Join us for our Josh Bersin Interviews series of one-on-one talks with our clients and other thought leaders. Josh Bersin is the world’s most prominent HRTech Futurist and thought leader in the human resources and talent management realm.
Today, Josh Bersin joins Nate Prosser, Head of Learning & Development at Vanguard, who talks about the journey of transforming the career experience at Vanguard.
Just about every company likes to tout its great organizational culture, but how many can say that their employees really believe they are helping to change the world?
It’s one of the world’s largest investment companies with 30 million investors, but it also has 17,000 crew members (aka, Vanguard employees), who not only embrace but connect intimately and personally with Vanguard’s mission-driven and purpose-driven culture.
“When our crew walk into the building each day, they literally feel like they’re changing the world, because they’re changing the world of investing. Vanguard was founded on a simple but profound idea that said, ‘What if we put our investors — the everyday investor — first and foremost in every single thing that we do? And by doing, that what type of culture and what type of company would we create?’
That radical idea led to a very unique structure. So, Vanguard is neither publicly traded nor privately owned. In fact, our customers, the people that buy Vanguard products, are the ones that actually own Vanguard. That gives us a lot of advantages, and also creates this unique company culture.”
Vanguard’s Business Imperative: A New Way of Working
Nate Prosser elaborated on how Vanguard was leveraging its unique organizational culture to move the business ahead during a question & answer session with HR technology analyst Josh Bersin during the FuelX event.
Here’s how Prosser presented Vanguard’s latest challenge. He said:
One of our top five CEO priorities is modern work practices. It’s called New Ways of Working, and there are four different work types that we’re going after. Essentially, it’s about lean and agile. We’re about a year and a half into a plan, and three years into the transformation. Part of it is career mobility, and that had been very organic because Vanguard has a family feel and is very relationship minded. It’s like, “who you knew is where you go.” And as (Fuel50 CEO) Anne Fulton says, the idea of in-demand jobs and in-demand skills actually ushering people into what we’re going to need in the organization is something that’s really appealing. And so, we have a lot of internal mobility, but frankly, when we saw the analysis, it’s kind of haphazard.
What was happening was that jobs and people would move from one area to another area to another area, but we weren’t actually building the skills to help people to move up. The laterals weren’t actually creating the capabilities that you would need, so that was creating blockages for people to actually fill the jobs that we needed.”
We think that this change will be a win-win and offer transparency to the crew member from an engagement perspective, but then on the back end, we can help understand if people are moving into the jobs that we need.
How Fuel50 is Helping Drive Cultural Transformation
So, how did Fuel50 really help to drive Vanguard’s cultural transformation? Nate put it this way in his conversation with Josh Bersin:
“We originally had Fuel50 in more of the talent strategy and succession planning areas. I’ve since moved it under L&D and look at it now through both lenses. That’s something we’re figuring out. A major reason we brought it in was a lot of things that you alluded to.
Vanguard has historically had a really, really low attrition rate, in the neighborhood of 5 percent, but recently it has risen closer to 10 percent. We have people citing lack of career advancement as one of the top reasons for leaving. Last year, close to 50 percent cited that reason for why people were leaving voluntarily, and we’ve heard through engagement surveys and exit interviews that there was a lack of understanding of what jobs existed. These were all catalysts for partnering with Fuel50.
What that looks like to Vanguard, with 17,000 crew members … is the idea that the burden is on the manager to know every job and know to everyone and to network for their employee. That’s what a lot of managers were feeling. And we found that a lot of our business areas were trying to create very static versions of Fuel50 through SharePoint and Excel files, and we wanted something modern and AI-driven. When we came across Fuel50 after a pretty extensive RFP, it really differentiated.
One of the big issues … is that we had over 7,000 different job profiles for 17,000 employees. It was impossible to make it work. Every other job is custom, and we knew that was not sustainable. The algorithms wouldn’t work.
So, we’ve embarked on a really long job architecture project. We intend to be under 2,000 job profiles when it finishes, but we’re doing a lot of it internally. And there are some challenges just in the speed of doing that. Essentially, what we’re doing is this: as the job families condense, we then make them available to those people in the job family, but that still hasn’t given us full transparency on all the jobs. Our big launch will be (in 2020).”
Building and Growing Vanguard’s Career Experience
Driving change in the career experience for a workforce of 17,000 isn’t easy, even for a company like Vanguard that has a strong internal infrastructure and solid corporate culture. But as Nate told Josh Bersin, it’s something Vanguard decided to utilize Fuel50 for to help make it all.
Here’s how Nate put it:
“There are three pieces we need to develop our workforce for the future. The first one is to up-skill our crew to transition to new ways of working. This is essentially a core academy where we’re building a new way to work — things like tech acumen, outcome orientation, and data-driven decision making. It’s also about advising our crew of how to take the “in-demand” jobs. So this is very much using the Fuel50 platform, flagging the jobs that are going to be important, helping people to navigate them and have the mobility so that they’re not blindly just talking to their network, but, that hey understand the whole organization and where the in-demand jobs will be going.
We also want to do some powerful re-skilling where we’re taking crew and members of the organization that we might need to divest in the next several years and pushing them to other places. This is something like taking someone who’s currently in operations and helping them move on to a second career within Vanguard — perhaps in lT or data analytics.
Doing those things, and anchoring it with the power of Fuel50 by using the reflect-explore-plan framework, is our intention going forward.”
Final Thoughts on the Process at Vanguard
Josh Bersin asked Nate Prosser how the process with Fuel50 and the ongoing workforce transformation was going, and although Nate said that “time will tell,” he did elaborate a bit more by saying this:
“There is a lot of work to make this happen, but we’re really proud of where we are and where we’re heading in the future. We feel great about the business strategy that we have anchored in a world-class client experience with low cost advice (for our customers). And we also feel great about our talent strategy, and that’s about a great Crew experience with solid career advice.”
We’ve been really impressed with Fuel50. My team works closely with them and has mentioned that they’re really receptive to feedback. They turn on capabilities much faster than what we’re used to, and we just really like the partnership.”