Persuader In the Storm

Persuader In the Storm | Human Resource Executive Online Facing significant morale challenges in the wake of the Enron and WorldCom scandals, KPMG's Bruce Pfau has kept a steady hand on employee engagement and retention.

Thursday, October 16, 2008
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When Bruce Pfau joined New York-based professional-services firm KPMG LLP as vice chair of human resources in 2004, he quickly realized he was diving into the churning, uncharted waters of an industry in the throes of increasing regulatory pressures and plummeting worker morale in the wake of the Enron and WorldCom collapses.

"When I joined the firm, it was right on the heels of all of the regulatory changes that had just come down relative to Sarbanes Oxley and the establishment of the Public Company Accounting Oversight Board," he says. "That sort of confluence of events drove this huge, difficult and tight labor market because there was an incredible amount of work generated by SOX. Our clients were under increasing regulation because of that."

The Big 4 accounting firms were absorbing all the extra work, Pfau says, and they were all under extreme pressure due to the toxic public relations and litigious environment. "No one quite knew exactly how to implement all the changes as a result of SOX," he says.

In addition, there were huge challenges in recruiting and retention as well as training. "Only 53 percent of KPMG workers said that it was a great place to work when I joined in 2004," he says. "We had high turnover [23 percent] and very mediocre morale. I walked into a situation where we really had to turn things around. Almost like a perfect storm. It was a very challenging situation."

Fast forward to today, and the number of employees who feel that KPMG is a great place to work now tops 80 percent, according to recent in-house surveys.

"We have record numbers of people joining us and developing and being promoted, and record low numbers of people leaving us," he says, adding that turnover rates have also been cut in half since he joined the company. "There were 19,000 [U.S.] employees and partners when I joined, and now there are 23,000."

For his part in this amazing turnaround, Pfau has been named to Human Resource Executive®'s 2008 HR Honor Roll.

From Pfau's perspective, his main task was to quickly engage the company's 1,650 partners across the company's 93 U.S. sites, because they had "an enormous workload," with both organizational and risk-management pressures on them.

"Gaining both their attention and their belief and trust that anything was going to change about the culture -- that we were going to be able to create an employer of choice atmosphere, bring turnover down and charge up employees -- was greeted skeptically, to use a polite word," he says.

Pfau credits buy-in from the top in helping to change workers' minds, particularly from KPMG Chairman Tim Flynn.

"Tim Flynn and the rest of the management committee locked arms and had a very significant appreciation for overcoming these issues," he says.

Flynn, in turn, says Pfau's leadership greatly contributed to the company's resurgence.

"Bruce's skill in engaging and collaborating with business leaders at the firm has ensured that HR's strategies and programs are successfully aligned with KPMG's business strategies," he says.

Overseeing Better Balance

In the cyclical world of accounting, work/life balance often takes a back seat to the deadlines brought on each year by tax season and increased government regulation.

But, in Pfau's words, "we know from our own surveys that the No. 1 reason people leave [the company] is because of issues around work/life balance. When we ask people in surveys about what they want from an ideal employer," he says, "one of the top two things is work/life balance and flexibility."

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In response, Pfau initiated seminars at different sites to help partners and their spouses find the right balance between work and home life. He also began building an "esprit de corps" within the company by initiating recognition and reward programs that include employee contests and surprise days off.

Pfau also understands that both employees and partners want opportunities to develop themselves within the company, which led him to create and institute career-planning resources in-house that help workers understand and then achieve their personal work goals.

On Pfau's watch, the company also runs contests involving the Super Bowl and other popular cultural events that allow employees to interact with each other about non-work topics. It is because of such programs that "people walk around with smiles on their faces now," says Pfau. "We're serious about the fun."

In addition to being the vice chair of KPMG's HR function, he is also the managing partner of the company's Montvale, N.J., office -- a huge facility where all of the company's finance, IT and HR functions are housed. With more than 1,800 people at the location, Pfau has a unique perspective to view his HR successes and challenges. "I'm their landlord and leader of that geographic location," he says. "All my national HR policies can be seen in the Montvale office. ... It's been useful and is an experience that plays to one's humility. Not everything that looks great on paper is going to work in practice."

Even setbacks do not keep Pfau down for long, according to a colleague.

"Bruce leads through 'persistent persuasion,' " says Shaun Kelly, vice chair of KPMG's tax division. "His education and experience as an HR professional gave him the confidence and the skills to help KPMG understand and manage the sea change that has taken place in people management in the last 10 years."

Whether facing a perfect storm or a sea change, Pfau has ably demonstrated he can be counted on to keep KPMG's ship moving full steam ahead.

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