#HRSummit2018 Rethink the Way you Work

I've really enjoyed being out in Singapore for this year's HR Summit. Actually I always enjoy being in Singapore. But I think another reason is that the conference has retained a focus on big, strategic issues, mostly related to HR in the 4th industrial revolution (being badged here as HR 4.0), more effectively than most conferences I've been to over the past few years. (I find most of these events have had peaks and troughs but this one has generally managed to keep at the peak level.)

I also enjoyed speaking both days at the event. I didn't really plan it this way but in hindsight, my inputs have focused quite tightly on the main conference theme and hashtag of 'rethinking the way you work'. For me this is about alignment - working out what we need to achieve, which will probably be different to what we've achieved in the past, then what qualities / outcomes we need to create in our people and organisation to do this, then what HR activities we need to use or change to make this happen.

In my first session I suggested all things 4.0 are moving people towards greater specialisation but that increasing complexity requires these specialists to be brought together in teams, other groups and networks. This makes these groups, and the relationships between people working in these groups, more important, and potentially more important than the individuals themselves. We need to focus on social capital rather than human capital.

Conference attendees seemed to agree with me - 90% suggested the way their people work together is more important than the quality of the individual employees.

This means that we should be developing our HR processes to produce these outcomes rather than the ones we used to need, ie they now need to support and enable groups and relationships rather than individuals.

But they don't do they? What do we measure, manage, develop and reward? 65% of my session attendees suggested their processes still focus on individuals, not teams and other groups. (And this is the most highly aligned set of scores across all the sessions I've asked people these two sets of questions.)

I also suggested that the way we support groups needs to change depending of the nature of the group. My best example of doing this came from Titansoft and the development of their non-conventional HR practices to support the company's agile IT teams.

Similarly to the examples I described in my own session, I thought these were some great, and even better, greatly aligned, HR practices for the type of groups (horizontal teams) used by this company.  Ie for me, it's not the non-conventional practices themselves which I'd suggest you use, it's the selection of the practices to fit the need of the type of group, and the focus on group vs individual (eg team vs individual based performance management).

In my second session  I argued that groups are so important we need to do more than align HR processes with the type of group, we also need to incorporate the highest priority type into our organisational structure.  When these groups are communities and networks we need to do this very carefully. We can't tell people in a community what to do, and as soon as we try, we've no longer got a community. But I also think these groups, which most people see as informal, are today often too important not to be formalised as part of the structure.

My suggestion, to continue the alignment, is that structure, and hence form of the organisation, should be based upon the main elements in my organisation model, the Organisation Prioritisation Model (OPM).

I asked my session attendees which of the element are most important in their organisation. Perhaps not too surprisingly, in this audience, although actually still quite surprisingly, 90% suggested the most important element are people, with the others responding the connections and relationships between the people. Ie we need to invest in our people, and their relationships, in order to achieve quality processes and business excellence, in order to deliver work and support customers. Customer results are a result of looking after our people, not the main aim itself.

For me, the type of group(s) we structure around should link to the priorities of the above elements. Work focused organisations should use horizontal project teams. Infrastructure based organisations should use simple groupings (functions). People companies should use communities (I loved Tanvi Gautam's suggestion that digital is all about human and a core human need is community.) Connection organisations should use distributed networks.

Yet again that doesn't seem to be what we do. Most (42%) of attendees' companies are still organised based on functions, though communities do come second, on 29%.

That's actually really high! - I don't generally suggest companies just use communities but introduce communities to support their functions or project teams. And it's also not represented by the case studies in the conference.

So we've had loads of examples of horizontal project teams: Siemens, Amazon, Netflix, Titansoft (above).

We've not heard much about communities. Really just Lo & Behold Group. This is from their website: "We operate like one big close-knit, wacky family that works really hard but plays even harder as one. We take the time to get to know our people as individuals in order to tailor career paths based on their personality, interests and strengths. We have a deep faith in our people, so we arm them with the necessary know-how and create opportunities that stretch them, making their years with us not only fun, but also incredibly fulfilling. We term this a 'LAB-er's stretch potential.' "

I don't know if the people in their establishments work as communities, but I suspect so. And if people really are the most important element of our organisations, I'd like to see more of our companies operating a bit more like this too. 

And I don't think we've had any case studies on networks at all. And actually given that so much of what we've been talking about is concerned with digital technology, we should have done.

I was particularly concerned that in an otherwise excellent presentation on the use of digital technology, the HRD from Singtel suggested that digital was so important, they'd set up a department for it. Departments / functions may be the traditional and fall-back solution, but they're generally not the best fit solution for digital. A network would probably be a better idea.

• Consulting   Research  Speaking  Training  Writing 
• Strategy  - Talent - Engagement  - Change and OD 
• Contact me to create more value for your business 
• jon [dot] ingham [at] strategic [dash] hcm [dot] com

 

#HRVision17 - DaVita - da community company

I had a great couple of days in Amsterdam at Osney Media's HR Vision conference last week where I did a keynote on moving focus from individuals to groups. I described how most organisations have four main types of group, each of which need to be treated differently, which are hierarchical functions, horizontal project teams, networks and communities (from The Social Organisation).

Organisations often prioritise one of these types of group as well and it was great to see a session from Gwen Burbidge from DaVita, which sees itself as a community first, and a company second. And yes, this means it does work differently from most other companies which are mainly based on hierarchical functions.

Gwen, pictured above, also used the metaphor of a village several times, which I use in the Social Organization too. The company's CEO is called the major. The slide in the above picture provides a couple of snapshots of DaVita employees and cultural artefacts. For example, one is of the three musketeers, and their motto 'one for all and all for one' is frequently heard in the organisation.

This isn't a small company though, it's a community of 70,000 team mates which is something quite special, I think.

A lot of this comes from intentionality, i.e. the actions they take to make it a community. One of my favourite points is that everyone has their own favourite walk-on music! I'm not quite sure how this works but imagine their offices get quite noisy around 9, 1 and 5.00.

The mayor often asks intentionally directed questions, for example what is it your parents taught you that you are still very grateful for, what should be be improving, and what was your DaVita crazy moment in the last six months?

They also have start / stop / continue meetings, announced in advance so that introverts can prepare for them, and they often look for someone who knows about an area to lead these.

All senior staff participate in reality days where they go and work at a clinic at 6.00am with the team mates working there.

The purpose of all this is to create a place where people want to work (or a village they want to live in). The metaphor here is like it being a mix of air and water - they want to be profitable, but they know this needs them to be a good place for people.

It's a terrifically impressive case study, and definitely the sort of organisation I'd love to work in, if I was ever going to again. In The Social Organization, I write about maverick organisations which manage their people completely differently from 99.999% of the world's businesses, and I'd definitely put DaVita in this list of companies.

I was a little disappointed when I asked about how DaVita's HR processes are different as a consequence of them being a community, as there didn't seem to be any. That can't be a good choice. Although they have just implemented Workday which is probably a good fit.

You may also be interested in the slides from my keynote:

HR Vision 2017 Keynote - Jon Ingham from Jon Ingham

More about me:

@joningham, http://linkedin.com/in/joningham 
info@joningham.com, +44 7904 185134

Top 100 HR Tech Influencer - Human Resources Executive 
HRD Thought Leader - HRD Connect
Mover and Shaker - HR magazine

Also develop your Strategic HCM capabilities at my new Strategic HR Academy

Finding a human capital niche: Haier’s horse race

 

  I’ve been chatting to a couple of clients over the last fortnight about the importance of developing a unique proposition for people management.

We tend to think that there is just one best way of doing HR, whereas in fact there is a broad variety of potential approaches open to us.

The key point is that people are all different.  This being the case, organisations can choose which sort of people they’re going to focus on employing and supporting.  The challenge then is aligning HCM strategy and HC / HR processes around this strategy in a way that will appeal to (deliver the deal for) the chosen group of people.

There’s a good example of this in Paul Evans and Vladimir Pucik’s book, The Global Challenge, which also emphasises the need for differentiation supported by internal consistency, along with the balancing of dualities (local and global) in international human resource management.

This is Haier, established as a refrigerator factory in Qingdao in 1920 and now a multinational consumer electronics and home appliances company which with over 6% share of the white goods sector is the market leader.  It is also credited with being mainland China’s (vs Hong Kong’s) only truly global brand.

Haier models its HR strategy on a race track in which case all employees, including managers, need to keep racing, and winning, in order to access rewards and responsibilities etc.  The company explains:

“Haier provides its every employee opportunities to develop and demonstrate talents.

It is not able people, but the mechanism to encourage able people development, should we be concerned about. The responsibility of a manager is to establish a ‘race track’, ie. personality development opportunity, for every employee to become a SBU.

The ‘Horse racing court’ requires three principles, firstly, fair competition; secondly, ability-based appointment; thirdly, reasonable job rotation. Under the contract labor system policy, employees are regularly evaluated and classified by performances, and the managerial personnel do not work at the same position permanently but rotate regularly in a fixed period. The significance of Haier’s human resource management is to stimulate the enthusiasm of employees. In this system, every employee can feel the pressure from both inside and outside the company and convert the pressure into creative motility. This is the key to success.”

 

Some of the main features of Haier’s approach include:

• Each employee’s targets increase by 1% every day.
• Every employee is subject to frequent and transparent performance appraisals (going against the traditional Chinese culture in which saving face is so important).
• Low performers are ‘put on medication’ which means remedial training.  More serious cases are put on ‘IV use’ which includes demotion.  Three negative reviews placing an employee in the bottom 10% of the workforce, leads to ‘hospitalisation’, ie dismissal.
• All employees can compete for job openings and promotions (‘races’) but have to keep on winning these to retain the title – there’s no such thing as a permanent promotion.
• Managers performance is also reviewed every week with the results being displayed every month in the entrance to the company’s cafeteria.  This includes green or red arrow indicating whether the manager’s score has gone up or down that month.
• Every quarter, those being judged ready to move are transferred into the company’s talent pool – but for that quarter only. Evans and Pucik note ‘there’s no philosophy of once you’re in, you’re in at Haier’.
• Promotions and demotions are published in the company’s internal newspaper.
• Chinese employees don’t receive a salary, but a share in the company’s profits, based upon their individual performance.

 

There’s also a good description of Haier in ‘OEC Management-
Control System Helps China Haier Group Achieve Competitive
Advantage’ (Thomas Lin, Managing Accounting Quarterly, 2005).

This notes, for instance, that:

“Each employee receives a daily grade for actual performance and progress toward achieving his or her target. Daily evaluation results are shown to workers the next day on the bulletin boards in the factory. The employees who are acknowledged as the best workers for three consecutive days have the honor of telling their experiences to fellow workers…

Small yellow 6-S squares are painted on the factory floor. At the beginning of each workday, team leaders stand inside the squares to give a briefing on that day’s work and relay any news to the employees. At the end of each workday, some workers will be called to stand on the footprints inside the squares to criticize themselves for making mistakes and share corrective actions taken during the day or to share some of their good work…

The company adopts a point system for production workers using the 3E card, and, if an employee earns more points, he or she makes a higher wage and bonus (this way, both management and employee know the daily wage and why).
The company also uses quality-check coupons to provide an additional incentive mechanism. Each employee has a quality-check coupon booklet with red and yellow coupons for rewards and penalties. The booklet lists all quality problems the firm has detected and provides guidelines for checking each defect. If an employee failed to self-check a quality problem that was later found by his or her team member during a cross-check or by the superior during a managerial check, the employee will lose a red coupon and receive a yellow coupon that will be counted against that day’s wage and bonus…

At the end of the day, all workers conduct a selfcheck of their own work with the OEC criteria, fill out their 3E (Everyone, Everything, and Everyday) cards with seven OEC criteria items, and submit them to their supervisors. All employees fill in a form daily and calculate their wage using the following formula: wage = rate 5 quantity + award – penalty.”

 

Now, we do need to be careful about stereotypes.  So for example, Evans and Pucik note that ‘while China has been a high power distance country, characterised by high in-group collectivism, young urban Chinese exhibit a considerably higher degree of individualism and a more modest level of power distance.  They are also more assertive than the previous generation.’

However I think most people would still agree that the US still has a more individualistic national culture and China a more collective one.

This makes it even more remarkable that Haier has managed to develop such a competitive company culture that it even strikes its newer US workforce as overly competitive (meaning that the company has had to adapt some of its HR practice such as giving out a brown bear or a pink pig, rather than assigning a red or yellow face to high / low performing employees).

 

I think this indicates very nicely and quite powerfully what can be achieved through differentiation.

The point here is that even a company as large and global as Haier (or GE or Aviva) can find a basis for differentiation, and enough people who will fit with this differentiated approach.  We don’t all have to implement the same ‘best practices’.

 

Contact me if you’d like to develop an approach that is best fit!

 

Technorati Tags: Haier,China,horse race,HR,International,Global,Paul Evans,Vladimir Pucik,The Global Challenge

 

• Consulting - Research - Speaking - Training - Writing
• Strategy - Team development - Web 2.0 - Change
• Contact me to create more value for your business
• jon [dot] ingham [at] social [dash] advantage [dot] com

.

Helping you create Next Generation HR

 

   In my last post, I described my ‘ideal’ process for human capital / talent / workforce / HR planning.  I also explained that the actual process I would hope to use with a client would depend upon their particular situation: strategy, context, challenges and opportunities etc.

I think it also depends upon their views about Next Generation HR, which I’d define as the way in which they believe HR can best create value for their organisation.

As I explained in my review of the CIPD’s session on Next Generation HR, I think there’s a variety of options available to organisations here.  To me, Next Generation HR is about continuing the movement towards best fit, so whereas the current generation of HR practice is about all moving together towards one view about effective HR practice, the next generation will be more differentiated – and more focused on the particular ways that HR can add and create most value in your particular organisation.

So I’ve put up a quiz on my blog to get more input on which of these you think will be the basis for Next Generation HR for you and your organisation.  These are the results so far:

 

Option	Response
Sustainable Organisational Performance (from the CIPD’s Next Gen HR research)	2 (28%)
Human Capital Management (accumulating human capital)	4 (57%)
The Social Business (accumulating social capital, including through the use of social media)	2 (28%)
Behavioural HR - using the insights of neuroscience to change HR’s, managers’ and employees’ decision making processes and activities	2 (28%)
Externally focused HR - developing a role outside the organisation	1 (14%)
Green HR- developing a tie-in with ethics and CSR	1 (14%)
HR 2.0 - the use of social media tools within HR (social recruitment, social learning etc)	1 (14%)
Imagination based HR	0 (0%)
Evidence (measurements and analytics) based HR	3 (42%)
Strengths Based HR - a focus on talents and appreciation etc.	2 (28%)
Other	1 (14%)

 

I’m obviously pleased to see HCM taking an early lead, but disappointed to see imagination based HR, one of my personal favourites, falling behind already!.  However, I’m after your views here – you’ve probably had enough of mine.

So please do select your personal favourite option(s) from the list – and if you’re voting for the ‘other’ category, perhaps add a comment to this post and let me know what you think I’ve missed.

 

Human Capital Planning

Reviewing which of these options make best sense for you is part of my Human Capital Planning process too.

I’ll describe more about this process, and how I can support it, in my next post.

 

 

Technorati Tags: Human capital,planning,Next Generation HR

 

 

• Consulting - Research - Speaking  - Training -  Writing
• Strategy  -  Talent  -  Engagement  -  Change and OD
• Contact  me to  create more  value for  your business
• jon  [dot] ingham [at] strategic [dash] hcm [dot] com

.

Dick Beatty on Differentiated metrics for a Differentiated workforce

 

   I had some quite long conversations with Dick Beatty at the InfoHRM conference.  It’s the first time I’ve really talked to someone who I have posted on quite extensively, and who has also already read my work, which I found quite interesting!

This is my summary of Beatty’s presentation.  I’ll come back to whether I’ve changed my views of his approach at all later on.

 

How do you build great organisations through metrics?  Beatty often speaks to CFOs. Where, how and who creates wealth for a firm is a major issue.  Understanding how HR can create value for business.  How do we use culture and talent to impact the bottom line?  We need to score on the bottom-line of the business, rather than the HR scorecard.

CEOs care about two things:

 

1.   Strategy

Every HR person wants to be a strategic partner / player.  But what does strategy mean?  It’s about value creation - customer value and economic value.  Firms provide society with value which society has the option to choose upon.  The better we serve the better our customers like us.  The more we can do this in the way our customers like, the more our shareholders like us.  HR doesn’t think enough like a real strategist.

 

2.   Data analytics

Numbers are the language of organisations.  You can’t win arguments through moralsuation.  Strategy needs to drive measures.  Measures need to drive decision making.  Think of surveys as communicating to your workforce about what is  important. Don’t ask about things no one cares about.  Needs to be interventionable – able to intervene to do things differently.

We want to get to the table.  What do we have to bring to the table and how do we get invited back?  There are various measurement frameworks: Saratoga, Jack Phillips, John Sullivan etc.  But these focus on getting the answer and then figuring out what we’re asking.

A better approach is to figure out what are the qs that are worth asking?

If you had the right data you could intervene and get the right solution.

 

Differentiation

Eg Avis ‘we try harder’ – why not try different?  Strategy is about customer value and uniqueness.  So how do we differentiate the workforce?  Where do we make extreme investments in talent?

We’re entering an economic era of great volitility – customer requirements are changing.  It’s causing us real pause in how we build organisations.  A big implication is workforce agility.  Firms need to ask how do we minimise fixed cost?  Well, the biggest cost in most organisations is the workforce.  Financial services: 91%; Oil & Gas: 16%; Average about 70%.  A good example is IBM’s On-demand strategy / on-demand workforce.

How do you build great organisations through great talent systems?

The key questions are:

1 How are we going to grow?  Where do we play?  How will we win?  If you don’t know where you’re going any plan will get you there.

2 How do you use resources to execute strategy?  Need systems to do this.  If you loose inventory no one cares too much.  If you mis-manage the workforce they do.  How do you build a resource management system for the management of the workforce?  There are stars in the workforce but you also need a star system to do this.  Manage your workforce like a portfolio and leverage its return.  Look at talent as a supply chain.  What’s our inventory and what are we going to do about it?

 

Strategic capabilities

We need to look at the enterprise the way investors look at the enterprise.

What are you going to differently to get different?  Organisations don’t do things differently - people do.  Get people to change or change the people.

We tend to think about culture / talent as lag variables.  (We’ll do it once we grow).  This is too late.  We need to think about customers / what customers need in order to grow.  How are we going to win the future?  Past is not necessarily the guide.  What experiments do you want to create to give you information on this?

Capabilities - bundles of information, processes and people [really core competencies but he thinks HR people get confused about this word.]

You can invest in 3,  maybe 5 of these things.  These things need to be strategic – creating customer and economic value.

What roles are strategic?  Have an impact on these capabilities?

 

 

Think like customer – why are we here, where are we going?  These questions are relevant to the business and the brand.  Your brand better align with culture.  If sending a brand message need the workforce to exhibit this in every interaction with a client.

Strategy drives capabilities

 

Strategic roles

Strategic roles are found within strategic capabilities.  For example: compare Nordstrom vs Costco – different capabilities so different strategic roles.

 

 

Jack Welch at GE wanted all A players.  Beatty told him he was crazy – you can’t afford all A players.  And you don’t need do everything to A level.  Ever tried to get decisions if everyone things they’re the smartest kid in the room?

There are three types of work in organizations — strategic, support, and surplus (used to be strategic, now not needed)

-   Strategic work creates customer and economic value.  Only about 15% of the positions in your firm (not 15% of employees) have an impact on your firm’s strategic success.  Not many roles but maybe a lot of people – Lockheed Martin has 15 strategic positions – but one of these has 10,000 people.

-   Performance variability in strategic work causes firms to underperform — and is a strategic opportunity! Reduce variability in roles most important.  The bell shaped curve does not help you, it hurts you.

 

 

Line managers impact the firm much more than we do as HR.  Hold them accountable for talent they’re responsible for.  Hold them accountable for HR work - selection, performance management, reward etc.  Give them a 90% appraisal on how they do things (from the people they’re managing).

Top talent is going to be looking around.  People who stay aren’t going to be the ones we want.  There’s more talent available now than there will be for a generation.  Get a move on and recruit in line with the strategic direction of the firm.

A right hire is someone who loves what you do, wants to do what you do.  Start the hiring process outside of the firm.

Pepsico moved to 66/34 balance between results and leadership stuff 4 years ago now 50/50.

The real issue in performance management is how well does the leadership execute the performance management system.

We’ve over designed, over metric’ed these things.  Make them simpler.

 

HR capability

Many HR ―professionals:

-   Don’t think like business executives or strategists

-   Want to treat employees the same

-   Spend considerable time defending or trying to fix poor performers

-   Many entered HR to ―help people

-   Many have never learned that strategy is about differentiating products/services on the outside and resources (including people) on the inside

-   CLC research suggests applying business analytics is the thing we do least well.

 

 

In the Q&A, I asked Dick whether he thought this approach would apply everywhere – particularly the idea that you shouldn’t invest in C players.  My concern wasn’t so much the UK, but other European countries where equality and inclusiveness are more valued.  Dick thought so.  I’m still not so sure.

Note that I’ve got no problem prioritising the A players.  This is a fundamental part of a lot of the work that I do, and the Human Capital Strategist programme that I deliver for the HCI (in UK and Europe) etc.  But I don’t believe this needs to mean than you withdraw support from the people you’ve labelled ‘C’ (eg by not bothering to give them feedback etc).

Your thoughts?

 

I will come back with more of my own reactions to all this shortly.

 

In the meantime, check out my previous posts on Dick Beatty and Differentiation:

• Beatty: ‘CFOs: Don’t Trust HR’ and the Employer of Choice
• Differentiated Workforce (Put strategy, not People, first)
• 10 reasons not to implement a Differentiated Workforce
• 3 key questions for HR.

 

 

Technorati Tags: Dick Beatty,Differentiated Workforce,InfoHRM

 

 

• Consulting - Research - Speaking  - Training -  Writing
• Strategy  -  Talent  -  Engagement  -  Change and OD
• Contact  me to  create more  value for  your business
• jon  [dot] ingham [at] strategic [dash] hcm [dot] com

.

Visa Europe: What do you want to be when you grow up?

 

  Did you get through yesterday’s rather monster ‘HR in the Social Business’ carnival?  Well, apologies, but I think this is going to be an even longer post… (it’s well worth reading though!)

 

I recently attended a great event, ‘Delivering Outstanding Performance’, organised by Michelle Lawton from Consult HR and ‘MOK’ from The Innovation Beehive.

Opening the event, MOK suggested that to contribute to their employers’ success, people need to be clear about what they want to be, who they are, and how that fits with their organisation.

We then had a presentation from Derrick Ahlfeldt, SVP HRM at Visa Europe with a case study from his organisation that demonstrated these points. In fact, Derrick’s story provided a great demonstration of much of what I’ve been blogging about here over the last couple of years too.

So I’ve gone a bit to town in describing Derrick’s presentation – and have also provided some notes / links to previous thoughts that support and occasionally challenge some of this case study:

 

Visa Europe story	My perspectives (NOT Derrick’s necessarily!)
As an association, Visa Europe is about developing the whole market (the European credit card business) through collaboration. By 2004, following a major restructuring and re-engineering, people had initiative fatigue. There was a need to re-engage people and gain additional discretionary contribution. Since then, the company has been working to become a ‘Peak Performing Organisation’.	Derrick didn’t present it like this, but I’d suggest that collaboration is Visa Europe’s mojo. External collaboration is clearly critical to the company’s success and I think they understand (implicitly at least) that because of this, internal collaboration is equally as important.
A major part of this shift has been creating an environment in which people are put at the centre of the organisation – an environment in which people don’t feel they are ‘being done to’, but are ‘doing it for themselves’ – ‘making ownership and accountability personal’.	Visa Europe has clearly been ‘putting human capital first’ – treating people as providers of critical human capital rather than simply (human) resources (my Strategic HCM blog is all about putting people and human capital first). This is absolutely appropriate for an organisation whose mojo is about collaboration as people will need to take accountability in order to trust each other in order to support collaboration (the other way of saying this is that building human capital is a pre-requisite for effective development of social capital… - see below).
Kevin Roberts, CEO of Saachi and Saachi, suggests that a ‘Peak Performing Organisation’ has a ‘sense of family’ within the team. This has been another part of Visa Europe’s recent shift.	Visa Europe has also been developing social capital around a sense of family. Again, this is absolutely appropriate for an organisation whose mojo is about collaboration (my Social Advantage blog is all about developing the right social capital to support an organisation’s mojo).
This shift has been supported by documenting: · An inspirational dream (“to be the world’s most trusted company”) · Shared spirit (“what makes Visa Europe different to other organisations?” eg competitive yet collaborative, trusted, multi-cultural family) · A common set of beliefs (eg empowering and investing in the individual, nurturing the dynamics and diversity of the Visa family) · The “Greatest Imaginable Challenge” (an extraordinary stretch target which is unique to the organisation and inspiring to its people) · Focus It took over a year to “wordsmith” this document in order to ensure that everyone was comfortable with it.	I think this process demonstrates the need to develop a solid push behind whatever a company is trying to do (whether this is articulated through a BHAG, mojo or something else) as a way of translating this intent into organisational capability. I particularly like the way that Visa Europe’s shared spirit and common beliefs blend human and social capital (competitive yet collaborative, individual and family). I presume the “Greatest Imaginable Challenge” which Derrick didn’t want to discuss is Visa Europe’s BHAG. But note that this is developed from the mojo (an inside-out approach) rather than the other way around. I also think Derrick probably under-sold the work he and his team did to socialise this document – in my experience, the process of creating a joint ‘vision’ for the organisation is more important than the document it produces. It’s about creating a shared mindset, rather than a wordsmithed document!

The ‘Peak Performing Organisation’ programme	My perspectives
The programme currently consists of two phases:
Phase 1 - Individual Visa Europe has made participation in this phase of the ongoing programme voluntary in order to create a different dynamic from the past. This phase consists of: · Plenary introduction sessions (in the first year of the programme, Visa Europe ran three events, each with 150 people, which was helpful in getting the programme started – they now run just four smaller sessions per year) · Three small group sessions (6-8 people) facilitated by an inspirational player (someone who has “been there and got the T-shirt”) · Development and communication of a personal values-story, identification of implications and creation of an action plan   The key questions that individuals consider in this values story are: · Given you are this person and these are your skills and talents, what can you bring to this organisation? · How does this link? (are you doing what you wanted to do when you grow up?) · Are you in the right job and the right organisation?   (A volunteer kindly described for us his story – including his ‘home me’ and his ‘CV me’ – explaining that once he had identified his talents from this story and discussed this with his group, his ‘CV me’ became the ‘real me’ – the distinction was removed: “I’m now more passionate and enthusiastic for everything I do in life directed to what I’m good at and would like to do anyway.”)	I think this phase of the programme provides a really nice (whoops – sorry MOK) explanation of a human capital vs a human resources approach. Ie the phase is about employees as individuals, not the business. However, there is a limit to this. Derrick was keen to stress that employee empowerment should not lead to organisational chaos – employees still need to do what the organisation needs them to: “It’s about understanding what the opportunities are and trying to do more of what they want within their existing or another role”   (Or as MOK described it, it’s about “total freedom in a gilded cage”.) I’d suggest the next stage might be to open the door of the cage and see what happens…   The phase also starts to develop social capital too (via sharing values stories within the team). There are some really good examples (eg Herman Miller) where sharing this type of information has had a very powerful team boosting effect.
Phase 2 – Team In this phase, a whole team is taken away to consider: · Alignment – the team purpose, customer dreams and nightmares: o The team as a whole considers what they want to achieve o They then get some customers in to describe what keeps them awake at night o The team discusses what it wants to achieve for its customers   · Values – realigning purpose based on customer input · Implications – barriers and challenges for action planning	Another good approach – this time to develop social capital. But could it be even more strongly based upon the existing capabilities of the team (what the team can do rather than what customers currently need)?

The results	My perspectives
People have generally been very positive about the change. However, disbelievers are tolerated as long as they do the job they are expected to do. And some people have left the organisation.	I think people are always going to leave organisations during a transformation like this. And if they’ve left with a better perspective of whom they are and where they should be, this can only be a good thing for them, and is probably a good thing for the organisation too. If they’ve left because they’ve found the whole thing a bit too ‘fluffy’ then I think that’s a shame for them. But I’m convinced that doing this sort of thing will gradually become part of everyone’s normal expectations.
Since 2004, · Survey completion rates have increased from 83% to 96% · Overall engagement has increased from 72 to 90% · External customer satisfaction has increased from 6.8 to 8.1   There are other positive statistics too, but what the Chief Executive says is also important are the stories and what he’s seeing in the organisation.	The CEO’s focus on both quantitative and qualitative evidence is totally appropriate. Not everything that’s important can be measured, and I think this applies particularly to organisational capability, ie to both human and social capital. However, clearly when something important can be measured, it makes sense to measure it. And what’s behind Visa Europe’s success? I’ve discussed the role of mojo, organisational capability / human and social capital and making a solid investment behind this. The other two aspects that I believe are particularly important are: · Alignment – between each of these different concepts and Visa Europe’s programmes and practices · Best fit – the things that Visa Europe has been doing won’t apply for all organisations, but they apply for this organisation, with its focus on trust and collaboration, superbly well.   So the message isn’t do what Visa Europe’s done. It’s applying the same level of insight and sharpness to your own organisation. And if you do this, you should gain the same levels of Human and Social Advantage too.

.

.

Phase 3?

We didn’t talk about this at all, but I’d suggest Visa Europe’s next step is towards even greater liberation of individual employees and of teams.

Derrick explained that as a result of the first two phases, Visa Europe is now confident that every person and every decision is linked with a golden thread to the organisation vision.

That’s great, but it still sounds rather too top-down?

I agree that they do need to manage performance against the organisation’s vision and objectives (top-down) but they would also benefit from taking ever greater advantage of the potential residing in each of the company’s employees – leading performance instead of just managing it (I’ll be talking about this in Greece next week) – ie bottom-up.

At the team-level, I’d suggest that Visa Europe continue to build social capital – perhaps by emphasising links across teams (bridging capital) as well as within the teams (bonding capital).

So I’d suggest they look at different opportunities that will help them do this – recognising that these may range from organisation development to social media; social events to reward practices; and social network analysis to facilities design.

 

Note - and I’ve emphasised this quite a few times - that the ‘social business’ (if this is what Visa Europe is) isn’t just about the use of social media.

 

So, for example, Michelle described a nice example from the BBC where people have been given the opportunity to go and experience different areas of the organisation for a few weeks (“the hot shoe shuffle”).

Note also that this isn’t in any way supposed to be criticism of Visa Europe’s story. They’ve done much more than most organisations would even dream of. I’m just explaining the direction I personally feel they should go.

 

Anyone else any suggestions for Derrick?

 

Thanks to MOK and Michelle for the invite to the event, and to Derrick and his IT colleague for the story.

 

Photo credit: Joe Mabel

Technorati Tags: Derrick Ahlfeldt,Visa Europe,MOK,Innovation Beehive,Michelle Lawton,Consult HR,Kevin Roberts,Peak Performing Organisation,human capital,social capital

This post is cross-posted at Social Advantage.

 

 

Consulting - Research - Speaking  - Training -  Writing

Strategy  -  Talent  -  Engagement  -  Change and OD

Contact  me to  create more  value for  your business

jon  [dot] ingham [at] strategic [dash] hcm [dot] com

.

3 key questions for HR

 

    Day 3’s task is to promote day 2’s list post.  One way of doing this is by commenting on other blogs and forums, and I’ve added a short review on Amazon.com.  Another is to add a follow-up post on this same blog.  So at the risk of completely overdoing this subject, here’s why - as I say in my Amazon review, and on the Talking HR show – I moderate my criticisms of Becker’s, Huselid’s and Beatty’s book, the Differentiated Workforce, by noting that the authors have asked some important questions that I think all HR practitioners should consider and formulate their own responses to.

These questions include:

1.   How is your company going to differentiate your people management strategy from your competitors?

As I posted previously:

“I agree that "most firms don't really have a workforce strategy" and clearly, this is a bit of a problem!  I agree that "Despite the tremendous attention in recent years to measuring the financial contribution of HR and talent, there is much less attention to getting the underlying workforce strategy right".  I've made this case several times - measures are important, but it's what you do with them that counts.

I also agree with the need to differentiate workforce (or people management) strategy.  I like the authors' point: "Just as any good business strategy involves making the right choices and the right investments, the same is true of a workforce strategy", and also Lucien Alziari's comment in the endorsements: "If you read your company's HR strategy, would you be able to tell which company it was written for?".  I'm a firm believer that you should be able to do so.”

 

If ‘people are our most important asset’, it’s not enough to treat this asset just like every other organisation.  You need to develop some kind of approach that differentiates you through your people (Becker’s, Huselid’s and Beatty’s Differentiated Workforce is an example of one of these approaches).

 

 

2.   What do you mean by talent?

In my view, you don’t need to follow any sort of talent management strategy to differentiate your people management strategy.  But if you do, and for it to be successful, you need to have a very clear view of what talent in your organisation means, and how if contributes to competitive advantage (Becker’s, Huselid’s and Beatty’s ‘A’ roles, based largely on Boudreau and Ramstad’s pivotal talent, are just one example of such a group).

 

 

3.   How are you going to navigate through the long value chain that culminates in improved firm performance?

The authors are correct in noting there is a long and indirect causal chain between HR activities, HC outcomes and business results.  However, I believe they reach the wrong conclusion from this realisation.  As I posted previously:

“The authors seem to disregard the opportunities for creating value by competing on intangibles by explaining that "the line line of sight between workforce strategy and strategic success is typically so indirect that figuring out how to get from here to there is difficult... There are few instances where a selection system, a performance management system, or leadership development has a direct impact on the firm's bottom line, making it hard to see how these decisions translate into strategic success."  I agree with the authors here - it is hard.  But this doesn't mean that we shouldn't try to do it.”

The right conclusions, in my opinion, are that:

• HR needs to concentrate on human capital outcomes rather than just HR activities
• These outcomes should be as important to HR as are business results, since these are not directly attributable to HR.
• Agreeing with Becker, Huselid and Beatty, strategy maps and scorecards are the best way to understand the relationships between elements in the value chain.

 

 

Technorati Tags: HR strategy,Differentiated Workforce,Brain Becker,Mark Huselid,Richard Beatty

 

 

• Consulting - Research - Speaking  - Training -  Writing
• Strategy  -  Talent  -  Engagement  -  Change and OD
• Contact  me to  create more  value for  your business
• jon  [dot] ingham [at] strategic [dash] hcm [dot] com

  .

10 reasons NOT to implement a Differentiated Workforce

 

    The second of Problogger’s 31 day challenges to build a better blog (31DBBB) is to write a list post.

In fact I’ve already just done a top 10 for HR Zone (which although it’s been published today was actually written at the end of last week, ie before the challenge was set), but here’s another.  This is my top 10 reasons not to implement a differentiated workforce (at least in the way that it’s described with the Differentiated Workforce book).

I’ve already posted on this book, but only after having read Chapter 1, and there’s a lot more I don’t agree with, having read the whole thing.  You can also hear more on a recent Talking HR show, and my interview on HRchitect’s Web Mingle.

So, here’s the list:

1.   A differentiated strategy and a differentiated workforce are two different things.  I agree that people management strategies should be differentiated, but differentiating the workforce is only one way of providing a differentiated strategy.  It’s not a best practice all organisations should implement.

2.   Differentiating the workforce in the way the book describes is only ever going to result in added value.  Greater opportunities lie in creating value, by, for example, building an organisation’s HR architecture around a particular organisational capability.

3.   Differentiating the workforce can be done in lots of different ways.  Differentiating by ‘strategic capabilities’ ie core business processes is only one of many options.  The authors claim that traditional approaches to talent management are not the answer (p53) – and they do have a point here – but job evaluation isn’t the way most organisations identify their talent groups.

4.   It’s not often going to be practical to move ‘A’ players into ‘A’ roles unless these are the ones the players are skilled and qualified to perform.  Matching players and roles is about ensuring that over time a higher proportion of the most talented people are working in the most important roles.  It’s not necessarily about moving existing employees.

5.   ‘A’ roles shouldn’t be the same for all organisations in a sector (p76) – there’s nothing differentiating in this.

6.   Deliberately seeking to attract candidates from below the midpoint of the labour market into ‘C’ positions (p104) is a joke.  Yes, some organisation has got to employ these people, but there’s no reason that it needs to be you.

7.   Forcing a positively skewed performance distribution on ‘A’ positions (p137) is an even bigger joke.  Yes, you want more talented people in more important roles but you want higher performance from them too.  You set more demanding expectations, and still work towards a normal distribution curve.

8.   Holding both line managers and HR accountable for the development of a successful workforce (p88) goes against on of the fundamental principles of good organisation design – to only ever hold one person accountable (RACI analysis).  For me, it’s HR that needs to be accountable for the outcome – which could be the right match of ‘A’ players in ‘A roles’, and business leaders accountable with what they do with that.

9.   Being an employer of choice (vs employee of choice) doesn’t need to mean what they describe it as (p113) – see this post.

10.   The HR scorecard, Workforce scorecard and the author’s adaptation of Kaplan and Norton’s Balanced Business scorecard (p156) make sense as a framework for objective setting and measurement at a high-level, but the perspectives within the first two of these simply don’t make sense as they’re not part of a strategy map (p169) – better use the HCM value chain.

 

 

What do you think?

 

 

Technorati Tags: Differentiated Workforce,Brian Becker,Mark Huselid,Richard Beatty

 

 

• Consulting - Research - Speaking  - Training -  Writing
• Strategy  -  Talent  -  Engagement  -  Change and OD
• Contact  me to  create more  value for  your business
• jon  [dot] ingham [at] strategic [dash] hcm [dot] com

  .

The Differentiated Workforce (Put Strategy, Not People, First)

 

     I've just read the first chapter of Becker, Huselid and Beatty's Differentiated Workforce.  I agree with a lot of the the book's suggestions, but disagree with some others.

 

Differentiated strategy, differentiated workforce (they're too different things!)

I agree that "most firms don't really have a workforce strategy" and clearly, this is a bit of a problem!  I agree that "Despite the tremendous attention in recent years to measuring the financial contribution of HR and talent, there is much less attention to getting the underlying workforce strategy right".  I've made this case several times - measures are important, but it's what you do with them that counts.

I also agree with the need to differentiate workforce (or people management) strategy.  I like the authors' point: "Just as any good business strategy involves making the right choices and the right investments, the same is true of a workforce strategy", and also Lucien Alziari's comment in the endorsements: "If you read your company's HR strategy, would you be able to tell which company it was written for?".  I'm a firm believer that you should be able to do so.

And I also believe in differentiating the workforce.  So, for example, I was fairly unimpressed by Paul Turner's comments at the recent CIPD conference that best practice in talent management is the inclusive approach - treating everyone as talent - and that this is what the majority of organisations do.  Firstly, because just because most organisations do this (based on a very limited sample), doesn't make it best practice.  Secondly, because I believe that organisations need to identify best fit solutions, rather than rely on best practice (which supports the points the book makes that I address above).  And thirdly, because I also believe that exclusive approaches - identifying a small group of people as talent - tends to be the right approach for many, if not most, organisations.

But not necessarily all.  What about an organisation that has an organisational capability around inclusivity.  They're not going to want to differentiate, are they?  The authors promote best fit over best practice, but then promote differentiation as a best practice that all organisations can use.  I don't think that logic works somehow.

A bit like Boudreau's belief in pivotal talent, the authors seem to assume that a strategic approach has to involve differentiation of the workforce.  They state that "differentiation is not just a feature of a successful workforce strategy, it is the most important feature" and "Differentiating the workforce strategy ultimately means investing disproportionately in certain employees and groups of employees, based on their strategic roles".  Why, and where's the evidence for this?  The closest they get is to say that: "Just as strategic differentiation reduces external homogeneity, internal homogeneity should also become much less important".  But I don't think this closes the case.  In fact, despite my comments above, I actually think that the global reset is pushing us towards greater inclusivity, eg towards reduced reward differentials, so we need to be careful not to extend a differentiated approach too far.

There are some other recommendations I don't totally support as well.

 

Strategy is more than just differentiation

One of my problems with the book is that its approach to people management strategy is purely adding value (requiring that "line managers define success but that HR professional deliver the solution" by identifying the 'strategic capabilities' - business processes - which best align with the business strategy).  I agree that adding value is essential but to me, people management can only be truly strategic when it creates values too (ie it identifies other capabilities which will inform not merely support business strategy).

The authors seem to disregard the opportunities for creating value by competing on intangibles by explaining that "the line line of sight between workforce strategy and strategic success is typically so indirect that figuring out how to get from here to there is difficult... There are few instances where a selection system, a performance management system, or leadership development has a direct impact on the firm's bottom line, making it hard to see how these decisions translate into strategic success."  I agree with the authors here - it is hard.  But this doesn't mean that we shouldn't try to do it.

And I believe that HR will have much more of an impact if it improves the capability of the whole workforce - in line with an overall human capital management strategy, rather than by just enhancing the capability of those people in the most strategic jobs.

 

Of course, I may change my opinions on the book once I've read the later chapters.  I'll let you know if I do - or we'll probably be discussing the book in the next episode of TalkingHR.

 

Technorati Tags: Becker,Huselid,Beatty,the Differentiated Workforce,book review

 

• Consulting - Research - Speaking  - Training -  Writing
• Strategy  -  Talent  -  Engagement  -  Change and OD
• Contact  me to  create more  value for  your business
• jon  [dot] ingham [at] strategic [dash] hcm [dot] com

  .