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HR&BUSINESS
LINKING PEOPLE, PLANNING AND PRODUCTIVITY                                                        NOVEMBER 2010




Peel off
the label
How to look behind frequently
misleading cultural labels to see
the true nature of an organisation




     tune up your workforce           engineering change              rethinking the recession
     Better workforce planning can    Process review can enable the   Future-proof responses to
     bring productivity rewards p10   elusive ‘more with less’ p14    the economic downturn p18
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Networking.
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www.sps.org.uk
welcome
This is the second edition of HR & Business
and I hope you will find it of interest and
pass it on to your colleagues. Our focus
as a society is about the ways in which HR
supports business goals through planning,
people strategies, metrics, productivity and
partnership.
                                                             6                         10                  14                               18
   In these straightened times, these are
essential contributions from HR professionals,             4 Upfront                                       14   Engineering a process change
and they need the knowledge and skills                           News, views and events from the HR             Process engineering is a different way to
to be able to play their part. Public sector                     Society, together with some of the             analyse business activities for businesses
organisations, in particular, are having to                      latest developments in the industry.           that need radical change to allow them
rethink their deliverables and processes, and                                                                   to achieve far more with far less, says
seek productivity improvements. A mutual                    6 The trouble with cultural labels                  Kees van Haperen.
partnership between line operations and HR                       Labels of organisational culture can
is essential for the necessary resource re-                      mask systems of great complexity but      18   Recession brings radical thinking
planning within a nervous employee relations                     there are approaches managers can              Research has revealed that organisations
environment. HR must be outward-looking to                       take to see the richness beyond the            have been responding creatively to the
the business, not immersed in its own agenda.                    label, says Naomi Stanford.                    recession, using new strategies that
   Do keep an eye on www.hrsociety.co.uk                                                                        should stand them in good stead for the
for our news and events, which include                    10 Shift workforce planning into a                    future, says Peter Reilly.
workshops in many business-related HR                            higher gear
subjects. The Society is currently developing                    Creativity and innovation are essential   22   Forward thinking
an attractive membership proposition to                          as organisations adapt to the economic         HR professionals in the public sector
encourage more members and broaden the                           downturn. George Blair shows how               must not become absorbed with
networking opportunities, on- and offline.                       a fresh approach to staffing can bring         redundancies. In this environment,
   I hope to meet you personally at one of our                   productivity dividends.                        they have a key role to play as business
events in the near future.                                                                                      partners too.

Andrew Mayo
President




if you would like to discuss any of the issues raised in this publication please contact                   Published by grist
Andrew Mayo on +44(0)1727 843424 or email andrew.mayo@mayolearning.com                                     21 Noel Street, Soho, London, W1F 8GP
                                                                                                           Publishing director Mark Wellings
                                                                                                           editor Sarah Coles
                                                                                                           Art director Andrew Beswick
                              hr Society is a network of senior HR professionals,
                                                                                                           sub-editor Jonathan Lalljee
                              academics and others involved in value-added HR strategy. Our                Commercial director Andrew Rogerson
                              aim is to lead thinking and share good practice in the linking of            Telephone +44 (0)20 7434 1447
people, planning and productivity, and provide a network forum for professionals working                   Website www.gristonline.com
in this area. Our activities include holding events to share knowledge; offering educational               Advertising and sponsorship Ian Carter
master classes; and facilitating and distilling research and disseminating knowledge.                      (info@media-shed.co.uk / 0844 858 4852)
For more information visit www.hrsociety.co.uk.                                                            This publication is printed on paper from
                                                                                                           sustainable sources using a chlorine-free process.


                                                                                                            h r&Business / novemBer 2010 3
News
All the latest news, views and events from the HR Society and its members


Workforce planners must prepare for
the end of the default retirement age
As the consultation on plans to scrap the                                                                           and providing some employment
default retirement age (DRA) conclude,                                                                              benefits, such as critical illness cover,
it looks increasingly likely that it will be                                                                        next to impossible.” He claimed it would
phased out from April 2011, with serious                                                                            raise complex legal and employment
implications for workforce planning.                                                                                questions which would create
    The consultation, from July to                                                                                  uncertainty for employers and their staff.
October 2010, proposed scrapping the                                                                                He concluded: “A default retirement age
DRA, which allows employers to force                                                                                helps staff think about when it is right
staff to retire at the age of 65. “With                                                                             to retire, and also enables employers to
more and more people wanting to                                                                                     plan more confidently for the future.”
extend their working lives we should                                                                                   The Managing an Ageing
not stop them just because they have                                                                                Workforce report from the Chartered
reached a particular age,” said Employment Relations Minister                          Management Institute (CMI) and the Chartered Institute of Personnel
Edward Davey.                                                                          and Development (CIPD) found that only 14% of workplaces are
    There is every sign the proposals will be implemented, and that                    ready to accommodate a changing workforce age profile.
the DRA will be phased out between April and October 2011.                                Andrew Mayo, president of the HR Society warned: “This
    This will have massive implications for workforce planning. John                   change makes workforce planning more complex, as the ability to
Cridland, Confederation of British Industry deputy director-general,                   predict requirements is now potentially difficult. Early warnings of
said: “For employers, these proposals could make workforce planning                    employees’ intentions will be needed.”



  M eM ber Spotlight                       David Stephenson, group head of organisational development, Royal Mail Group

  What are your key                                            same time become more agile and            be changing. Each individual goes through
  challenges at the moment?                                    innovative in meeting future needs.        their own change experience, so we must
  The sector is facing the                                                                                recognise the importance of individuals. Like
  challenge of a fall in mail                                  How do you keep staff engaged              most organisations, one of the key relationships
  volumes, because of the                                      in a challenging time?                     is with their line manager, so supporting
  economic downturn as well                                      A few months ago we reached an           managers is vital.
  as new technology. While this                                  agreement with the unions and that
  offers opportunities in new                                    has given us a positive opportunity      What tools work well for you?
  areas it also means the business                               for us all to work together to improve   We have a very proud, loyal and passionate
  must adapt and redesign.                                       the business.                            workforce, and tapping into that works well.
  Changes in regulation mean there is more              It’s always important to be straight              That can be everything from local incentives
  competition, with competitors able to use our      with people and that’s no less important             such as ‘watch and win’, which allows staff to
  delivery networks much more cheaply.               during challenging times. You must never             benefit from spotting business opportunities,
     Another OD challenge is to balance the          underestimate the need to communicate.               to local problem solving schemes to make us
  tension between the need to modernise the             It’s important to understand what is driving      more operationally excellent. Coaching and
  business and become more efficient, yet at the     people’s engagement and how that might               supporting people through change is also key.


4 www.hrsociety.co.uk
net Working events

                                                                          HR Society diary
Return on investment is key                                               jaNuary
                                                                          Masterclass: Understanding
                                                                                                                  february
                                                                                                                  Presidents Forum: Current issues
for HR professionals                                                      organisational Development              for Hr in the Public sector
                                                                          Chris Nutt, an experienced              The session will be lead by Angela
                         HR professionals are not driven to identify      organisational development              O’Connor, chief people officer at
                         their return on investment (ROI) by              leader, facilitator, consultant and     the National Policing Improvement
                         organisational edict, but because they feel it   vice president of the HR Society        Agency, where she is head of
                         is an essential weapon in their professional     will lead this practical masterclass    profession for police HR and
                         armoury, says Professor Andrew Mayo,             designed to offer insight into how      learning and development staff
                         president of the HR Society.                     to improve your organisation.           in England and Wales and lead
                             Speaking after his annual Essentials         It complements conventional,            on police learning, development
                         Series workshop on the subject, he said:         structured thinking with a mindset      leadership, and people strategy.
“It is a professional responsibility to be able to demonstrate that       that enables you to intervene more         She will share the benefits of her
we have spent money wisely and delivered value for it, and                effectively in the flows of the real    experience including as director
this year there was a clear recognition among participants that           world.                                  of HR for The London Borough of
knowledge of ROI is a basic requirement for any professional.”                It avoids reducing organisational   Enfield and heading a national HR
    The workshop explores the theories behind ROI and helps               development to statements of            team determined to ensure the
participants put them into practice. It goes through setting              grand theory, and takes its task as     Crown Prosecution Service became
objectives, devising the formula for ROI, addressing the difficulty       understanding why, what and how         a world class prosecuting authority.
of measuring intangibles and explores specific cases.                     you can learn from past experience         Among the many awards she
    Mayo says: “We offer practical solutions and discuss the              and make an effective, practical        has received are for HR Director of
experiences of all the participants in some detail. As ever, as           difference in your current context.     the Year 2007 at the HR Excellence
part of the process, the participants were able to use examples               Participants will explore the       Awards, and positions is in Human
of successes to offer solutions to one another as well as bringing        cultural characteristics of their       Resource Magazine’s top 10 most
some of the theory to bear on their own projects.”                        organisation and their preferences      powerful people in HR list, and
   Andrew Mayo will run another workshop on Measuring ROI                 for the way they work to change         in Personnel Today’s top ‘power
in 2011. Visit www.hrsociety co.uk for more details.                      and sustain it for the better.          players’. Her HR teams have been
                                                                          They will also gain insights into       the recipients of numerous awards.
                                                                          organisational development as              She is a board director of Skills
hr society document                                                       a philosophy and a toolkit; and
                                                                          discover how to live with the
                                                                                                                  for Justice and has been elected the
                                                                                                                  vice president of the CIPD Police
library launched                                                          complexities, to be shrewd and          Forum.
                                                                          practical as well as professional       Date: TBC February 2011
As part of its mission to help inform members and disseminate             Date: 10.00-4.30, 25 January 2011       Location: One Whitehall Place,
the latest thinking on issues affecting them, the HR Society              Location: One Whitehall Place,          London SW1A 2HE
has launched an expanded document library on its website,                 London SW1A 2HE                         Fee: £190 plus VAT for members of
www.hrsociety.co.uk.                                                      Fee: £320 (& VAT) for members,          the HR Society and £275 plus VAT
   The library is split into a number of categories including:            £395 (& VAT) for non-members.           for non-members.
workforce planning, employee engagement, people strategies, HR
metrics, human capital management, employee demographics
and HR business partnership.
   The documents available range from introductions to the
topic, to articles written by HR Society council members and              All attendees at their first Hr society event will receive one year’s
useful diagrammatic representations of concepts. There is also a          complimentary membership of the Hr society
facility to enable member feedback on the articles.
   Andrew Mayo, president of the HR Society said: “This library           For more information visit www.hrsociety.co.uk.
offers useful insights into the topics for HR professionals who           to book any of these events contact Lara Roberts, programme administrator
want a more detailed understanding of the various subjects.               Tel: 01264 774004 Fax: 01264 774009 Email: network@hrsociety.co.uk.
Over the coming months and years we will be adding to the                 if you have suggestions for events, subjects or speakers please email
breadth and depth of the library and introducing services for             HR Society president Andrew Mayo at andrew.mayo@mayolearning.com.
members only.”

                                                                                                              h r&Business / novemBer 2010 5
the trouble with
cultural labels
Labels of organisational culture can mask highly complex systems, but there are approaches
managers can take to see the richness beyond the label, says naomi stanford.




              F
                      ollowing his seminal research on national              These labels are a fact of organisational life.
                      cultures at IBM between 1967 and 1973,              Think of your own organisation – what label do
                      Geert Hofstede was asked: “Between the time         people attach to its culture? Common ones are a
                      that you were first analysing this data and now,    culture of innovation, a culture of collaboration or
               has your definition of culture changed?” His answer        a culture of teamwork. A rather more vivid label
               was: “No, not really. Of course, you have to realise       appeared in The Economist (31 July 2010), which
               that culture is a construct. When I have intelligent       talks of Pimco, one of the world’s largest bond-
               students in my class, I tell them, ‘One thing we           fund managers, having “a culture of constructive
               have to agree on: culture does not exist’. Culture is a    paranoia”.
               concept that we made up which helps us understand             Labels are a fact of life because they serve several
               a complex world, but it is not something tangible like     useful purposes: they are identifiers, much like a
               a table or a human being. What it is depends on the        luggage label on a suitcase; they act as flags for
               way in which we define it.”                                waving and mustering behind (or tearing down and
                  People tend to define the culture of an organisation    attacking); they are a quick and easy-to-use form
               in terms of a label, as if it were a tangible, as in       of shorthand or sketch that people can recognise
               Apple being described as having “created a culture         or picture; they are yardsticks for measurement or
               of secrecy”, and Walmart “an austere culture built by      comparison; and they can act as a defence.
               old man Walton” or Unilever’s CEO, Paul Polman,
               wanting to develop “a culture of accountability”.          Shallow and misleading
                                                                          The first problem with labels of culture is that they
                                                                          are shallow and confusing. The painting of a pipe by
                                                                          Magritte labelled “Ceci n’est pas une pipe” (this is
                  Dr Naomi Stanford is an organisation design,            not a pipe) is a good example of this. The confusion
                  innovation and culture consultant with clients in the   lies in labelling something that looks like a pipe as
                  private, government and non-profit sectors in the       ‘not a pipe’ because, in fact, it is not a pipe but a
                  US and Europe. She helps develop adaptive, open         two-dimensional representation of a pipe. Similarly,
                  and innovative organisations. She is the author of:     a label of a culture is not the culture itself but an
                  Organization Design, The Collaborative Approach,        abbreviated verbal or written definition. Labels do
                  The Economist Guide to Organisation Design and          not represent the pervasive, implicit, nuanced, subtle,
                  The Economist Guide to Organisation Culture.            complex and dynamic ways of community being that
                  Email: naomi@stanford.cc                                might be generalised across an organisation, but are
                                                                          experienced individually and subjectively.

6 www.hrsociety.co.uk
orgaNiSatioNal culture




                                                                        “ Culture is not
                                                                          something tangible
                                                                          like a table or a
                                                                          human being. What
                                                                          it is depends on the
                                                                          way in which we
                                                                          define it.”




    Second, labels imply something fixed in the way      because this, in his view, would lead to “the best
that a flag is fixed. The flag of a country does not     business decisions for the firm as a whole, and paying
change beyond recognition – the Union Jack or            employees in stock helped reinforce that culture.
the Star Spangled Banner have been the same for          I wanted them all to think and act and behave like
decades. An organisation’s culture, however, is always   owners.”
moving and fluid. Toronto-based academic Gareth             If, as in this case, there is no concerted effort to
Morgan’s definition states: “[Culture is] an active      create a shared understanding then simply making the
living phenomenon through which people jointly           statement is a recipe for disaster. It makes a number
create and recreate the worlds in which they live.”      of assumptions: that Fuld’s notion of ‘teamwork’ is
                                                         the same as each employee’s; that employees have a
teamwork trap                                            common view of what ‘thinking, acting and behaving
Third, labels do not invite the creation of a shared     as an owner’ is (and that they want to be an owner);
meaning. When Richard Fuld took over as chief            that people are motivated by the same rewards – in
executive of Lehman Brothers in 1994, he was             this case shares; and that ‘teamwork’ leads to the best
determined to establish a culture built on teamwork      business decisions.                                       >

                                                                         h r&Business / novemBer 2010 7
that the creation of shared meaning is the key factor.
“ If there is no concerted effort                                                         He defines culture as “a pattern of shared basic
                                                                                          assumptions that the group learned as it solved
  to create a shared understanding,                                                       its problems of external adaptation and internal
                                                                                          integration that has worked well enough to be
  simply making a statement about                                                         considered valid and, therefore, to be taught to new
                                                                                          members as the correct way to perceive, think and
  culture is a recipe for disaster.”                                                      feel in relation to those problems”.

                                                                                          unpack the label
                                                                                          Given that labels of culture are a fact of organisational
                                                                                          life, and also that they have severe limitations, there
                                                                                          are approaches managers can take to see beyond the
>      Fuld’s main action to develop a culture of                                         label into the richness of what it stands for.
    teamwork was to link compensation to the overall                                          Visualise a suitcase with your name and address
    performance of the firm through equity awards                                         on the luggage label. From the name and address a
    (Fuld himself being awarded colossal sums,                                            certain amount can be assumed: someone might
    somewhere between $350 million and $484.8                                             judge that you live in a good neighbourhood, or that
    million between 2000 and 2008). When Lehman                                           number 3A implied a flat rather than a house. But
    Brothers filed for bankruptcy during the financial                                    the assumptions would have to be based in prior
    sector collapse of 2008, it became clear that the                                     knowledge of addresses, and assumptions are not
    culture of teamwork was one based on greed, lack of                                   always correct. You might have borrowed the suitcase
    oversight and accountability, and blame. These are                                    and forgotten to take the original owner’s label off.
    not the characteristics commonly associated either                                        However, the act of unpacking the suitcase
    with teamwork, or with well-run owner-managed                                         is going to give a lot more clues about you. The
    businesses.                                                                           clothing, toiletries, possibly books, medications and
       American organisational academic Edgar                                             documentation will all tell a story. It is the same
    Schein’s definition of culture reinforces the notion                                  way with organisations. Unpacking the thing that




              Questions: unpacking the label
              These questions use the first two parts     across the whole organisation or in   • Why do the values need to define
              of the O’Reilly/Chatman definition:         pockets?                                what’s important? Do they do this
                                                        • When are they shared/not shared?        or is there a disconnect between
              • What are your shared values?              In other words, what circumstances      what’s important and any values
              • How do you know these values are          or contexts foster sharing values?      demonstrated or stated?
                shared? What is the evidence?           • What is important to the              • When does the link between
              • Why are these shared values               organisation?                           defining what’s important and
                important (in terms of achieving        • How do the shared values help           shared values come into play – in
                your business strategy)?                  define this? You need evidence          what circumstances?
              • Who shares these values? Are they         here.                                 • Where in the organisation is it
                shared by everyone or just some         • Who defines what is important and       obvious that shared values help
                people?                                   thus fosters the values? Or do the      define what is important? What can
              • Where are these values shared –           values foster what’s important?         you learn from this?




    8 www.hrsociety.co.uk
orgaNiSatioNal culture




is labelled allows you to tell the story and see the          book oFFer
patterns and themes that are referenced in many of
the definitions of culture.

Define culture
The first step to seeing beyond the label is to take a
definition of culture that appeals to you. There are
many beyond the ubiquitous “the way we do things
round here”. A definition that works is from CA
O’Reilly and JA Chatman, authors of Culture as social
control: Corporations, cults and commitment (1996),
which suggests that culture is “a system of shared
values, defining what is important, and norms,
defining appropriate attitudes and behaviours, that
guide members’ attitudes and behaviours”.
    After definition, the second step is to identify the
label, for example: “We have (or want) a culture of
innovation.” The third step is to unpack that in terms
of the definition by asking a lot of questions (see box).
                                                              organisation Culture:
Questions can also be developed to delve into the norms,      getting it right
attitudes and behaviours, guiding members’ attitudes
and behaviours with regard to the aforementioned              Naomi Stanford’s book Organisation Culture:
definition. The questions should be asked of a random         Getting it right (The Economist, 2010) provides
sample of the organisation (or part of it that is under       a concise guide for managers, analysing how to
study). It is likely to generate a surprising variety of      harness the power of culture, how to understand
answers, but several common themes will emerge.               an organisation’s culture and how to harmonise it
                                                              with a business strategy.
current cultural influences                                      Complete with advice on how to avoid common
The next step is to look at what should be kept and           mistakes while making cultural changes and on
why, and what should be shaped or changed and why.            maintaining a healthy culture in the long term,
Then look at what is currently shaping the culture.           the book includes real-life examples from such
Often it is performance measures, reward systems, job         major and diverse companies as IKEA, Google and
designs, work flows and other infrastructure elements         Procter & Gamble.
that form boundaries. Much as the choice of suitcase
shapes packing strategies and the amount of stuff             Offer details: HR Society members can receive a
that can be fitted in, so changing the infrastructure         20% discount (RRP £12.99). Telephone or email
changes the possibilities.                                    Emily Orford at Profile Books (020 7841 6300/
   A change of culture is not an overnight switch. John       emily.orford@profilebooks.com) and quote
Chambers is in his seventh year of changing Cisco’s           “Organisation culture – HR & Business offer”.
culture. Lou Gerstner took a similar amount of time
at IBM, and Alan Mullally at Ford is in his fourth
year “with a long way to go”. These leaders recognised
that they could label the culture they aspired to, but
that getting to it takes patience, persistence and a
detailed understanding of social and infrastructure
nuances, complexities and relationships.

Naomi runs a popular Essentials session on Organisational
Design for HR Society members every summer. Details
will be available closer to the time at www.hrsociety.co.uk

                                                                                               h r&Business / novemBer 2010 9
Shift workforce
              planning into
              a higher gear
              Creativity and innovation are essential as organisations adapt to the economic downturn.
              george blair shows how a fresh approach to staffing can bring productivity dividends.




              m
                            any organisations adopt a Jeremy                  The traditional approach to an economic downturn
                            Clarkson-style attitude to workforce          is to focus on reducing staff costs by such means as
                            planning: they just put their foot down       freezing vacant posts. This weakens organisations,
                            and hope for the best. It is a no-nonsense    as these are often the very posts where competition
               approach that can feel quite appealing. In reality,        for talent is strongest. In addition, the workforce’s
               however, using the careful planning and teamwork of        average length of service creeps up, which can mean
               a Formula One racing team will win the top place on        that innovation is likely to be in short supply when it
               the podium.                                                is required the most; the current way of doing things
                  This is because improving productivity and              is likely to be seen as best. Yet doing more of the same
               innovation is central to workforce planning when           will only give you more of the same.
               suitably supported by a regular inflow of fresh talent,
               as well as a culture of questioning and continuous         use the downturn productively
               improvement. Successful workforce planning is              A downturn is the time, and opportunity, to find ways
               therefore positioned at the crossroads between             of doing things differently. For example, workforce
               operations, finance and human resources.                   planning can reduce staff costs while introducing
                                                                          fresh blood by encouraging part-time working and
                                                                          sabbaticals, although this needs to be approved on a
                                                                          case-by-case basis, so that it does not adversely affect
                                                                          the organisation. It is also a great time to recruit
                    George Blair is managing consultant of Shared         graduate interns because managers can ensure they
                    Solutions Consulting. He has extensive consultancy    can make a valuable contribution to the organisation
                    experience in the UK and overseas, including          before offering them a permanent position.
                    Eastern Europe, Africa and the Middle East. He is        This has been used to great effect in the past
                    joint author of two books on organisational change,   couple of years when many unions have negotiated
                    and often speaks at conferences and workshops to      pay sacrifices to preserve jobs. For example, BA pilots
                    senior managers and postgraduate students. He has     worked for a month without pay, while the financial
                    been an expert witness to the House of Commons        services firm KPMG introduced flexible working
                    Health Select Committee and adviser to the King’s     with a maximum reduction in base salary capped at
                    Fund in workforce planning and development.           20% per individual. Nearly 80% of KPMG’s 11,000
                    Email: george@sharedsolutions.net                     UK staff applied to work a four-day week or take
                                                                          extended unpaid leave.

10 www.hrsociety.co.uk
workforce plaNNiNg




“Freezing vacant posts                                    Questions to address
 means innovation can be                                  during a recession
 in short supply when it                                  Workforce demand                          • How could you increase the

 is required the most.”
                                                          • Which activities should staff stop        number of secondments within
                                                            doing, or do less often, because          your organisation and with your
                                                            they add little value?                    suppliers?
                                                          • Which activities should be kept
                                                            in-house and which should be            Productivity
                                                            contracted out?                         • What traditional customs and
                                                                                                      practices should you challenge?
                                                          Workforce supply                          • What could you learn from other
   Business performance can be improved by                • Could you reduce your workforce           industries?
matching staff composition by age, gender and               numbers through the offer of            • Do you measure quality from a
ethnicity more closely to customers. One building           part-time working arrangements            customer perspective?
society found that their most successful staff were the     and sabbaticals that may prove to       • Could you gain more business
older ones who were closer in age to many of their          be attractive to some members             by targeting customers who
customers. So why do more car dealers not go out            of staff?                                 are trading down and therefore
of their way to recruit and train more female service     • Could you benefit from using              increasing your earnings per
managers, given the proportion of women who make            interns so that you are sure of           employee?
car-buying decisions yet who may feel patronised, or        staff before you appoint them?          • How could the use of IT and the
even bullied, by male-dominated sales staff?              • What benefits would you see if            web be maximised to reduce
                                                            your workforce better reflected           costs and improve your services
beware of burnout                                           your customer profile?                    to customers?
Many employers attempt to improve productivity
by reducing headcount, while expecting the same
outputs. However, this usually leads to poor-quality
service and outputs from demoralised staff because >

                                                                                                 h r&Business / novemBer 2010 11
“ Reduce the time staff                                                               reduce the quality of thinking, because concentration
                                                                                      is interrupted to check the latest missive pinging into
  spend on activities that do                                                         the inbox. Advise staff on the use of emails and, if
                                                                                      appropriate, implement email-free periods.
  not add value to customers
                                                                                      Map out processes
  or the organisation.”                                                               It is a good idea to map out processes and procedures
                                                                                      to see if they could be done with fewer steps. Another
                                                                                      source of waste is the poor layout of workplaces,
                                                                                      which causes staff to walk about needlessly. This
                                                                                      can be rectified by mapping where staff go and
                                                                                      then relocating facilities. Budget airlines improved
                                                                                      productivity by squeezing extra flying time from
                 > they   have to cut corners and risk burnout from                   their expensive aircraft by using unnumbered seating
                    working longer hours. The resulting loss of business              to reduce passenger boarding times. There are no
                    can easily outweigh any gains from staff costs.                   doubt long-standing customs and practices in all
                       A much better approach is to eliminate waste.                  organisations that could be questioned.
                    This is done by reviewing how staff spend their time                  Creativity makes all the difference to improving
                    and eliminating or reducing the amount of time                    productivity, so it is important to focus on new
                    spent on activities that do not add value to customers            revenue opportunities rather than just cost reduction.
                    or the organisation. Process engineering becomes                  A recession is a great opportunity for low-price
                    a core tool here. Question how much time is spent                 operators to attract more upmarket customers by
                    answering emails, many of which may be of little                  enhancing their offering. Thus, McDonald’s attracted
                    importance. Equally, a constant stream of emails can              Starbucks customers by introducing lower-cost




  Workforce planning in action
  Wendy Hirsh, independent                                                 Workforce planners think about costs as well as heads. The
  consultant and researcher and                                         ‘less’ is often really less money. It is vital to know what different
  member of the Hr society                                              groups of people cost (not just their salary but full cost) and to be
                                                                        able to track savings as workforce changes are implemented. This
  Like many others with practical                                       means having people and jobs well coded by type and level of
  experience of workforce planning, I                                   work, matched to financial data.
  see it more as a mindset than a set of                                   On the workforce supply side, we think about skills as well as
  particular techniques. So faced with                                  numbers of people. This is about the right mix of job types and
  an organisation seeking to ‘do more                                   also about having the people who possess the right skills for
  with less’, how might a workforce                                     those jobs. Planning in terms of job families and key specialist
  planner’s mind run? Four issues                                       skills can be more illuminating than planning by business unit or
  come immediately to mind.                                             cost centre alone.
     First, we need to ask what the ‘doing more’ is really about. Is       Workforce planners always see the short-term against the
  ‘more’ about quality, such as reducing manufacturing waste? Is it     longer-term backcloth. We seek to ‘do more with less’ in a way
  process efficiency rather than volume, like reducing waiting times    that positions the business more strongly for the future, in
  in the NHS? Or is ‘more’ really about higher levels of productivity   terms of the quality and demography of the workforce. This has
  and activity, for example teaching more students in higher            implications for recruitment (keeping some going, especially
  education with fewer lecturers? Sometimes we need to identify         of younger people) and for leavers (managing voluntary
  which work is central and cut out tasks that add little value.        severance with care).


12 www.hrsociety.co.uk
workforce plaNNiNg




Fairtrade coffee. This increased income and profit per                 net Working events
member of staff.
   Seeing old problems through new eyes can be                         HR Society events
encouraged by creating secondments either within
the organisation or with suppliers. This is particularly   essentials series
important for staff who have been in the same job for      employment
many years.
                                                           demographics
use the web                                                Managing consultant at Shared Solutions
IT can be either a financial drain or a source of          Consulting, George Blair, runs regular sessions
business advantage, depending on how well it works         on the landscape of employment in global
in practice. A well thought out website can reduce the     businesses for the HR Society.
number of telesales staff needed to answer queries, as     These sessions address themes such as future
well as administrative costs. For example, customers       employee age profiles, classes and locations,
of courier companies can track the progress of their       labour market statistics, skills and learning
consignments over the web. Those who can see their         organisations.
purchase records on the web are also more likely to        Each session is tailored to the needs and
use it for repeat orders.                                  challnenges of attendees.
   Innovation often comes from copying                     Details: For news of the next session, visit www.
organisations in quite different industries. That is       hrsociety.co.uk, and click on the events section.
why so many different organisations have copied
Amazon’s facility that shows customers what others         Masterclass
with the same purchasing habits have bought.
   Having the right key performance indicators for         Workforce planning
employees is also essential. Call centre operations        Professor Andrew Mayo runs regular sessions on
often get this wrong. They encourage staff to              workforce planning for all HR practitioners who
maximise the number of phone calls they answer by          need to work with resource planning, especially HR
minimising call duration. This is a great way to lose      business partners and planning specialists. They
customers, who often need to call again to get what        provide the business case for effective workforce
they want. This contrasts with the likes of telephone      planning, and offer practical tips for the most
banking company First Direct, which has a loyal            effective approaches. The workshops are illustrated
customer base because its staff focus on meeting           by practical exercises and case studies. Participants
customer needs, regardless of time taken. Thus, at         can take away a workbook to apply to their own
least one performance indicator should measure             organisations.
quality from a customer point of view.                     Details: For news of the next session, visit www.
                                                           hrsociety.co.uk, and click on the events section.
contracting out
Another consideration is to review which functions
to keep in-house and which to contract out. This
should be based on demonstrable advantages drawn
from detailed analysis, not wishful thinking. For
instance, some NHS hospitals have contracted out
their non-urgent pathology tests to highly automated,
commercial laboratories with low marginal costs.
   A successful HR function needs to be heavily
engaged in improving productivity and never more
so than during a recession. Workforce planning is the
way to achieve this by engaging operational staff at all
levels in creative approaches to how work is done.

                                                                                   h r&Business / novemBer 2010 13
engineering a
process change
Process engineering is a different way of analysing business activities that can bring radical
change and enable businesses to achieve far more with far less, says kees van Haperen.




                i
                    n the current political and economic climate,            Process engineering is a different way of analysing
                    public and commercial organisations are forced to     businesses that can bring radical change and improve
                    achieve greater value for money. The traditional      overall business performance. Often, the need for
                    view is that this should be achieved through          change in a business is triggered by the introduction
                cost reduction and productivity improvement. Yet a        of new ideas, prolonged growth or the need for
                more powerful argument can be made for taking a           sustainable development.
                less linear approach and a more holistic view of the         Today’s business environments are more complex
                way organisations operate. It makes more sense to         and uncertain than ever. Decision makers must cope
                look at what organisations should be doing, rather        with a rapid pace of change while making sense of
                than concentrating on what they are doing. HR             messy challenges. Organisations often fail to embrace
                departments control many processes that consume           a holistic approach for fear of undertaking too much
                their time and that of managers, so process engineering   and losing sight of what needs to be achieved.
                is a key skill for them. They have as much a part to      However, a better understanding of organisational
                play in seeking organisational efficiency as anyone       systems and processes can help to create different
                and need to analyse all their processes.                  ways of working and exploit the full potential of the
                                                                          organisation’s information.

                                                                          improving processes
                                                                          For today’s organisations to sustain, or even deliver,
                    Kees van Haperen is managing director of Koios        higher performance over time they need to ensure
                    Group Ltd a consultancy specialising in strategy,     that business processes become more mature.
                    change and programme/project management.              Michael Hammer, one of the founders of the theory
                    Koios Group is a member of the CMC Partnership        of business process engineering, says organisations
                    consortium for the Buying Solutions Management        should consider this process of maturity holistically
                    Consultancy and Accounting Services framework         and according to two important interdependent
                    agreement. He has been a member of the HR             characteristics: process enablers (aspects such
                    Society Council since 2006.                           as design, performers, owner, infrastructure and
                    Email: kees@koiosgroup.com.                           metrics) and enterprise capabilities (leadership,
                                                                          culture, expertise and governance). Although it could

14 www.hrsociety.co.uk
proceSS eNgiNeeriNg




be argued that his concept is arbitrary, his analysis         There are, however, significant problems with this
model gives a good insight of the intricacies of           type of approach. Although it works well in tackling
tackling organisational improvement.                       difficulties, when applied to complexity it results in
    We work in systems all the time – our work,            unintended consequences, creating vicious circles of
home, social life and hobbies are all related to various   ever-more complex rules and frameworks. In turn,
systems that all interact with each other at some          this could exacerbate the problems and lead to distrust
stage. The concept of process engineering offers ways      and miscomprehension within an organisation. It
to improve the systems within organisations, as well       could even result in a decline in the legitimacy of the
as to look across organisational boundaries into the       process and decision making itself.
wider environment. However, working in systems
is not a linear activity: step two does not necessarily    thinking in systems
follow step one.                                           Complex situations tend to be characterised by a high
                                                           degree of uncertainty. The existence of significantly
well-oiled machines?                                       different perspectives on the problems at hand
Traditionally, organisational and management               contribute to this uncertainty. In such circumstances,
scientists have seen organisational systems merely as      change becomes piecemeal and evolutionary because
complicated machines. In other words, organisations,       there is little agreement on the nature of the problem,
economies and even societies behave in a linear            let alone the most appropriate solution. Furthermore,
manner, with outcomes directly related to input.           causality is indeterminate and many factors are
Therefore, organisational behaviour is predictable.        interconnected or even interdependent.
Since this behaviour can be understood, it can be              In this context, ‘systems thinking’ adopts a different
effectively controlled by well-designed external           strategy to simplifying problems. Rather than
interventions. This view is based on facts derived         breaking down problems into smaller components
from objective dispassionate observations from a           that can be analysed, it goes up a level of abstraction
single external position by policy makers. Thus, it is     and discards some of the detail. This means that in
appropriate and efficient to separate organisational       analysing organisational issues, connections between
design from actual implementation. Moreover,               the components of problems can be maintained.
if the diagnosis is correct the remedy will be             The late Russ Ackoff stressed that a ‘system’ is a
straightforward.                                           whole consisting of two or more parts that satisfies >

                                                                          h r&Business / novemBer 2010 15
>   five conditions: the whole has one or more defining              To give some tangible shape to such organisational
                     properties or functions; each part in the set can affect     wisdom, the principles of one particular systems-
                     the behaviour or properties of the whole; each of            thinking approach can be used: soft systems
                     these parts is necessary but insufficient for carrying       methodology (SSM). SSM is a structured way
                     out a defining function; the way that each part of the       to establish a learning system for investigating
                     system affects its behaviour or properties depends on        complex messy problems. It aims to improve areas
                     (the behaviour or properties of ) at least one other         of concern by activating continuous learning in the
                     part of the system; and the effect of any subset of          people involved in the situation. Learning takes
                     essential parts on the system as a whole depends on          place through the iterative process of using systems
                     the behaviour of at least one other such subset.             concepts to reflect upon and debate perceptions of
                                                                                  the real world, then take action and again reflect on
                     Soft systems methodology                                     what is happening using systems concepts.
                     In brief, a system is a whole that cannot be divided             This reflection and debate is structured by a
                     into independent parts without the loss of its essential     number of systemic models. It is important not to
                     properties or functions. When the performances               lose sight of the fact that these models are holistic,
                     of the parts of a system, considered separately, are         idealised types of certain aspects of the problem
                     improved, the performance of the whole may not               situation rather than accounts of it. As a matter of
                     be (and usually is not) improved. In fact, the system        fact, these SSM-derived models become analysis
                     may function less well, or even be destroyed.                frameworks that address a variety of organisational
                                                                                  problem dimensions. At this stage, it is important to
                                                                                  understand that the focus of the enquiry is on what
                                                                                  the organisation is or ought to be about and not how
                                                                                  it operates.

  “Don’t waste a good crisis”                                                     the process perspective
                                                                                  Embracing the process perspective makes it much
  Dr Mark Pegg, director of the Leadership                                        easier to investigate the detailed functioning of the
  Centre at Ashridge business school and                                          organisation and to scrutinise its activities. This is
  member of the Hr society                                                        described as the perspective of ‘how’ the organisation
  The strength and depth of the credit crunch                                     does what it ought to be doing. To enable this, it is
  means everyone is doing more with less. For                                     necessary to adhere to a few important principles. In
  the private sector, the change has taken place                                  the recent past, some of these principles have been
  over the past couple of years, so this is now                                   incorporated into the ‘lean systems’ approach made
  business as usual. The public sector tends to                                   famous by Toyota.
  lag behind because of the way spending plans                                       First, a process has a starting point and an end
  work, so it is only just embracing the idea.                                    point. The process could also have a defined owner,
      Our advice is to ‘never waste a good crisis’. If you think you can get      group of actors or users and should convey a purpose
  where you want to go just by squeezing more productivity out of the             or desired outcome and comprise some form of
  system, you will be disappointed. You need to take the opportunity for a        decision making. There should be rules that govern
  major redesign of how you provide services. Risk aversion has to be put         the standard or quality of inputs throughout the
  aside and you have to innovate.                                                 process, alongside a recognition that the process
      If you want a radical solution, you need to build radical into the system   under review is usually linked or connected to
  and think differently about how you do things.                                  other processes. In using the process frameworks
      Spot your innovators and look after your mavericks. In the past, they       to identify and analyse issues, one should consider a
  may have been too radical and they needed to be managed. Now they               range of questions including: whether the activity is
  need to be given more freedom because they can make a real difference.          being done and how; who is doing it; what the issues
      Sort out the people at the top. If your leaders don’t do radical things,    are; and what could be improved.
  how can you expect the organisation as a whole to do them? You need                While answering such questions, the process
  a new kind of leader who can let go and trust people to do more and to          review should attempt to count how many steps are
  build ideas. In this crisis, power needs to be devolved.                        involved, whether there are hands-off handovers and
      You also need to encourage boundary-less behaviour. The temptation          how many. Total process timings should be addressed
  is to dig in and focus on your own priorities, but we need to work better       while capturing the approximate time taken for each
  together through sharing and collaboration.                                     step and between steps. The investigation should
                                                                                  identify whether there are queues or waiting lists,

16 www.hrsociety.co.uk
proceSS eNgiNeeriNg




or whether ‘parallel processes’ could be identified.
These tend to be the main causes of delay – common
examples are administrative processes involving such                                     net Working event
things as letters, records, and so on.
                                                                                        HR Society event
understanding variation
Last, but not least, when work takes place in single
places, such places may become ‘bottlenecks’.                                essentials series
‘Queues’ (for example, waiting lists or cancellations)                       Process engineering
can occur because demand exceeds capacity, or there
is a mismatch between the variations in periodic                             Kees van Haperen brings more than 15 years of
demand and periodic capacity.                                                experience in organisational analysis, risk, crisis
   Systems thinking and lean process approaches                              and business continuity consultancy roles to this
encourage a better understanding of the variation that                       session on systems and process concepts for
occurs in all processes. It is particularly important for                    improving organisational performance.
managers to understand the causes of variation in a                          The session aims to introduce a different
process if they wish to predict its behaviour and act                        way of thinking and of analysing businesses,
to improve it. As variation is intrinsic in all process,                     covering topics including systems thinking, the
improved processes will exhibit reduced variation                            difference between a process and a system,
as output becomes more predictable and costs are                             matching capacity and demand, and the
lowered. However, it should be understood that                               benefits of process mapping. A range of tools
without knowledge of variation, managers may well,                           and techniques used to design and improve
with the very best intentions, take action that actually                     organisations will also be reviewed.
makes things worse.                                                          Date: 7 December 2010, 10am-4.30pm
                                                                             Location: One Whitehall Place, London
barriers to change                                                           Fee: £320 (& VAT) for members; £395 (& VAT)
It should be noted there is often a breakdown in                             for non-members.
communication between groups or departments,                                 To book: www.hrsociety.co.uk/index.php/
which inhibits process performance. Such                                     societies-activities/essentials-series
breakdowns pose significant challenges to the
management of change or process improvement
initiatives. In fact, success will largely depend upon
discovering and analysing these disconnects. It is also
prudent to highlight that successful organisational
change requires senior management involvement
and support. Organisational change specialist John
Kotter explains that transformations often fail
because firms fail to maintain a sense of urgency for
change. They may suffer from the lack of an aligned
leadership coalition or an unclear vision/strategy that
engages employees all levels.
   Experience has shown that problems occur at
interfaces between organisational units. This is often
due to a lack of understanding between units or to          gains, quality improvements, organic capability
differing opinions about objectives held by members         improvements and lasting changes to organisational
of different organisational units. The result may be        culture. Additional benefits could be realised through
that no one has a complete picture of how the end-          the capture and distribution of detailed process
to-end chain of activities in a single process actually     knowledge among geographically dispersed units.
works, with managers tending to concentrate on              In an information context, process maps could be
their areas of responsibility without considering the       used to determine the impact of an organisation’s
effect on the total operation of the process or the         information resource on the major operating scenarios
system as a whole.                                          of the enterprise and to provide an implementation-
   The potential benefits of a process view can             independent specification for human system
be measured in terms of cost savings, schedule              interactions.

                                                                                                 h r&Business / novemBer 2010 17
recession brings
              radical thinking
              Research has revealed that organisations have been responding
              creatively to the recession, using new strategies that should stand
              them in good stead for the future, says Peter reilly.




              r
                        esearch from the Institute of Employment           had responded, whether their strategies were different
                        Studies (IES) shows that organisations             and whether such initiatives might have longer-term
                        responded to the recession by developing           beneficial impacts on employment relations. These
                        new strategies that should have beneficial         case study organisations were chosen because they
               long-term impacts.                                          had implemented innovative cost-saving programmes
                  The 2009 recession resulted in a sharp drop in           in an attempt to minimise headcount reductions. The
               economic activity that was greater than that seen in        IES also looked at existing literature on the use of
               the previous two recessions. But perhaps less widely        cost-saving measures during the recession, aimed at
               known is the fact that employment fell by much              helping organisations think through their responses
               less than during the previous recessions. During            to business change.
               the downturn of the early 1990s, companies quickly
               downsized to contain labour costs. This time, it            clinging on to key personnel
               appears they have responded differently.                    Four broad themes emerged from the research,
                  During the last quarter of 2009, the IES visited         Learning from the downturn: key messages from
               four organisations – KPMG, Jaguar Land Rover,               an employer perspective (2010): retaining skilled
               Norton Rose and the BBC – to find out how they              employees in preparation for recovery; recognising
                                                                           employee engagement would be affected during any
                                                                           change; protecting the employer brand image; and
                                                                           minimising the hidden costs of redundancies.
                                                                              First, organisations seemed to have been keen,
                 Peter Reilly is the director of research and              when choosing their cost-saving approaches, to
                 consultancy at the Institute for Employment Studies.      retain key staff in preparation for recovery. Having
                 He joined IES in 1995 after 16 years with Shell where     won these employees in the war for talent, they were
                 he held various HR posts. At the Institute he leads its   not going to let them go easily. In previous downturns
                 work on the HR function and significantly contributes     vital skills, such as in IT, had been lost thanks to the
                 to the Reward and Performance Management theme.           use of crude ‘slash and burn’ tactics that had no regard
                 He has given consultancy support to organisations on      for protecting scarce capabilities or future needs.
                 issues in this area and is a regular speaker.             This time, companies seemed to operate on the basis
                 Email: peter.reilly@employment-studies.co.uk              of expecting a V-shaped recession and so put more
                                                                           thought into workforce planning.

18 www.hrsociety.co.uk
reSearch




             Second, the research showed evidence of greater       the organisation, only to be hiring others in another
          awareness that a badly conducted downsizing exercise     part. Previous downturns had also demonstrated that
          could have an adverse effect on the employees left       it takes considerable time to recruit the right quality
          behind. The development of employee engagement           candidate once the market improves and the new
          has been a more explicit aim of organisations who        people also have to be fully trained and inducted,
          believe it leads to better organisational performance.   which leads to more time and expense.

          employer brand image                                     five main strategies
          Third, how an organisation handles cost savings also     The IES research shows there have been five main
          has an impact on its brand image and employee value      routes to putting these four goals into practice: pay
          proposition. Organisations did not want to be sullied    reduction exercises; flexible working practices; paying
          by the way they were perceived to have handled their     attention to people processes; developing a strategic
          response to the recession. Some even seem to have        approach to business decisions; and fostering a
          sought to enhance their employer brand in the way        ‘shared destiny’.
          they handled change.                                        To illustrate how widespread the pay-focused
              Finally, in the 1990s, companies became aware        approach was, a survey of 1,600 UK workers,
          of the enormous hidden costs associated with             conducted by Keep Britain Working in the summer
          redundancies. Some of this expense arose from the        of 2009, showed 54% had experienced a pay cut,
          left hand not knowing what the right hand was            a reduction in hours or a loss of benefits since the
          doing – for example, laying off staff in one part of     recession began. A 2009 survey report published
                                                                   by the Towers Perrin consultancy (now Towers
                                                                   Watson), called Cost-cutting strategies in the downturn
                                                                   – a delicate balancing act, also found that the most
                                                                   common cost-cutting approach was a salary freeze.
                                                                      However, the extent to which salary freezes in the
                                                                   private sector over the duration of the recession have
“ Organisations did not want to                                    really been absolute ‘freezes’ has to be questioned.
                                                                   Incremental and developmental pay increases, hot
  be sullied by the way they were                                  skill payments for professional staff, and pay increases
                                                                   and bonuses for high performers all seem to have
  perceived to have handled their                                  continued to operate in the absence of a general pay
                                                                   award. The use of other cost-saving strategies, such
  response to the recession.”                                      as overtime restrictions, has reduced levels of total
                                                                   earnings for employees at some companies.                >

                                                                                  h r&Business / novemBer 2010 19
the external presentation of the company brand and
“ Sceptics may say companies                                             reputation. Therefore many employers have been
                                                                         focusing on more intangible factors, such as timely
  have made temporary changes                                            communication and promoting honesty and trust
                                                                         within the organisation. They have been especially
  but business as usual will                                             careful to recognise that fairness in change processes
                                                                         and the demonstration of ‘procedural justice’ is
  resume after the recession.”                                           important to secure the support and understanding
                                                                         of ‘winners’ and ‘losers’ in the workforce.

                                                                         Strategic decision making
                                                                         Another key message to emerge was that any cost-
                                                                         saving strategy beyond compulsory redundancy has
                                                                         to address the key enablers of business performance
                                                                         to make it effective in avoiding headcount reductions.
                                                                         This requires an organisation-wide perspective and
                                                                         has a number of dimensions: focusing on the long
             > implementing flexible working practices                   term as well as the short; targeting the cost pressures
                Throughout the recession, there has been a greater       faced in different areas of the organisation, rather
                use of temporal flexibility (that is, varying working    than adopting a blanket set of measures; seeing issues
                hours to achieve a more effective deployment of          from a corporate not business unit viewpoint; and
                labour to meet business requirements) to help avoid      not allowing narrow, sectional interests to prevail.
                headcount reductions. Employers have implemented            Actions have to be anticipatory and based on
                flexible working patterns, such as flexible working      considering ideas from, and consulting with, a range
                weeks, short-time working and reduced hours to           of stakeholders about responding to present and
                temporarily reduce time inputs.                          future pressures. The process requires corporate
                   According to joint Chartered Institute of Personnel   endorsement of local action, but not simply the
                and Development (CIPD) and KPMG research,                spreading of equal pain everywhere. Rather it is
                Labour market outlook, in February 2009 some 19%         targeted action to deal with specific cost/income
                of companies were making greater use of flexible         imbalances. This allows the organisation to protect
                working during the recession. Four months later,         investments in business areas that are critical to its
                the CBI’s Employment trends 2009 - Work patterns         long-term strategy, such as research and development
                in the recession found that more than two-thirds of      and marketing. Cost savings in these areas can reduce
                organisations had increased flexible working or were     a company’s ability to capitalise on new demand
                considering doing so. Two of the case studies IES        when growth returns.
                used for its research showed an increased appetite for
                flexible working among employees.                        fostering a shared destiny approach
                                                                         An important theme emerging from the IES case
                attention to people processes                            studies that flowed from sensitivity on employee
                The research evidence also suggests that employers       engagement was a determined attempt to create
                have made efforts to maintain employee engagement        a sense of a ‘shared destiny’ in facing business
                during the downturn, in the belief that engaged          problems. For example, cost-saving measures were
                employees keep companies afloat during the hard          often launched among the most senior staff before
                times, and help them recover and thrive when             staff on lower grades. Salary freezes were applied
                business activity levels rise.                           to executives as well as employees. Job cuts did not
                   Employers have also recognised that the way           affect only one group of staff, such as those at the
                in which they manage the workforce during the            bottom of the pay ladder.
                downturn affects not only the wellbeing and                 One way in which shared destiny was emphasised
                productivity of the remaining employees, but also        was by involving employees in making the tough

 20 www.hrsociety.co.uk
reSearch




decisions over how to bring about savings. Just                                        net Working event
under half of the respondents to the Towers Perrin
survey actively brought their workforce into the                                       HR Society event
problem-solving process during the downturn. This
is in keeping with the trend for increasing employee
involvement in business processes, which can drive                          research briefing
engagement and help to build a two-way collaborative                        What have we learned
working relationship.
                                                                            about change during
will co-operation survive?                                                  recession and cuts?
Sceptics will dismiss many of these research
results as pretty ephemeral. They will believe that                         Led by Peter Reilly, director of research and
companies will have made some temporary changes                             consultancy at the Institute for Employment
to get through the hard times but business as usual                         Studies, this session will describe the Institute’s
will resume after the recession. Thus this mutual                           research on HR issues with regard to how
approach to flexible working will disappear as                              organisations faced the recession. Themes to be
employees will push for more scope for adjustment                           discussed include how lessons learned might be
on their terms and employers will respond to greater                        applicable to the public sector, which practices
demand by sweating their assets to the maximum                              and strategies will survive and whether businesses
degree possible.                                                            will just return to their normal routines.
   Cynics will suggest that some of the ‘solutions’                         Date: 17 January 2011, 2pm-4.30pm
to resourcing problems highlighted by the research,                         Location: One Whitehall Place, London
especially those involving working time, are all very                       Fee: £190 (& VAT) for members; £275 (& VAT)
well for professional services firms, but are no use in                     for non-members.
manufacturing and retail. The preoccupation with the                        To book: www.hrsociety.co.uk/index.php/
employer brand goes with the same territory – some                          events/83
might see it as nothing more than window dressing.
   More reflective commentary has also suggested
that there will be a pay-back for the wage restraint
that employees have accepted as part of the recession.
Trade unions will insist on making up lost ground
once the profits begin to flow and/or the labour
market tightens. Even those not covered by collective
agreements will seek to exploit their market position,
especially as the new, leaner organisations may be
more vulnerable to unexpected resignations.

May i have some more?
There are also fears that the cost-cutting measures       for dealing with an unexpected worsening of the
will not stretch far enough if there is a double-dip      business situation or else their well-intentioned
recession. One case study had already experienced         efforts will fail.
the challenge that actions taken in good faith had           This research suggests that organisations
proved to be inadequate. The HR director described        approached the 2009 recession with a planning
going back to the employees “Oliver Twist-like, to        orientation and a desire to protect their people assets
ask for more”.                                            in a way that they might have not done before. They
   Under these circumstances, it is hard to retain        have been innovative and engaging in the way they
employee engagement. Uncertainty, especially, leads       have sought to retain and motivate their workforce,
to deteriorating morale. So those organisations that      but there are still challenges to face as the UK has
are trying to avoid redundancy need to have strategies    not yet returned to a sound economic footing.

                                                                                               h r&Business / novemBer 2010 21
forwarD thiNkiNg




         Public sector cuts
have finally been revealed.
Departments have had time to
consider their options, but plenty
of planning is still needed.
  Andrew Mayo, president of the HR Society, mulls over the impact of the Comprehensive Spending Review
  for HR professionals within the public sector




  t
            he Gershon report (2004) was one of many past            to job and organisation redesign. One of Ulrich’s original key
            efforts to reduce inefficiencies in the civil service.   roles for business partners was that of change agent. This means
            He introduced the concept of productive time –           more than dealing with individual people issues in the course
            defined as time spent delivering front line services.    of change – professional organisation development practitioners
  This is of course a variation of the direct vs indirect ratios     should be expert in all aspects of change.
  that have their origins in manufacturing.                             And there is much more for HR to contribute. Undoubtedly
      In the present scenario, it could not be more relevant, as     leaders need new skills. For the past 15 years the task of leading
  governments seek to maintain as many services as possible          in public services has always been challenging, but it has been a
  with reduced resources. It is indeed a key ratio in workforce      period of rising expenditure. We know from the private sector
  planning; which should always start with the resource              that few leaders are effective in both downsizing and in times of
  needed for front line activities and then work backwards by        growth. So attention must be paid to leadership effectiveness, and
  ratios to different lines of support. Those ratios
  will need to change in the coming months.
      When it comes to HR, it is more important          “ There is a risk that redundancies
  than ever that they are closely supporting the
  operational strategy and business needs of               absorb HR attention, but the need for
  public departments. They will have plenty to do
  regarding redundancies, but there is a risk that         close business partnerships is key.”
  this becomes all-absorbing. The need for close
  business partnership – supporting operational
  managers in their objectives – is paramount.                       the challenges of maintaining engagement in tough times. This
      We can start with systematic workforce planning. Each          is a time also when HR should sharpen up its expertise on return
  business scenario must be analysed for the resources needed        on investment of programmes and initiatives: they will all need
  and balanced with the supply available – knowing that              to show a viable outcome and the often woolly and soft objectives
  recruitment will be a politically undesirable activity (even if    that have sufficed in the past will not be acceptable. Indeed the
  sometimes inescapable). Although many public organisations         whole arena of measurement in HR relating key people measures
  paid attention to this in recent years, few developed robust       to performance will have a greater significance.
  long term methodologies. The availability of finance seems             This is a demanding agenda for HR professionals, and will
  to call the tune, whereas the resources needed to deliver an       involve knowledge and skills that will be new to many of them.
  outcome should. Compromise may be necessary but at least           Prior to the spending review training and consultancy were as
  one knows the price that will be paid for it in non-delivery.      good as banned in most departments. There is no doubt help will
      Clearly productivity initiatives and process re-engineering    be required in the coming months and it should be sought and
  should be at the forefront of change. Expertise in these areas     used wisely.
  in a civil service environment is limited. We would argue
  they are very much areas for involvement for HR. It will lead      Email: andrew.mayo@mayolearning.com



22 www.hrsociety.co.uk
See more clearly
The mission of the HR Society is to lead
thinking and share good practice in the
linking of people, planning and productivity.
In so doing, we provide a forum for senior
professionals working in these areas.

We meet our mission by:
• building a network of members involved in the
 business edge of people issues
• organising topical events with leading speakers
 for debate and discussion
• offering educational masterclasses, seminars
 and workshops
• holding joint meetings with other professional
 societies dedicated to the support of
 organisations
• facilitating and distilling research
• developing, publicising and disseminating
 relevant knowledge.




Find out more about the Society, its activities and membership at: www.hrsociety.co.uk

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Page 4, interview with David Stephenson

  • 1. HR&BUSINESS LINKING PEOPLE, PLANNING AND PRODUCTIVITY NOVEMBER 2010 Peel off the label How to look behind frequently misleading cultural labels to see the true nature of an organisation tune up your workforce engineering change rethinking the recession Better workforce planning can Process review can enable the Future-proof responses to bring productivity rewards p10 elusive ‘more with less’ p14 the economic downturn p18
  • 2. Information. Intelligence. Networking. STRATEGIC PLANNING SOCIETY STRATEGY COMMUNITY SHAPING TOMORROW Our online discussions enable professionals to Free access to Shaping Tomorrow (worth £95pa), share insight and experience. Live network events the world-leading futurist database of over 25,000 allow you to meet other people working in the resources to help organisations anticipate and strategy field, and we support our members in better prepare for emerging global opportunities arranging their own events. and risks. LONG RANGE PLANNING CONFERENCES Six times a year members receive the leading Learn from others’ experiences. You will receive international strategic planning journal; academic advanced notification and discounted attendance in flavour, but with practitioner techniques offered at many leading conferences on strategic issues. (worth £120pa). EVENTS DIARY STRATEGY MAGAzINE The strategists’ diary, includes many free or Four times a year members receive our acclaimed reduced-cost events from the SPS and other magazine, dedicated to helping practitioners bodies. We also welcome members who wish to improve their strategy formulation and promote their own meetings and events to the implementation. SPS community. LIBRARY EMAIL NEWSLETTER Unlimited access to our online library containing Our monthly newsletter keeps all SPS community over 320 expert articles related to strategy, with more members abreast of strategy news, events, being added every month. courses, research and insight on strategic topics. For further details on membership and more information about SPS please contact us: T: +44 (0)845 056 3663 E: membership@sps.org.uk www.sps.org.uk
  • 3. welcome This is the second edition of HR & Business and I hope you will find it of interest and pass it on to your colleagues. Our focus as a society is about the ways in which HR supports business goals through planning, people strategies, metrics, productivity and partnership. 6 10 14 18 In these straightened times, these are essential contributions from HR professionals, 4 Upfront 14 Engineering a process change and they need the knowledge and skills News, views and events from the HR Process engineering is a different way to to be able to play their part. Public sector Society, together with some of the analyse business activities for businesses organisations, in particular, are having to latest developments in the industry. that need radical change to allow them rethink their deliverables and processes, and to achieve far more with far less, says seek productivity improvements. A mutual 6 The trouble with cultural labels Kees van Haperen. partnership between line operations and HR Labels of organisational culture can is essential for the necessary resource re- mask systems of great complexity but 18 Recession brings radical thinking planning within a nervous employee relations there are approaches managers can Research has revealed that organisations environment. HR must be outward-looking to take to see the richness beyond the have been responding creatively to the the business, not immersed in its own agenda. label, says Naomi Stanford. recession, using new strategies that Do keep an eye on www.hrsociety.co.uk should stand them in good stead for the for our news and events, which include 10 Shift workforce planning into a future, says Peter Reilly. workshops in many business-related HR higher gear subjects. The Society is currently developing Creativity and innovation are essential 22 Forward thinking an attractive membership proposition to as organisations adapt to the economic HR professionals in the public sector encourage more members and broaden the downturn. George Blair shows how must not become absorbed with networking opportunities, on- and offline. a fresh approach to staffing can bring redundancies. In this environment, I hope to meet you personally at one of our productivity dividends. they have a key role to play as business events in the near future. partners too. Andrew Mayo President if you would like to discuss any of the issues raised in this publication please contact Published by grist Andrew Mayo on +44(0)1727 843424 or email andrew.mayo@mayolearning.com 21 Noel Street, Soho, London, W1F 8GP Publishing director Mark Wellings editor Sarah Coles Art director Andrew Beswick hr Society is a network of senior HR professionals, sub-editor Jonathan Lalljee academics and others involved in value-added HR strategy. Our Commercial director Andrew Rogerson aim is to lead thinking and share good practice in the linking of Telephone +44 (0)20 7434 1447 people, planning and productivity, and provide a network forum for professionals working Website www.gristonline.com in this area. Our activities include holding events to share knowledge; offering educational Advertising and sponsorship Ian Carter master classes; and facilitating and distilling research and disseminating knowledge. (info@media-shed.co.uk / 0844 858 4852) For more information visit www.hrsociety.co.uk. This publication is printed on paper from sustainable sources using a chlorine-free process. h r&Business / novemBer 2010 3
  • 4. News All the latest news, views and events from the HR Society and its members Workforce planners must prepare for the end of the default retirement age As the consultation on plans to scrap the and providing some employment default retirement age (DRA) conclude, benefits, such as critical illness cover, it looks increasingly likely that it will be next to impossible.” He claimed it would phased out from April 2011, with serious raise complex legal and employment implications for workforce planning. questions which would create The consultation, from July to uncertainty for employers and their staff. October 2010, proposed scrapping the He concluded: “A default retirement age DRA, which allows employers to force helps staff think about when it is right staff to retire at the age of 65. “With to retire, and also enables employers to more and more people wanting to plan more confidently for the future.” extend their working lives we should The Managing an Ageing not stop them just because they have Workforce report from the Chartered reached a particular age,” said Employment Relations Minister Management Institute (CMI) and the Chartered Institute of Personnel Edward Davey. and Development (CIPD) found that only 14% of workplaces are There is every sign the proposals will be implemented, and that ready to accommodate a changing workforce age profile. the DRA will be phased out between April and October 2011. Andrew Mayo, president of the HR Society warned: “This This will have massive implications for workforce planning. John change makes workforce planning more complex, as the ability to Cridland, Confederation of British Industry deputy director-general, predict requirements is now potentially difficult. Early warnings of said: “For employers, these proposals could make workforce planning employees’ intentions will be needed.” M eM ber Spotlight David Stephenson, group head of organisational development, Royal Mail Group What are your key same time become more agile and be changing. Each individual goes through challenges at the moment? innovative in meeting future needs. their own change experience, so we must The sector is facing the recognise the importance of individuals. Like challenge of a fall in mail How do you keep staff engaged most organisations, one of the key relationships volumes, because of the in a challenging time? is with their line manager, so supporting economic downturn as well A few months ago we reached an managers is vital. as new technology. While this agreement with the unions and that offers opportunities in new has given us a positive opportunity What tools work well for you? areas it also means the business for us all to work together to improve We have a very proud, loyal and passionate must adapt and redesign. the business. workforce, and tapping into that works well. Changes in regulation mean there is more It’s always important to be straight That can be everything from local incentives competition, with competitors able to use our with people and that’s no less important such as ‘watch and win’, which allows staff to delivery networks much more cheaply. during challenging times. You must never benefit from spotting business opportunities, Another OD challenge is to balance the underestimate the need to communicate. to local problem solving schemes to make us tension between the need to modernise the It’s important to understand what is driving more operationally excellent. Coaching and business and become more efficient, yet at the people’s engagement and how that might supporting people through change is also key. 4 www.hrsociety.co.uk
  • 5. net Working events HR Society diary Return on investment is key jaNuary Masterclass: Understanding february Presidents Forum: Current issues for HR professionals organisational Development for Hr in the Public sector Chris Nutt, an experienced The session will be lead by Angela HR professionals are not driven to identify organisational development O’Connor, chief people officer at their return on investment (ROI) by leader, facilitator, consultant and the National Policing Improvement organisational edict, but because they feel it vice president of the HR Society Agency, where she is head of is an essential weapon in their professional will lead this practical masterclass profession for police HR and armoury, says Professor Andrew Mayo, designed to offer insight into how learning and development staff president of the HR Society. to improve your organisation. in England and Wales and lead Speaking after his annual Essentials It complements conventional, on police learning, development Series workshop on the subject, he said: structured thinking with a mindset leadership, and people strategy. “It is a professional responsibility to be able to demonstrate that that enables you to intervene more She will share the benefits of her we have spent money wisely and delivered value for it, and effectively in the flows of the real experience including as director this year there was a clear recognition among participants that world. of HR for The London Borough of knowledge of ROI is a basic requirement for any professional.” It avoids reducing organisational Enfield and heading a national HR The workshop explores the theories behind ROI and helps development to statements of team determined to ensure the participants put them into practice. It goes through setting grand theory, and takes its task as Crown Prosecution Service became objectives, devising the formula for ROI, addressing the difficulty understanding why, what and how a world class prosecuting authority. of measuring intangibles and explores specific cases. you can learn from past experience Among the many awards she Mayo says: “We offer practical solutions and discuss the and make an effective, practical has received are for HR Director of experiences of all the participants in some detail. As ever, as difference in your current context. the Year 2007 at the HR Excellence part of the process, the participants were able to use examples Participants will explore the Awards, and positions is in Human of successes to offer solutions to one another as well as bringing cultural characteristics of their Resource Magazine’s top 10 most some of the theory to bear on their own projects.” organisation and their preferences powerful people in HR list, and Andrew Mayo will run another workshop on Measuring ROI for the way they work to change in Personnel Today’s top ‘power in 2011. Visit www.hrsociety co.uk for more details. and sustain it for the better. players’. Her HR teams have been They will also gain insights into the recipients of numerous awards. organisational development as She is a board director of Skills hr society document a philosophy and a toolkit; and discover how to live with the for Justice and has been elected the vice president of the CIPD Police library launched complexities, to be shrewd and Forum. practical as well as professional Date: TBC February 2011 As part of its mission to help inform members and disseminate Date: 10.00-4.30, 25 January 2011 Location: One Whitehall Place, the latest thinking on issues affecting them, the HR Society Location: One Whitehall Place, London SW1A 2HE has launched an expanded document library on its website, London SW1A 2HE Fee: £190 plus VAT for members of www.hrsociety.co.uk. Fee: £320 (& VAT) for members, the HR Society and £275 plus VAT The library is split into a number of categories including: £395 (& VAT) for non-members. for non-members. workforce planning, employee engagement, people strategies, HR metrics, human capital management, employee demographics and HR business partnership. The documents available range from introductions to the topic, to articles written by HR Society council members and All attendees at their first Hr society event will receive one year’s useful diagrammatic representations of concepts. There is also a complimentary membership of the Hr society facility to enable member feedback on the articles. Andrew Mayo, president of the HR Society said: “This library For more information visit www.hrsociety.co.uk. offers useful insights into the topics for HR professionals who to book any of these events contact Lara Roberts, programme administrator want a more detailed understanding of the various subjects. Tel: 01264 774004 Fax: 01264 774009 Email: network@hrsociety.co.uk. Over the coming months and years we will be adding to the if you have suggestions for events, subjects or speakers please email breadth and depth of the library and introducing services for HR Society president Andrew Mayo at andrew.mayo@mayolearning.com. members only.” h r&Business / novemBer 2010 5
  • 6. the trouble with cultural labels Labels of organisational culture can mask highly complex systems, but there are approaches managers can take to see the richness beyond the label, says naomi stanford. F ollowing his seminal research on national These labels are a fact of organisational life. cultures at IBM between 1967 and 1973, Think of your own organisation – what label do Geert Hofstede was asked: “Between the time people attach to its culture? Common ones are a that you were first analysing this data and now, culture of innovation, a culture of collaboration or has your definition of culture changed?” His answer a culture of teamwork. A rather more vivid label was: “No, not really. Of course, you have to realise appeared in The Economist (31 July 2010), which that culture is a construct. When I have intelligent talks of Pimco, one of the world’s largest bond- students in my class, I tell them, ‘One thing we fund managers, having “a culture of constructive have to agree on: culture does not exist’. Culture is a paranoia”. concept that we made up which helps us understand Labels are a fact of life because they serve several a complex world, but it is not something tangible like useful purposes: they are identifiers, much like a a table or a human being. What it is depends on the luggage label on a suitcase; they act as flags for way in which we define it.” waving and mustering behind (or tearing down and People tend to define the culture of an organisation attacking); they are a quick and easy-to-use form in terms of a label, as if it were a tangible, as in of shorthand or sketch that people can recognise Apple being described as having “created a culture or picture; they are yardsticks for measurement or of secrecy”, and Walmart “an austere culture built by comparison; and they can act as a defence. old man Walton” or Unilever’s CEO, Paul Polman, wanting to develop “a culture of accountability”. Shallow and misleading The first problem with labels of culture is that they are shallow and confusing. The painting of a pipe by Magritte labelled “Ceci n’est pas une pipe” (this is Dr Naomi Stanford is an organisation design, not a pipe) is a good example of this. The confusion innovation and culture consultant with clients in the lies in labelling something that looks like a pipe as private, government and non-profit sectors in the ‘not a pipe’ because, in fact, it is not a pipe but a US and Europe. She helps develop adaptive, open two-dimensional representation of a pipe. Similarly, and innovative organisations. She is the author of: a label of a culture is not the culture itself but an Organization Design, The Collaborative Approach, abbreviated verbal or written definition. Labels do The Economist Guide to Organisation Design and not represent the pervasive, implicit, nuanced, subtle, The Economist Guide to Organisation Culture. complex and dynamic ways of community being that Email: naomi@stanford.cc might be generalised across an organisation, but are experienced individually and subjectively. 6 www.hrsociety.co.uk
  • 7. orgaNiSatioNal culture “ Culture is not something tangible like a table or a human being. What it is depends on the way in which we define it.” Second, labels imply something fixed in the way because this, in his view, would lead to “the best that a flag is fixed. The flag of a country does not business decisions for the firm as a whole, and paying change beyond recognition – the Union Jack or employees in stock helped reinforce that culture. the Star Spangled Banner have been the same for I wanted them all to think and act and behave like decades. An organisation’s culture, however, is always owners.” moving and fluid. Toronto-based academic Gareth If, as in this case, there is no concerted effort to Morgan’s definition states: “[Culture is] an active create a shared understanding then simply making the living phenomenon through which people jointly statement is a recipe for disaster. It makes a number create and recreate the worlds in which they live.” of assumptions: that Fuld’s notion of ‘teamwork’ is the same as each employee’s; that employees have a teamwork trap common view of what ‘thinking, acting and behaving Third, labels do not invite the creation of a shared as an owner’ is (and that they want to be an owner); meaning. When Richard Fuld took over as chief that people are motivated by the same rewards – in executive of Lehman Brothers in 1994, he was this case shares; and that ‘teamwork’ leads to the best determined to establish a culture built on teamwork business decisions. > h r&Business / novemBer 2010 7
  • 8. that the creation of shared meaning is the key factor. “ If there is no concerted effort He defines culture as “a pattern of shared basic assumptions that the group learned as it solved to create a shared understanding, its problems of external adaptation and internal integration that has worked well enough to be simply making a statement about considered valid and, therefore, to be taught to new members as the correct way to perceive, think and culture is a recipe for disaster.” feel in relation to those problems”. unpack the label Given that labels of culture are a fact of organisational life, and also that they have severe limitations, there are approaches managers can take to see beyond the > Fuld’s main action to develop a culture of label into the richness of what it stands for. teamwork was to link compensation to the overall Visualise a suitcase with your name and address performance of the firm through equity awards on the luggage label. From the name and address a (Fuld himself being awarded colossal sums, certain amount can be assumed: someone might somewhere between $350 million and $484.8 judge that you live in a good neighbourhood, or that million between 2000 and 2008). When Lehman number 3A implied a flat rather than a house. But Brothers filed for bankruptcy during the financial the assumptions would have to be based in prior sector collapse of 2008, it became clear that the knowledge of addresses, and assumptions are not culture of teamwork was one based on greed, lack of always correct. You might have borrowed the suitcase oversight and accountability, and blame. These are and forgotten to take the original owner’s label off. not the characteristics commonly associated either However, the act of unpacking the suitcase with teamwork, or with well-run owner-managed is going to give a lot more clues about you. The businesses. clothing, toiletries, possibly books, medications and American organisational academic Edgar documentation will all tell a story. It is the same Schein’s definition of culture reinforces the notion way with organisations. Unpacking the thing that Questions: unpacking the label These questions use the first two parts across the whole organisation or in • Why do the values need to define of the O’Reilly/Chatman definition: pockets? what’s important? Do they do this • When are they shared/not shared? or is there a disconnect between • What are your shared values? In other words, what circumstances what’s important and any values • How do you know these values are or contexts foster sharing values? demonstrated or stated? shared? What is the evidence? • What is important to the • When does the link between • Why are these shared values organisation? defining what’s important and important (in terms of achieving • How do the shared values help shared values come into play – in your business strategy)? define this? You need evidence what circumstances? • Who shares these values? Are they here. • Where in the organisation is it shared by everyone or just some • Who defines what is important and obvious that shared values help people? thus fosters the values? Or do the define what is important? What can • Where are these values shared – values foster what’s important? you learn from this? 8 www.hrsociety.co.uk
  • 9. orgaNiSatioNal culture is labelled allows you to tell the story and see the book oFFer patterns and themes that are referenced in many of the definitions of culture. Define culture The first step to seeing beyond the label is to take a definition of culture that appeals to you. There are many beyond the ubiquitous “the way we do things round here”. A definition that works is from CA O’Reilly and JA Chatman, authors of Culture as social control: Corporations, cults and commitment (1996), which suggests that culture is “a system of shared values, defining what is important, and norms, defining appropriate attitudes and behaviours, that guide members’ attitudes and behaviours”. After definition, the second step is to identify the label, for example: “We have (or want) a culture of innovation.” The third step is to unpack that in terms of the definition by asking a lot of questions (see box). organisation Culture: Questions can also be developed to delve into the norms, getting it right attitudes and behaviours, guiding members’ attitudes and behaviours with regard to the aforementioned Naomi Stanford’s book Organisation Culture: definition. The questions should be asked of a random Getting it right (The Economist, 2010) provides sample of the organisation (or part of it that is under a concise guide for managers, analysing how to study). It is likely to generate a surprising variety of harness the power of culture, how to understand answers, but several common themes will emerge. an organisation’s culture and how to harmonise it with a business strategy. current cultural influences Complete with advice on how to avoid common The next step is to look at what should be kept and mistakes while making cultural changes and on why, and what should be shaped or changed and why. maintaining a healthy culture in the long term, Then look at what is currently shaping the culture. the book includes real-life examples from such Often it is performance measures, reward systems, job major and diverse companies as IKEA, Google and designs, work flows and other infrastructure elements Procter & Gamble. that form boundaries. Much as the choice of suitcase shapes packing strategies and the amount of stuff Offer details: HR Society members can receive a that can be fitted in, so changing the infrastructure 20% discount (RRP £12.99). Telephone or email changes the possibilities. Emily Orford at Profile Books (020 7841 6300/ A change of culture is not an overnight switch. John emily.orford@profilebooks.com) and quote Chambers is in his seventh year of changing Cisco’s “Organisation culture – HR & Business offer”. culture. Lou Gerstner took a similar amount of time at IBM, and Alan Mullally at Ford is in his fourth year “with a long way to go”. These leaders recognised that they could label the culture they aspired to, but that getting to it takes patience, persistence and a detailed understanding of social and infrastructure nuances, complexities and relationships. Naomi runs a popular Essentials session on Organisational Design for HR Society members every summer. Details will be available closer to the time at www.hrsociety.co.uk h r&Business / novemBer 2010 9
  • 10. Shift workforce planning into a higher gear Creativity and innovation are essential as organisations adapt to the economic downturn. george blair shows how a fresh approach to staffing can bring productivity dividends. m any organisations adopt a Jeremy The traditional approach to an economic downturn Clarkson-style attitude to workforce is to focus on reducing staff costs by such means as planning: they just put their foot down freezing vacant posts. This weakens organisations, and hope for the best. It is a no-nonsense as these are often the very posts where competition approach that can feel quite appealing. In reality, for talent is strongest. In addition, the workforce’s however, using the careful planning and teamwork of average length of service creeps up, which can mean a Formula One racing team will win the top place on that innovation is likely to be in short supply when it the podium. is required the most; the current way of doing things This is because improving productivity and is likely to be seen as best. Yet doing more of the same innovation is central to workforce planning when will only give you more of the same. suitably supported by a regular inflow of fresh talent, as well as a culture of questioning and continuous use the downturn productively improvement. Successful workforce planning is A downturn is the time, and opportunity, to find ways therefore positioned at the crossroads between of doing things differently. For example, workforce operations, finance and human resources. planning can reduce staff costs while introducing fresh blood by encouraging part-time working and sabbaticals, although this needs to be approved on a case-by-case basis, so that it does not adversely affect the organisation. It is also a great time to recruit George Blair is managing consultant of Shared graduate interns because managers can ensure they Solutions Consulting. He has extensive consultancy can make a valuable contribution to the organisation experience in the UK and overseas, including before offering them a permanent position. Eastern Europe, Africa and the Middle East. He is This has been used to great effect in the past joint author of two books on organisational change, couple of years when many unions have negotiated and often speaks at conferences and workshops to pay sacrifices to preserve jobs. For example, BA pilots senior managers and postgraduate students. He has worked for a month without pay, while the financial been an expert witness to the House of Commons services firm KPMG introduced flexible working Health Select Committee and adviser to the King’s with a maximum reduction in base salary capped at Fund in workforce planning and development. 20% per individual. Nearly 80% of KPMG’s 11,000 Email: george@sharedsolutions.net UK staff applied to work a four-day week or take extended unpaid leave. 10 www.hrsociety.co.uk
  • 11. workforce plaNNiNg “Freezing vacant posts Questions to address means innovation can be during a recession in short supply when it Workforce demand • How could you increase the is required the most.” • Which activities should staff stop number of secondments within doing, or do less often, because your organisation and with your they add little value? suppliers? • Which activities should be kept in-house and which should be Productivity contracted out? • What traditional customs and practices should you challenge? Workforce supply • What could you learn from other Business performance can be improved by • Could you reduce your workforce industries? matching staff composition by age, gender and numbers through the offer of • Do you measure quality from a ethnicity more closely to customers. One building part-time working arrangements customer perspective? society found that their most successful staff were the and sabbaticals that may prove to • Could you gain more business older ones who were closer in age to many of their be attractive to some members by targeting customers who customers. So why do more car dealers not go out of staff? are trading down and therefore of their way to recruit and train more female service • Could you benefit from using increasing your earnings per managers, given the proportion of women who make interns so that you are sure of employee? car-buying decisions yet who may feel patronised, or staff before you appoint them? • How could the use of IT and the even bullied, by male-dominated sales staff? • What benefits would you see if web be maximised to reduce your workforce better reflected costs and improve your services beware of burnout your customer profile? to customers? Many employers attempt to improve productivity by reducing headcount, while expecting the same outputs. However, this usually leads to poor-quality service and outputs from demoralised staff because > h r&Business / novemBer 2010 11
  • 12. “ Reduce the time staff reduce the quality of thinking, because concentration is interrupted to check the latest missive pinging into spend on activities that do the inbox. Advise staff on the use of emails and, if appropriate, implement email-free periods. not add value to customers Map out processes or the organisation.” It is a good idea to map out processes and procedures to see if they could be done with fewer steps. Another source of waste is the poor layout of workplaces, which causes staff to walk about needlessly. This can be rectified by mapping where staff go and then relocating facilities. Budget airlines improved productivity by squeezing extra flying time from > they have to cut corners and risk burnout from their expensive aircraft by using unnumbered seating working longer hours. The resulting loss of business to reduce passenger boarding times. There are no can easily outweigh any gains from staff costs. doubt long-standing customs and practices in all A much better approach is to eliminate waste. organisations that could be questioned. This is done by reviewing how staff spend their time Creativity makes all the difference to improving and eliminating or reducing the amount of time productivity, so it is important to focus on new spent on activities that do not add value to customers revenue opportunities rather than just cost reduction. or the organisation. Process engineering becomes A recession is a great opportunity for low-price a core tool here. Question how much time is spent operators to attract more upmarket customers by answering emails, many of which may be of little enhancing their offering. Thus, McDonald’s attracted importance. Equally, a constant stream of emails can Starbucks customers by introducing lower-cost Workforce planning in action Wendy Hirsh, independent Workforce planners think about costs as well as heads. The consultant and researcher and ‘less’ is often really less money. It is vital to know what different member of the Hr society groups of people cost (not just their salary but full cost) and to be able to track savings as workforce changes are implemented. This Like many others with practical means having people and jobs well coded by type and level of experience of workforce planning, I work, matched to financial data. see it more as a mindset than a set of On the workforce supply side, we think about skills as well as particular techniques. So faced with numbers of people. This is about the right mix of job types and an organisation seeking to ‘do more also about having the people who possess the right skills for with less’, how might a workforce those jobs. Planning in terms of job families and key specialist planner’s mind run? Four issues skills can be more illuminating than planning by business unit or come immediately to mind. cost centre alone. First, we need to ask what the ‘doing more’ is really about. Is Workforce planners always see the short-term against the ‘more’ about quality, such as reducing manufacturing waste? Is it longer-term backcloth. We seek to ‘do more with less’ in a way process efficiency rather than volume, like reducing waiting times that positions the business more strongly for the future, in in the NHS? Or is ‘more’ really about higher levels of productivity terms of the quality and demography of the workforce. This has and activity, for example teaching more students in higher implications for recruitment (keeping some going, especially education with fewer lecturers? Sometimes we need to identify of younger people) and for leavers (managing voluntary which work is central and cut out tasks that add little value. severance with care). 12 www.hrsociety.co.uk
  • 13. workforce plaNNiNg Fairtrade coffee. This increased income and profit per net Working events member of staff. Seeing old problems through new eyes can be HR Society events encouraged by creating secondments either within the organisation or with suppliers. This is particularly essentials series important for staff who have been in the same job for employment many years. demographics use the web Managing consultant at Shared Solutions IT can be either a financial drain or a source of Consulting, George Blair, runs regular sessions business advantage, depending on how well it works on the landscape of employment in global in practice. A well thought out website can reduce the businesses for the HR Society. number of telesales staff needed to answer queries, as These sessions address themes such as future well as administrative costs. For example, customers employee age profiles, classes and locations, of courier companies can track the progress of their labour market statistics, skills and learning consignments over the web. Those who can see their organisations. purchase records on the web are also more likely to Each session is tailored to the needs and use it for repeat orders. challnenges of attendees. Innovation often comes from copying Details: For news of the next session, visit www. organisations in quite different industries. That is hrsociety.co.uk, and click on the events section. why so many different organisations have copied Amazon’s facility that shows customers what others Masterclass with the same purchasing habits have bought. Having the right key performance indicators for Workforce planning employees is also essential. Call centre operations Professor Andrew Mayo runs regular sessions on often get this wrong. They encourage staff to workforce planning for all HR practitioners who maximise the number of phone calls they answer by need to work with resource planning, especially HR minimising call duration. This is a great way to lose business partners and planning specialists. They customers, who often need to call again to get what provide the business case for effective workforce they want. This contrasts with the likes of telephone planning, and offer practical tips for the most banking company First Direct, which has a loyal effective approaches. The workshops are illustrated customer base because its staff focus on meeting by practical exercises and case studies. Participants customer needs, regardless of time taken. Thus, at can take away a workbook to apply to their own least one performance indicator should measure organisations. quality from a customer point of view. Details: For news of the next session, visit www. hrsociety.co.uk, and click on the events section. contracting out Another consideration is to review which functions to keep in-house and which to contract out. This should be based on demonstrable advantages drawn from detailed analysis, not wishful thinking. For instance, some NHS hospitals have contracted out their non-urgent pathology tests to highly automated, commercial laboratories with low marginal costs. A successful HR function needs to be heavily engaged in improving productivity and never more so than during a recession. Workforce planning is the way to achieve this by engaging operational staff at all levels in creative approaches to how work is done. h r&Business / novemBer 2010 13
  • 14. engineering a process change Process engineering is a different way of analysing business activities that can bring radical change and enable businesses to achieve far more with far less, says kees van Haperen. i n the current political and economic climate, Process engineering is a different way of analysing public and commercial organisations are forced to businesses that can bring radical change and improve achieve greater value for money. The traditional overall business performance. Often, the need for view is that this should be achieved through change in a business is triggered by the introduction cost reduction and productivity improvement. Yet a of new ideas, prolonged growth or the need for more powerful argument can be made for taking a sustainable development. less linear approach and a more holistic view of the Today’s business environments are more complex way organisations operate. It makes more sense to and uncertain than ever. Decision makers must cope look at what organisations should be doing, rather with a rapid pace of change while making sense of than concentrating on what they are doing. HR messy challenges. Organisations often fail to embrace departments control many processes that consume a holistic approach for fear of undertaking too much their time and that of managers, so process engineering and losing sight of what needs to be achieved. is a key skill for them. They have as much a part to However, a better understanding of organisational play in seeking organisational efficiency as anyone systems and processes can help to create different and need to analyse all their processes. ways of working and exploit the full potential of the organisation’s information. improving processes For today’s organisations to sustain, or even deliver, Kees van Haperen is managing director of Koios higher performance over time they need to ensure Group Ltd a consultancy specialising in strategy, that business processes become more mature. change and programme/project management. Michael Hammer, one of the founders of the theory Koios Group is a member of the CMC Partnership of business process engineering, says organisations consortium for the Buying Solutions Management should consider this process of maturity holistically Consultancy and Accounting Services framework and according to two important interdependent agreement. He has been a member of the HR characteristics: process enablers (aspects such Society Council since 2006. as design, performers, owner, infrastructure and Email: kees@koiosgroup.com. metrics) and enterprise capabilities (leadership, culture, expertise and governance). Although it could 14 www.hrsociety.co.uk
  • 15. proceSS eNgiNeeriNg be argued that his concept is arbitrary, his analysis There are, however, significant problems with this model gives a good insight of the intricacies of type of approach. Although it works well in tackling tackling organisational improvement. difficulties, when applied to complexity it results in We work in systems all the time – our work, unintended consequences, creating vicious circles of home, social life and hobbies are all related to various ever-more complex rules and frameworks. In turn, systems that all interact with each other at some this could exacerbate the problems and lead to distrust stage. The concept of process engineering offers ways and miscomprehension within an organisation. It to improve the systems within organisations, as well could even result in a decline in the legitimacy of the as to look across organisational boundaries into the process and decision making itself. wider environment. However, working in systems is not a linear activity: step two does not necessarily thinking in systems follow step one. Complex situations tend to be characterised by a high degree of uncertainty. The existence of significantly well-oiled machines? different perspectives on the problems at hand Traditionally, organisational and management contribute to this uncertainty. In such circumstances, scientists have seen organisational systems merely as change becomes piecemeal and evolutionary because complicated machines. In other words, organisations, there is little agreement on the nature of the problem, economies and even societies behave in a linear let alone the most appropriate solution. Furthermore, manner, with outcomes directly related to input. causality is indeterminate and many factors are Therefore, organisational behaviour is predictable. interconnected or even interdependent. Since this behaviour can be understood, it can be In this context, ‘systems thinking’ adopts a different effectively controlled by well-designed external strategy to simplifying problems. Rather than interventions. This view is based on facts derived breaking down problems into smaller components from objective dispassionate observations from a that can be analysed, it goes up a level of abstraction single external position by policy makers. Thus, it is and discards some of the detail. This means that in appropriate and efficient to separate organisational analysing organisational issues, connections between design from actual implementation. Moreover, the components of problems can be maintained. if the diagnosis is correct the remedy will be The late Russ Ackoff stressed that a ‘system’ is a straightforward. whole consisting of two or more parts that satisfies > h r&Business / novemBer 2010 15
  • 16. > five conditions: the whole has one or more defining To give some tangible shape to such organisational properties or functions; each part in the set can affect wisdom, the principles of one particular systems- the behaviour or properties of the whole; each of thinking approach can be used: soft systems these parts is necessary but insufficient for carrying methodology (SSM). SSM is a structured way out a defining function; the way that each part of the to establish a learning system for investigating system affects its behaviour or properties depends on complex messy problems. It aims to improve areas (the behaviour or properties of ) at least one other of concern by activating continuous learning in the part of the system; and the effect of any subset of people involved in the situation. Learning takes essential parts on the system as a whole depends on place through the iterative process of using systems the behaviour of at least one other such subset. concepts to reflect upon and debate perceptions of the real world, then take action and again reflect on Soft systems methodology what is happening using systems concepts. In brief, a system is a whole that cannot be divided This reflection and debate is structured by a into independent parts without the loss of its essential number of systemic models. It is important not to properties or functions. When the performances lose sight of the fact that these models are holistic, of the parts of a system, considered separately, are idealised types of certain aspects of the problem improved, the performance of the whole may not situation rather than accounts of it. As a matter of be (and usually is not) improved. In fact, the system fact, these SSM-derived models become analysis may function less well, or even be destroyed. frameworks that address a variety of organisational problem dimensions. At this stage, it is important to understand that the focus of the enquiry is on what the organisation is or ought to be about and not how it operates. “Don’t waste a good crisis” the process perspective Embracing the process perspective makes it much Dr Mark Pegg, director of the Leadership easier to investigate the detailed functioning of the Centre at Ashridge business school and organisation and to scrutinise its activities. This is member of the Hr society described as the perspective of ‘how’ the organisation The strength and depth of the credit crunch does what it ought to be doing. To enable this, it is means everyone is doing more with less. For necessary to adhere to a few important principles. In the private sector, the change has taken place the recent past, some of these principles have been over the past couple of years, so this is now incorporated into the ‘lean systems’ approach made business as usual. The public sector tends to famous by Toyota. lag behind because of the way spending plans First, a process has a starting point and an end work, so it is only just embracing the idea. point. The process could also have a defined owner, Our advice is to ‘never waste a good crisis’. If you think you can get group of actors or users and should convey a purpose where you want to go just by squeezing more productivity out of the or desired outcome and comprise some form of system, you will be disappointed. You need to take the opportunity for a decision making. There should be rules that govern major redesign of how you provide services. Risk aversion has to be put the standard or quality of inputs throughout the aside and you have to innovate. process, alongside a recognition that the process If you want a radical solution, you need to build radical into the system under review is usually linked or connected to and think differently about how you do things. other processes. In using the process frameworks Spot your innovators and look after your mavericks. In the past, they to identify and analyse issues, one should consider a may have been too radical and they needed to be managed. Now they range of questions including: whether the activity is need to be given more freedom because they can make a real difference. being done and how; who is doing it; what the issues Sort out the people at the top. If your leaders don’t do radical things, are; and what could be improved. how can you expect the organisation as a whole to do them? You need While answering such questions, the process a new kind of leader who can let go and trust people to do more and to review should attempt to count how many steps are build ideas. In this crisis, power needs to be devolved. involved, whether there are hands-off handovers and You also need to encourage boundary-less behaviour. The temptation how many. Total process timings should be addressed is to dig in and focus on your own priorities, but we need to work better while capturing the approximate time taken for each together through sharing and collaboration. step and between steps. The investigation should identify whether there are queues or waiting lists, 16 www.hrsociety.co.uk
  • 17. proceSS eNgiNeeriNg or whether ‘parallel processes’ could be identified. These tend to be the main causes of delay – common examples are administrative processes involving such net Working event things as letters, records, and so on. HR Society event understanding variation Last, but not least, when work takes place in single places, such places may become ‘bottlenecks’. essentials series ‘Queues’ (for example, waiting lists or cancellations) Process engineering can occur because demand exceeds capacity, or there is a mismatch between the variations in periodic Kees van Haperen brings more than 15 years of demand and periodic capacity. experience in organisational analysis, risk, crisis Systems thinking and lean process approaches and business continuity consultancy roles to this encourage a better understanding of the variation that session on systems and process concepts for occurs in all processes. It is particularly important for improving organisational performance. managers to understand the causes of variation in a The session aims to introduce a different process if they wish to predict its behaviour and act way of thinking and of analysing businesses, to improve it. As variation is intrinsic in all process, covering topics including systems thinking, the improved processes will exhibit reduced variation difference between a process and a system, as output becomes more predictable and costs are matching capacity and demand, and the lowered. However, it should be understood that benefits of process mapping. A range of tools without knowledge of variation, managers may well, and techniques used to design and improve with the very best intentions, take action that actually organisations will also be reviewed. makes things worse. Date: 7 December 2010, 10am-4.30pm Location: One Whitehall Place, London barriers to change Fee: £320 (& VAT) for members; £395 (& VAT) It should be noted there is often a breakdown in for non-members. communication between groups or departments, To book: www.hrsociety.co.uk/index.php/ which inhibits process performance. Such societies-activities/essentials-series breakdowns pose significant challenges to the management of change or process improvement initiatives. In fact, success will largely depend upon discovering and analysing these disconnects. It is also prudent to highlight that successful organisational change requires senior management involvement and support. Organisational change specialist John Kotter explains that transformations often fail because firms fail to maintain a sense of urgency for change. They may suffer from the lack of an aligned leadership coalition or an unclear vision/strategy that engages employees all levels. Experience has shown that problems occur at interfaces between organisational units. This is often due to a lack of understanding between units or to gains, quality improvements, organic capability differing opinions about objectives held by members improvements and lasting changes to organisational of different organisational units. The result may be culture. Additional benefits could be realised through that no one has a complete picture of how the end- the capture and distribution of detailed process to-end chain of activities in a single process actually knowledge among geographically dispersed units. works, with managers tending to concentrate on In an information context, process maps could be their areas of responsibility without considering the used to determine the impact of an organisation’s effect on the total operation of the process or the information resource on the major operating scenarios system as a whole. of the enterprise and to provide an implementation- The potential benefits of a process view can independent specification for human system be measured in terms of cost savings, schedule interactions. h r&Business / novemBer 2010 17
  • 18. recession brings radical thinking Research has revealed that organisations have been responding creatively to the recession, using new strategies that should stand them in good stead for the future, says Peter reilly. r esearch from the Institute of Employment had responded, whether their strategies were different Studies (IES) shows that organisations and whether such initiatives might have longer-term responded to the recession by developing beneficial impacts on employment relations. These new strategies that should have beneficial case study organisations were chosen because they long-term impacts. had implemented innovative cost-saving programmes The 2009 recession resulted in a sharp drop in in an attempt to minimise headcount reductions. The economic activity that was greater than that seen in IES also looked at existing literature on the use of the previous two recessions. But perhaps less widely cost-saving measures during the recession, aimed at known is the fact that employment fell by much helping organisations think through their responses less than during the previous recessions. During to business change. the downturn of the early 1990s, companies quickly downsized to contain labour costs. This time, it clinging on to key personnel appears they have responded differently. Four broad themes emerged from the research, During the last quarter of 2009, the IES visited Learning from the downturn: key messages from four organisations – KPMG, Jaguar Land Rover, an employer perspective (2010): retaining skilled Norton Rose and the BBC – to find out how they employees in preparation for recovery; recognising employee engagement would be affected during any change; protecting the employer brand image; and minimising the hidden costs of redundancies. First, organisations seemed to have been keen, Peter Reilly is the director of research and when choosing their cost-saving approaches, to consultancy at the Institute for Employment Studies. retain key staff in preparation for recovery. Having He joined IES in 1995 after 16 years with Shell where won these employees in the war for talent, they were he held various HR posts. At the Institute he leads its not going to let them go easily. In previous downturns work on the HR function and significantly contributes vital skills, such as in IT, had been lost thanks to the to the Reward and Performance Management theme. use of crude ‘slash and burn’ tactics that had no regard He has given consultancy support to organisations on for protecting scarce capabilities or future needs. issues in this area and is a regular speaker. This time, companies seemed to operate on the basis Email: peter.reilly@employment-studies.co.uk of expecting a V-shaped recession and so put more thought into workforce planning. 18 www.hrsociety.co.uk
  • 19. reSearch Second, the research showed evidence of greater the organisation, only to be hiring others in another awareness that a badly conducted downsizing exercise part. Previous downturns had also demonstrated that could have an adverse effect on the employees left it takes considerable time to recruit the right quality behind. The development of employee engagement candidate once the market improves and the new has been a more explicit aim of organisations who people also have to be fully trained and inducted, believe it leads to better organisational performance. which leads to more time and expense. employer brand image five main strategies Third, how an organisation handles cost savings also The IES research shows there have been five main has an impact on its brand image and employee value routes to putting these four goals into practice: pay proposition. Organisations did not want to be sullied reduction exercises; flexible working practices; paying by the way they were perceived to have handled their attention to people processes; developing a strategic response to the recession. Some even seem to have approach to business decisions; and fostering a sought to enhance their employer brand in the way ‘shared destiny’. they handled change. To illustrate how widespread the pay-focused Finally, in the 1990s, companies became aware approach was, a survey of 1,600 UK workers, of the enormous hidden costs associated with conducted by Keep Britain Working in the summer redundancies. Some of this expense arose from the of 2009, showed 54% had experienced a pay cut, left hand not knowing what the right hand was a reduction in hours or a loss of benefits since the doing – for example, laying off staff in one part of recession began. A 2009 survey report published by the Towers Perrin consultancy (now Towers Watson), called Cost-cutting strategies in the downturn – a delicate balancing act, also found that the most common cost-cutting approach was a salary freeze. However, the extent to which salary freezes in the private sector over the duration of the recession have “ Organisations did not want to really been absolute ‘freezes’ has to be questioned. Incremental and developmental pay increases, hot be sullied by the way they were skill payments for professional staff, and pay increases and bonuses for high performers all seem to have perceived to have handled their continued to operate in the absence of a general pay award. The use of other cost-saving strategies, such response to the recession.” as overtime restrictions, has reduced levels of total earnings for employees at some companies. > h r&Business / novemBer 2010 19
  • 20. the external presentation of the company brand and “ Sceptics may say companies reputation. Therefore many employers have been focusing on more intangible factors, such as timely have made temporary changes communication and promoting honesty and trust within the organisation. They have been especially but business as usual will careful to recognise that fairness in change processes and the demonstration of ‘procedural justice’ is resume after the recession.” important to secure the support and understanding of ‘winners’ and ‘losers’ in the workforce. Strategic decision making Another key message to emerge was that any cost- saving strategy beyond compulsory redundancy has to address the key enablers of business performance to make it effective in avoiding headcount reductions. This requires an organisation-wide perspective and has a number of dimensions: focusing on the long > implementing flexible working practices term as well as the short; targeting the cost pressures Throughout the recession, there has been a greater faced in different areas of the organisation, rather use of temporal flexibility (that is, varying working than adopting a blanket set of measures; seeing issues hours to achieve a more effective deployment of from a corporate not business unit viewpoint; and labour to meet business requirements) to help avoid not allowing narrow, sectional interests to prevail. headcount reductions. Employers have implemented Actions have to be anticipatory and based on flexible working patterns, such as flexible working considering ideas from, and consulting with, a range weeks, short-time working and reduced hours to of stakeholders about responding to present and temporarily reduce time inputs. future pressures. The process requires corporate According to joint Chartered Institute of Personnel endorsement of local action, but not simply the and Development (CIPD) and KPMG research, spreading of equal pain everywhere. Rather it is Labour market outlook, in February 2009 some 19% targeted action to deal with specific cost/income of companies were making greater use of flexible imbalances. This allows the organisation to protect working during the recession. Four months later, investments in business areas that are critical to its the CBI’s Employment trends 2009 - Work patterns long-term strategy, such as research and development in the recession found that more than two-thirds of and marketing. Cost savings in these areas can reduce organisations had increased flexible working or were a company’s ability to capitalise on new demand considering doing so. Two of the case studies IES when growth returns. used for its research showed an increased appetite for flexible working among employees. fostering a shared destiny approach An important theme emerging from the IES case attention to people processes studies that flowed from sensitivity on employee The research evidence also suggests that employers engagement was a determined attempt to create have made efforts to maintain employee engagement a sense of a ‘shared destiny’ in facing business during the downturn, in the belief that engaged problems. For example, cost-saving measures were employees keep companies afloat during the hard often launched among the most senior staff before times, and help them recover and thrive when staff on lower grades. Salary freezes were applied business activity levels rise. to executives as well as employees. Job cuts did not Employers have also recognised that the way affect only one group of staff, such as those at the in which they manage the workforce during the bottom of the pay ladder. downturn affects not only the wellbeing and One way in which shared destiny was emphasised productivity of the remaining employees, but also was by involving employees in making the tough 20 www.hrsociety.co.uk
  • 21. reSearch decisions over how to bring about savings. Just net Working event under half of the respondents to the Towers Perrin survey actively brought their workforce into the HR Society event problem-solving process during the downturn. This is in keeping with the trend for increasing employee involvement in business processes, which can drive research briefing engagement and help to build a two-way collaborative What have we learned working relationship. about change during will co-operation survive? recession and cuts? Sceptics will dismiss many of these research results as pretty ephemeral. They will believe that Led by Peter Reilly, director of research and companies will have made some temporary changes consultancy at the Institute for Employment to get through the hard times but business as usual Studies, this session will describe the Institute’s will resume after the recession. Thus this mutual research on HR issues with regard to how approach to flexible working will disappear as organisations faced the recession. Themes to be employees will push for more scope for adjustment discussed include how lessons learned might be on their terms and employers will respond to greater applicable to the public sector, which practices demand by sweating their assets to the maximum and strategies will survive and whether businesses degree possible. will just return to their normal routines. Cynics will suggest that some of the ‘solutions’ Date: 17 January 2011, 2pm-4.30pm to resourcing problems highlighted by the research, Location: One Whitehall Place, London especially those involving working time, are all very Fee: £190 (& VAT) for members; £275 (& VAT) well for professional services firms, but are no use in for non-members. manufacturing and retail. The preoccupation with the To book: www.hrsociety.co.uk/index.php/ employer brand goes with the same territory – some events/83 might see it as nothing more than window dressing. More reflective commentary has also suggested that there will be a pay-back for the wage restraint that employees have accepted as part of the recession. Trade unions will insist on making up lost ground once the profits begin to flow and/or the labour market tightens. Even those not covered by collective agreements will seek to exploit their market position, especially as the new, leaner organisations may be more vulnerable to unexpected resignations. May i have some more? There are also fears that the cost-cutting measures for dealing with an unexpected worsening of the will not stretch far enough if there is a double-dip business situation or else their well-intentioned recession. One case study had already experienced efforts will fail. the challenge that actions taken in good faith had This research suggests that organisations proved to be inadequate. The HR director described approached the 2009 recession with a planning going back to the employees “Oliver Twist-like, to orientation and a desire to protect their people assets ask for more”. in a way that they might have not done before. They Under these circumstances, it is hard to retain have been innovative and engaging in the way they employee engagement. Uncertainty, especially, leads have sought to retain and motivate their workforce, to deteriorating morale. So those organisations that but there are still challenges to face as the UK has are trying to avoid redundancy need to have strategies not yet returned to a sound economic footing. h r&Business / novemBer 2010 21
  • 22. forwarD thiNkiNg Public sector cuts have finally been revealed. Departments have had time to consider their options, but plenty of planning is still needed. Andrew Mayo, president of the HR Society, mulls over the impact of the Comprehensive Spending Review for HR professionals within the public sector t he Gershon report (2004) was one of many past to job and organisation redesign. One of Ulrich’s original key efforts to reduce inefficiencies in the civil service. roles for business partners was that of change agent. This means He introduced the concept of productive time – more than dealing with individual people issues in the course defined as time spent delivering front line services. of change – professional organisation development practitioners This is of course a variation of the direct vs indirect ratios should be expert in all aspects of change. that have their origins in manufacturing. And there is much more for HR to contribute. Undoubtedly In the present scenario, it could not be more relevant, as leaders need new skills. For the past 15 years the task of leading governments seek to maintain as many services as possible in public services has always been challenging, but it has been a with reduced resources. It is indeed a key ratio in workforce period of rising expenditure. We know from the private sector planning; which should always start with the resource that few leaders are effective in both downsizing and in times of needed for front line activities and then work backwards by growth. So attention must be paid to leadership effectiveness, and ratios to different lines of support. Those ratios will need to change in the coming months. When it comes to HR, it is more important “ There is a risk that redundancies than ever that they are closely supporting the operational strategy and business needs of absorb HR attention, but the need for public departments. They will have plenty to do regarding redundancies, but there is a risk that close business partnerships is key.” this becomes all-absorbing. The need for close business partnership – supporting operational managers in their objectives – is paramount. the challenges of maintaining engagement in tough times. This We can start with systematic workforce planning. Each is a time also when HR should sharpen up its expertise on return business scenario must be analysed for the resources needed on investment of programmes and initiatives: they will all need and balanced with the supply available – knowing that to show a viable outcome and the often woolly and soft objectives recruitment will be a politically undesirable activity (even if that have sufficed in the past will not be acceptable. Indeed the sometimes inescapable). Although many public organisations whole arena of measurement in HR relating key people measures paid attention to this in recent years, few developed robust to performance will have a greater significance. long term methodologies. The availability of finance seems This is a demanding agenda for HR professionals, and will to call the tune, whereas the resources needed to deliver an involve knowledge and skills that will be new to many of them. outcome should. Compromise may be necessary but at least Prior to the spending review training and consultancy were as one knows the price that will be paid for it in non-delivery. good as banned in most departments. There is no doubt help will Clearly productivity initiatives and process re-engineering be required in the coming months and it should be sought and should be at the forefront of change. Expertise in these areas used wisely. in a civil service environment is limited. We would argue they are very much areas for involvement for HR. It will lead Email: andrew.mayo@mayolearning.com 22 www.hrsociety.co.uk
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  • 24. See more clearly The mission of the HR Society is to lead thinking and share good practice in the linking of people, planning and productivity. In so doing, we provide a forum for senior professionals working in these areas. We meet our mission by: • building a network of members involved in the business edge of people issues • organising topical events with leading speakers for debate and discussion • offering educational masterclasses, seminars and workshops • holding joint meetings with other professional societies dedicated to the support of organisations • facilitating and distilling research • developing, publicising and disseminating relevant knowledge. Find out more about the Society, its activities and membership at: www.hrsociety.co.uk