AESO Saves $6M by Making HR a Strategic Business Imperative
OREANDA-NEWS. November 06, 2015. Alberta Electric System Operator (AESO) is a small organization with a large mandate – keeping the lights on across Alberta, Canada.
AESO provides access to the province’s electricity grid, which totals \\$5 billion in annual energy transactions. But like many businesses in the province of Alberta, AESO has faced difficulties attracting and retaining talent. Canada’s entire electricity and renewable energy industry will need to recruit over 45,000 new skilled workers by 2016, more than twice the number recruited in the last five years. Looking at growth mandates that would double the organization’s size, AESO’s leadership team realized they had to dramatically lower its historically high turnover rates of up to 18 percent.
Talent Strategy Outmaneuvers the Competition
With under 500 people, AESO employs just a sliver of the region’s total number of energy industry workers. However, AESO is competing for skilled workers in high demand across the entire energy sector, particularly from oil and gas and the electricity industry. Lisa Nadeau, Chief Human Resources Office at AESO, recently spoke at the SuccessConnect 2015 event in Las Vegas. She discussed how the company’s decision to align HR with the business strategy reduced turnover rates by over 50 percent, resulting in more than \\$6 million in savings in rehiring and retraining costs.
“Our business is characterized by multi-year training and certification timeframes coupled with a sizeable aging workforce projected to retire within five years. This makes talent management a strategic business imperative to outmaneuver the competition in the war for skilled workers,” said Nadeau. “We knew we had to make sure the right people were on board to support company growth, and that meant increasing our ability to attract talent in the face of competition and high retention of the best talent in the industry.”
Nadeau shared AESO’s transformation journey as the company moved from siloed, manual processes to an integrated Human Capital Management (HCM) system on SuccessFactors cloud-based software.
Plan Ahead as Much as Possible
Nadeau can’t say enough about the importance of having a defined plan of action. “Don’t select something because it’s shiny and new. Get what’s right for your company based on the work you do and your company’s culture.”
Admitting that HR transformation can be like swapping an airplane engine mid-flight, Nadeau advised companies to think about obtaining additional resources before the project begins. “It can be overwhelming trying to manage these new projects while staying on top of every day HR activities,” she said. “We realized that we needed additional assistance.”
Collaboration Eases the Launch
Throughout the planning and implementation of the software, the AESO HR team worked directly with senior leadership and other departments to not only gain agreement on objectives and timelines, but to also conduct training for a smooth system launch.
“We made the discussion about the stakeholders, not about the system,” said Nadeau. “We always focused on how the process, software and outcomes were focused on benefits to them. We have our clients, and IT in particular, help us during the testing phases to hear their feedback, which is always very valuable.”
Integrated HCM Pays Off
Using the SAP SuccessFactors HCM Suite implemented to date, including Employee Central, Goals and Performance, Succession, and Learning and Development, along with well-defined human capital processes and programs, AESO has embedded workforce planning into business planning. This has allowed the company to dramatically increase leadership hires from within to 90 percent, and to fill job vacancies with high quality employees in under 35 days on average. Nadeau is optimistic about AESO’s future, fueled by engaged employees and a deep leadership bench.
“All of our work on learning and development, succession planning and talent profiles has really increased our employee engagement,” said Nadeau. “We have a defined succession process for developing leaders, identifying, developing and promoting existing employees who now comprise a much stronger leadership team.”
When it comes managing people, AESO is doing much more than keeping the lights on. The strategic alignment between HR and the business is illuminating a future that’s brighter than ever for the company and its employees.