IBM Corporation

Company: IBM Corporation
Company Division/Group: Human Resources
Company Description: "IBM strives to lead in the creation, development and manufacture of the industry's most advanced information technologies, including computer systems, software, networking systems, storage devices and microelectronics. And our worldwide network of IBM solutions and services professionals translates these advanced technologies into business value for our customers."
Nomination Category: Organization Awards Categories
Nomination Sub Category: Best Human Resources Organization

Nomination Title: Providing Innovative Solutions for a High Performance Workforce

1. Tell the story of what this functional organization has achieved in 2002 (up to 500 words). Focus on specific accomplishments, and relate these accomplishments to past performance or industry norms. Be sure to mention obstacles overcome, innovations or discoveries made, and outcomes:

   IBM is devoted to providing a welcoming, challenging and rewarding environment for its employees. To illustrate its HR leadership, we will describe approaches to five innovative programs that help attract, motivate and retain world-class employees – a strategic element of IBM’s business success.

   Executive Resources: One of the HR team’s challenges is to ensure IBM has the leadership talent to fill key executive positions, now and in the future, resulting in a world-class leadership team. HR conducted a comprehensive research effort to identify the characteristics that distinguish outstanding business leaders inside the company. Eleven leadership competencies unique to IBM were identified along with the behaviors that demonstrate the competencies for all levels of management, including senior executives. Today, potential leaders across IBM are assessed annually against these competencies as part of the company's succession planning process. In addition, any executive reviewing potential leaders must go through a five-minute HR drill briefing of their candidates, ensuring the right diverse mix and representation of its leadership team.

   As a result, when it comes to developing bench strength in business leaders across an organization, no company does it better than IBM according to a special report released by Chief Executive Magazine. "Developing individuals to lead IBM now and for the future is one of our most important corporate responsibilities," said Randy MacDonald, IBM's senior vice president of human resources. "IBM's top spot in this first-of-a-kind ranking confirms our commitment to give all of our employees the opportunity to develop and contribute at the highest level possible."

   E-Learning: A major HR challenge is how to motivate and retain more than 300,000 employees around the world to be smart, innovative and committed to winning in a fiercely competitive environment. That’s why IBM values education and encourages and enables its employees to grow, learn and develop both professionally and personally. As a result, the HR team offers more than 40,000 classroom and e-learning Internet courses for professional development to employees around the global, and many opportunities for personal growth in the civic, trade, professional and non-profit sectors.

   Diversity: Reflective of its worldwide customer base, IBM has a broad definition of diversity. In addition to race, gender and physical disabilities, it includes human differences such as culture, lifestyle, age, religion, economic status, sexual orientation and marital status. Workforce diversity at IBM excludes no one and serves as the bridge between the workplace and the marketplace. As a result, to promote diversity throughout the corporation, IBM’s employees around the world participate in a number of programs created by the HR organization, including councils and network groups. IBM has 67 Diversity Councils - - a Global Council that addresses international issues, a Canadian Council, and a South African Council. Each IBM geography (Americas, Asia/Pacific, and Europe/Middle East-Africa) has a Women’s Council. And IBM has 137 Diversity Network Groups, which are employee-based. These groups are formed by employees from the following constituencies: Asian, Black, Gay/Lesbian, Bisexual, or Transgender; Hispanic, Men, Native American, Disabled and Women.

   Work/Life: IBM HR has taken a leadership position in the industry when it comes to understanding and creating programs that address the work/life issues of employees. Thorough research is at the heart of IBM’s leadership position. The first IBM Work/Life Issues Survey was conducted in 1986. In 2001, the first IBM Global Work/Life Survey was conducted - the largest, most complex single-focused work/life survey by any corporate, academic, or government entity. The HR strategy is to continue the five-year cycle on a global basis. The results represent the viewpoints of 25,822 employees from 48 countries in 20 languages on 196 questions. The result is the development of a variety of industry-leading workplace practices which give employees more choice and flexibility in how, when and where they do their jobs.

   Variable Pay Program: How does the HR team attract the best people in the business? First and foremost, they developed a compensation strategy that pays competitively and differentiates cash and equity programs to reward key talent and high performance. The team then gave IBM managers the flexibility and tools to compensate their top contributors like the best in the marketplace. One of those leading tools was IBM’s Variable Pay Program – a program based on personal performance, the company’s success, and how closely annual objectives are met in key areas. For most employees, the target Variable Pay opportunity is 10-15 percent of annual earnings – with the potential for far great rewards for extraordinary performance. As a result, our top performers receive payouts that are two and a half times greater than lower performers. IBM paid out more than $1.4 billion in employee bonuses in 2001. Bonuses have not yet been paid for 2002.

   Finally, no other company in the industry has four executives named Fellows to the prestigious group of the National Academy of Human Resources: two former HR executives: Walt Burdick and Tom Bouchard, and two current HR executives: Randy MacDonald and Ted Childs.