‘One Prudential’: Profile of A Metamorphosis
Ghostwritten by Milca Esdaille; used with permission

by Michele S. Darling
Executive Vice President, Corporate Governance and Human Resources
Prudential Financial

When Art Ryan joined Prudential as Chairman and CEO in 1994, it was clear he had a challenging turnaround to orchestrate. After decades of outstanding performance in the insurance industry, Prudential was struggling. It faced policyholder lawsuits as a result of questionable sales practices, and profitability suffered as the company lost market share while burdened with an unwieldy and unfocused infrastructure. Not surprisingly, growing numbers of key employees were leaving. For a company that had once dominated the insurance market, it was a painful time.

A Reinvention Occurs
All that has changed. Ryan has marshaled the hard work of a handpicked executive team, as well as the coordinated efforts of 60,000 employees—or associates, as they are called today—to fashion a metamorphosis that few believed possible seven years ago. Poised between a proud past and an exciting future, the company has transformed itself from a foundering "old-school" insurance giant into an agile financial powerhouse boasting a broad array of wealth creation and wealth protection products and services. As the company moves beyond its 125th anniversary, it prepares for its planned demutualization later in 2001. This will provide Prudential with an official entry pass into the arena of publicly traded financial services companies. It will enter fully prepared to aggressively compete in a global market place, against a sophisticated set of players.

Today, we have received glowing accolades on the company and its management: for its vision, commitment to innovation, its impressive reinvention, and its coveted reputation as one of the top companies to work for. For two consecutive years, Working Mother magazine has listed Prudential as one of ten top companies for working mothers. It was recently recognized by CIO magazine as one of 100 companies identified as leaders for the next millennium, based on the quality of it’s Human Resources function, it’s ability to innovate and reinvent itself, and its focus on customer relations. In the past two years, Prudential has been included in the "Top 25 Best Companies for Executive Women" by Working Woman magazine. It is also on Fortune’s most recent list of "The World’s Most Admired Companies.

What has been the key to the successful reshaping of Prudential? Aside from the reconfiguration of Prudential’s balance sheet and a massive streamlining effort, a fundamental cultural shift has occurred, and is a primary driver in preparing Prudential for future success. Ryan’s goal, encapsulated in the "One Prudential" mantra that has invaded every aspect of managing the company, was to ensure that each and every associate (1) understood the company’s mission and could present one face to the external market place, and (2) was enrolled as a full and vocal participant in creating a new Prudential. Given that this goal hinged on reaching and refocusing each associate, it is no surprise that Human Resources has been at the heart of both the planning and execution of Prudential’s transformation. To meet this challenge, the Human Resources function also had to undergo a significant alteration. Everything from the way it viewed its role, to its administrative infrastructure, to the programs and services it offered, had to change. We also needed a positive learning environment and a framework for talent selection and development.

Human Resources Associates as Full Partners and Cultural Catalysts
When I joined Prudential in February of 1997 as head of Human Resources, the senior management team was fully engaged in the hard work of stabilizing the company. It was also pushing for full implementation of the kinds of initiatives required to effect what Ryan perceived as a much-needed cultural shift. I quickly assessed that the HR function, as it existed, was not equipped to serve as a cultural change agent. In order to meet the challenge of moving the company towards Ryan’s "One Prudential" vision, HR needed to become fully integrated into, and perform as a respected member of, all layers of line management.

Our HR function was outdated, with units operating as disparate silos. Their focus was on administrative functions such as payroll processing and record-keeping. There was little communication between the various units, and no systems integration. What little interaction there was could be characterized as "bickering" and competitive. In addition, there was no compensation function, and no one was accountable for, or engaged in, managing diversity or employee learning and development. An inadequate benefits function focused on putting Band-Aids on old-fashioned plans decidedly out of sync with a rapidly evolving labor market. There was no system in place to capture or manage basic data about employees. Twelve-hundred HR professionals were working very hard at pushing paper, but had no common agenda, nor the structure or tools needed to partner with line management to move the company forward.

Before changing a thing, our first step was to fully engage the company’s senior management team in the redesign of the function. With Ryan’s support, an HR Policy Committee comprised of the Chairman’s direct reports was established. Views were solicited on the business challenges being faced, on the existing HR organization, and on ideas about the kind of HR team that would be needed to achieve the business goals across Prudential. The Policy Committee remains active still, meeting quarterly with HR senior management. From its inception, the HR-business line partnership was based on a foundation of committed dialogue, characterized by active solicitation of ideas, genuine listening, and what I describe as a strong belief in the "equality of ideas". That philosophy has become the cornerstone of the array of programs and practices that have given life to the One Prudential concept.

Armed with the insights of senior management, as well as invaluable input from the existing HR staff, we moved swiftly to implement an HR redesign. Functions were centralized around "communities of practice" that included compensation, diversity, organizational effectiveness, learning, employee relations labor law, etc. We carefully selected, from both inside and outside the company, a team of dedicated practice leaders capable and committed to building programs and processes in alignment with senior management’s vision. A centralized operations group was created and tasked with building and implementing a cutting-edge systems architecture for HR, and with spearheading key HR technology projects that the team knew were essential to providing the kinds of metrics that would quantify and track progress towards the reshaping of the company.

Each core business segment was assigned a Human Resources Vice President, with solid-line reporting and accountability to both myself and the segment’s business executive. Human Resources Consultants ("HRCs") were appointed to units below segment level, also reporting to both their business and HR seniors. The HRCs role is to partner with line managers to facilitate access to the HR "communities of practice." They also serve as the front lines, communicating needs and concerns up and down the line, and assisting in the rollout of strategic initiatives. Because the HR structure was the joint brainchild of both the HR and line business leadership, tension between line and staff that is often found in such dual-reporting arrangements has been minimized. The new HR organization is fully integrated into the fabric of the line organization, and it has proven its ability to serve as an impressive change agent.

Importantly, all this was accomplished while cutting expenses. The total HR staff today stands at approximately 800, down from more than 1,200 in early 1997. Even with extensive investments in technology and the rollout of One Prudential Exchange ("OPX")—a $38 million, highly innovative learning program—the annual HR budget is $181 million, down almost $20 million from 1997 levels.

We did not have the luxury of completing the overhaul of the HR function before tackling our first and biggest task. We began planning and implementing One Prudential Exchange (OPX), the company’s sweeping change initiative, just months after my arrival.

OPX: A Company-Wide Exercise in Collaborative Learning
OPX has been much more than a large-scale employee training effort. In both its scope and depth, OPX is unique in that it goes beyond re-educating a workforce to redefining—for every associate—the context within which Prudential does business. It has also crystallized for each how they fit into both the company’s and the economy’s "big picture," while enrolling them in recreating their company to ensure unflagging focus on the customer. This is an essential element to Prudential’s goal of becoming a competitive force in the public marketplace. OPX stressed that in order to be responsive to a changing customer profile, Prudential now had to go head to head with brokerage firms, banks and full-service financial institutions.

The genesis of One Prudential Exchange was a conversation between Ryan and myself as we discussed my overall assessment of the HR function and the company shortly after my arrival. Ryan believed that unless each associate absolutely understood, in more than merely an intellectual way, where the company was headed and what role he or she had to play in getting the company there, then there was little chance of Prudential ever achieving its goal. He challenged me with taking his strategic vision of a unified and refocused Prudential, and in some way engendering a sense of ownership and understanding among each and every employee. What would it take for each Prudential associate to understand the evolving business context the company operated in, and how each needed to work to impact and redirect the company to successfully compete for customers within that environment?

Our answer was OPX. OPX became a company-wide learning effort based on the groundbreaking work of Root Learning®, a consulting firm that specializes in helping large organizations educate their employees by using unique training aids known as "Learning Map®" visuals. Essentially, a learning map is a deceptively simple yet effective teaching tool disguised as a customized, colorful and high-impact illustration rendered on large "sheets." Despite evoking cartoon images, when used in conjunction with Root Learning’s® interactive process, they enable participants to absorb and analyze massive amounts of information quickly, and then draw their own conclusions in a collaborative and dynamic environment. And they do so while having a surprising amount of fun.

My team presented ideas on using Root Learning® visuals to the HR Policy Committee, the group of line executives who had provided advice on the redesign of the HR department. Instead of coming in and talking to them conceptually about it, we brought them maps Root Learning® had designed for PepsiCo. After "playing" with the maps for a short time, Policy Committee members reported understanding the dynamics of the beverage industry far better than they ever had.
They were so impressed with the maps, that they not only approved the recommendation that they be used with Prudential’s associates, but they invited me to present the maps to Prudential’s Board of Directors.

I remember thinking, as I faced our group of very impressive Board members at an off-site meeting in Florida, that these people are going to kill me! What will they think of me, walking in armed with these cartoon maps, asking them to play a game similar to Monopoly, and telling them this is the most effective way to communicate our business strategy and help our associates embrace a cultural shift? They did not kill me. Instead, they became fully engaged, they laughed, and even they learned a lot in the process.

With management’s blessing, Root Learning® created a series of maps for Prudential and worked with our HR organization and line management to design a process—OPX—to roll them out. Over a period of 14 months nearly 94 percent of our associates across the country went through four separate, daylong sessions where they learned much more than just how to play with the maps.

According to Don MacLean, business development director at Root Learning®, whose clients include PepsiCo, Boeing, Bell Atlantic and Merck, "few people in the typical large organization fully understand or can agree on the strategic context of their business. It is unusual for a CEO to unleash a free discussion of the forces and demands that influence the firm. But even where this happens, the resulting knowledge is almost never presented to the people who must in reality drive changes and improvements."

Frank Bordonaro, Prudential’s chief learning officer and head of The Center for Learning and Innovation, our Connecticut learning facility, describes a typical OPX session.

"It was an unlikely setting for a corporate revolution: 8 a.m. on a Spring day, around 190 Prudential associates gathered in the Marriott Hotel near Newark Airport in New Jersey. Brought together from Prudential’s far-flung operations around the U.S., few of them knew each other. They came to undergo an ambitious and far-reaching re-education, a company-wide effort that is a prelude to Prudential’s planned demutualization and emergence as a public company. We determined the training effort was critical if Prudential is to succeed as a public company, and adapt to an increasingly demanding marketplace.

"The 190-odd associates were split into tables of up to nine, with a trained facilitator at each table. The groups, which were shuffled throughout the day, included people from different backgrounds, experience and lines of business. After a brief introduction by senior managers, the facilitator turned over the first of several visuals, an image-filled full-color sheet measuring 40 inches by 60 inches.

"The group spent a few minutes looking at the images and accompanying text before an elected person began to work through a series of observations and questions, reading from prepared dialogue cards which indicated when the group should discuss an issue or undertake an activity. The visuals had been crafted to encourage participants in the learning process to offer their own views and opinions."

Using "then" and "now" tables, the maps helped associates assess how, over the past decade, customer views regarding top financial needs (e.g., protecting family in case of unexpected death, planning for retirement, paying for tuition, vacations and major purchases, etc.) had changed relative to their parent’s generation. Other tables assisted associates in understanding how the nature of financial assets held by households (deposits, securities, mutual funds, whole-life insurance, etc.) have shifted, and what the corresponding shifts in the types of institutions holding such deposits (insurance companies, banks, brokers, mutual funds, credit unions, etc.) were. The visuals ultimately lead the associates to independently draw the conclusion that customers dictate everything, and that it was every associate’s mission to anticipate and respond to their needs, or Prudential would fail.

[INSERT FIGURE A: OPX Learning Map, A New World; caption as in book]

"These visuals and tables," continues Bordonaro, "created a powerful context for Prudential’s business which most staff had not explicitly understood. Moreover, it was drawn out from the conversations among members of each table, so that they felt the insight came from peers and colleagues rather than from on high. This reinforced the learning element of the session."

Ryan adds, "Like a lot of people, I was quite startled when I first saw a map visual. I thought it might be a gimmick, which was not what I wanted. But it turned out to be easier to communicate using maps. They are very effective learning tools, and they get the message across very quickly. Feedback from people who have been through OPX is very positive. The staff appreciate that management has given the time and energy to engage them rather then simply tell them what to do. That tells them something about our management style, that we listen as well as talk!"

A critical aspect of the success of the initial OPX experience was that it brought together, into learning groups, diverse groups of associates. Beyond the importance of fostering an environment that not only encourages, but also expects two-way communication, our second mantra is the importance of having that active communication reflect a diversity of ideas.
At these sessions, you could be sitting at a table working through one of the maps with a seasoned agent from the West Coast, a senior vice president from company headquarters in New Jersey and a new hire from a customer call center in Florida. And this was not a passive learning process. It required active dialogue, the willingness to speak up, challenge and question each other. We wanted the diverse views and the diverse perspectives of our associates brought to the table without regard to hierarchy, location, background or function. The way we think about things, the way we problem-solve and design every initiative and program, is built around the view that diversity makes us great. We strive to preach and practice the notion that every idea, every viewpoint, provides an opportunity for learning and therefore deserves to be heard and considered.

The OPX experience proved so effective and was so very enthusiastically received, that the company has rolled out two additional learning programs using the same model. While the first initiative focused on strategy, the second focused on measurements. Using the Root Learning® maps, OPX Phase II served to generate discussion and a real understanding amongst associates of the key metrics Prudential uses to set goals and measure performance. The maps broke down how financial performance indicators worked. What does ROI really mean? What other measures would a Prudential customer, manager or shareholder use, and why? What can associates at all levels do to increase shareholder value? How should management assess progress against stated business goals? How do measurements apply to an individual associate’s business unit? To their specific job?

We took the strategy, and then the measures, right down to the work unit level and got people to look at their own business, and link the two. Not many companies have attempted to bring the understanding of key management indicators "to the people" on such a comprehensive level.

OPX set the stage for new communications and learning processes. Although the approach was the same, learning pictorials were used and the delivery took advantage of Prudential’s extensive technology network.

We’ve put up a learning pictorial on our intranet site that deals with the demutualization process. It is highly interactive, so you can go in and look at different steps in the process, and delve deeper via links within the system if you want more information. An aggressive communication effort, delivered primarily to associates’ computer desktops, ensures the learning is company-wide. It’s impossible for anyone in our business to escape the fact that we’re planning on going public this year. Whether it is the Chairman talking about it, whether it is the endless emails about it, or whether it is the intranet site that forces you into it when you open your mail up in the morning, we are constantly delivering information on what demutualization is and what it means to all of us. Because associates have previously found the maps to be so compelling, they are accessing the on-line pictorials consistently and across the board. We closely monitor the number of hits on the site, and it’s been quite impressive.

What has been truly unique about OPX is that it has served as a lightening rod, setting the stage for what has become a deep and broad cultural transformation. The practices of active dialogue, of tapping into diversity and creating collaborative learning opportunities, are today reflected in all aspects of business and people management within the organization. It has affected all other learning initiatives spearheaded by the Prudential Center for Learning and Innovation. It is the foundation upon which the company’s total compensation and benefits programs have been redesigned and rolled out, and is the basis for town hall meetings at Prudential locations across the country. In these meetings as many as 300 to 400 associates gather so feedback and suggestions to management plans can be elicited. Bi-annually, satisfaction surveys are administered to all staff, with feedback used not only to determine if Prudential associates are tracking with the company’s goals, but also whether they perceive management as responsive to their individual needs. And surveys are not administered for cosmetic purposes; their outcome is a determinant of management’s compensation.

More on Learning: The Prudential Way
Root Learning® research points to a correlation between strong corporate reputation and performance and the willingness to invest in workplace learning. MacLean argues that the more firms invest in workplace learning, the better their performance and the higher their market value. "Firms which are viewed as leading-edge competitors spend up to 6 percent of their total payroll on learning, and train more than 80 percent of the workforce," he points out.

Prudential’s learning efforts have reached 100 percent of the workforce, but as chief learning officer, Bordonaro recognizes that senior and mid-level business leaders have unique training needs. It is their responsibility to partner with and motivate their staff to deliver daily against business goals. The extension of the One Prudential vision—where every associate understands the company’s strategy and their role in realizing it—is The Prudential Way initiative, which provides senior and mid-level business leaders with the tools and knowledge base to effectively manage within the context of the broader vision.

INSERT FIGURE B: Leadership Competency Model; caption as in book]

The centerpiece of The Prudential Way, which strives towards fostering a uniform approach to business management among its senior business leaders, is The Leadership Competency Model. The Competency Model is, in turn, the centerpiece of all of Prudential’s assessment and development programs, and has been incorporated into the managers’ performance appraisal process. Using a business simulation model developed by Applied Research, a number of key executives were assessed, over an intensive one and a half day period, against nine core competencies that have been identified as essential to effective leadership. Six executives go through the simulation at a given time. Prudential executives have come to trust the simulation results, because of its proven ability to assess the strengths and development needs of each manager against selected competency areas. The results are used to design custom development solutions, such as personal coaching and rotational assignments, that address identified needs. They are also used to assess an individual’s potential to move up within the organization. Plans are underway to expand the assessment approach, and a streamlined version is being introduced as a selection device for executive-level hires.

[INSERT FIGURE C: Core Competency Definitions; caption as in book]

Another development initiative under The Prudential Way umbrella is the Innovation Team. Innovation Teams provide real-time, action-oriented learning that encourages creative problem solving. Seven to ten high potential managers and key position holders are assigned to cross-functional teams with an accountable executive, and then given large-scale organizational problems to tackle over a two- to three-month period. After a rigorous learning process and some hard work, team members come up with specific recommendations, which they present to the Chairman and CEO and a team of executives.

For example, as an Executive Vice President in charge of both Human Resources and Corporate Governance, I sponsored a group that looked at risk management and self-assessment. I wanted Corporate Governance staff to place greater emphasis on self-assessment. So my team was tasked with the job of figuring out how to do that, and they did an incredible job, coming up with excellent solutions that we are implementing.

The innovation teams have looked at the pros and cons of offering differentiated service levels to customers via a variety of channels (face-to-face, telephone, interactive voice response system, etc.). The other groups looked at intergenerational wealth transfer, risk management and revenue enhancement. Innovation teams have become an integral part of how Prudential develops leaders and increases our impact in the marketplace.

What these various initiatives under The Prudential Way "umbrella" accomplish is a consistent approach to managing the business. The result is that, if you were to talk to a few Prudential managers, you would get a sense pretty quickly that they come out of the same school, that they think the same way, use the same business model, talk the same business language; they problem solve and lead their units in a fairly similar fashion. But the goal is not to have a cadre of cookie-cutter managers who do not think for themselves. It is to ensure that the business leadership understands and embraces the organization’s overall mission, works within that framework to seek information from and partner with others to get things done, and exercises critical, conceptual thinking when evaluating and resolving key business issues.

Benefits as A Strategic Weapon
Study after study concludes that employees rank job content and perceived opportunities for growth and development as more important than pay and benefits in determining overall job satisfaction. Yet, in today’s difficult labor market, employees with expertise in critical job families are demanding increasingly competitive pay and benefit packages from employers anxious to attract and retain them. The result has been a virtual talent war—particularly in the technology and financial services industries—in which benefits, perks and performance-linked compensation features such as stock options are the weapons of choice.

In order to remain competitive, Prudential has tended to the basics of pay plan design and implementation. Traditionally, the company had been burdened with a hierarchical culture that paid employees based on level. What the market paid for similar jobs, and more importantly, individual and business performance—had no impact on pay decisions. In addition, there were multiple and inconsistent salary programs to administer across business lines and locations. It has been an almost revolutionary idea to de-couple pay from titles, to simplify the hierarchy, have fewer layers and levels, and to replace many of our pay plans with one stream-lined program that is market-based, competitive and linked to performance. For us, that has been a real cultural shift.

Where Prudential has gone far beyond basics is with its benefits and work-life programs. A lot of companies have added choice and flexibility to their benefits offering. But our work-life benefits are unusually rich, and our approach has helped us win several awards in the last few years.

Not satisfied with resting on our laurels, in 2001 the company revamped and added new features to our already impressive benefits offerings, enhancing the choices and flexibility we offer associates. Prudential is highly innovative in designing attractive work-life benefit choices that employees can select from to meet individual needs.
I credit the success we’ve had with benefit design to two things. At Prudential benefits design is a diversity initiative. The value of diversity is a key element in the overall business agenda. Performance against diversity goals directly affects management compensation. About 10 percent of our senior leader compensation is tied to the achievement of diversity goals. So we’ve worked really hard at diversity. Are we the most successful in the world? No. Are we getting there? Yes. One way we’re getting there is by offering benefits and work-life program offerings that acknowledge the needs of a truly diverse population. We know that in order for us to be successful in a diverse global economy, we need to attract and retain people who are diverse, who bring different perspectives, different thoughts, different skills, different backgrounds.
Prior to rolling out the new benefits and work-life plans, Prudential tapped into its favorite touchstone—our associates. Four hundred associates representing all levels and various regions participated in focus groups on pay and benefits. In addition, fifty company executives were interviewed. These sessions helped the Compensation team develop a menu of offerings that supports company strategy and culture while attracting and retaining a talented workforce. What evolved from these interviews and focus groups was a set of guiding principals that the company used to design—and will continue to use to assess—its total compensation offerings: the combination of pay, core benefits and optional and work-life benefits and perks.

[INSERT FIGURE D: Our Guiding Principles; caption as in book]

Working Mother magazine, in its latest "Best Companies for Working Mothers" listing, highlighted Prudential’s track record in providing flexible work arrangements—such as job sharing—and in offering programs such as Daddy Stress, a recent pilot workshop that addresses the needs of fathers, many of whom must also balance parenthood and work. The workshop drew record attendance. Other benefits include a $5,000 adoption benefit, extension of many of the benefit programs to part-time associates, sponsorship of on-site day care centers and lactation facilities, and a company match of 25 percent of funds associates contribute to a dependent care reimbursement account—which covers both child and adult care. Recently, Prudential piloted a program that offers concierge services.

We have tried to go further than most companies in finding creative solutions to help our associates manage their lives, as well as be very productive at work, and we’re very proud of that.

Prudential management knows that investment in benefits not only provides a powerful weapon in the war for talent, but also improves the bottom line. Such investments have resulted in a 20 percent decrease in absences, and an 8 percent reduction in turnover. In today’s tight labor market, this is significant. According to a recent Fortune article, Human Resources executives estimate that, all factors considered (including search fees, training costs and lost business), the cost of a defecting professional can be as high as 150 percent of his or her annual salary. In addition to such quantifiable payoffs, there are payoffs that defy measurement.

The Keys to One Prudential
Prudential today is widely recognized as a leading company, and as such, it attracts a roster of employees that represents the best in the industry. Compared to its prospects in 1994, or even in 1997 when I joined the company, the transformation has been undeniably impressive. What has driven Prudential’s successes? Many companies pay lip service to the notion that an organization’s employees are its only truly sustainable competitive advantage. At Prudential, that philosophy underpins the development of long term strategy and the day-to-day policies and practices that shape the quality of life—both inside and outside of the workplace—for each of it’s 60,000 associates. With a diverse group of associates who feel valued, who are actively pursued and enrolled in the work of providing one face to its customers, and enlisted in continuously impacting customer satisfaction, the future of Prudential looks solid.

But to fully realize our Human Resources transformation, we need a cultural conversion to occur within the enterprise. There wasn’t one distinct action we could take to begin assuming the role we wanted Human Resources to play. Instead, to make our HR regeneration successful, we had to become a business partner, and a catalyst for change. Among the actions we had to take were:

• Improving systems and processes (i.e., our infrastructure)
• Developing a sound relationship with the executive team
• Defining our new roles
• Implementing new ways to work
• Assessing our talent
• Educating and communicating with our associates
• Changing the benefits and compensation structure and processes

Combined, these actions have created a cultural change that spans the entire organization. The payback has been significant, both from a monetary perspective, and in terms of our reputation. As I mentioned earlier, we achieved significant savings in our HR functionality. What’s more, we have received numerous accolades for our employee-focused initiatives. These include awards for our diversity and technology efforts, and recognition as a most admired company. Collectively, these actions have helped us become prepared for Prudential’s demutualized future.

Lessons Learned: A Primer from the Head of HR

1. Human Resources staff must work hard to foster a close partnership and open dialogue with line management. Only then can it design an HR structure and programs and policies that are in alignment with the business strategy.

We have really smart business leaders. My role has been basically to listen to them, understand what they have to say, and try to build strategies and programs that really help them get to go where they need to go. Listening has made a world of difference."

Communicate! Communication, both informal and structured, is the linchpin between strategy and execution. Engage all levels of the organization in active discussions about strategy, challenges, organizational performance measures, customer needs, as well in the planning of programs that will directly impact employee satisfaction and morale.

I have a philosophy that there is an equality of ideas. While people may have different roles within the organization, it’s important that their ideas be heard and weighed. We want people’s creative ideas; that is why we solicit input, ask for reactions. Many of the programs that we’ve designed that have worked best haven’t been management’s ideas. They’ve come from really bright people out there who just wanted a chance to be able to express what they think.

2. When a company is employee-focused, it is naturally customer-focused.

We conduct bi-annual employee satisfaction surveys, where we look at how committed our associates are to the organization along several criteria. We benchmark ourselves against the Mayflower group of companies—companies like ourselves that also participate in the survey. We look at items like their understanding of our strategy, their commitment to serving our customers, to staying with Prudential; their overall satisfaction with their managers, with pay and benefits, with how they are being developed. The results are used to make improvements in problem areas, and to set business leader compensation.

3. Diversity is a key business tool that leads to broader solution sets and better decision- making.

We make diversity a key element in all aspects of managing our business. We do so consistently, and we diligently measure progress. Results are used to determine business leader compensation.

4. Have the courage to try something completely different, even if it appears a bit risky.

Organizations do not become great unless its people take chances and try new things out, making adjustments as needed. Hire and keep smart people and let them try new things. It can be scary. Our experience with OPX is a really good example. It could have been a disaster: sixty thousand people playing with maps in hotel rooms across the country. But it communicated that it’s OK to do something fundamentally different, its OK to have fun and struggle, to laugh a lot and learn together. We want a culture where people feel they won’t get nailed if they try something new.

5. Measure results. Establish HR-related measures that make sense and manage against them.

We’ve created something that almost nobody else has, a Management Dashboard accessed via a web browser that provides senior business leaders, at a glance, with immediate access to the metrics we’ve deemed critical to managing human capital; these include employment and turnover statistics and associate satisfaction surveys. It provides data on how each unit is performing against organizational goals, with links to various levels of detail, and analytical tools that allow seniors to delve into the dynamics that may be driving the numbers. PeopleSoft helped us create the dashboard, and it’s quite impressive!

Summary
Clearly, Prudential’s reinvention is the end result of many concerted efforts. But the fundamental factor driving the company’s transformation is the willingness to embrace and implement and across-the-board cultural shift. Only by changing its culture could Prudential achieve success.