The world's leading financial services providers and one of the oldest banks in the UK, Royal Bank of Scotland Group adopted SHRM approach with the recognition to outperform its peers, the contribution and performance of its people would be key.

1. The Royal Bank of Scotland Group
By Garima Saxena, 3rd Eye Advisory Ltd
Strategic Human Resource Management at Royal Bank of Scotland
The world's leading financial services providers and one of the oldest banks in the
UK, Royal Bank of Scotland Group adopted SHRM approach with the recognition
to outperform its peers, the contribution and performance of its people would be
key. This was done by a joint initiative by HR Director and Chief Executive, and a
'make it happen'culture within RBS. The development of SHRM was aimed to keep
ahead of the information needs of the company. RBS's focus was to get the basics
right and concentrate on four main measures around engagement, absence,
turnover and short-term tenure. RBS brought in a range of people to develop the
SHRM framework to supplement the skills of the HR team. The organization was
keen to bring in the very best people available to ensure the most robust and
'joined-up' approach. Skills included market research, technology and finance. It
was key for RBS that:

2. 1. SHRM was on its business (and not just HR) agenda
2. It built a compelling employee proposition that attracted, engaged and retained
the best talent
3. The effectiveness of the people strategy was assessed through the impact on
business performance
Underpinning the SHRM approach was the RBS strategy summarized in the
diagram below.
This strategy reflects that RBS generates superior sustainable value for
shareholders through adding value for both customers and the Bank's own people.
RBS analyzed the data collected from employee survey which was sent to all
employees, containing over 100 questions. The analysis was done against both
employee’s characteristics and against business outcomes and initiatives. In terms
of the contributions to the SHRM model, RBS has been able to adjust the employee
proposition and assess the impact on staff. This was linked with the business
outcomes, and to assess the links between the two. The important findings from
the survey were:
1. The impact of engagement on business outcomes
2. The links between reward and engagement
3. The life stage of the employee, and that the proposition needs to reflect
differing needs at differing times

3. In terms of outputs, RBS has identified seven areas of employee performance that
show a significant, consistent positive link with business and customer
performance metrics. These measures are:
1. Structured information is developing by more than 40% consistently.
2. Traditional content writes, including unstructured information, are developing
by up to 80% each year.
3. Global information will develop to 40 zettabytes (ZB) by 2020.
4. 85% of this information development is required to originate from new sorts;
with machine - produced information being anticipated to expand 15 times by
2020.
The analysis has shown that engagement is a key indicator in human capital terms.
Engaged employees perform well and contribute directly to business success. They
found that the employees who are engaged:
1. Say: Consistently speak positively about the RBS Group to colleagues,
potential employees, and customers.
2. Stay: Have an intense desire to be a member of the RBS Group.
3. Strive: Exert extra effort and engage in behaviors that contribute to
business success.

4. The Drivers to Engagement is a recognized toolkit used in RBS to reward the
superlative performers and to encourage through engagement. The links between
monetary reward and engagement are notexact and non-monetary recognition has
been found to be more important in engagement terms. 'Reward' also covers
hygiene issues which need to be put right rather than just paying more. However,
while the link is not precise, RBS points out that reward can be organized from the
epicenter and can be sorted out rapidly for everyone and therefore have an
extensive impact as follows:
1. Reward is not the number one driver of engagement, for example, the impact of
a good manager is significantly greater.
2. However, the organizational impact of good managers is limited by narrow
spans of control i.e. they can have a very positive impact but only on a relatively
small number of people.
3. In contrast, reward done well can drive engagement across the whole
organization.
4. Investment in the design of effective reward programs can therefore deliver
significant enterprise wide returns.
RBS offers flexible reward through its RBS Select program to ensure all employees
can be engaged through being able to choose the rewards that best meet their
circumstances at that time. Some 105,000 employees are eligible for the program
and administration of it has been outsourced. RBS judiciously targets the rewards
which makes the engagement levels increase by up to 20 per cent. The SHRM
approach also makes financial sense for RBS as on an average, it takes ten months
to repay the recruitment and onboarding costs of a new recruit. Therefore,knowing
the engagement criteria is important for the new recruitment and retention
strategy.
For RBS, the key to success has been the identification of the impact of engagement
on their business performance and the links between engagement and reward.
Coupled with this has been RBS's linkage of SHRM with business performance.
The bank has attempted to turn as much HR data into bottom line impact as

5. possible, which has helped with organization wide buy in. RBS HR staff have had
to learn 'business language' to communicate with their colleagues and RBS found,
as other organizations have, that this was not always easy for the HR team. RBS
has supported the SHRM approach with senior management buy in and has
ensured senior people from all elements of the business are involved in getting
SHRM right.
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