
agencies will be at risk for achieving their missions –
not only because of the number of employees, but
because of the loss of institutional knowledge and
skills that employees developed,” said David Krieg,
Human Capital Officer, Internal Revenue Service, in
response to the survey’s findings. “The twofold
100
impact
on management is that government agencies will
80
60
40
20
The 2014 State of Human Capital Management Report 5
0Cultivate Leaders of Tomorrow, Today
An agency’s ability to successfully execute its current benchmarking questionnaire for HCMG’s 2013
and future missions is dependent upon its ability human capital manager audience. The survey
to enable the succession of leadership; an active, was distributed at the HCMG Conference, where
strategic approach is crucial for the years ahead. more than 200 leaders answered questions about
Leaders must utilize training across the government strategic human capital planning, workforce
to help employees garner the specific skill-sets management strategies, talent management,
needed to address the complex challenges that and best-in-class strategies for building a results-
the federal workforce is charged with, such as oriented culture. Their roles included Chief Human
national security, disaster response, and economic Capital Officer, Senior Vice President, Deputy
security. HCMG and Cornerstone’s research Assistant Attorney General, President, and Chief
indicates that an overarching problem in federal Executive Officer. They represented agencies or
workforce management is the lack of a uniform organizations as diverse as the U.S. Department
plan of succession to bridge the knowledge gap of Defense, Department of Homeland Security,
from point A to point B. Individual, siloed efforts NASA, and the Environmental Protection Agency.
are not strategic and are not designed with long- This report details the results of the survey and
term success in mind. Lacking a unified effort across comments on the trends for the future success of
agencies wastes resources and does a disservice to human capital management in government.
the workers involved. As previously stated, working
together to develop the best leadership will allow
the federal workforce to meet its full potential.
How can leaders bridge the gap between
where they are now and where they want to be? Preparing current employees for future roles
“Organizations need to be realistic about their and additional responsibility is especially
goals and priorities,” Krieg said. “They need important in today’s human capital
[to] fight for the critical factors that will enable
environment. If agencies can begin to break
success. Employees are the most important
element for organizational success and we need down the silos and integrate their resources
to support, appreciate and empower them as and efforts around talent management
much as possible.” Krieg advocates finding low- initiatives, they will be better prepared to
cost, high-impact alternatives to the classroom,
take full advantage of the governments most
such as shadow assignments and increased
coaching and mentoring, to help employees step important resource: its human capital.
into leadership and management roles. Increased
flexibility and creativity could also be the key to
solving the challenges highlighted in this report.
“Overly regulated and structured processes and
policies will no longer be effective in an ever-
changing and increasingly complex environment,”
Krieg continued. “Organizations need to empower
employees with the freedom to approach problems
in different ways.”
The team behind WBR’s HCMG training series,
with help from an advisory board of senior-level
employees with talent management expertise, along
with partner Cornerstone OnDemand, created a
The 2014 State of Human Capital Management Report 6The Findings
Where do you see the greatest need for staff
development within your organization?
For human capital managers in the federal sector, Human capital managers are working on their own
adapting to the changing workforce is a key individual projects instead of working in conjunction
component of staff development. Doing “more with one another strategically to reach their ultimate
with less” is the slogan for the government, goals. Their siloed efforts may lead to a disconnect
stemming from factors such as a three-year pay in the long run, and time may be wasted as internal
freeze, sequestration, and reductions in training to departments simultaneously and unknowingly
keep in line with ongoing budget cuts.iii The real reinvent the wheel. If individual departmental efforts
challenge for human capital managers is around are better combined, organizations might see more
filling skills gaps and ensuring organizational substantial progress toward achieving the common
efficiency to prepare for the organizations’ goals of developing future leadership.
future. These challenges, in conjunction with
limited resources, make it all the more difficult The results of the HCMG survey show a stark
for agencies to ensure that they provide new and departure from the core values of some the survey’s
necessary resources without breaking the bank. respondents. For instance, according to the U.S.
Marine Corps leadership manual, “adaptability”
HCMG’s research found that 77 percent of human means a willingness to deviate from normal,
capital managers cited adaptability to changing accepted practices – even from doctrine – if that is
needs and leadership development when asked what it takes to win on the battlefield. Soldiers are
about the greatest need for development in their trained for uncertainty, and they encounter it daily.
organizations. In other words, the challenges of Their resources in terms of troops and arms can
the current budget environment are making it change radically without warning, and they need to
difficult for agencies to break out of their current adapt quickly to achieve their missions.
siloed molds in order to prepare employees to
meet future demands and to lead their agencies. The government agency landscape, on the other
hand, is no battlefield. Employees entering the
HCMG’s findings are not groundbreaking; workforce have not been trained to adapt to the
adaptability to changing needs will always be key uncertainty of an unlevel playing field, and human
for success in any organization. Change is fast and capital professionals must keep this in mind when
uncertain. Human capital managers in particular developing, executing, and implementing training
are tasked with developing strategies amid for their employees.
uncertainty and must put forth new initiatives that
can keep pace with the speed of change in the
federal sector.
Only 4%
4%
“Any new initiative or program intrinsically has 10%
to be ever-evolving and ever flexible to change 10%
as needed,” said the IRS’ Krieg. “Organizations
need to anticipate changes in the environment and 76% of respondents saw their
take considered risks rather than react only to the succession planning efforts as
status quo. They then must keep working to react
very successful.
to changes and update their strategy.”
The 2014 State of Human Capital Management Report 7Leaders in the federal sector are attempting to
empower staff to “do more with different,” a term
first coined by Peter Shelby, Associate Dean of the “This is a new paradigm. It’s a shift in the way
National Intelligence University. In order to do more of doing business that’s going to be for the
with different, leaders must find new ways to be more long term. How are we going to accomplish
self-sufficient in what they do and not rely on external the same amount or more work with what we
vendors when budgets are cut. They must learn to
build their strategic training plans together and share have? In order to grow, we have to become
resources to keep pace with the new realities for job very, very targeted, and [have to] focus on the
expectations in the federal sector. core mission. A lot of the ‘nice to haves’ have
gone away.”
“We have to realize that sequestering may go on
for the next ten years,” said Shelby. “This is a new Peter Shelby, Associate
paradigm. It’s a shift in the way of doing business that’s
Dean, National Intelligence
going to be for the long term. How are we going to
accomplish the same amount or more work with what University
we have? In order to grow, we have to become very,
very targeted, and [have to] focus on the core mission.
A lot of the ‘nice to haves’ have gone away.”
What are your organization’s top
priorities for 2014?
In an industry rife with hurdles and challenges, one is where agencies often miss the boat – is that it’s not a
might think that deciding on “mission critical” federal question of duplicating what you have now and backfilling
issues would be incredibly complex. Surprisingly, these vacancies. Agencies sometimes don’t get that.”
decisions are quite simple.
With the wave of retirements looming, the potential loss
In preparation for the impending silver tsunami, of leadership could be devastating. This potential loss of
workforce planning is top of mind for federal agencies. institutional knowledge underscores the importance for
When asked to identify their top three priorities agencies to find a uniform, strategic, and efficient approach
for 2014, respondents of the HCMG survey cited to acquiring and retaining individuals with the critical skills
identifying/closing skills gaps in their workforce as needed to lead the country in coming years.
the number one priority for 2014 (71 percent), coming
ahead of recruitment (60 percent), and training and It is not hard to see why closing skills gaps and
development (53 percent). succession planning are top priorities for federal
agencies. What is surprising is the reality of where
With the GAO predicting that 30 percent of federal agencies are investing their money in relation to what
employees will retire by 2016, a lack of focus on succession
planning could be devastating. Preparing employees for 71% Identifying/Closing Skills Gaps
future roles and responsibilities is crucial for the success of
60% Recruiting People with the Right Skills for the Job
human capital management in the government. iv
53% Training and Development for All Staff
“Succession planning is about preparing for the future,” 21% Annual Performance Reviews
said Goldenkoff of the GAO. “If agencies aren’t doing that
16% Continuous Feedback
or are not doing that well, it could exacerbate the issue
going forward as more and more folks retire. The important 40% Identifying/Retaining Top Performers
thing to understand about succession planning – and this 38% Succession Planning
0 10 20 30 40 50 60 70 80
The 2014 State of Human Capital Management Report 8100
they cite as their apparent goals. While identifying 1 Recruiting People With The
19% 24% 13% 19% 18%
Right Skills For The Job 34%
and closing skills gaps was cited by 78 percent
80 of
16% 20% 31%
2 Identifying/Closing Skills 20% 9% 32% 31%
respondents as a top priority, only 45 percent
60 reported Gaps
10% 12%
that they are actively working on related projects.
40 3 Training And Development 16%
19% 20%
For All Staff 55%
20 45% 46% 45% 40%
Annual Performance 30% 31%
“It is almost axiomatic that when budgets are tight or 4
Reviews 1 2 3 4 5 6 7
0
are being reduced, training and development efforts are 5 Continuous Feedback
zz Yes – working on it now
among the first items to go,” said John Palguta, Vice 6 Identifying/Retaining Top zz Maybe – considering in next 24 months
Performers
President, Policy of the Partnership for Public Service zz No – not at this time
100 7 Succession Planning zz Yes – but reducing current investment
(PPS). “For some agencies last year, for example, it was
80
a choice between additional days of unpaid furlough
for some employees or deferring training. It’s60not that your mission is, not just now, but what your mission
agency leaders and chief human capital officers40 don’t is going to look like five years in the future.”
understand the need to close skills gaps or to20invest in the
development of their employees, it’s more of a case of In the current human capital environment, federal
0
deferred maintenance of the workforce. Unfortunately, as agencies’ goals are not in line with the actual
we know, if maintenance is deferred for too long, there is investments that are being made. This disconnect,
danger of a breakdown or, in this case, mission failure.” HCMG’s survey found, is demonstrated throughout
the workforce planning cycle. While 60 percent of
human capital managers cited recruiting people
with the right skills for the right job as one
It’s not that agency leaders and chief human
of their top three priorities for 2014, only 46
capital officers don’t understand the need to percent are currently investing in projects related
close skills gaps or to invest in the development to hiring employees with the right skills for the
of their employees, it’s more of a case of job. What is more surprising, given the pending wave
of retirements, is that only 38 percent of human
deferred maintenance of the workforce. 100 capital managers cited succession planning as one of
Unfortunately, as we know, if maintenance 80 their top three priorities, coming in fifth out of the
is deferred for too long, there is danger60 of a seven options listed in the survey. Only 31 percent
breakdown or, in this case, mission failure.” of human capital managers are actively working on
40
succession planning at their organizations. Nearly half
20
John Palguta, Vice President, (49 percent) are reducing the investment in this area
0 or not working on it at all.
Policy of the Partnership for
Public Service The findings again illuminate the need to break down
siloed, individual efforts on projects related to a
single component of succession planning and work
In the limited budget environment, federal agencies strategically together with long-term success in mind.
feel that they are lacking the resources needed to
adequately prepare employees for leadership roles as HCMG’s findings are not unusual. Over the past 13
the next generation of agency managers and leaders. years, the GAO has followed the federal sector’s
The survey findings serve as an important warning about increasing focus on closing skills gaps to address
the need for long-term workforce development, the workforce challenges in government. In a recent
consequences of not aligning resources across agencies report, the GAO found that, in order to address
to meet mission critical goals, and the risks of insufficient emerging mission critical skills shortages, strategic
planning and development of future leaders. human capital planning is necessary.v To ensure that
agencies are on pace with their succession planning
“I think this is illustrative of a larger issue with talent efforts, the report highlighted the need to involve
80
management and the level of sophistication and top management employees and identify critical skills
70
knowledge of how to do talent management 60 within and competencies needed to achieve current and
the government,” said Goldenkoff. “It 50 really varies future program results, develop strategies tailored to
40
across agencies. This goes back to the 30
importance address skills gaps, build internal capabilities needed
of workforce planning and understanding 20 your to address administrative and training support for
workforce dynamics. Knowing who’s10coming and workforce planning strategies, and include plans
0
who’s going, what skills are needed. [Knowing] what to monitor and evaluate agencies’ progress toward
meeting human capital goals.
The 2014 State of Human Capital Management Report 960
50
40
30
20
10
0
Is your agency currently investing in projects
related to any of the following initiatives?
As previously stated, workforce planning is
80
especially important as agencies are facing a wave 71%
70
Respondents of the
of retirements.60 According to the GAO, 58 percent 60%
HCMG survey cited
of senior executives will be eligible for retirement 53%
50
as of 2016.vi The40 potential loss of leadership identifying/closing skills
and institutional30 knowledge, coupled with fiscal gaps in their workforce
pressures, underscores
20 the importance of a uniform, as the number one
strategic, and 10efficient approach to acquiring, priority for 2014 (71%),
0
developing, and retaining individuals with needed
critical skills across agencies. coming ahead of recruitment (60%) and training/
development (53%)
HCMG’s survey found that only four percent of
20 30 40 50 60 70 80
agencies view 100
their succession planning efforts turnover, especially retirements, are trending upwards
as successful, the lowest response rate across all and the talent bench is thinner than it should be terms
80
seven initiatives. Succession planning initiatives of finding individuals ready to move up to higher
garnered the most
60 negative feedback on the survey, levels of responsibility or into management roles.
with a full 20 percent of the respondents reporting None of this bodes well for employee engagement,
40
succession planning projects as unsuccessful, coming productivity, or efforts to manage well. That doesn’t
00 ahead of continuous
20 feedback (12 percent) and mean that it will be impossible to improve in any or all
80 identifying/retaining
0 top performers (11 percent). of these areas, but the degree of difficulty associated
60 These findings suggest that federal agencies’ siloed with making improvements has certainly increased.
40
and independent projects are impeding their ability
to succeed with succession planning strategies. As “Organizations need to be realistic about their goals
20
a result, agencies are not adequately building a and priorities, but they also need to fight for the
0
leadership pipeline and are underpreparing the next critical factors that will enable success,” said IRS’s
generation of agency leadership. Krieg. “Employees are the most important element
for organizational success and we need to support,
00
1 Identifying/Closing Skills 6% 16% 12% 19% 4% 7% 4% appreciate, and empower them as much as possible.”
80 Gaps 33%
41% 44%
Recruiting People With 57%
60
2 56% What’s most telling about HCMG’s findings is that 63
The Right Skills For The 57%
54%
40
Job 43% percent of the human capital professionals surveyed
Training And Development 41% 38%
3 28% 21% 26% said that they view their succession planning efforts
20 For All Staff 19%
Annual Performance 9% 6% 6% 8% 12% 11% 20% as “not successful.” With agency priorities aligned to
0 4 1 2 3 4 5 6 7
Reviews training, development, and closing skills gaps, why are
5 zz Unsuccessful
Continuous Feedback agencies feeling like they are coming up short?
zz Not Very Successful
6 Identifying Top Performers
zz Somewhat Successful
7 Succession Planning zz Very Successful In a word, training.
Palguta spoke to some the factors contributing to
unsuccessful succession planning initiatives:
Identifying and closing skills gaps was cited by
Many agencies [have] seen increased workloads
and decreased resources relative to that workload. 78% of respondents as a top priority, but only
It’s difficult to plan when there is uncertainty over 45% reported to be
funding levels or when one is trying to accommodate actually working on
00
to an across-the-board reduction in spending levels this project at this
80 along with an increase in workload. Many federal
60 organizations have seen workloads increase and time
40 relative resources decrease. Employee
20
0
The 2014 State of Human Capital Management Report 1020
0
100
Are you investing in a more comprehensive training 80
60
program for 2014 than you had in 2013? 40
20
While training and development was reported to be Training programs
0
were identified
one of the top three priorities for all respondents of the as one of the top three priorities
HCMG study, only 45 percent claimed to be working on
this now. Thirty-four percent of human capital executives
for organizations in the federal
reported to actually be reducing their investments and sector, but only 14 percent 14%
only 12 percent reported to be “very successful” in reported that they are
this pursuit. If this is a top priority, and 88 percent of 44%
increasing their investments
respondents feel that they currently are unsuccessful in 42%
this regard, why is less being done instead of more?
in this area. What’s more, 44
percent are reducing their
While 60% cited recruiting current investments in training
people with the right skills for for the coming year.
the right job as one of their
46% top 3 priorities, only 46% are “With respect 100to the spending more or less money on
64%
currently investing in projects training, I think
80
that agency training budgets have been
hiring employees with the and continue to be affected by budgetary funding,”
60
said Yvonne Jones, Director, GAO. “Some agencies have
right skills for the job
continued to 40 put quite a bit of emphasis on training and
some, I think, feel that they’ve been forced to. You need
20
“The disconnect between desire and execution on the to know what an agency’s goals and objectives are and
training and development front is very much resource how training fits
0 into that in order to understand the
related,” said Palguta. “Not only [do agencies have] impact of budgetary funding for training.”
limited training dollars, but [also have] limitations on
related travel and on the amount of time an organization “[The fact] that agencies aren’t doing effective
can afford to have an employee away from the job. The workforce planning, succession planning or not
pendulum has very much moved to the too little training investing in training and development raises the risk
and development side of the equation and one can only of skill gaps in the future,” said Goldenkoff. “This
hope it will at least slowly move to the ‘close to almost could affect the ability of agencies to cost-effectively
adequate’ range on the scale. Again, federal leaders carry out their missions.”
know that it can be penny wise and pound foolish
to under-invest in their employees but in some cases
they’ve only had pennies.”
“Unfortunately, training is often considered discretionary
and not ‘mission critical,’” said Krieg. “The challenge “The challenge is to establish the importance
is to establish the importance of training while looking of training while looking for cost-effective
for cost-effective solutions that provide the necessary solutions that provide the necessary knowledge
knowledge and skills. We are investing in online learning
and skills. We are investing in online learning
and virtual classes to maintain our employees’ skills.”
80
and virtual classes to maintain our
70
Though training programs were identified as one of employees’
60 skills.”
the top three priorities for organizations in the federal 50
sector, only 14 percent of those surveyed reported that David
40 Krieg, Human Capital
they are increasing their investments in this area. What’s 30
Officer, IRS
20
more, 44 percent are reducing their current investments
10
in training for the coming year. With agency priorities
0
aligned to training and development/closing skills gaps,
there is clearly a disconnect between their goals and
their realities.
The 2014 State of Human Capital Management Report 110
00
80
60
40
20
Through which of these methods do you
0
deliver training content?
According to the survey responses, 89 percent of “There are many different kinds of training and
managers are currently using online courses to training investments that takes place in the federal
deliver training content over classroom training (82 government,” said Jones. “Some training would
percent) and live streaming (78 percent). The findings be for future leaders of agencies, but some of the
indicate that human capital executives are using any training would be for lower level [employees] who
and all methods possible to deliver training content haven’t been in the federal workforce very long.
in the most effective way. Some training is to deepen the skills of technical
80
employees.
70
There’s such a huge range of training
00
6% 2% 5% 7% 5% 7% 3% that’s taking
60 place that the training needs to
1 Individual 7% 3% 50
80 Instruction 11% 14%
17% 21% 20% be closely
40 coordinated with the agency’s overall
2 Online Courses objectives.
30
If we look at this in terms of bridging
60 20
3 Live Streaming
73% 89% 78% 72% 70% 63% 82%
critical skills
10 gaps, an agency needs to look not only
Content/
40
Webinars at its broad
0
goals but look at the kinds of people
20
4 Blended Learning with the kinds of skills they need now.”
10% 2% 3% 4% 4% 10% 12%
0 Peer-to-Peer 1 2 3 4 5 6 7
5
Learning Building a reliable, skilled workforce must first
zz Used to use
Membership
6
Program
zz Currently using begin with actively identifying talent and assessing
zz Not currently using, but want to invest in
7 Classroom zz No interest in using
internal 80and external candidates for the right skills,
competencies,
70
and experience to fill both unanticipated
60
and expected
50 vacancies. Only through an effective
“Training is a critical strategy to ensure employees succession
40
30
planning program can human capital
have the skills they need to perform their jobs – as professionals
20 ensure that they have an adequate
10
technicians or as leaders,” said Krieg. “However, the pipeline 0of skilled professionals to eventually lead when
impact of federal budget cuts is two-fold, both in terms it becomes their time to do so.
of finding effective low-cost training, and in terms of
time to step away from regular work responsibilities.
This is particularly true with emerging leaders, because 100
meaningful leadership training and development 80
requires more than class time, [it also requires] 60
89%
experiential learning. We have to find low-cost, high- 40 89% 82% 78%
impact alternatives to the classroom, such as shadow 20
assignments and increased coaching and mentoring.” 0
of managers are currently using online
Even in a limited budget environment, training is courses to deliver training content,
of the utmost importance for future leaders. More
coming ahead of classroom training
than three-quarters of all respondents are currently
investing in, open to investing in, and/or already (82%) and live streaming (78%).
using all of the listed methods to deliver content to
their workers. However, agencies are falling short
when they try to bridge the gap between where
they currently are and where they need to be. Siloed
efforts again may be to blame.
20 30 40 50 60 70 80
The 2014 State of Human Capital Management Report 12When evaluating your current programs and
procedures for your employee management
initiatives, how do you feel what you have in place
100
today compares to where you need it to be?
80
60
40
More than 76 percent of respondents said
20 that they are jobs done” was another significant bone of contention among
falling short of where they need to be in0 their employee federal employees. The increasing dissatisfaction, one could
management initiatives. assume, contributed to fewer employees recommending their
organizations as good places to work; these numbers dropped
These findings, again, are not isolated to the HCMG survey. from 70 percent who did so in 2010 to 63 percent in 2013.ix
76%
Every year, the OPM surveys federal workers on their job
3%
satisfaction, sense of mission and sense of morale. Of the More
376,500 federal workers surveyed across industries, the than
satisfaction rate of federal employees is currently at 59 21% 24%
of respondents said that they
percent, down from 63 percent in 2012 and 67 percent in
2010. vii are falling short of where they
52%
need to be in their employee
“The current situation is not encouraging in terms of management initiatives.
making improvements in these areas, but neither is it
hopeless,” said Palguta. “Few federal organizations can do Katherine Archuleta, the acting director of the OPM, described the
‘more with less,’ but they can do ‘less with less’ by setting state of human capital management in the federal sector in the
priorities and through innovation and collaboration. They foreword of OPM’s report:
may also be able to ‘do something 80 different’ to accomplish
70
their mission more effectively or efficiently.”
60
The survey results serve as an important warning about the long-
50 term consequences of the sequestration and budget uncertainty.
The overall findings of the OPM survey,
40 viii
which are in line with Without a more predictable and responsible budget situation, we
30
HCMG’s results, are bleak at best and 20
illustrate an important risk losing our most talented employees, as well as hurting our
narrative of the current state of human
10 capital management ability to recruit top talent for the future.x
in the federal sector. The Department0 of Defense, Department
of Housing and Urban Development, General Services Any federal employer taking note of the significant decline in
Administration, and Environmental Protection Agency, for satisfaction, as demonstrated by the findings from the HCMG
instance, reported to have some of the steepest declines in job survey and the surveys, can see that across sectors, regardless
satisfaction. “Lack of sufficient resources needed to get their of management level, federal employees are unhappy and
dissatisfied.xi Factors such as an unprecedented three-year pay
freeze, automatic reductions from sequester and reductions in
training and other areas, as cited in the findings of the HCMG
“Few federal organizations0 can10 do20 ‘more
30 40 50 60 70 80
survey, are clearly taking their toll on the federal workforce.
with less,’ but they can do ‘less with less’
by setting priorities and through innovation
and collaboration. They may also be able to
“If we look at this in terms of bridging critical
‘do something different’ to accomplish their
skills gaps, an agency needs to look not only at
mission more effectively or efficiently.”
its broad goals but look at the kinds of people
John Palguta, Vice President, with the kinds of skills they need
Policy of the Partnership for now.”
Public Service
Yvonne Jones, Director
GAO
The 2014 State of Human Capital Management Report 130 10 20 30 40 50 60 70 80
What do you see as the top barriers, other than
budget, that are preventing you from reaching 100
80
your goals? 60
40
20
An overwhelming majority of respondents said that in how 0they manage and engage current talent.
agency culture was the biggest impediment outside of Seventy-six percent of respondents feel that employee
budget that prevents them from meeting their talent management
100
initiatives are falling short of where they
management goals. Of all the barriers listed, need to80 be, and 49 percent said their agencies are not
79 percent of respondents listed “management identifying
60 and retaining top performers. Agencies are
culture” as their top barrier for 2014. reducing40 training and development investments while
ongoing 20 training targeted at the aging workforce and
Why? younger0 workers are needed in order to bridge the age
gap and keep the skills and knowledge of all workers
“The senior leaders in an organization are the people up to date.xii
who define the goals of the organization and how to
get there,” said Jones. “They are the people who often Second, federal agencies are not adequately preparing
[are] most principally responsible for making it clear to employees to step into leadership roles. Sixty-three
employees how their work on the day to day basis fits in percent of respondents view their succession planning
with the objectives of the organization and how they get efforts as unsuccessful even though 38 percent of
there. [That’s why] the role of the leaders and the kind of respondents listed this as one of their top three
culture that they define for the organization is so critical.” priorities for 2014. Only four percent of agencies view
their succession
100
planning efforts as “very successful.”
The research and analysis done by the Partnership for 80
Public Service (PPS) as part of its annual Best Places to Third, and
60
perhaps most important, agency culture was
Work in the Federal Government ranking confirms that cited as40the most significant barrier to preventing agencies
effective leadership – or the lack thereof – is a major driver from reaching
20
their goals, apart from budget, among
0
of employee satisfaction and commitment. Unfortunately, the human capital executives surveyed. Investment is
2013 saw government-wide employee satisfaction reach continuously focused on recruitment, not retention, and
its lowest level in the last 10 years. However, even in agency investment as a whole is not necessarily aligned
this climate, 24 percent of the 371 organizations in the with agency talent management priorities.
survey managed to maintain or even improve employee
engagement. It was not that those organizations received This study reveals that there is a lack of unified internal
more funding, but more that senior leaders and managers leadership and talent management across agencies. If
in those organizations figured out how to engage their siloed efforts within agencies continue, the agencies will
employees, even in tough times. continue on this same path without reaching achieve
“The bottom line here is that good managers do have
some control over the culture in an organization even
when matters outside their control are having a negative
impact,” said Palguta. “Improving the quality of federal
supervisors and managers, therefore, can help a lot. It
starts with how we select individuals to enter the ranks
80
70
60
50
40
38% of
respondents
listed succession planning
of management and then how we support and develop 30
20
38% 63% 4% as one of their top three
those individuals. A management culture, especially 10
a poor one, can be very difficult to change but as an 0 priorities for 2014, even
increasing number of managers leave government, this is though 63% of respondents view their
a great time to focus on the next generation of leaders.”
succession planning efforts as unsuccessful. Of
HCMG’s findings illuminate a number of overarching all of the respondents, only 4% of agencies
issues that should be cause for concern moving view these efforts as very successful.
forward. First, federal agencies are falling short 0 10 20 30 40 50 60 70 80
The 2014 State of Human Capital Management Report 149%
9%
3%
When 79%
of government executives
mission success. Without significant changes, this will
continue to be a barrier going forward. This, coupled
with simultaneous pressures to build talent and cut costs,
believe that the greatest exacerbates the need to look internally to make the most
79%
of talent and work together to accomplish the federal
impediment to achieving their
sectors’ goals. In the face of an aging infrastructure and
goals is management culture,
shifting political realities, a very troubling reality is that
that culture needs to change. the United States may have to settle for an adequate
infrastructure instead of a great one if nothing is done
to make significant improvements within government
agencies.
Going Forward: Evolving Culture to Foster Change
What can we do to combat these challenges? First and It also means investing in the development of those
foremost, HCMG’s findings illuminate the need for a supervisors, managers, and leaders over the course of
cultural shift within agencies. Effective leadership is the their careers. It means ensuring the agency leaders,
key driver of successful human capital management. including political leaders, understand and support the
Simply put, the tone starts from the top. When need for good managers and hold current managers
79 percent of government executives believe that accountable for engaging employees and achieving
the greatest impediment to achieving their goals is results. Finally, it also means that members of Congress
management culture, that culture needs to change. need to understand that the American public really does
want a government that works and that they have a
“The management culture will inevitably shift as current, major role to play in this regard.”
long-time federal managers leave and newer managers
from other generations take over,” Palguta said. “The A results-oriented performance culture, as reported
trick is [to] manage that shift in the desired direction. by the HCAAF Results-Oriented Performance Culture
Index,xiii evolves out of the “policies and practices
of the agency, the organization’s leadership at every
0 10 20 30 40 50 60 70 80
level, and [the] management decisions that shape the
work environment.” These elements touch employees
“Organizations will need to become more each and every day and are directly responsible for the
flexible and creative in how they accomplish motivation and engagement of employees to “put forth
work. Overly regulated and structured their best effort possible, while weathering changes of
an uncertain environment.”xiv
100 processes and policies will no longer be
80 effective in an ever-changing and increasingly “Organizations will need to become more flexible and
60 complex environment. Organizations need creative in how they accomplish work,” said Krieg. “Overly
40 to empower employees with the freedom to regulated and structured processes and policies will no
longer be effective in an ever-changing and increasingly
20
approach problems in different ways. This
0
complex environment. Organizations need to empower
is particularly important as the workforce employees with the freedom to approach problems
becomes more diverse – in terms of different in different ways. This is particularly important as the
100 generational groups, and in how people think workforce becomes more diverse – in terms of different
generational groups, and in how people think and work.”
80 and work.”
60
Change is fast and uncertain. In a rapidly changing
David Krieg, Human Capital
40 economic environment, organizations must continually
20
Officer, Internal Revenue Service assess the nature of the work that needs to be done and
0 evaluate how this translates to what skill sets are needed
The 2014 State of Human Capital Management Report 15moving forward to be productive and effective. Agencies believe that their organizations are interested in
also need to realize the technical infrastructure needed to helping them to improve their skills. The percentage
remain competitive. To effectively utilize its human capital, of employees who recommend their agency as a good
an organization needs to understand the nature of its place to work continues to decline from 70 percent in
workplace, as well as the composition of its workforce.xv 2010 to 63 percent in 2013.
“While technology, innovation, and creativity are all The government has made strides in this respect but
part of coping with the speed of change, none it works still has a long way to go. In 2002 and 2004, Congress
without making sure that the people part is working,” provided agencies – individually and across the federal
said Palguta, Vice President, Policy of the Partnership for government – with additional authorities and flexibilities,
Public Service . “It’s not just having the right people with such as the authority to offer recruitment bonuses. More
the right skills for the jobs to be done, but also having recently, Congress enacted the Telework Enhancement
a work environment that encourages and empowers Act of 2010, which is intended to provide opportunities
employees to take responsibility for finding ways to for more federal employees to telework. According
better manage change and take some risks in looking to OPM’s “2013 Status of Telework in the Federal
for better ways to get the work done. It will take great Government: Report to Congress,” a growing number
managers to create that environment.” of agencies do use telework as a strategic tool and are
poised to “achieve significant cost savings while meeting
The federal sector will need to change its practices in goals, achieving their mission and serving the American
order to effectively respond to “environmental economic people.”xvii Sixty-eight percent of HCMG’s respondents
changes” while also looking internally to identify areas listed teleworking as an initiative their organizations have
where attention to workforce needs can maximize put in place to elevate motivation and morale, ahead of
productivity to respond to external competition demands. xvi non-monetary recognition (63 percent) and mentorship
programs (46 percent).
Workers who do not feel respected or valued have
lower levels of engagement. As demonstrated in the The HCMG survey clearly highlights the need for better
FEVS survey, federal employees reported a reduction succession efforts in the federal sector and brings to
in recognition for high performance. Fewer employees light the other areas where there is definite room for
improvement. While findings may paint a less than
flattering picture of the current state of human capital
management in the federal sector, they should be taken
as merely a jumping off point for further improvement.
“While technology, innovation and creativity are
What is most important, perhaps, is the federal
all part of coping with the speed of change, none workforce’s unwavering commitment to the public
it works without making sure that the people part sector. According to the 2013 FEVS survey, “the Federal
is working. It’s not just having the right people workforce [is resilient and shows a] strong commitment
to government – employees are willing to put in extra
with the right skills for the jobs to be done, but
effort to get the job done, find ways to do their job
also having a work environment that encourages better, and emphasize the importance and quality of
and empowers employees to take responsibility their work.”
for finding ways to better manage change, and
Change cannot happen overnight. The federal sector has
to take some risks in looking for better ways to
a long way to go before it can fully realize the goals for
get the work done. It will take great managers to effective human capital management. Leadership is one of
create that environment.” the key drivers for successful human capital management.
An arsenal of talented, engaged employees with the drive
John Palguta, Vice President to succeed is another. Only when the two combine will
Policy of the Partnership for strategies emerge that consider the past and best plan
Public Service for the future. It is then, and only then, that the federal
workforce will be able to bridge the gap between where it
is and where it wants to be.
The 2014 State of Human Capital Management Report 16You can also read
