2017 Benchmarking Report: Culture of Innovation IPMA-HR International Training Conference anD Expo September 19, 2017 Presenter: Lindsey O’Connor

What We Will Cover Benchmarking Study Survey Results Background Organizational Culture Objectives State of Innovation Demographics HR’s Role Methodology Case Studies

Background Adapted key determinants that influence innovation Communication Collaboration Support for Change Autonomy Vision and Mission Chief Innovation Officer Time Framework from 2003 article “Building Organizational Culture that Stimulates Creativity and Innovation”

Objectives Assess organizational culture’s strength and opportunities for fostering innovation Evaluate how organizations structure and operations support a culture of innovation Determine what kind of innovative HR initiatives are being implemented and who drives those initiatives Assess the role HR plays in innovating best practices for key HR areas

Methodology & Demographics IPMA-HR emailed the survey to 5,275 members 311 respondents ±5% confidence interval with 95% confidence level Level of Government Where Employed n=234 State 9% Local/County 78% Federal 1% Special District 5% Educational Organization 3% Other Organization Size Small 51% Medium 40% Large 10% Job Title n=235 Director Manager 26% Consultant/Partner Analyst 13% Coordinator 6% Assistant 4%

Culture Communication Support from Leadership Collaboration Innovation as a Priority Support for Change Autonomy

Communication Three-quarters of HR professionals who responded to the survey agreed there are open lines of communication at their organization. 82% strongly agreed or agreed that there are open lines of communication between employees. Slightly lower between employees and management (66%) and communication between departments (65%). From the survey you can see that smaller organizations responded as having higher lines of communication than medium or large organizations.

Communication between Management and Staff 37% agreed agreed that staff feel comfortable giving feedback to their supervisors 31% agreed that management seeks input from staff on major decisions 35% feel neutral about the topic Small organizations had a higher agreed or strongly agreed response rate than medium and large organizations. Respondents from small organizations agreed more with the statement (42%) than did those from medium (32%) or large (24%) organizations

Collaboration High Levels of Collaboration 76% agreed staff in their department work well with one another 72% agreed departments in their organizations work well with one another

Support for Change 72% agreed they are encouraged to express their ideas for change 40% of respondents agreed that people in their organizations are supportive of enacting change While there is a difference in how respondents from organizations of different sizes or different types rated communication, collaboration or support for change – the differences were not significant.

Autonomy 45% agreed that employees in their organization are encouraged to take initiative 60% agreed that their organization is supportive when staff make mistakes Organizations that create and maintain a culture of innovation give staff a sense of autonomy and a feeling that they will be supported when they make mistakes.

Support from Leadership Employees from organizations with high support from leadership report: Better communication between staff and management More encouraged to take initiative and make decisions The good news – only about 26% of respondents felt senior leadership is slightly or not at all committed to a culture of innovation.

Organizational Attitude More agreement with following statements from organizations with higher commitment to innovation: However, significant differences were found between how highly respondents rated senior leadership’s level of commitment to innovation and how highly they rated communications between managers and staff and the autonomy they feel within the organization. Attitude toward innovation was asked of members focused on discussing, generating and executing new ideas. 60% reported that their organization viewed innovation as somewhat of a priority. Senior Leadership's Commitment to Innovation

Structure Mission Statement Common Innovative Projects Chief Executive Officer Drivers of Innovation Employee Engagement Surveys Barriers to Innovation Workforce/Succession Planning Time for Developing Projects In addition to a communicative and collaborative culture, organizational structure can be an influential force for fostering innovation. In this section we look at whether organizations where IPMA-HR members practice support innovation via mission, vision and value statements, designating a chief innovation officer, and putting other structural pieces in place.

Mission Statement HR practitioners from organizations that name innovation as a mission, vision, or value: Report that their organizations place higher value on discussing, generating, and executing new ideas. Gave higher average ratings for communication, collaboration, and support for change 44% of survey respondents reported that innovation is a part of their organization’s mission, vision or values statement. Those organization that have innovation as a guiding principle also gave higher average ratings for communication, collaboration and support for change than did members from organizations that do not call out innovation. These folks were also more likely to report that their organizations place higher valued on discussing, generating and executing new ideas.

A majority of members (63%) reported that their organization did not have a chief innovation officer. Those organizations with a CIO or workgroup, most (82%) reported the position or group was created recently (last 4 years).

Chief Innovation Officer As you can see, workgroups are more common than CIOs at all sizes and types of organizations. Large organizations are more like to have a CIO or workgroup (57%), than medium-sized ones (32%) and small ones (22%)

Time for Collaboration and Independent Projects Organizations that make innovation a priority allow significantly more time for independent work-related projects

Employee Engagement Surveys 41% conduct surveys, 88% share results. This practice is beneficial for fostering a communicative culture and a culture of innovation.

Workforce/Succession Planning Open-ended responses included: gap analysis, successor identification, and performance incentives

Common Innovative Projects Rank Innovation Type Example 1 Service Innovation (n=63) Adopting new methods or technologies to improve services 2 Channel Innovation (n=59) New methods to connect services to the public 3 Process Innovation (n=59) New management systems and revised administrative processes 4 Structure Innovation (n=47) Internal structural changes and new roles Management is the primary driver of innovation. Allowing staff time to brainstorm new ideas and giving staff time to work on independent projects related to work help to foster innovation. Organizations that make innovation a priority also allow more time for independent work-related projects.

Barriers to Innovation Budgetary restrictions was the top choice across organization type and size Lack of time and sufficient staffing were common open-ended responses.

HR’s Role Current Innovative Practices Technological Innovations Recruitment and Hiring Learning and Development Primary Challenge Compensation Performance Management Top Factor to Enable Innovation

Recruitment & Hiring Recruitment New marketing materials Building an online brand New Software for Applications, Interviewing, and Onboarding

Learning & Development New Programming About half focused on Leadership Development Adaption to new technology Customer service LMS Focus on ongoing availability of materials

Learning and Development Topics Effective Communication was the most common topic Support high levels of communication reported through this survey 40% described updating or implementing a learning management system, with expanding the online availability of lessons and materials.

Compensation Pay Structures Pay for performance Broadbanding Market value compensation for hard-to-fill roles Pay for performance Pay increases Bonuses

Performance Management Evaluation Approach From numerical, past-focused to narrative, future focused Feedback From annual conversations to frequent coaching Software Implemented to facilitate changes Moving away from ranking and more narrative forward looking methods for evaluating performance.

Technological Innovations Overall replacement of or an update to their human resources information system (HRIS) to facilitate changes Recruitment and hiring focus Modernize online job announcement

Primary Challenge Small organizations report: Open-ended responses: Budget Constraints Open-ended responses: lack of time lack of staff departmental culture

Top Factor to Enable Innovation Support from leadership is top factor across organization size and type Employees from organizations with high support from leadership report Better communication between staff and management Feeling encouraged to take initiative

Case Studies Online Onboarding Supplementary Pay Increase Program Washington County, Minnesota Supplementary Pay Increase Program CPS HR Consulting Embedded Videos in Job Postings Sedgwick County, Kansas

Online Onboarding Washington County, Minnesota HR Department 1,200 full-time and part-time employees HR Department 14 employees Divisions: Recruiting, Risk Management, Labor Relations, Benefits Initiative Taking employees long to be fully integrated Implementation Hires are sent paperwork with offer letter Outcome Better first impression, improved experience, improved employee engagement

Supplementary Pay Increase Program CPS HR Consulting Self-supporting public agency, CPS HR Consulting provides a full range of integrated HR solutions to government and nonprofit clients Initiative If an employee gets an increase, while at the same time, the market has moved and the pay range moves up, the employee could potentially remain in the lowest quartile of the pay range Implementation Supplemental pay increase matrix not only take into account the employees’ performance for the year, but also give them an additional bump based on where their pay fell within the pay range. Outcome Used to program for a couple of years, but still inconclusive

Embedded Videos in Job Postings Sedgwick County, Kansas 2,700 full-time and part-time employees HR Department 19 employees Divisions: Employment Services, Compensation and Classification, Benefits, Employee Development, and Work Environment Initiative Help with recruiting hard-to-fill position Implementation Communication department writes, films, edit mini videos; HR post in job description Outcome Good feedback, quality of applicants because they can see what the job really entails

Discussion