One of the case studies to be presented at the forthcoming CIPD HRD 2012 conference and exhibition on Learning and Organisational Development (April 25 & 26, London) is titled: ‘Creating a leading organisation through innovative people development’. The study is a joint presentation by British Airways and the London Organising Committee of the Olypmic and Paralympic Games (LOCOG). The link to the session is here.
In anticipation of the presentation and in order to recognise the innovations for what they are, I thought it would be a good idea to recap on current best practices in employee development. I am going to reflect on two sources and then introduce a valuable reference table from Bersin & Associates http://www.bersin.com/.
Cornell University identified six ‘Best Practices in Employee Development’. They are:
- Use shared services – to avail of synergies and to deliver training needed to develop required competencies
- Make use of online training
- Leadership development – instigate formal programs
- Benchmark your development practices – to maintain competitiveness
- Provide career development services – high performing organisations typically do this. The listed benefits: retention, employee mobility and succession planning
- Secure and share organisational knowledge – make it easy for employees to find and share knowledge, foster informal ‘communities of practice’ within the organisation, online and social networking technology may also be of help.
Eric Jackson of Forbes magazine approached the topic from the perspective of addressing the global leadership shortage in business, in his article ’6 Things Best-In-Class Companies Do To Grow Leaders’ . The practices highlighted are:
- Develop people at all levels of the organisation, not just at executive level.
- Measure progress – people want to know how they are progressing
- Meet with your boss – development programs will fail if the boss is not involved
- Create a development plan and track it over time. In best practices companies, this is supplemental to and separate from the performance reviews
- Encourage mentors – mentor participation should be voluntary
- Discuss your career path – this focus helps to bolster employee loyalty
It was useful to come across these articles and you can see how the approaches could form the foundation of good development programs. The question occurred to me though – how widely should you cast the net in developing the people in your organisation? In the rapidly-evolving, knowledge economy, probably very widely indeed. The words of Sir Terry Leahy, former CEO of Tesco, the UK’s largest supermarket retailer, came to my mind. He has stated that “The key to organisational success is for people from every rung of the corporate ladder to take responsibility. Leadership matters everywhere. The great thing we always tried to achieve at Tesco was to have thousands of leaders, not just one”.
What Sir Terry is describing is the empowered organisation. Here is Bersin’s excellent list of ’40 Best Practices For Creating An Empowered Enterprise’.
I am keen to see how the innovations of British Airways and LOCOG can add to current best practices in people development and to see where they can be positioned on Bersin’s list.
Tim Harford’s ‘Adapt – Why Success Always Starts With Failure’ – How are businesses putting it into practice?
I just finished reading Tim Harford’s latest book: ‘Adapt – Why Success Always Starts With Failure’. Harford is a smart man, as befits a leader writer for the Financial Times and a successful author of popular economics books. He has a particular gift for putting us in our comfort zone by first describing situations we are familiar with before revealing the economic forces at play underneath. He does all this in his trademark breezy and insightful style.
Probably the key issue in the book is: what is the best way to solve complex problems? The narrative flows around the solution to this question. Real-life challenges are explained, a proposed approach is offered (‘Adapt’) and plenty of examples are given to support Harford’s proposal.
As a starting point, Harford argues strongly against a culture of reliance on experts and centralised management in the face of complex problems. He cites research which demonstrates that the power of experts to make accurate predictions is poor. Harford uses both the USSR and Donald Rumsfeld’s stewardship of the war in Iraq as examples of spectacular failures of centralised control. Both were guided by top-down, all-knowing ideologies and both were intolerant of dissent. Consequently, both were incapable of learning what was happening on the ground and were blind to evidence that what they were doing was not working.
For truly complex problems Harford argues that a ‘trial-and-error’ approach to problem solving works best. He draws on evidence from biology (evolution), business and military warfare to support his case and outlines the three steps to follow, given here:
- first, seek out new ideas and try new things (‘fail often’);
- when trying out new things, do so on a survivable scale;
- seek out feedback and learn from your mistakes
In supporting this approach, Harford stresses the value of having a ’worms-eye’ view of the situation, whereby those solving the problems get to see them up close. What implications does this have for business? It means that we need to encourage feedback from the coal-face of the operation. For example, we should consider: What is the true nature of the problem the customer has? What does the customer really value? We need, therefore, to harness the wisdom and experience of the employees who are working in the ‘value zone’ of the company. This is reminiscent of the Employees First Customers Second approach taken by Vineet Nayar and HCL Tech (http://blog.careergro.com/2012/03/14/the-employees-first-customers-second-phenomenon/) where Nayar is adamant that it is impossible for him, even as CEO, to know all the answers. Consequently, Nayar made conscious efforts to empower HCL Tech employees to take the initiative in and responsibility for solving the business’ problems.
In ‘Adapt’, Harford provides examples of companies which take a decentralised approach to the successful operation of their businesses. One is the UK high-street repair-service retailer, Timpson, whose business model is founded on a culture of transparency and on staff being empowered to solve customers’ problems as they arise. Timpson has gone so far as to remove EPOS systems from his shops because he wants the local outlets rather than head office to run the business. The owner, John Timpson calls his approach ‘Upside Down Management’ and has, literally, written the book on the subject http://www.amazon.co.uk/dp/B003NX730G/ref=rdr_kindle_ext_tmb
A second example is W L Gore, which Fast Company magazine has labelled ‘the world’s most innovative company’. From the outset, W L Gore believed that engaging his employees was critical to his goal of Gore becoming an innovative organisation. To this day, Gore associates set their own career goals, self-commit to the work they choose to do and feel a deep association with the goals of the organisation. Gore is a perennial on the ‘great companies to work for’ lists. See an excellent interview with Gore CEO Terri Kelly by Gary Hamel here: http://blogs.wsj.com/management/2010/03/18/wl-gore-lessons-from-a-management-revolutionary/
What Timpson, W L Gore, HCL Tech and Whole Foods (also featured by Harford) each do, in addition to giving employees freedom and responsibility in the business, is to make them accountable to each other. Each organisation places a lot of weight on peer-to-peer feedback. With bottom-up power comes peer accountability, it seems.
Thanks to Tim Harford for yet another good read. You can find out more details about him, his books and his other activities at http://timharford.com/
I just finished reading Vineet Nayar’s important book, ’Employees First, Customers Second’ – Fortune magazine has hailed his company, HCL Technologies, as having the ‘world’s most modern management’. The book covers the transformation of HCL into a global IT services powerhouse from the time Nayar took the helm as CEO in 2005. HCL is famous now for the democratic nature of its business. However, that is simply the What of the book – the revelations are in the Why and the How of the transformation. Here are my notes from Nayar’s story.
1. Why was a transformation necessary?
This is a good question because when Nayar took over in 2005, HCL was experiencing 30% annual growth. So, problem, what problem? However, Nayar has a healthy paranoia about business, believing that ‘unless a company becomes obsessed with constant change for the better, then gradual change for the worse goes unnoticed’. On a practical level, he observed evidence of complacency in HCL at the time and noted that its then growth rates were consistently behind its competitors.
Nayar believes that the asset base of knowledge-economy companies increasingly resides in the talent and creativity of its employees. In particular, for a service company like HCL, he identified the ‘value zone’ of the company as the interface between HCL employees and its customers i.e. where the knowledge and service which the customer values can be found.
2. How was the transformation accomplished?
With the value of hindsight, Nayar partitions the transformation into four stages. In practice, at the time, he and HCL were undertaking courageous organisational and behavioural experiments. Nayar proceeded with his innovations when he expected the benefits to outweigh the risks. At all times, he paid great attention to communicating broadly, at all levels of the organisation, and to getting feedback prior to implementing changes. Here are the stages HCL went through:
(i) Mirror-Mirror: Creating the need for change. Nayar insisted that HCL conduct an honest self-assessment and to look for things with which it was not satisfied in the company. In planning a move from point A to point B, he stressed that it is essential to truly know where you are starting from. Secondly, prior to moving forward, people require a vision of a better future to give them the confidence and the motivation to support the move. In HCL’s case, the vision was to move from being a discrete IT services supplier to a global IT integration company fit to compete with and succeed against industry giants like IBM and Accenture.
(ii) Trust through transparency: creating a culture of change. Nayar identified trust as a pre-requisite for any change program and identified building transparency throughout the organisation as the means to achieve it. HCL took transparency to unprecedented levels for a company of its size. For example: (a) employees were granted access to team level financial data across the organisation; (b) employees were empowered to pose questions to anyone in the organisation and to expect their questions to be answered, all in a transparent online forum; (c) a true 360 degree feedback process was established and, because it was focused on developmental opportunities rather than performance appraisals of individuals, employees were confident enough to post their survey results online; (d) ultimately, employees company-wide were given access to the policy and strategy formulation processes.
(iii) Inverting the organisational pyramid: building a structure for change. Nayar discovered that the then hierarchical structure of HCL was an impediment to success. He maintains that centuries-old hierarchies and matrixes are not fit for purpose in the knowledge economy because the value of such companies is not centralised or their value may not reside in their technology but rather in how it is delivered. According to his philosophy, functions like management, HR, finance etc. should be enablers for the people in the value-zone of the organisation. HCL changed their structure to make the enabling functions accountable to those who were creating value for the company. He called this ‘reverse accountability’. HCL also took a radical approach to 360 degree surveys. Nayar was dissatisfied with conventional 360 degree processes because participants are either wary of the process or do not participate in a sincere way. HCL’s approach was different because: (a) they redefined it as a developmental process rather than an evaluation process; (b) they allowed anyone in the organisation to provide feedback to anyone else ; and (c) Nayar and the senior management team published their reports online to encourage transparency. In following this approach, Nayar felt he was tapping into ‘the wisdom of crowds’ in getting broad feedback about development opportunities for individuals. HCL made sure that this developmental 360 degree process was disconnected from the HR department and the performance appraisal process. Instead, it was conducted by a new entity called the Talent Transformation and Intrapreneurship Development team.
(iv) Recasting the role of CEO: Transferring the responsibility for change. Having come this far and having delivered exceptional growth to the company and value to its clients, Nayar focused on the sustainability of change. In this step, HCL achieved something remarkable by tapping into the values of the employees. Nayar realised that if he could engage people around their passions, beliefs and ethics they would be more likely to take responsibility for change. He was interested in engaging with the whole person. HCL worked to identify the core values of its people using custom surveys. It then set up boundaryless Employee-First Councils organised around specific passions or interests. For example, councils were created around issues related to health, art, CSR, music etc. All the councils were run by employees. This process and the councils turned out to be hugely popular with staff – people welcomed the opportunity to be able to express themselves more. There was an unexpected pay-off for HCL too. Some councils were organised around business-related passions such as technology and many valuable business ideas were generated. Nayar realised that HCL had stumbled upon an unanticipated benefit: ‘unstructured innovation’.
This is a summary of the main points in the book. Great credit is due to Nayar and HCL for pushing the boundaries and empowering their employees to take responsibility for the success of the business. HCL’s courageous approach has paid off and it underpins the world-leading success it has achieved over the last seven years. By way of interest, I noted that HCL has been a Worldblu (www.worldblu.com) certified company since 2010.
‘Employees First, Customers Second’ is brief, just 208 pages, and is a brisk, uncomplicated read. I am curious if we will see other large companies having the vision and courage to follow HCL’s path to success.
Here are my takeaways from the CIPD Employee Engagement Workshop held on Jan 25, 2012, at the beautiful Holborn Bars venue in London. The workshop was expertly conducted by Emma Bridger of The Communications Lab (http://www.thecommunicationslab.co.uk/). Emma is a member of the UK government Employee Engagement Taskforce (EET) guru group. See http://engagingforsuccess.org/.
- Firstly, Emma settled on a definition for engagement originating with John Smythe: ‘Employee engagement is a process by which people become personally implicated in the success of a business’. Notable because this is only one of 56 definitions of engagement which the EET has identified so far.
- Emma’s epiphany from working on David McLeod’s landmark 2009 report ‘Engaging for Success’ was that there are two levels of employee engagement in organisations: transactional engagement and, the more powerful, transformational engagement. The former is more reactive – actions are taken as a result of survey results, for example. The latter is proactive and embedded in the values and behaviours of the organisation and, further, employees are an integral part of delivering the business strategy. CIPD CEO, Jackie Orme, estimates that 75% of engagement strategies operate at the transactional level and just 25% at the transformational level.
- Provocatively, Emma declared that she does not like employee engagement surveys. She feels that the survey process is dry, has low buy-in from employees, suffers from dwindling response rates and the ROI is low.
- Emma’s focus instead is on a more considered approach, rooted in positive psychology. At a practical level, she recommends first winning over champions within an organisation, then having those educate the leaders/line managers and, finally, the line managers engaging with the employees. Among other tools, Emma uses ‘appreciative inquiry’ in working with groups, encouraging participants to remember positive engagement experiences through storytelling and through envisioning what an engaged workplace would look like to them.
- In one of the group exercises, we were asked to exchange stories of episodes in our careers when we were most engaged. Then, the whole room was asked to share the characteristics of these experiences. There was no shortage of them. Included were: measurable progress, autonomy, having development opportunities, organisational values, empowerment, challenge etc. Interestingly, neither MONEY nor INCOME was volunteered as a factor by any of the delegates. Emma said that in her 10 years of conducting engagement workshops, money has only been offered once as a factor.
- What role does leadership play in companies? This was elegantly illustrated in a chart from John Smythe, showing the ‘four approaches to leadership’:
- Telling the many what has been decided by the few
- Selling to the many what has been decided by the few
- Inclusion – driving accountability down by giving people the time and space and resources
- Co-creation – judging who will add value by if included in decision-making
These approaches may be suitable in different circumstances, for example, ‘Telling’ might be appropriate in a crisis. The most enlightened approaches are the latter two and are appropriate when deep understanding is needed or where individuals can add value in decision-making respectively, resulting in willing collaborators or personally committed collaborators, again, respectively.
- What of the conversations on the floor? A prominent theme in the conversations I had was the problem many organisations are experiencing in the retention or recruitment of skilled people. The skills gap rears its ugly head again in our knowledge economies. It was clear that companies are having difficulty finding or developing skilled people. Interestingly, in a number of notable instances, the employees under discussion were skilled field technicians who had little or remote interaction with head office and management. Consequently, communication was poor and the sensing of peoples’ needs was difficult. However, these same employees increasingly tend to have access to mobile devices, such as laptops or iPads. The opportunity to stay connected with these employees in a meaningful way would appear to lie with taking advantage of the mobile technology they have and the delivery of support services to them in real-time and online.
- Overall, very positive feeling on the floor about the workshop. Thanks to Emma!
How to hire and hold great people to drive your business in 2012 – Dublin Chamber briefing, Jan 18, 2012
This event was hosted by the Dublin Chamber of Commerce, this morning, Jan 18, 2012. The subject is an important one and was skillfully presented by Peter Cosgove, director of CPL Resources. Here are my takeaways:
1. People are not your #1 asset !
Peter’s point with this attention-grabber was that, despite the repeated claim by top management, this statement is not backed up by the behaviour of companies in practice. Often, few metrics are in place to measure the value of people to the organisation. One obvious reason for this is that it is difficult. People are complex and they do not behave the way that classical economists like to think.
Another point to support Peter’s claim is that the salaries of the executives in charge, i.e. the HR directors, of the supposed #1 asset are about half that of the directors of other functions. So, there is a gap between the talk and the walk!
2. Hiring the right people
Peter pointed out some of the pitfalls of hiring and some of the remedies. He also made clear why this issue is important: as the complexity of the job grows, the cost of hiring the wrong person escalates to multiples of the new hire’s annual salary. The Good to Great mantra of ‘Get the right people on the bus and the wrong people off the bus’ applies. Things to pay attention to when hiring:
- the responsibility and accountability should not be with HR but with the business, most critically, with the line manager.
- focus on getting the right people. Do not be distracted by urgency or deadlines or inflexible screening procedures which may reject the right candidate when he/she is available. Pay especial attention to CHECKING REFERENCES! Regarding psychometric tests, they can be successful if part of a recruitment process but they need professional interpretation and are not useful alone.
- involve your existing team in the recruitment process. They will have to work with the new hire. Look inside your company too when filling positions. Your people know who the best people are.
- be conscious of your company’s brand, the potential hiree’s perception is the reality not what you are trying to project. Be mindful of the touchpoints with your candidates. Remember what Donald Burr of People Express airlines said ‘Dirty trays in our planes tells our customers that we don’t maintain our engines’.
4. Retaining people
Recent data shows that job satisfaction in the depressed economy in Ireland is generally low and that the percentage of people who have indicated an intention to seek a new position when the economy recovers is running at very high levels.
What is the top of the wish list of high performers in organisations ? According to new data, it is a MENTOR. Additionally, high performers want to see accountability in the workplace.
5. The role of social media
Social media is not going away. Peter predicted that we will be unable to resist using social media in business and will be drawn in to using it even if it is against our will. He illustrated this with a show of hands at the meeting – those who had been resistant to Facebook 5 years ago had all succumbed by now and had established accounts. In response to a question about the effectiveness of blogging, Peter reported it has worked very well as a tool for CPL and has directly led to them winning new business.
6. The war for talent
Consistent with what Deloitte has spoken of their Human Capital Trends Report 2011, Peter pointed out that the war for talent is not likely to subside any time soon and remains a vital issue for companies. He identified one causal factor as the likely shrinking source of available workers in Western Europe consistent with the decline in birth rates in the region.
Overall, excellent and relevant content. Mentoring is something we strive to facilitate with our online career management product, at www.careergro.com. I have some homework to do following Peter’s talk – to search out and study that new data which puts mentoring at the top of the wish list for high performers in companies. Finally, Paul’s slidedeck is available here: http://www.cpl.ie/blog/post/98226532/how-to-hire-and-hold-top-talent.
‘The Coaching Organisation’ – A briefing on Executive Coaching organised by the diploma in executive coaching program at UCD Smurfit School of Business, Dublin, on Dec 7, 2011.
Presented by Dr. Geoff Pelham and Colm Murphy.
Very interesting evening. The 50 or so attendees included many with an interest in coaching or learning and development. Colm Murphy did an excellent job in involving the audience in the discussions and in soliciting their inputs. The noteworthy takeaways were:
- What ROI metrics can be used to justify spend on executive coaching or executive coaching training? This problem has not been solved. It has been a challenge for the industry to find accepted metrics and none were identified during the discussions. Some participants recounted that stories of personal transformations arising from coaching make an impact on senior management and decision makers, one participant liked comparisons of employee behaviours before and after the coaching engagements. Colm Murphy suggested looking at before and after engagement scores since engagement is highly valued by companies and is regularly measured. Conclusion: no consensus and a challenge to identify hard ROI metrics.
- Coaches should avoid trying to solve the coachee’s problems and should focus on giving them the space to find their solution. There is tension between expectations of companies who want to see outcomes from the coaching in terms of actions and individuals who need to reflect and develop an understanding of how they can best improve. The coaches warned of moving to action too quickly and cautioned that much of the effectiveness of coaching programs is down to the commitment and mindset of the organisation towards coaching.
- Coaching should be future focused, looking at improvement opportunities. In the past, coaching was seen as an intervention i.e. coaches were brought in when there was a perceived problem to be solved.
- Are there true ‘coaching organisations’ in Ireland (i.e. where management by coaching is pervasive in the organisation)? Not in the experience of the attendees. Even in the best companies there are only pockets where coaching is embraced. In these instances, the situation is most likely influenced by a department or group manager’s affinity for coaching. The practice of managers having informal coaching conversations with staff rather than formal, semi-annual events was lauded.
- Diageo was praised as an organisation that handles employee relations well in a downturn. Joan Hodgins, VP HR Supply, was cited for presenting case studies on Diageo’s approach in recent times.
- Reference book on leadership development: Leadership Coaching – From Personal Insight to Organisational Effectiveness, by Graham Lee
Thanks to UCD Smurfit for organising the event. The link to their website and course details is here: #mce_temp_url#
Deloitte Human Capital Trends 2011 – Takeaways from a Career Development and a HR SaaS provider perspective
In Deloitte’s new and impressive publication, they analyse twelve trends in the field of Human Capital Management, six of which they say are revolutionary and six of which are evolutionary. The twelve trends are:
- Workforce analytics
- HR in the cloud
- From ladder to lattice
- Emerging markets
- Diversity and inclusion
- Next generation leaders
- Talent in the upturn
- COOs for HR
- Leading in a regulated world
- Collective leadership
- Contingent workforce
- Employer health care reform
I am choosing to highlight the first three of the revolutionary trends, as I found them to be particularly relevant to the provision of employee-focused career development services using Software-as-a-Service (SaaS) technology.
1. Workforce Analytics: Opportunities abound to build predictive capability in workforce planning, recruitment, retention, leadership and development. Companies will often already have a lot of data available to them. Now, due to falling technology costs and an increasing awareness of the power of data, companies can move from reactive to proactive personnel planning. Companies should start with real business problems and focus on building their analytics capabilities from the outset.
2. HR in the cloud (SaaS) – it’s inevitable!: SaaS technology is evolutionary but its business implications are revolutionary. SaaS has already demonstrated value in scalability and flexibility. SaaS can offer a middle ground between in-house tech people for HR and full-scale outsourcing. For clients, SaaS vendors will have to demonstrate that they can meet their security, QoS and integration needs.
3. From Ladder to lattice: The workforce and the workplace are changing, for example, organisations are becoming flatter, much work is project-based where the ability to collaborate is highly valued, there is increased diversity in the workforce, staff definitions of success in their careers vary wildly and many people are using virtual workplaces. In today’s world, the one-size-fits-all definition of career success no longer holds true.
Deloitte promotes the concept of Mass Career Customization (MCC) where careers are personalized and in-tune with each individual’s life. Deloitte presented what they identified as the top talent concerns of their clients in the following bar chart:
The future importance of analytics is a recurring theme in the document. Deloitte’s clients say that there is a worldwide business leadership shortage. Analytics may be used to fill the talent gaps internally in organisations. Deloitte asserts that the traditional command-and-control model of leadership is waning and getting organisations to work as one requires new ways of thinking, for example, employee engagement and commitment have to be harnessed. Collective leadership in organisations is required. Deloitte also calls for a more prominent role for HR in business. They say that HR professionals are well suited to the development of business-focused, HR metrics the development of reliable data for analytics and to take responsibility for HR compliance issues and risk management. Step forward HR!
The full publication can be viewed on Deloittes website at: #mce_temp_url# or downloaded as an app.
This post presents some of the key points from Professor Tony Watts excellent briefing on ‘Why career development matters’.
I found the original article on the web at: #mce_temp_url#
Career development is the lifelong process of managing progression in learning and work. The quality of this process significantly determines the nature and quality of individuals’ lives. However, in the modern era:
- Organisations are exposed to change
- Security lies not in employment but in employability. Individuals have to be ready to learn new skills.
- Careers now are increasingly being seen as not chosen but constructed.
Career development is a public good.
- It is important for effective learning
- It is important for an effective labour market (for finding jobs, for motivation and productivity)
Career development is crucial to the success of lifelong learning policies
- Schooling can be designed as a system but lifelong learning cannot, it needs to embrace many forms of learning in many different settings.
- It is the individual who must provide the impetus (it depends on the individual)
- Therefore, the country’s future is dependent on the quality of decisions and transitions made by individuals.
If individuals are to manage their career development effectively, they need support:
- Developing career management skills
- Information on the opportunities open to them
- Support in reviewing the options and converting information into personal action
Prof. Watts cited reports from the OECD which indicate that career management may play an important role in economic growth. [Eu Commission report on lifelong learning (2000) and career guidance and public policy (2004)]
 Watts, A.G, 2004, ‘Why career development matters’, CareersEngland.