Human Resources Director 14.11 by Key Media

HUMAN RESOURCES DIRECTOR HCAMAG.COM ISSUE 14.11

HOT LIST The who’s who of HR 2016

THE DEVIL IS IN THE DETAIL Disciplinary action and procedural fairness

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INSIDE HR Tabcorp on values and the ‘social licence to do business’

IS BESPOKE BEST? Leadership development in focus

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EDITORIAL www.hcamag.com NOVEMBER 2O16 EDITORIAL

SALES & MARKETING

Editor Iain Hopkins

Marketing & Communications Manager Lisa Narroway

Journalists Miklos Bolza John Hilton Editorial Assistant Hannah Go Production Editor Roslyn Meredith

Business Development Managers James Francis Steven McDonald Dale Ashworth

CORPORATE

ART & PRODUCTION

Chief Executive Officer Mike Shipley

Design Manager Daniel Williams

Chief Operating Officer George Walmsley

Designer Marla Morelos Traffic Coordinator Freya Demegilio

Managing Director Justin Kennedy Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

EDITORIAL ENQUIRIES iain.hopkins@keymedia.com.au

SUBSCRIPTION ENQUIRIES tel: +61 2 8011 4992 subscriptions@keymedia.com.au

WHEN THE GOING GETS TOUGH… THE HIGH-PRESSURE stakes of a merger or acquisition can be a valuable learning experience for HR professionals. Whether your organisation is the buyer or seller, rarely is HR given a greater opportunity to contribute to business operations than during this often-fraught time. As our Statistics infographic in this issue demonstrates (p4–5), M&A deals are on the rise globally. Significantly, according to a study by Mercer, 89% of companies listed talent issues in their top three integration challenges, including such pain points as employee retention, cultural integration, leadership assessment, compensation and benefit levels, and overall talent management. These people-related challenges exist in a highly competitive deal environment featuring truncated timelines, less access to information, and increasingly activist shareholders. In fact, 41% of buyers report

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Eighty-nine per cent of companies listed talent issues in their top three integration challenges less time to complete due diligence compared to three years ago, while 33% claim sellers are providing less information about assets for sale. Meanwhile, more than one third of sellers (34%) are finding more and more of their divestment resources are required to address HR issues. These risks are magnified when deals occur beyond national borders, which in 2016–17 is more likely to occur than ever: 50% of respondents reported recently conducting cross-border deals, and 24% are more likely to consider multicountry transactions than they were in January 2014. The report listed legislative and regulatory issues, cultural and operational mismatches, and differing leadership skills and expertise as being the factors that escalate the most in cross-border transactions. It’s interesting to note that several of the HR directors in our annual Hot List have been through the trials and tribulations of M&A activity – and most would agree their careers are all the richer for the experience. Iain Hopkins, editor

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NOVEMBER 2016

CONNECT WITH US Got a story, suggestion or just want to find out some more information?

CONTENTS

HOT LIST

14 COVER STORY

HOT LIST

HRD’s annual Hot List brings together the best of the best in the industry – an impressive group of high achievers in the HR profession PEOPLE

MAKING VALUES WORK FOR YOUR COMPANY While a ‘set and forget’ mentality about organisational values remains in many businesses, Tabcorp has taken a different approach by positioning values at the heart of business operations

HRDirector_au +Hcamag HumanResourcesDirector

UPFRONT 01 Editorial

FEATURES

TREAD CAREFULLY: DISCIPLINARY ACTION

The devil really is in the detail when it comes to disciplinary action and procedural fairness

How can HR earn its stripes during M&A activity?

04 The data

M&A activity globally is on the rise – and talent management is increasingly being seen as critical to any deal’s success

06 News analysis

With the FWC’s decision on penalty rates pending, HRD looks at the likely impact on employers

08 Upfront: Employment law How internal investigations can potentially hurt HR

10 Upfront: Technology

Can HR help ease ‘tech fatigue’ in the workplace?

FEATURES

WORKFORCE MANAGEMENT

HRD discovers how the insights gleaned from time and attendance data are the foundation of efficient and cost-effective workforce management strategies

PEOPLE 12 Head to head

Is Australia ready for unlimited annual leave?

54 Career path

Singaporean-born Melissa Wong has achieved much since she arrived in Australia in 1999 – she shares her career path with HRD

FEATURES

RECRUITMENT COMES OF AGE

HRD outlines why recruitment has morphed into ‘talent services’

HCAMAG.COM CHECK IT OUT ONLINE

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STATISTICS

NOVEMBER 2016

THE TALENT FACTOR IN M&As

GOING GLOBAL: ESSENTIAL HR DUE DILIGENCE

A new study has focused on the key HR elements to consider for M&A success M&A DEALS around the world are on the rise, with companies constantly looking to grow their businesses and improve operational efficiency and finances. For Australia-based companies, M&A activities may occur due to a desire to extend geographic and customer markets; increase production, sales and distribution capacities; and add new products and technologies. However, businesses need to be reminded of the people behind the scenes. Though the human capital is difficult to place a dollar value against, when integration is done right it offers sustainable competitive advantage

US$4.7trn Total value of M&A deals worldwide in 2015, a 32% increase over 2014

89%

Percentage of companies that included ‘talent issues’ in their top three integration challenges

and is key to successful M&As. Mercer’s inaugural report, People Risks in M&A Transactions, is the first to focus exclusively on the people factor and how it impacts on integration. The study identified a significant increase (32%) in global M&A activity for 2015, with buyers becoming more open to cross-border transactions. Such deals bring with them added risks due to cultural and legal barriers. Companies must not only consider the human capital in terms of finances but also its effect on the operations and contribution to the overall strategy of the business.

64%

Percentage of corporates that focused on senior talent acquisition and retention during M&A activity

57%

Percentage of private equity businesses that identified leadership team effectiveness as a top HR issue

SWEETENING THE DEAL Value drivers – buyers Facing shorter timelines, less information, stiff competition and potential cultural and legal differences in multi-country transactions, buyers must consider these HR practices to make sure all bases are covered: 1. Assess the leadership team and key employee capabilities.

Value drivers – sellers While contending with market volatility and the demands of investors, sellers must also maintain customer relationships and productivity while transitioning the business, and thus have to act on the following: 1. Consider a retention program for critical employee groups.

2. Develop effective retention strategies.

2. Leverage experienced sell-side advisers and separation specialists.

3. Have a clear culture, communications, and change management plan.

3. Consider providing a well-priced transition services agreement (TSA).*

4. Evaluate HR service, delivery and design needs.

4. Document a clear talent management/staffing plan.

A FOCUS ON REWARDS DURING M&AS Evaluating corporate reward schemes – from base pay to incentive metric/targets and non-cash rewards – is crucial during due diligence. Here’s what is being assessed: Medical benefits

91.7%

Defined contribution plan(s)

78.6%

Broad-based compensation

44.7%

Executive compensation

35.9%

HR compliance

24.3%

5. Enlist experienced resources to hasten the transition process.*

Executive contracts/change-in-control payouts

23.6%

6. Adopt an enterprise/global view to effectively manage benefits.

Global benefits

7. Leverage reward programs to attract and retain talent.

Minimum wage issues

*Assigning a project management office (PMO), integration management office (IMO) or separation management office (SMO) can accelerate decision-making and execution

Before going global, prepare thoroughly by considering HR governance in context. By adopting a holistic view, Mercer’s Global HR Governance Structure suggests buyers can mitigate risk by gaining a fuller picture of the issues that can impact on deal success. A comprehensive global strategy will instil financial discipline and compliance.

21.8% 18.0%

*For sellers providing support services during the transition period, a TSA helps mitigate reputational risk and cover costs

DB pension/post-retirement

17.5%

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CULTURAL CONCERNS

OPERATIONAL CONCERNS LEGISLATIVE AND REGULATORY CONCERNS - Data protection - Tax/remuneration - Employment law - Works councils - Social security - Reporting requirements - Record-keeping

- Vendor fragmentation - Currency issues - Location of records - Format and content of records - Technology utilisation - Process variations - Language - Foreign Corrupt Practices Act (FCPA) compliance - Harmonisation of contract renewals - Common vendor contract language - Fiduciary standards

TRENDS IN TALENT DUE DILIGENCE Sellers recognise the importance of allocating more resources and efforts to address HR issues during due diligence. Sixty-four per cent of companies agree that talent is the most significant aspect at this stage, and they are making the effort to assess the talent in the businesses involved on both sides of the deal.

- National cultures - Management style - Organisational culture - Local customs and practices

SKILLS CONCERNS - Complex stakeholder environments (eg works councils, unions, management, and supervisory boards) require very specific skills and engagement approaches - Accountable HR country resources

TOP PEOPLE RISKS 1. Employee retention 2. Cultural and organisational fit 3. Leadership team (quality of management/executives)

How much effort are you putting into HR issues when preparing for a divestiture? More effort 34% About the same 65% Less effort <1%

By what means are you learning about the talent involved in the deal? Conducted through external adviser 10% In-house talent assessment process 55% None 35%

4. Compensation and benefit levels 5. Talent availability, identification, assessment, and placement

POST-MERGER HR SYNERGIES Buyers require post-deal evaluation of the following for successful HR operations: Compensation and employee benefit alignment to market HR technology Cultural drivers for success Source: People Risks in M&A Transactions 2016, Mercer

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UPFRONT

NEWS ANALYSIS

PENALTY RATES UNDER REVIEW With the FWC examining whether Saturday and Sunday penalty rates should be aligned, is the review progressing along the right path? DO PENALTY rates attract people to work on weekends or holidays or are they just relics in today’s modern gig economy? This question has been examined since the end of 2014 through the Fair Work Commission’s four-yearly review of modern awards – the final decision of which could have very real impacts on employers and employees in retail and hospitality. However, employers are playing a waiting

of employment relations in Macquarie University’s Department of Marketing and Management and director of the university’s Centre for Workforce Futures, says the review itself is not drawing on enough empirical data; rather it has relied too heavily on economic theory and modelling. Professor Markey, who was part of the review process on the impending decision, has undertaken considerable research into the

“There’s a lot of research showing that people who work on the weekend … find it hard to make up for that lost time with family and friends during the week” Ray Markey game: in September the FWC unexpectedly delayed its decision on whether to cut Sunday penalty rates until at least December. Tribunal president Iain Ross called for further evidence from employers pushing for penalty rate cuts. The Australian reported in September that Commission members are believed to be sympathetic to employer arguments that penalty rate cuts are justified because of societal changes and, to a lesser extent, a positive employment impact associated with reducing penalties. Although the ultimate outcome is still hard to predict, Ray Markey, professor

effects of altering penalty rates, particularly in the hospitality and retail sectors.

Reasonable evidence While employers – and to some extent the Productivity Commission – have said that changing rates will have an impact on employment, empirical evidence of this has yet to be presented, says Markey. Additionally, he adds that surveys done by employer associations of their members have been biased. “These are members that are actually trying to reduce rates. They know that’s the argument, so of course it’s not a good survey technique.”

A second form of evidence, presented by economists, is an extrapolation from economic theory. This, Markey says, predicts that if the cost of labour is reduced, there will be increased employment. “But there’s actually no empirical data which shows this is the case, and that’s part of the problem.” The only data available on the impact of employee entitlements on employment is the minimum wage, and this has been argued for some time. However, the evidence is sketchy at best. “In some cases, employers may substitute older workers for younger workers, but even that’s contested. It’s not clear cut, so there’s no empirical data about employment.”

Conflicting results If Sunday penalty rates are aligned to Saturdays, one possible impact for employers could be an increased difficulty in finding staff to work on Sundays, Markey says. This prediction is hinted at in the Australian Work and Life Index (AWALI) survey (see box).

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MIXED MESSAGES AWALI SURVEY HIGHLIGHTS 18.3% of workers regularly work on Sunday 29.6% of workers regularly work on Saturday Sundays were associated with higher work-life interference than Saturdays AI GROUP SURVEY HIGHLIGHTS 26.6% of workers preferred to work on Sunday 28.6% of workers preferred to work on Saturday 70.5% of workers would work more hours on Sunday if offered 72.3% of workers would work more hours on Saturday if offered “There could likely be a supply problem if penalty rates are reduced on Sundays. The vast majority of people who work those days don’t do it for any reason other than the money.” The AWALI survey found that 17% of those who worked on Sundays did so for the flexibility this offers, while 83% did so because of the higher rates, Markey says. These results are in stark contrast to a recent survey of fast-food workers about their employment preferences by the Australian Industry Group (Ai Group), which found that there was no preference by employees for working Saturdays or Sundays. According to Ai Group survey (see box), the most common reason given for employees wanting to work on Saturday rather than Sunday was that they wanted to spend time with their family on Sundays. While employees aged 15 years and under said their preference for working on Sunday was due to sporting commitments on Saturdays, those aged 16–24 years said their preference was based more on friends being available to socialise on Saturdays.

This survey has been questioned by the FWC, which has asked for further evidence from the Ai Group. “The Fair Work Commission has questioned that very strongly and a decision is now probably delayed by a couple of months,” Markey says. He adds that the Ai Group survey runs contrary to most other research, which shows that people working on Sundays consider it an unsociable time. “There’s a lot of research showing that people who work on the weekend, evenings, and especially Sundays, find it hard to make up for that lost time with family and friends during the week.”

A renewed focus In general, there are several areas where additional research should be conducted before the FWC comes to its final decision, Markey says. For instance, since penalty rates have been introduced in different states incrementally, this could be examined further. “New South Wales had these rates for much longer than Victoria. When they were

introduced in the 1970s or 1980s in Victoria, if you track employment level, there’s not much difference in the pattern afterwards.” Determining what the real operational costs are for employers is another area that could be looked into. For instance, Markey says that for 25–50% of businesses in the retail and hospitality industries, employee costs are actually quite small comparative to other operating costs. “It has been suggested to me by a couple of businesses that the real issue is actually rent. I don’t know if they’ve got empirical evidence on this, but what seems to happen is that after three years when they renegotiate their rent and after they’ve established their current base, the rent often goes up significantly.” This warrants further investigation, Markey maintains. If rent is the real issue, a reduction in penalty rates may not have much of an impact on profitability as it fails to tackle the underlying problem of increasing rental costs.

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UPFRONT

EMPLOYMENT LAW UPDATE NEWS BRIEFS Employer under fire for paid graduate scheme WBH Legal retracted a controversial graduate program charging applicants $22,000 for a two-year work placement. The scheme – intended to be run by WBH’s Adelaide-based adlawgroup – was questioned by the Law Society of South Australia and investigated by the Fair Work Ombudsman, who indicated that charging employees for work might be be illegal. A year after its suspension in September 2015, WBH Legal announced that the program would not be reintroduced as it would be seen as “an elitist solution to the fundamental problem of too many graduates and too few opportunities in law”.

Worker sacked for ISIS post unfairly dismissed Aerocare Flight Support was ordered to pay $4,800 to former employee Nirmal Singh after he was unfairly dismissed for posting controversial statuses on Facebook that implied ISIS support. The Fair Work Commission informed the firm that the latter had not properly reviewed Singh’s account and had not given him ample time to explain his posts; the management team was also not fully informed of the situation. Furthermore, the decision of the firm to dismiss employees based on social media posts that, according to witnesses, did not violate the policy, was deemed invalid.

Domestic violence leave under fire The Australian Industry Group (Ai Group) has challenged the domestic violence leave proposed by the Australian Council of Trade Unions (ACTU). ACTU called for 10 days of paid domestic and family violence leave in its modern awards submission to the Fair Work

Commission. Ai Group countered that the eligibility of the entitlement was unclear due to the use of the term “experiencing [violence]”, which could result in perpetrators of violence taking the leave. ACTU has responded, saying that it is apparent that eligibility for leave is reserved for victims only.

Landmark decision clarifies redundancy calculations The Fair Work Commission has ruled that regular and systematic periods of casual employment will count towards total redundancy payouts under certain circumstances, following a dispute between the Australian Manufacturing Workers’ Union (AMWU) and Forgacs Engineering/Donau. After Forgacs’ layoffs in July 2015, AMWU made an appeal for casual-turned-permanent workers, challenging the length of service required for final redundancy payouts. The case was accepted after a second appeal led to deliberation on how “regular and systematic employment” was defined in the Fair Work Act and triggered the casual conversion clause.

Legal issues on Snapchat at work Seyfarth Shaw partner Justine Turnbull has voiced concern over the use of Snapchat in the workplace, explaining how “complication arises because of its auto-destruct nature”, which removes proof of bullying and harassment and makes it “more likely to be used for inappropriate conduct”. In so doing, other evidence such as interviews with witnesses and the word of the alleged victim and the alleged perpetrator must be taken into consideration. Turnbull suggested that social media policies should include aspects of inappropriate workplace use and staff should be properly trained on these matters.

HOW INTERNAL INVESTIGATIONS CAN HURT HR HR may be trying to solve it all, but at what expense? What are some common HR mistakes made when conducting internal investigations? Fay Calderone, partner in the people & workplace services group at DibbsBarker, gave HRD some practical advice on how to minimise personal and corporate risk. Firstly, it’s critical to follow internal policies and procedures in place. Provision for investigation in the grievance procedure should be brief and flexible to enable the organisation to use internal or external investigators as necessary. Calderone cited the case of Goldman Sachs JB Were Services Pty Limited v Nikolich (2007), in which an employee was awarded more than $500,000 for psychological injury as a result of a breach of contract. The policy manual was said to have been incorporated into the employment contract that the employee was required to sign. “In that [policy/contract], there was a statement that said the employer would take every practicable step to protect his health and safety while at work. By failing to investigate this matter and properly shelter him from the supervisor he had made allegations about, they were in breach of that.” Thus, the recommendation is that the grievance procedure should not be contractual, so that an employer’s failure to follow the policies cannot crystallise into a breach of contract claim for the employee, Calderone said. HR must also remain impartial throughout the process. If the initial outcome of the investigation proves unsatisfactory for the complainant, HR should not insist on continuing investigations by themselves as impartiality could already be compromised. Lastly, HR should consider injecting the “veil

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of professional legal privilege” into an investigation, Calderone said. This prevents the full contents of a report from being disclosed in a court case by choosing to conduct the investigation through an external lawyer from the outset. However, it is important to weigh up the commercial costs of conducting such an external investigation, especially since some matters won’t warrant taking such extensive action, she said.

HR must remain impartial throughout the process Calderone cited two instances in which an external investigation would be preferred: significant bullying allegations and sexual harassment claims. “Any significant bullying complaint has the risk of a report to the regulator, so to Safe Work. Then Safe Work can come in and ask for the report to be produced and used as the basis to prosecute the organisation on its findings. “The other one is sexual harassment. I find sexual harassment allegations tend to be a bit more cultural. Some of the more systemic sexual harassment cases that we see don’t tend to be isolated individuals. They tend to be groups of individuals who may very well implicate senior leaders in the business.”

Q&A MEDICAL EXAMINATIONS:

Paul O’Halloran Partner and accredited specialist (workplace relations) FCB WORKPLACE LAW

Fast fact In the case Cole v PQ Australia Pty Ltd T/A PQ Australia, PQ Australia was fined $45,900. The Fair Work Commission ruled that the decision to force Mr Cole to attend a medical exam was unreasonable in the circumstances.

WHERE DO YOU STAND? Under what conditions can HR make an employee medical examination compulsory? Referring an employee to an independent medical examination (IME) will generally be compulsory where the employer has concerns that an employee cannot perform the inherent requirements of their job, or where they pose a safety risk to themselves or others at the workplace. For example, a common scenario is where an employee has sustained a physical injury that prevents them from undertaking manual tasks forming a major component of their job. Sadly, we are also seeing an increase in mental illness at work, so referral to an IME is a good idea if symptoms suggest severe depression, drug abuse or self-harm. What steps should HR take here in order to reduce any legal risks? Although the right to refer an employee to an IME can be referenced to statutory work health and safety obligations, to avoid issues associated with an unwillingness to attend it is a good idea to include contractual terms relating to IMEs in individual employment contracts and relevant policies. It is also essential that HR is able to articulate the “inherent requirements” of the particular role held by the employee who is the subject of the IME. This is the criteria against which the doctor will determine the employee’s capacity and fitness to return to work and any reasonable adjustments HR will need to make to assist the employee. Managing ill or injured employees is one of the most complex areas for HR because it overlaps with numerous areas of law, including unfair dismissal, workers’ compensation, adverse action and discrimination. Don’t be afraid to refer employees to IMEs for this reason alone. If an IME can be justified on health and safety grounds, employees are not immune from attendance merely because they may be exercising some other workplace right at the time, such as being absent on sick leave or workers’ compensation. Lastly, employers should carefully choose the IME provider. A suburban GP will rarely be adequate. A specialist IME provider should be used and detailed correspondence must be provided, asking questions about the employee’s prognosis, diagnosis and capacity to undertake the inherent requirements of the role. In some cases, legal privilege may be required over the IME report so that it is not disclosed to the employee or subject to disclosure in litigation. In these circumstances, engaging a lawyer before the IME will be necessary. If an employee refuses a medical examination, what should HR do next? If done properly, referral to an IME should amount to a lawful and reasonable direction. Refusal to attend can be treated as a disciplinary matter. HR should provide the employee with an opportunity to respond to the reasons for non-compliance before considering the disciplinary outcome. Case law in this area confirms that dismissal may be appropriate in some cases.

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UPFRONT

TECHNOLOGY UPDATE

SUFFERING FROM TECH FATIGUE Where can we draw the line when it comes to technology?

expectations can steal employee resources even when actual time is not required – simply because employees cannot fully separate from work. The expectation doesn’t have to be explicit or part of written policies. It can be a normative standard of behaviour at the company or defined by leaders as acceptable. “Thus, if an organisation perpetuates the ‘always on’ culture it may prevent employees from fully disengaging from work eventually

Managers can directly express their expectations regarding emails and other after-hours work It seems like common sense that replying to emails after work hours may cause employees to stress out. And yet it’s also so easy to justify replying to or sending out just one last email. Recent research, however, suggests that that ‘one last email’ is a big job stressor that could potentially lead to an employee’s emotional exhaustion. The study, authored by Liuba Belkin of Lehigh University, William Becker of Virginia Tech, and Samantha A Conroy of Colorado State University, is the first to “identify the emailrelated expectations as a job stressor along with already established factors such as high workload, interpersonal conflicts, physical

NEWS BRIEFS

environment, or time pressure”, according to Science Daily. What the authors have found is that it isn’t the number of emails or the amount of time spent on them after work hours that causes exhaustion. Rather, it is the organisational expectation of replying that causes anxiety. Calling it “anticipatory stress”, Belkin and company describe it as “a constant state of anxiety and uncertainty as a result of perceived or anticipated threats … that makes [employees] unable to detach and feel exhausted regardless of the time spent on after-hours email”. The authors argue that this cultural environment suggests that organisational

VR technology may soon replace conference calls

Businesses could potentially be looking at virtual reality as an option for business meetings within the next two years as technology advances enough to make geographic distance between colleagues a thing of the past, according to Professor Andrew Glennester of Reading University. He said that even eye contact and handshaking would be as realistic as if everyone was in the same room. However, some VR developers, such as Jonathan Wagstaff of Context, believe conference calls will remain popular as VR technology may still be too costly and will be more helpful for collaborative working. 10

leading to chronic stress,” Belkin says. They detail their findings in the article and urge managers to combat this issue by coming up with programs that can help employees detach. One suggestion is to have email-free workdays or a rotating schedule on replying to emails after work to help manage work-life balance. Managers can also directly express their expectations regarding emails and other afterhours work, such as limiting them to a certain number of hours or up to certain times. “We believe our findings have implications for organisations, as even though in the short run being ‘always on’ may seem like a good idea because it increases productivity, it can be dangerous in the long-run,” they write.

How emotion-detecting technology can help HR

Researchers at Massachusetts Institute of Technology have revealed the EQ-Radio, an emotion-sensing app that uses wireless radio signals and boasts a reported 87% accuracy rate. The device may prove useful in advertising, health care, and even in the workplace, where managers need to read the non-verbal cues from employees in order to lead them better. Other apps available to managers at present include TINYpulse and Morale, which is another emotion-based app that lets team members rate their moods for the day, thus helping managers track morale.

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Q&A

TELL ME A STORY… Mike Erlin Managing director, Australia & New Zealand Cornerstone OnDemand

Fast fact According to Deloitte’s 2015 Global Human Capital Trends report, 75% of companies believed that using people analytics was ‘important’ but just 8% felt their organisation was ‘strong’ in this area.

How does the art of ‘storytelling’ apply to data analytics in HR? HR data analytics is not yet a common language across most businesses. Mastering what data analytics can bring to the business is a journey that requires a set of capabilities to uncover the drivers that lead to new opportunities and decisions that can affect change in a business. Stories help HR deliver more strategic value to the business by taking the audience (eg executives) on a journey. Through stories, the storyteller provides direction and points of relevance to focus the audience on the items that drive action and positive change for the business. Good stories bring people of different backgrounds and mindsets to a common point of reflection. From this point, they can each consider the impact, positive or negative, that the story’s message will have on them and, if done well, it will compel them to be a part of the required action and change.

What crucial aspects are needed to craft a data ‘story’? The beginning, middle and end are pretty crucial. Start at the end with what success looks like: What is the end point of the journey? A change. Next, work backwards: What do you want to compel

Developing the liquid workforce

Accenture’s Technology Vision 2016 has identified that, with the continuing investments made in technology, organisations should also invest in their workforce to produce more flexible, multiskilled employees – “workforce chameleons” – who know how to use the technology and can use it effectively to create adaptable and change-ready work environments that can meet the demands of the 21st century. To achieve this, organisations must implement learning as a core competency, promote agility and innovation, and generate insightful analytics that show organisational capabilities and improve workforce responsiveness.

your audience to do to drive the change you seek? An action. With that clearly understood, work backwards still: How do they need to feel in order to be compelled to take the required action to drive the change? An experience. Finally, the start: What does your audience need to know? The scene. Adopting a policy to recruit an age-diverse workforce (an action) will drive a two-point increase in customer satisfaction and a $7m improvement in operating margin across the business (a change).

How can HR best communicate this story to the C-suite or workforce? Be ready and competent to deliver the story. Ready might mean you get to leverage your online learning to freshen up your presentation and/or sales skills. With that complete, consider graphics, video in support of the ‘experience’, and be prepared to take your executives on a journey to realise that change. Competent might mean you understand the tools and skills within your department, you’ve analysed the available data, gained the appropriate insights, have modelled different scenarios that will drive the change needed in the business, and have a story that will cover the journey. You will move mountains! Good luck.

Technology may lead hierarchies to crumble

An ADP study has shown that 86% of workers in Asia-Pacific believe that departments and hierarchies in the workplace will eventually cease to exist. Australian workers in particular welcome greater autonomy at work: 80% are positive about defining their work schedules and 78% are confident about adapting to constant role-shifting. Seventy per cent of Australians already see how use of technology encourages independence, productivity and performance. Nevertheless, 58% of workers are sceptical about their company taking enough risks to keep up with tech changes.

Free rostering tool helps retailers

In response to a series of highprofile prosecutions related to underpayment of workers in the industry sector, the National Retail Association (NRA) and HRM software developer Rision have launched the Roster Coster, a free online tool designed to help retailers ensure they meet their legal obligations to employees. NRA CEO Dominique Lamb acknowledged the difficulties employers faced in complying with the General Retail and Fast Food Industry Awards, and also explained how the tool would help “maximise efficiency and optimise staff deployment”, on top of helping them abide by the law. www.hcamag.com

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PEOPLE

HEAD TO HEAD

GOT AN OPINION THAT COUNTS? Email hrd_editor@keymedia.com.au

Is Australia ready for unlimited annual leave? Is it time to shake up the notion of four weeks of paid annual leave and introduce something more flexible to match the ebbs and flows of work – and the demands of employees?

Amantha Imber Founder Inventium

If trust levels are high between management and employees, then yes, Australian organisations are ready. However, if managers don’t trust their staff, then an unlimited leave policy will simply result in paranoia from management that staff might abuse the policy. There are plenty of companies within Australia where engagement levels are high. When you have a fundamentally healthy culture, unlimited leave is more likely to be effective. Just keep an eye on the impact of social norms and how these can impact the success of such a policy. For example, if the norm in your company is one of people not wanting to take leave for fear of being seen as slacking off, then unlimited leave will probably not fix this.

Katie Burke

Rebecca Nash

Vice president of culture and experience HubSpot At HubSpot, we’ve had an unlimited vacation policy since 2010. Since we started it, we’ve added five new offices (including Sydney) and over one thousand people. We have almost 1,500 employees who have logged countless airline miles, enjoyed flexible time with their children and significant others, and taken up or expanded upon their hobbies. We believe that your work should fit into your life rather than your life fitting into your job. We hire remarkable people and give them a considerable amount of responsibility and autonomy. Instead of reduced productivity, we believe people are more engaged and focused because they can spend less time on permissions slips and more time on work they love doing.

Group executive people & culture Perpetual Australian businesses are redefining flexibility. There is no one-size-fitsall approach, and it’s important for employees to work with their employers to determine how, where and when they work, to cultivate a culture that encourages and promotes flexibility. Flexibility is about empowering your people to be the best they can be, and there are many different ways to achieve that. If unlimited annual leave is part of the toolkit – if an organisation feels they are ready to offer it as an option to their employees – then absolutely it is something that should be explored.

IS UNLIMITED LEAVE THE NEXT FAD FOR EMPLOYEE BENEFITS? While organisations have differing policies and methods for handling leave requests dependent on the nature of the work, an ‘honour system’ of unlimited leave is becoming more prominent in US organisations and is now taking root in Australia. ‘Unlimited leave’ is used as a catch-all term for heavily relaxed leave policies, although in practice these still often involve structure to some degree, such as an individual’s leave having to be approved by their team. Others have taken it to the extreme. “Our vacation policy is simple and understandable: we don’t have one. We focus on what people get done, not on how many days they worked,” said Reed Hastings, CEO of Netflix.

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27/10/2016 1:14:48 PM

OPINION

DIVERSITY & INCLUSION

Brought to you by

HR’S REVERSE DISCRIMINATION CHALLENGE Ciaran Foley, Head of Frazer Jones, Australia, discusses the potential impacts of gender biases in business I’VE BEEN thinking about writing this article for a little while now. I’ve been hesitant to do so because I’m conscious that this article would be much better written by a female who would undoubtedly be able to draw upon work and life experiences that I can’t as a male, but here goes. In over 15 years of working in people and recruitment related roles, I’ve met hundreds of exceptional HR professionals. They are all passionate about how HR can positively impact on an organisation. The vast majority are also well aware that a diverse workforce will always offer more potential for growth and opportunity than a one-dimensional workforce. The HR profession has paved the way for executive gender diversity and making senior leadership roles more appealing to women. Across the ASX Top 50 companies, around 75% of HR heads are currently female. Interestingly, a similar percentage is reflected in Frazer Jones’ Global HR Survey, which sought the opinion of nearly 3,500 HR professionals around the world: 70% of the respondents in Australia were female, compared to 62% globally. It can’t be any coincidence that the number of senior female HR leaders are an inspiration to young females entering the workforce – and that is a good thing. It is a shame that other business units don’t appear

to have the same number of female role models as HR does. For many organisations, the diversity discussion has progressed past gender; however, given that HR comprises higher numbers of women than other functions, this is a gender issue that needs addressing.

traditionally held by males. If this doesn’t happen, I wonder whether HR is itself in danger of becoming one-dimensional. Ironically, when we are asked to recruit more junior HR roles, if gender is ever referenced it will usually be along the lines of “We would love to hire a guy into this role

“Business leaders need to consider the gender bias in HR … If this doesn’t happen, I wonder whether HR is in danger of becoming one-dimensional” Ciaran Foley, Head of Frazer Jones, Australia I have personally been instructed to run search assignments for senior HR professionals where it has been strongly suggested that a female would be a good fit for the role. In every case, the reason behind a preference for a female was the lack of female representation on the leadership team. Nonetheless, my role is to source the strongest shortlist, regardless of gender. Business leaders need to consider the gender bias in HR, the gender split of other business units, and start to take a more aggressive approach to the recruitment of female leaders into roles which have been

as there are so many females in the team…” – and therein lies the challenge for HR. More and more females are choosing to enter and build careers in HR, whereas more and more men are choosing to pursue different career paths. Given the gender bias across different business units, it is easy to see why both parties are making these decisions. For a more detailed look at diversity and inclusion in Australia versus the world, pre-request your copy of Frazer Jones’ Global HR Survey from our website – www.frazerjones.com/australia.

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27/10/2016 1:15:56 PM

COVER STORY

2O16 HOT LIST

HOT LIST 2016 HRD’s annual Hot List brings together the best of the best in the industry – an impressive group of high achievers in the HR profession

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27/10/2016 1:37:05 PM

IT’S ALWAYS a pleasure browsing through the final list of HR professionals featured in HRD’s annual ‘who’s who’ guide. These are the people who continue to add value to the profession and increase its standing in the business world. Some of them have appeared in our previous Hot Lists, proving their staying power; others have featured in the magazine over the past 12 months. Then there are the new contenders: they’ve launched innovative initiatives, tackled tough business-critical challenges, or moved the dial on persistent issues like diversity and inclusion.

Many have already been acknowledged as industry leaders – some have picked up accolades, such as at the Australian HR Awards, and others work for organisations that have been applauded as employers of choice by the likes of Aon Hewitt and the Great Place to Work Institute. Significantly, it’s not all about bright optimism; some HR professionals on the list are in declining markets or companies that are struggling to reinvent themselves. Rain, hail or shine, HR continues to prove its worth, as the leaders on the following pages prove.

HOT LIST INDEX NAME

ORGANISATION

NAME

Bashinsky, Alec

PAGE

Deloitte

Jenkins, Kate

Cash, Michaelia

Minister for Employment

Cook, Dan

DEXUS Property Group

Corr, Suzette

Dawson, Tim

Doyle, Cathy Dunn, Sarah

PAGE

ORGANISATION

Australian Human Rights Commission

Keogh, Alla

MYOB

Kincaid, Sally

QBE Australia & New Zealand

ANZ

Mourra, Naomi

BBC Worldwide

Allianz Australia

Murphy, Steven

Tourism Australia

McDonald's Australia

Paine, Matthew

ICC Sydney

Adobe Asia-Pacific

Phipps, Michelle

Brown-Forman

Duetoft, Klaus

eBay

Phipps, Rob

KFC Australia

Egan, Kellie

Atlassian

Purtell, Alicia

Lion

Fleming, Amanda

Coles

Sammut, Sarah

Fitness First

Fraser, Helen

AECOM

Scriven, Jon

Qantas Group

Garcia Bernal, Susana

NBCUniversal

Smith, Graeme

Philip Morris International

Hartnett, Peter

Sanitarium

West, Adrian

Cisco

Hyman, Barb

REA Group

Wiblen, Leith

The Star Entertainment Group

Jenkins, Ingrid

Microsoft Australia

Winnett, Ashley

GM Holden

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27/10/2016 1:16:26 PM

COVER STORY

2O16 HOT LIST ADRIAN WEST Head of HR, Australia & New Zealand, Cisco

MATHEW PAINE HR director, ICC Sydney

Mathew Paine joined ICC Sydney in 2014 after seeing the plans for the new Sydney Convention Centre. Paine effectively had a “clean slate” to create HR how he wanted it. This meant conceptualising all the processes, procedures and systems, envisioning a new culture together with the CEO, and recruiting for 1,500 part-time and 300 full-time roles. In line with the massive recruitment drive, the company announced an education partnership with the TAFE NSW Sydney Institute to set up education programs for TAFE students and provide career progression-related training for staff and selected students. For Paine, the goal is creating long-term careers for employees – and once the hype around the ICC Sydney opening subsides post-December, he’ll be implementing more robust and sustainable talent management initiatives.

As one of Aon Hewitt’s 2016 ‘Best Employers’, Adrian West has played a key role in creating Cisco’s culture of trust and boosting its commitment to workplace flexibility and gender equality. West believes that an effective HR director can communicate the overall direction and strategy effectively to key stakeholders by first “focusing on raising the profile of the overall HR function … then promoting and managing the success of specific initiatives or programs of work”. One major initiative is the ‘People Deal’, which includes replacing outdated annual performance ratings with regular conversations between staff and managers. Another is a salary review across cultural and gender categories. West feels there’s still a lot to be done for gender equality. He says: “We are a great place to work for females, [but] I want us to be the best.”

KELLIE EGAN

HR director, Australia & APAC, Atlassian

It’s been a massive 12 months for the Aussie software tech company. In December 2015, Atlassian’s float on the Nasdaq went without a hitch, raising US$634m, making it the most successful Australian listing ever on a US market. Apart from the vision of co-founders Mike Cannon-Brookes and Scott Farquhar, the recurring key to Atlassian’s success has been its HR practices. Kellie Egan has been in the industry for over 15 years and has been part of Atlassian since 2013. One creative HR initiative was the company’s global recruitment campaign in 2015, which was just as fast-paced and fun as a marketing campaign. To recruit five UX (user experience) designers in five days, the HR team found the top talent-rich cities in Europe, came up with a tagline, ran an online advertising campaign, and drove a VW Kombi van around Europe, interviewing and picking up ‘UX Surfers’ along the way.

DAN COOK

General manager, people & culture, DEXUS Property Group

“People felt we were doing the fundamentals well, but what they were looking for was more of a focus on health,” Dan Cook tells HRD. “Many of our people have an interest in health and wellbeing, and flexibility.” The DEXUS wellbeing initiative starts from the physical environment – the WELL Building, which includes building features that contribute to health and wellbeing. They address factors such as air quality, lighting, acoustics, thermal comfort, and active design. Instead of having the HR team arrange a long list of health/fitness programs, Cook has introduced Wellbeing Communities, which are empowered to make critical decisions relating to wellbeing. Composed of volunteer employees, the communities address five categories/areas of emphasis – D&I; Mind, Body and Nutrition; Workplace and Social; Professional Development and Careers; and Benefits and Recognition.

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27/10/2016 1:16:30 PM

HELEN FRASER HR director, AECOM

When asked about Helen Fraser’s role in the company, CEO Lara Poloni said: “The role is more business adviser than anything. We have a vision for where we want the business to go, so I rely on Helen’s advice and her team to help us achieve a lot of those business objectives, and provide clarity and an action plan.” As the strategist, Fraser knows that to get to the best outcome it must start with the people: “HR has to be key because a big part of change management is about changing people’s behaviour.” It’s been a busy time for Fraser. She worked closely with her NZ colleagues on the integration of URS NZ with AECOM NZ. This involved migrating all URS staff onto new contracts, benefits, hours, etc. Even more impressive was the announcement that AECOM would commit 5% of additional salary budget to address gender pay inequality – said to be a first in the traditionally male-dominated engineering and construction sector.

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27/10/2016 1:16:39 PM

COVER STORY

2O16 HOT LIST A GREAT YEAR FOR…

JON SCRIVEN

Group executive human resources & office of the CEO, Qantas Group

The turnaround in Qantas’s fortunes in the space of three years is remarkable. After posting one of its biggest ever yearly profits ($1.02bn) in the 2015/16 financial year, the company rewarded around 25,000 workers, including pilots, cabin crew, ground staff and check-in staff, with a hefty bonus. Personnel were only eligible for the bonus if they were covered by an EBA that included an 18-month pay freeze – which was outlined in the $2bn Qantas Transformation program launched in February 2014. At the time the company was again deemed profitable, Qantas offered a one-off bonus to staff affected by the pay freeze, equivalent to 5% of each employee’s salary. To further promote this quick turnaround and increased profitability, Qantas also launched a series of initiatives which increased engagement to 79% across all areas of the group – an increase from 68% in 2012. These initiatives included improved health and safety metrics, an employee peer recognition program, a flexible work program, and a new program to tackle unconscious bias.

BARB HYMAN Executive general manager, people & culture, REA Group

Barb Hyman has always firmly believed that HR can and should adopt a marketing mindset, especially in recruitment. “Representing our employer brand and telling the story of our culture is a critical capability which, when done right, enables us to make connections with high-quality talent.” True to form, in June 2016, REA Group was named as a LinkedIn Top Attractor and was the sole company featured from both the digital and media industries. In August, it was named Best Employer at the B&T Women in Media awards for its achievements in promoting workplace equality. This included its innovative parental leave provisions and increasing female representation at all levels of the business. For Hyman, it always goes back to looking after their people. “While it’s great to be recognised as a top employer externally,” she says, “how our people feel about working at REA Group is just as important to us … our people are our best advocates.”

STEVEN MURPHY

General manager, people & culture, Tourism Australia

In response to ongoing digital disruption, which is impacting on roles and departments within Tourism Australia, Steven Murphy and his team are running a change program that involves understanding global best practices and working with specialists on creating clear role descriptions that incorporate cultural and legal differences across countries. In sourcing and developing talent, his team is changing the traditional requirements for roles in terms of educational background/work experience – for example, for PR roles, considering those with backgrounds in behavioural science, design, and entrepreneurship, and not just degrees in journalism/communications.

NAOMI MOURRA Head of HR, ANZ, BBC Worldwide

Since joining BBC Worldwide in 2009, Naomi Mourra has focused her attentions on talent development, having launched a global management system, an induction program, training and development programs, and wellbeing initiatives during her tenure. In 2013, she was appointed as head of HR, and thus far she’s been working to keep HR simple but also “very different” – specifically in terms of communication. To achieve both objectives, Mourra uses humour to cut through the ‘white noise’ of corporate communications, particularly around aspects of HR that may be stressful or worrying (such as appraisals or bonuses). She’s known for showing engaging video presentations in order to lighten things up, or sending quirky emails to ensure people don’t instantly hit ‘delete’. As head of HR, she sees her role as “a conduit between the workforce and [the] MD”, and has prompted the MD to embrace hot-desking in order to get a holistic view of BBC Worldwide’s people.

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27/10/2016 1:16:38 PM

BEST OF THE BEST The Australian HR Awards ‘HR Director of the Year’ category is one of the most hotly contested. This year the finalists included: Sarah Sammut, Fitness First Australia Caroline Bosch, Honeywell Alla Keogh, MYOB Peter Hartnett, Sanitarium Health and Wellbeing Tania Abbotto, Sportsbet.com.au Leith Wiblen, Star Entertainment Group Erin Cramlet, Stryker South Pacific Michael Johnston, Westpac Group The independent panel of judges gave the accolade to Peter Hartnett of Sanitarium – see his profile on p25 of this Hot List.

SARAH DUNN Head of people resources, Adobe Asia-Pacific

SUSANA GARCIA BERNAL VP, HR, Asia-Pacific, NBCUniversal

Susana Garcia Bernal oversees the HR function in a detailed ‘matrix structure’ covering over 550 employees in six businesses across 12 countries in the Asia-Pacific region. Despite the scope of her work, Garcia Bernal believes in the importance of “paying attention to the small details”, especially when celebrating cultural differences. Being “an introvert Spaniard” based in Asia and having worked in different countries and industries have both certainly helped her develop this cultural sensitivity. In terms of D&I initiatives, Garcia Bernal and her team launched OUT in Australia, an LGBT group that also has a presence in the US, Singapore and London. In April this year the company launched a comprehensive leadership development program, the Talent Lab Space, based in Singapore. The Singapore Lab follows on from similar concepts in New York, LA and London, and provides a suite of L&D experiences matched to key transition points in an employee’s career.

Adobe Australia has just been included (for the fourth time in a row) in the annual Best Places to Work list compiled by Great Place to Work Australia, making Sarah Dunn a proud member of a winning company and HR team. The award reflects the company’s performance in five key areas: credibility, camaraderie, respect, fairness and pride. Adobe has taken strides in terms of offering flexible work conditions – particularly by providing generous parental leave for Australian and New Zealand workers. Going beyond the traditional maternity and paternity leave provisions, Dunn and her team have introduced leave for primary and non-primary caregivers, and have extended the paid leave period by a factor of four times the original offering.

ALLA KEOGH

Head of people & performance, MYOB

Alla Keogh takes great pride in seeing her team grow within the business, to the point that other leading organisations approach them for insights and advice on best practice. Keogh is focusing on L&D in order to keep that growth momentum. In 2015, the team launched a holistic L&D program – Learning Lab – which has been breaking participation and employee satisfaction targets every month. From an immersion and onboarding program for new team members to development journeys for managers, Keogh ensures that all employees receive the training they need “to achieve competitive advantage in a disrupted market”. She offers practical advice to other HR leaders: remember the ‘people’ element and don’t just focus on numbers: “[We have to] move away from making decisions based purely on cost, efficiency and ROI, to approaching every problem from the user’s perspective.”

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27/10/2016 1:16:42 PM

COVER STORY

2O16 HOT LIST SUZETTE CORR

General manager, HR, ANZ

Suzette Corr joined ANZ in 2008 and has since held several roles in the bank’s HR function. However, it’s in her current role that she has perhaps hit her stride, becoming an advocate for putting the ‘human’ back into human resources. Corr’s priorities include diversity – she is part of ANZ’s Notable Women group – as well as staff engagement and financial performance. Concerning the latter two, she says: “HR can be both human-focused, as well as commercial … I think it’s actually given us a stronger position at the executive table … because of the balance.” Furthermore, Corr explains how the human element – as exemplified by the ethics and the integrity of the business – directly affects the commercial. “Consumers refuse to support businesses they do not trust, so ultimately this is about an organisation’s sustainability,” she says. For her, HR has a crucial role in managing the intangibles, such as brand, consumer trust, employee relations, and leadership strength.

SALLY KINCAID

CHRO, QBE Australia & New Zealand

ALEC BASHINSKY CHRO and people & performance partner, Deloitte

One of HR’s most continuously innovative leaders, Alec Bashinsky has again scored a spot on HRD’s Hot List. This year alone, Deloitte’s HR team, under Bashinsky’s stewardship, won HR Team of the Year (>1,000 employees) and Best Graduate Development Program at the Australian HR Awards. The firm has formulated a people and performance strategy, called P&P Talent 2020, which aims to create an “extraordinary talent experience”. Of the strategy’s highlights, one stands out in particular: the new approach to performance management, which is rightfully called ‘StandOut’. Bashinsky explains the reason for “blowing up” performance management: “We need something nimble, to operate in real time, that can be managed at a local office level, and fuels future performance rather than assessing it in the past.” For the P&P team, this meant replacing the outdated and cumbersome rating system with frequent ‘check-in’ conversations between team leaders and members. It also involves team leaders regularly receiving team pulse survey results via a customised mobile app and online portal. StandOut has received an average of 690 performance pulses per month for the first half of 2016.

Since joining QBE in 2012, Kincaid and her team have kept busy with the company’s global operational transformation program, which has primarily revolved around building the Group Shared Services Centres (GSSC). To support this, the HR team worked hard to maintain employment of valued employees through knowledge transfer and workforce planning. Over 200 Australia and New Zealand Operations (ANZO) SMEs were tapped to coach and mentor the company’s GSSC partners in the Philippines. A new GSSC intern development program was introduced that allowed high-potential employees in the ANZO to participate in an 18-month internship. Another focus is workplace diversity. To implement relevant initiatives, the team sources ideas from employees, through their online platform, on how to address gaps in various areas – generational, multicultural, disability, and gender. The company has won a spate of accolades, including Employer of Choice in 2015 at the Australian HR Awards.

INGRID JENKINS HR director, Microsoft Australia

To stay ahead of market disruptions, Ingrid Jenkins makes sure her team stay focused on their agenda: accelerating cultural transformation and equipping employees for continuous modernisation of the workplace. Though Jenkins is only just about to reach her first anniversary at the company, she has been working hard to keep up to speed with the strategic agenda and channeling all HR efforts to achieve the Microsoft vision of ‘Mobile First, Cloud First’. In response to criticisms about the lack of D&I initiatives in the IT sector, Jenkins outlines to HRD what the company is doing to address that. “Over the past 12 months we’ve rolled out worldwide unconscious bias training, as well as reinvigorated our Local Diversity Council, [which is] run by employee representatives … who have determined four key areas of priority for Microsoft Australia: Women & Girls in Technology; Disability & Accessibility; Indigenous Inclusion; LGBTI. Whether through programs, activities or events, Microsoft ensures our employees are aware of and practice diversity and inclusion on a daily basis.”

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27/10/2016 1:16:48 PM

AMANDA FLEMING HR director, Coles

Amanda Fleming joined Coles in October 2015 as HR director, overseeing HR activities for 100,000 team members across 2,300 retail outlets. This year, the company was named one of LinkedInâ&#x20AC;&#x2122;s Top 25 most sought-after companies to work for in Australia. Coles was the only non-financial services company to make the top five. To put this in perspective, Coles receives 400,000 applications per year. Fleming points to initiatives on diversity and flexible work arrangements as the key attractors and retention drivers for prospective and current team members. The company has increased the number of women in leadership positions to 31%, employs more than 2,300 Indigenous team members across the country, and works with Disability Work Australia and Social Ventures Australia to offer employment to people with disabilities. Coles also provides flexible work and leave options, including a boost earlier this year to paid parental leave from eight weeks to 12 weeks for permanent full-time and part-time team members with more than 12 months of continuous service.

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27/10/2016 1:16:53 PM

COVER STORY

2O16 HOT LIST THE INFLUENCERS

KATE JENKINS

Sex Discrimination Commissioner, Australian Human Rights Commission

While she may not be an HR practitioner as such, Kate Jenkins holds a role critical to many in the profession. Countless HR-related concerns can ultimately be traced back to something deeper: the value of human rights. Her appointment to Sex Discrimination Commissioner earlier this year, on top of being Commissioner at the Victorian Equal Opportunity and Human Rights Commission, was welcomed by many, especially with the issues that needed to be addressed, such as the continuing gender pay gap in Australia and women’s safety, economic independence and wellbeing. As an advocate of gender equality and D&I, Jenkins has launched an independent review into sex discrimination and sexual harassment in the Victorian Police, as well as diversity campaigns such as Fair Go Sport and Play By the Rule. Her work motto derives from her school motto and seems highly appropriate given her current title: ‘Deeds not words’.

SENATOR MICHAELIA CASH Minister for Employment

Although it’s a portfolio that has been treated with kid gloves in recent years, given the somewhat volatile nature of this area (most would remember the fallout from WorkChoices), Senator Michaelia Cash’s role is critical to shaping Australia’s workplace relations framework. The federal government has recently come under fire from employer groups for not acknowledging the Productivity Commission’s recommendations for workplace reform. The government continues to tinker on the side – for example, with the introduction of three pieces of workplace relations legislation on 31 August. The three bills include the Building and Construction Industry (Improving Productivity) Bill 2013, which aims to restore the Australian Building and Construction Commission; the Fair Work Amendment (Respect for Emergency Services Volunteers) Bill 2016, which aims to protect Country Fire Authority volunteers and other firefighting and state emergency service volunteer bodies; and the Fair Work (Registered Organisations) Amendment Bill 2014, which aims to establish an independent Registered Organisations Commission.

TIM DAWSON Chief HR manager, Allianz Australia

This year, Allianz Australia’s internship program was ranked one of the best (12th) in Australia by the Australian Association of Graduate Employers. Tim Dawson tells HRD: “Development of our people is based on a culture where people and performance matter. Within this culture, every single employee, including our interns, is expected to demonstrate key attributes, including customer and market excellence, entrepreneurship, collaborative leadership and trust.” The company is also making solid progress in terms of achieving diversity, having been named an Employer of Choice for Gender Equality in 2014 and 2015 by the Workplace Gender Equality Agency. Last year, Allianz was one of only two insurance companies to achieve this status – a reflection of positive action in an industry that has too few female leaders.

GRAEME SMITH Director HR – Australia, NZ & Pacific Islands, Philip Morris International

For obvious reasons, the tobacco industry is notoriously challenging to attract people to, meaning that HR has a critical role to play in sourcing and recruiting talent. To address this concern, the company developed a global internship program called INKOMPASS, which Graeme Smith describes as “a journey of learning through self-discovery”. In line with the needs of Generation Y, Smith and his team launched a bold and interactive online campaign and assessment process. Selected candidates are then placed in multiple departments, assigned real projects impacting on daily operations, and supervisors to mentor them for the duration of the program.

ROB PHIPPS

Chief people officer, KFC Australia

KFC’s new interactive, goal-setting program – #myplan – enables its 30,000-plus employees to be directly involved in their career progression. Through the program, employees are encouraged to set short- and long-term goals, from making major purchases to considering career shifts that may even occur outside the company. The online module goes beyond learning necessary functions and transactions within the business, serving instead as a platform for self-evaluation and goal-setting for the development of the employee as a person. The program also calls for accountability on the part of managers in guiding their staff through the process. Rob Phipps believes that taking deliberate steps to empower staff pushes them to be the best they can be.

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27/10/2016 1:36:50 PM

SARAH SAMMUT Head of HR, Fitness First

Fitness First’s employee make-up is unique. Around 50% of its workforce is casual, and employees are scattered across more than 65 locations in Australia. Only 15% have access to emails. This creates some logistical issues for the HR team, who need to ensure areas like L&D don’t slip by the wayside. The solution, Inspire, provides the experience of an app, while being compatible with different devices such as desktop and tablet. Employees are able to complete L&D modules, connect with their colleagues across the country, and stay up to date through a central newsfeed. Inspire resulted in the Fitness First team collecting the 2016 Best Use of Technology accolade at the Australian HR Awards.

LEITH WIBLEN

General manager HR, Queensland, The Star Entertainment Group

As the company continues its work on the multibillion-dollar Queen’s Wharf Brisbane Integrated Resort Development, the HR team is also working on recruitment and training programs for the expansion. Leith Wiblen lists these initiatives as one of the HR team’s more notable recent accomplishments. “We built a number of small programs with foundations that are scalable, [since] we’ll be doubling in size in the next five years,” she says. Earlier this year, Wiblen took part in a networking event at her alma mater, Griffith University, where she gave an inspirational address to students on part-time employment, internships and volunteer roles. But beyond HR initiatives, she takes greater pride in her team and the people she works with, having seen her team receive positive feedback from an internal customer service survey and achieve high engagement results.

MICHELLE PHIPPS

HR director, ANZ/SEA/North Asia, Brown-Forman

Michelle Phipps leads a lean team of three HR business partners, overseeing 350 employees in Brown-Forman’s Asia-Pacific operations and spearheading initiatives on talent, culture, HR process, organisation structure, and particularly D&I. Her PhD in communications and cultural strategy undoubtedly contributed to this emphasis, and the company’s D&I strategy is one example of global best practice. As part of the strategy, Phipps has put one D&I council in place for each region (Australia, Southeast Asia, North Asia), knowing that “D&I is a leadership concern” and cannot be easily achieved by running the same programs/activities across regions. Phipps has also ensured that the company’s D&I initiatives go beyond the office space, and has been heavily involved in industry-specific networking events. Brown-Forman also threw its weight behind the 2016 Sydney Gay and Lesbian Mardi Gras.

A TOUGH YEAR – BUT STILL SHOWCASING HR BEST PRACTICE Gillian Davie, general manager – HR, Woolworths Home Improvement Division Masters Home Improvement stores, part of Woolworths Group, will cease trading on 11 December, and Woolworths’ Home Timber & Hardware stores will subsequently be sold to Metcash, resulting in the closure of several stores. The shake-up will see Gillian Davie and the HR team supporting a total of 7,700 employees during the transition. Woolworths is working with the SDA – the retail workers’ union – to find Masters employees jobs within the group or with external competitors. Alternatively, full-pay redundancies will be offered where suitable roles are not available. Dan Cram, executive general manager, people & culture, AGL In 2016, Dan Cram’s IR/ER skills have been put to the test with ongoing union stoushes at Loy Yang power station in Victoria. In the latest round in September, AGL opted for a ‘last resort’ attempt to terminate an EA that would affect more than 500 employees. This followed the rejection by 70% of employees of a 20% pay rise offer from AGL. The CFMEU has subsequently indicated it will apply to the Fair Work Commission to undertake a ballot of its workers to authorise industrial action, which has the potential to disrupt power supplies in Victoria. Geoffrey Woodcroft, senior vice president global human resources, Peabody Energy Off the back of a sustained period of low coal prices, Peabody Energy Corp, the biggest coal producer in the US, filed for bankruptcy in April, making it the fifth major US coal producer to enter Chapter 11 in the past year. While Australian operations are not included in the US filing, Geoffrey Woodcroft, who headed the company’s Australian HR operations before making a move to the US earlier this year, adeptly handled downsizing in Australia, ensuring that exiting employees were treated with respect, and continuing leadership training and other business functions critical to ensure future growth.

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27/10/2016 1:17:08 PM

COVER STORY

2O16 HOT LIST

CATHY DOYLE

KLAUS DUETOFT

One major challenge Cathy Doyle has been handling this year is facilitating continuous L&D for all 100,000 Australia-based employees. Across Australia, McDonald’s invests $40m annually in its training initiatives, technology and incentives. The HR team launched online training through the ‘metime’ app, letting employees choose the best time for them to receive training in their medium of choice. But beyond training programs and materials, Doyle acknowledges that it’s a good culture that serves as the foundation, and employee engagement is the mark of that culture. In line with that, the team has launched the ‘I’m a Macca’s Person’ campaign to celebrate the achievements of the crew and let them take pride in being part of the organisation.

Few industries are as fast-paced as the online retail space, and eBay veteran Klaus Duetoft – he’s been associated with the company since 2003 – has seen it all. Over the past few years, he has focused on transforming how HR operates in order to support a rapid-growth company. ‘MyHR’ was launched to do just that. The MyHR team handles all HR operational functions – everything from back-end data management and analytics through to policy interpretation and development, benefits management, and engaging managers with performance management and counselling – to name a few areas. Today, 95% of eBay’s employees’ needs are met by the MyHR function. “We now have an organisation where we have around 80 people servicing around 15,000 people. It’s highly efficient and scalable.”

Chief people officer, McDonald’s Australia

Senior director APAC, MyHR, eBay

ALICIA PURTELL

People & culture director, Beer, Spirits & Wine Australia, Lion

LinkedIn’s 2016 Top Attractors list ranks Australia’s best 25 companies for attracting and retaining top talent. Lion ranked eighth this year and was the only food and beverage company in Australia to make the list. Lion fosters an ‘achievement culture’ among its 6,700 employees. “Culture has a lot to do with this accolade,” Alicia Purtell tells HRD. “People want to work somewhere that feels consistent with who they are, and to do something that they think is meaningful.” Central to Lion’s culture is innovating and growing its people. Purtell is “grateful for the experience” of helping lead that creativity, whether that’s through exploring the velocity and speed of change of the culture, promoting new capability in the form of mental toughness, or having breakthrough coaching conversations with leaders.

ASHLEY WINNETT Executive director – human resources, GM Holden

The last few years have been “emotionally challenging” for GM Holden employees, says Ashley Winnett, as large-scale manufacturing operations in Australia run down and the company transitions towards a future focused on design and sales. “Our team’s mission is both selfless and clear – support our employees to successfully transition to life outside of Holden whilst building a new Holden which honours the legacy of those that could not continue on our amazing corporate journey to be Australia’s Best Automotive Company,” Winnett says. In May, Winnett was honoured at the 2016 LinkedIn Conscious Business Leadership Awards, taking top honours in the Management Maestro category. The awards, instituted by LinkedIn in 2015, create a unique platform for recognising HR thought leaders who mindfully foster an environment of trust, integrity and openness within their organisations.

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PETER HARTNETT Head of people & culture, Sanitarium

Peter Hartnett has made quite a name for himself in the HR profession – capped this year by winning the HR Director of the Year award at the Australian HR Awards. At Sanitarium he has been instrumental in developing a bespoke development plan for sales and account management staff, and has launched a leadership program to ensure the executive have a constructive impact on their teams. Sanitarium employees are encouraged to ‘own their space’ and expand their skill sets. Sanitarium’s brand managers are an example: they are responsible for end-to-end delivery of product marketing. However, they are not only expected to ‘own’ marketing campaigns; they are expected to be involved in cross-business initiatives and working closely with the R&D and supply chain teams. The same applies to the people & culture team: everything they develop is incubated and executed by the team. “It keeps us up to date with latest thinking and expands our skill sets to work with our business in making Sanitarium a great place to work,” Hartnett tells HRD.

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FEATURES

LEGAL

TREAD CAREFULLY: DISCIPLINARY ACTION AND PROCEDURAL FAIRNESS Amber Chandler reveals how the devil really is in the detail when it comes to disciplinary action and procedural fairness

SOME KEY lessons have been gained from recent unfair dismissal cases in the Fair Work Commission and Federal Court. To avoid breaching the unfair dismissal provisions, it is of utmost importance that management focus on both the reason for the dismissal and the procedure that leads to dismissal. It is easy to forget in the heat of the moment that procedural fairness must

still be afforded to an employee, even in cases where an employee has demonstrated appalling conduct.

The cases In Pham v Somerville Retail Services Pty Ltd [2016] FWC 2267, co-workers alleged that a process worker directed crude sexual insults at them on several occasions. In meetings about

this conduct, the employer directed her to attend to certain matters and the process worker refused to do so, thus failing to obey a direction from her employer. The employer carried out an investigation and held two disciplinary meetings with her about her conduct, ultimately leading to her dismissal. While this appears to be a textbook response by the employer, ultimately it was found to be an unfair dismissal by the Fair Work Commission. Of significance was the fact that the investigation failed to take a statement from the process worker herself, and therefore did not afford her the opportunity to respond to the allegations or identify anyone who could support her version of events. In fact, until the day of dismissal, the employer’s HR manager failed to discuss with the process worker details of the allegations made against her. In addition, the process worker was not given any indication prior to the first meeting that she was to be issued with a warning. The employer’s Counselling and Disciplinary Policy set out a two-step process which the HR manager did not follow when giving the warnings. Commissioner Lee stated that if the HR manager had followed the process, it “may have reduced the fear and confusion” the process worker felt in the first meeting and “perhaps the outcome could have been different”. The Commissioner did not accept the HR manager’s excuse that she couldn’t follow the procedure because the process

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worker had gone on leave and she did not know when she was going to return to work. Importantly, the Commissioner accepted that the reason for the dismissal was valid as the process worker had not followed direct orders on two occasions. However, the employer’s failure to follow its Counselling

of the reason for his dismissal. Commissioner Bissett found the lack of procedural fairness was harsh, disproportionate and unreasonable “in circumstances where, had an open investigation been undertaken and had he been given an opportunity to respond, an alternative penalty may have been applied and

To avoid breaching the unfair dismissal provisions, it is of utmost importance that management focus on both the reason for the dismissal and the procedure that leads to dismissal and Disciplinary Policy and procedure meant the dismissal was harsh and unreasonable. Similarly, in Kirkbright v K&S Freighters Pty Ltd [2016] FWC 1555, a dismissal was overturned by the Fair Work Commission due to procedural flaws. An employee of a truck company was found to have misused a company fuel card and provided freight services to persons without charging them. Commissioner Bissett accepted that the employee had taken each action without permission and in breach of well-established company policy, and this provided a valid reason for dismissal. However, when the general manager requested that the HR manager call a meeting to present the employee with the allegations and evidence, the HR manager decided instead that the employee was to be dismissed at the meeting by the area manager. The HR manager told the area manager to advise the employee of the termination at the meeting, but did not provide a thorough briefing to this manager to walk him through the appropriate steps that should be taken in such circumstances. The employee was not at any stage advised that his conduct was in issue or that he was being investigated. He was not provided with an opportunity to respond to claims against him. Prior to being dismissed, he was not advised

in circumstances where he otherwise has a 30-year unblemished record”.

Lessons for management While the role of the HR manager is to provide guidance to management in handling such matters, all management should be aware of the policies and procedures and have an understanding of procedural fairness in their day-to-day interactions with employees reporting to them. It is important that management are clear as to what circumstances constitute serious misconduct, which generally allows for summary (immediate) dismissal of an employee. However, most misconduct falls outside the definition or serious misconduct and circumstances are not always blatantly obvious.

Employers must have practical and clear workplace policies and procedures to enable them to address misconduct in a consistent manner, including: • Code of conduct and other policies addressing conduct, including bullying, discrimination and harassment, and social media use • Complaint/grievance handling procedure • Counselling and disciplinary policy and procedure

Finally, it is best practice to ensure that all employer action is accountable to the factors set out in Section 387 of the Fair Work Act 2009 under “Criteria for considering harshness, etc.”, which provides as follows: “In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account: (a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and (b) whether the person was notified of that reason; and (c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and (d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and (e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal; and (f ) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and (g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and (h) any other matters that the FWC considers relevant.”

Amber Chandler is a Sydney-based partner practising in employment law at law firm Kaden Boriss. She regularly provides legal advice to employers, particularly in regard to HR issues, and appears regularly before the Fair Work Commission, the Federal Circuit Court and state employment tribunals.

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FEATURES

LEADERSHIP DEVELOPMENT

TYING DEVELOPMENT TO STRATEGY

Off-the-shelf leadership programs have their place in today’s workplace, but as DLPA’s Karlie Cremin argues, going bespoke can result in more strategically targeted leaders

WHEN KARLIE CREMIN teamed up with business partner Lenore Miller to found Dynamic Leadership Programs Australia (DLPA), it was a combination of two different world views. On one side was Miller, with the necessary background in people and culture, but on the other was Cremin, with a more bottom-line focus on business strategy and finance. It’s a combination of disciplines that HR

interrogated and used to inform the formulation of a leadership development program, organisations were seeing changes not only in terms of team dynamic and capability of staff, but also in the bottom line and other performance metrics.”

A road less travelled There is little quality research data available to back up the use of bespoke programs over

“Ultimately, businesses pick bespoke options because they are looking for higher returns, and they see how these programs would work for them”

An uncomfortable truth

Karlie Cremin managers may do well to heed when it comes to implementing leadership development programs. “Our whole service offering was formulated on the basis of bringing those two vantage points – strategy and the people within an organisation – into leadership development programs,” Cremin explains. “What we noticed is that, when profit drivers in particular were clearly identified,

are considered in their design. Martha Gephart and Victoria Marsick at Columbia University in New York have also noted higher levels of success in leadership development when learning tools have been adjusted after the collection and analysis of data, thus creating enhanced strategic leverage points in the organisation. There’s just one problem. While DLPA’s assumptions have been borne out by practical experience since 1999, businesses typically start by wanting off-the-shelf options. “Most businesses don’t actively seek a bespoke option,” Cremin says. “The current economic environment means that cost is front of mind for businesses, and bespoke sounds expensive. For this reason, very few actually seek bespoke options.” It is the quest for ROI that often encourages a shift towards bespoke programs. “Ultimately, businesses pick bespoke options because they are looking for higher returns, and they see how these programs would work for them.” In the end, Cremin says bespoke leadership development options only work if there is a real and genuine commitment from a business to critically assess what makes it profitable. “If they aren’t willing to do that, bespoke options won’t yield anything significantly higher than an off-the-shelf option. Bespoke programs require an open and honest appraisal of the business as it currently is and a willingness to change your point of view.”

off-the-shelf alternatives, primarily because of the difficulty in measuring success with all of the variables involved. However, academics like Richard Bolden at the University of the West of England have hypothesized what could be seen as common sense to most HR professionals: that leadership development programs are likely to have a higher impact when contextual and organisational factors

If there is a common theme to what businesses seek from bespoke programs, Cremin says it is about getting their leadership teams comfortable with being uncomfortable. “Ultimately, I think businesses want to go through a process with their leadership team that allows them to sit in discomfort and take the required action anyway, so that they can act as a positive change agent within the organisation,” Cremin says.

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NOT HITTING THE MARK This applies to the business as well. The creation of a bespoke program can involve workshops with key stakeholders determining current circumstances, aspirations and the overall business strategy, as well as workforce assessments, which can include interviews, cultural and employee engagement surveys, and 360 assessments. The business is asked to open itself to scrutiny, so the program supports the overall strategy. The result is often a mix of both hard and soft leadership training, delivered through workshops, team building, coaching, mentoring and even retreats. With an expanding pool of capacities required of leaders today – from staples like time management, conflict resolution and communication to the increasingly important harnessing of discretionary effort, unconscious bias, and

The 2014 Aon Hewitt Top Companies for Leaders study indicated that the average organisation annually spent US$1.1m on leadership development and US$400,000 on high-potential development. Is this investment hitting the mark? A 2015 Korn Ferry survey of 7,500 respondents, more than 80% of whom were at the C-suite or director level, revealed the following:

40% of respondents didn’t regularly review leadership needs against their business strategy

62% examined their organisation’s leadership capabilities and saw gaps that needed filling

17% of survey respondents said they were confident they had the talent needed to deliver on strategic priorities

having the hard conversations – Cremin says constant improvement is required in both technical and non-technical skill areas.

Two scenarios illustrate this point:

A strategic tool

A business may identify a strategy of excellence in customer service to gain a larger market share, as well as the fact that their leaders are poor at convincing others to buy in to change.

For those that choose a bespoke program, DLPA’s Cremin says there can be a big difference in the way it works within a business.

Strategy 1: Seeking customer service excellence

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CHANGING ON THE GO Bespoke programs have the ability to flex midstream to address any unforeseen ‘surprises’, as these two DLPA case studies show. Leadership success While working with a mediumsized construction company, DLPA helped HR switch from standard development modules to a bespoke solution after it was established that staff were all at radically different stages of development. After developing individual programs to sit alongside the off-the-shelf product, the company was able to ensure each person reached the necessary point of development. 30% growth A private business without any training systems in place asked DLPA to design and implement them, but it was soon established that staff weren’t sure what the strategy even was, or how to implement it. Because of the long-term lack of systems, the people with ‘power’ were also not the people with ‘position’. A custom program upskilled managers, while the business strategy changed after suggestions from staff, leading to 30% growth in the last 12 months.

DLPA Dynamic Leadership Programs Australia (DLPA) is a bespoke leadership and business development program provider that drives strategic objectives and unlocks the potential of current and emerging leaders. With corporate strategy at the heart of DLPA’s programs, our team works hand in hand with each client to identify key barriers to their success, develop leadership skills, align organisational values, and empower people to reach higher levels of performance.

Rather than clipping together preset parts, like a general communication workshop, a persuasion workshop and a necessary customer service workshop, a bespoke program will first assess whether the customer service strategy is appropriate to the business, and then involve staff in the formulation of the program that will support them through implementation. With staff enrolled in the strategy from the outset, they are likely to be committed to doing what is required to be successful. In some cases leaders undergoing training may – after the communication workshop for example – become aloof and disgruntled. Though an off-the-shelf program would either stop entirely or keep on going regardless, a

that strategy in that particular organisation. Through the use of this data, the organisation can develop a program that ensures staff are equipped to deliver the strategic outcomes for the business, which will in turn result in a more responsive and agile business or business unit that is better equipped to respond to changing market conditions while keeping an eye on the ultimate goal.

A bespoke future When DLPA first began, Cremin says only 5% of new clients would come through the door asking for a bespoke program. That has now risen to 20% of the market, though Cremin says the bulk of the remaining 80% quickly convert to a bespoke option.

“The organisations that will thrive in future will be agile, responsive and lean. Part of this model has to be leveraging the power of people to closely serve strategy” Karlie Cremin bespoke option would seek to collect data and locate the root cause of the change in attitude, and the subsequent program activities would be altered to mitigate the change. This might mean a revised order, changing the style of coaching or even completely changing the content, to ensure that the program continues to align with the strategy and assists with implementation.

Strategy 2: Seeking aggressive growth Many companies want to capture strong growth through better leadership. In a bespoke program, this would mean drilling down through the detail of the strategy to identify capacity issues, planning issues, skills gaps and any other issues that may reduce the effectiveness of the implementation of

This may increase in a future where program outcomes are likely to be the primary measure of returns, as the economy rewards more strategically focused businesses. “I believe the organisations that will thrive in future will be agile, responsive and lean,” Cremin says. “Part of this model has to be leveraging the power of people to closely serve the strategy. HR managers will need to keep this in mind when selecting development programs to ensure they select products that produce the best results. “For programs to be effective you need to be very outcomes-focused. When you then couple that with using the overall strategy of the business to inform the outcomes you are seeking, you significantly increase your return. Why would you do anything else?”

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TECHNOLOGY

THE NUMBERS GAME:

WORKFORCE MANAGEMENT

HRD discovers how the insights gleaned from time and attendance data are the foundation of efficient and cost-effective workforce management strategies

DOES YOUR CEO (or CFO) still believe that labour force optimisation is simply about operational matters such as knowing who shows up for work and how many hours they do? The retail sector – specifically the case of Boost Juice Bars – might provide food for thought. Boost uses RITEQ workforce management technology to look at the weather forecast for the coming week and will then look at historical sales data going back 240 weeks. A complex set of algorithms can

future,” says David Kroser, Managing Director of RITEQ. “It makes absolute sense that in order to plan effectively, you must have a foundation of accurate data to work with that relates to your current workforce position.” For Kroser it’s about more than simply gaining insight from data; it’s a way for C-level executives to identify and continuously improve workforce performance and business contribution by actively engaging with their HR teams in building and delivering

“When proactively managing labour costs, looking at the data after the fact is too late” David Kroser then determine how many people need to be rostered in each store at half-hourly intervals each day in order to meet the probable demand for the company’s products. Boost Juice provides just one example of how time and attendance data can form the foundations of more sophisticated workforce management strategies. “Workforce planning is very much a strategic HR function requiring the analysis of data in order to plan your workforce of the

effective intervention strategies. “When properly developed and executed, people analytics provide the opportunity for every HR department to transform itself from an operational support role to that of valueadded business partner,” he says. RITEQ maintains that it is in the interests of both parties to recognise the value of the data that can be extracted from workforce management systems. This data can provide insights into issues such as labour force

productivity and optimisation, absenteeism rates, and the deployment of the workforce.

Workforce management planning The workforce planning process can be broken into three key areas. It all starts with the labour demand planning: what is required based on the business plan? The second area is workforce labour supply planning, and the third is labour sustainability planning. “Where time and attendance fits in is primarily with labour demand planning,” Kroser says. “For example, the sort of data that becomes really important is your employee mix – FTEs, casuals, part-timers – and how optimised that mix is. How much overtime are you incurring? For example, could you have three FTEs replace a handful of casuals working overtime? You’ll also be looking at absence trends. It’s all the metrics that feed into the demand process and thinking about what you’ll need for the future.” Effective workforce management planning also consists of several essential operational elements:

Labour planning: How many people will need to be rostered in X location to meet a certain level of demand at a certain time of day? “This is labour demand in the context of having the right people in the right place at the right time,” says Kroser. Labour optimisation: Referring back to the Boost Juice example, what are the impacting factors that will determine how many people are needed to run a store, for example? Labour scheduling: Scheduling staff based on the above demands and ensuring employees are notified of their schedules or rosters. “Technology has allowed for greater mobility,” says Kroser. “You can now notify employees of their shifts and

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RETURN ON INVESTMENT Efficient workforce management systems can resolve multiple challenges for HR while providing an impressive return on investment. RITEQ highlights three key areas:

Area of solution

Problems this solves

Return on investment

Savings and assumptions

- Manual pay rule interpretation

- Reduction in admin head count through automated interpretation

- Reduced head count x annual salaries of admin staff

- Pay rule interpretation inconsistencies

- Guaranteed compliance with Award legislation

- Reduced IR issues – savings immeasurable

- Wage payment errors

- Reduction in wage payment errors

- Typically, 0.3% of total hourly paid wage costs

Budgeting and schedule KPIs

- Labour cost blowouts

- Reduced labour costs due to more accurate and controlled scheduling

- Typically, 0.5–1% of total hourly paid wage costs

Timesheet exceptions

- Manual inefficient processes

- Administration time savings

- Reduction in time per week x hourly rate of improving staff – typically, 30 to 120 mins per week depending on number of employees

- Inconsistent adherence to corporate timesheet exception rules

- Reduced labour costs and improved compliance

- Typically, 0.25–1% reduction in hourly paid labour costs depending on level of inconsistencies

- Identification of tardiness exceptions and trends

- Reduced labour costs

- Typically, 0.5–1% reduction in hourly paid labour costs depending on level of tardiness

Pay rule interpretation

allow them to bid for shifts. That extends into what we call dynamic rostering, whereby the system can automatically build a roster for you based on the best fit to meet a particular cost, or remain compliant with EBA or Award rules.”

Day-to-day operations: This covers what actually happens every day. Do employees clock on/off, or do they fill in a timesheet that goes to their manager? In an automated system this can be referenced against the shift the employee was rostered to work. The system will then approve the shift ready for payment, or use its Award

interpretation engine to determine the correct rates of pay – for example, David worked seven hours of normal time, two hours at time and a half, and three hours of double time. It will then move it into the payroll system. Alternatively, if it falls outside the threshold and exceptions range – for example if the employee was late for work – a manager is notified and they will deal with the exception. In the RITEQ system this occurs in real time.

Technology integration Kroser reiterates that incorrect foundations at the demand-planning stage will result

in incorrect long-term outcomes for the business. For this reason, he believes that workforce management system/application integration is critical to success. Each disparate system needs to be able to ‘talk’ to the others. “It must be integrated as part of an ecosystem because application integration is really business integration; with the amount of data being processed by various systems you cannot operate without having really strong integration. In this day and age it’s not practical or feasible to manage data in Excel spreadsheets,” Kroser says. He adds that having workforce management

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DAVID KROSER’S TOP TECH TIPS 1. Ease of use and flexibility: “Each industry has vastly different requirements in the way they manage employees. Compare, for example, retail to hospitality. At the core they all need to be able to do the same things but in different ways. If you don’t make it as simple as an Excel spreadsheet to use, managers won’t use it.” 2. Accessibility: “Cloud-based centralised systems that are accessible to employees via mobile devices are critical. There’s a lot of older technology still around where the vendor has prettied up the front end to make it look good, but deep down it’s old technology. Cloud-based technology can provide real-time insights and a single point of truth.” 3. Analytical functionality: “Once our clients get beyond the transactional part of implementation, it comes down to the analysis of the data being generated. You need strong data science that is able to take that data and present it in a format that is actionable. Data for the sake of data is a waste; actionable data is really important.”

RITEQ RITEQ exists to inform and enable optimum workforce performance across all industries. From humble beginnings in Sydney in 2001, RITEQ has established itself as a significant force in the world of human capital management. With more than 350 clients and 15,000 locations globally using its solutions, RITEQ’s offering includes workforce management and people analytics software coupled with education and consulting.

data fully integrated into workforce planning analytics eliminates a significant amount of manual intervention, and ensures accuracy.

Analytics and workforce planning With HR today more prepared to embrace data and analytics as an essential part of decision-making and planning, it’s no surprise that RITEQ has taken steps to add analytical tools to its technology suite. “We already had a fantastic transactional tool in RITEQ WFM, but it was operational in nature; we wanted to build its reporting capabilities and offer analytical tools for more effective workforce management,” Kroser says. “Clients increasingly want to go beyond just the workforce management metrics

sale, payroll, HR, financial, traffic counting and other relevant systems. RITEQ further added to its people analytics capabilities in October this year with the acquisition of Optimum Performance. The company’s founder, Stephen Moore, will add valuable knowledge to the RITEQ team. “It’s been a long-standing mission to use our existing workforce management platform as the foundation for future growth,” says Kroser. “The acquisition of Optimum Performance brings with it unique and comprehensive knowledge and understanding of human capital metrics and analysis.” With the annual labour bill in most organisations meeting or exceeding 60% of total operating expenditure, Kroser says this

“Workforce planning is very much a strategic HR function requiring the analysis of current and historical data in order to plan your workforce of the future” David Kroser relating to time and attendance or rostering systems. They want to see more information around workforce efficiency, effectiveness, capability and engagement. We hold a lot of data within our workforce management system and we were looking to obtain more effective insights from that data.” To that end, in September 2015 the company acquired SeeMoreData, the creators of business intelligence and analytics platform BI Plus. The RITEQ Analytics solution was integrated into RITEQ Workforce Manager as a module in early 2016. It offers out-ofthe-box dashboard analytics on all workforce management data within RITEQ. Clients are also able to feed other data sources into the analytics tool to combine workforce data with data from other key sources such as point of

level of insight will be vital to HR’s ongoing evolution as a strategic business partner. He cites just one example of how data analytics can help move HR from being reactive to proactive. “When you’re managing labour costs, looking at the data after the fact is too late,” he says. “A system like ours is able to alert you in real time when an employee is about to go into overtime hours. It allows you to then be proactive in making a decision about clocking off that employee because otherwise they’ll cost you money. The return on investment is significant. It’s not just about improved efficiencies, more accurate data and better compliance; it’s about proactive labour management where you can make decisions on things before they happen, because you have the insights to do so.”

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INSIDE HR

MAKING VALUES WORK FOR YOUR COMPANY While a ‘set and forget’ mentality towards organisational values remains entrenched in many businesses, Tabcorp has taken a different approach by positioning values at the heart of everything the company does AROUND 30% of human life is spent working. If the average working week is considered to be around 40 hours and a few weeks of annual leave each year are factored in, most people spend around 25-30 years working. While advocates of employee engagement have long recognised that making work not just enjoyable but meaningful pays significant dividends, it’s only now that HR and senior executives are taking action. The key to taking action on this front is running a values-driven business, says Merryl Dooley, Tabcorp’s executive general manager of people, culture and communications. “Work can and should meet some of the basic human needs, including a sense of belonging, achievement, purpose and meaning,” she says. “Further, managers can tap into employees’ values to help make work meaningful – not by ‘selling back’ the values associated with day-to-day work, but by empowering employees to find their own meaning by providing an environment and roles which allow employees to be authentic.”

HRD sat down with Dooley to see how Tabcorp has created this values-anchored culture.

HRD: Tell us a little about the Tabcorp business. Merryl Dooley: Tabcorp is an ASX 100 listed Australian gambling entertainment company. It’s a diversified business across three areas: wagering and media, gaming services and Keno. We are growing globally and currently have operations in the UK that are expanding, but the bulk of our business remains in Australia where we employ more than 3,500 people across brands such as Keno, Luxbet, Sky Racing, Sky Sports Radio and Tabcorp Gaming Solutions.

HRD: How does HR operate at the company? MD: The people, culture and communications team is set up so we have a number of business partners who partner directly with the business units; they in turn are supported by centres of

excellence such as talent and OD; total rewards, which covers remuneration; and health, safety and wellness. Communication is a relatively new part of my remit. As the business is changing we’re bolstering our numbers and capabilities and partnering the business and delivering work on the back end. What I mean by that is we’re streamlining the processes so we can deliver services to our employees.

HRD: What does a values-driven business mean to you and what role do you think HR plays in such a business? MD: It’s a big question right now. We recently held a senior leaders’ conference and had a keynote speaker who talked about the social licence to operate a business. For me, values provide our social licence to operate. That requires thinking about what the organisation is doing – essentially delivering its products and services – but also how we do that. We talk about our values and they are very much about behaviours: how we interact with our customers, our employees, our stakeholders,

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“Values provide us with our social licence to operate. That requires thinking about what the organisation is doing – essentially delivering its products and services – but also how we do that”

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FEATURES

INSIDE HR

THE VALUES DISCONNECT Research released by LinkedIn has revealed that 60% of professionals say not sharing a company’s mission, values or purpose is a deal-breaker when they are considering a new job. Many employers could be missing out on engaging great candidates by not clearly promoting their values and mission. According to the research: 34% of recruiters say that their values and mission are missing from their company’s website. 27% mention values and mission in job ads. 10% of recruiters are not able to articulate their own company’s values at all, and just 17% include these values on the company LinkedIn page. 43% of recruiters say they wouldn’t exclude otherwise suitable candidates from the hiring process if they didn’t agree with the organisation’s values, mission or purpose.

our regulators. They are highly visible, and employees are accountable to these values. The role of HR, along with the entire senior executive team I might add, is to be custodians of culture. For me that means holding teams and senior leaders accountable, ensuring they are the best role models of the ways in which we work, and then ensuring from a communications perspective that we meld all the values into the people processes and policies so that the values don’t sit on a poster on the wall. For example, we’re doing our performance review process right now and we have a performance framework that means you can’t be a high performer unless you’re also performing to those values – which relates back to how you’re reaching your goals.

HRD: Often that is not communicated very well – companies have lofty organisational objectives that don’t filter down to employees effectively.

HRD: In your view, how does work meet the basic human need of a sense of belonging?

HRD: Do you think HR often gets hamstrung when there is a disconnect between the values of employees and the values of a business?

MD: I was on my way to work recently and talking to my cab driver. He asked me what I did and I talked about my role at Tabcorp. We talked about the blurring of work and home, and I think increasingly the meaning of work and the sense of belonging we want to get from work has increased because of how much time we spend at work. Work is also increasingly being seen an experience; it’s not just about showing up and doing your job. We want more from the work experience. When I think about belonging I see that as the emotional connection to a workplace, and really it’s about making a connection between why I show up to work and what I do and the extent to which that is important for the organisation. We’ve used Gallup’s Q12 Employee Engagement Survey for several years. There’s a question in the Q12 which asks the extent to which an employee feels they contribute to the mission and purpose of the organisation. To me, that is an indicator of the sense of belonging.

MD: It’s a good point. When we started with Gallup four or five years ago, we identified that our employees were incredibly passionate about their jobs; many of them come from a family of trainers, and racing is in their blood. But the challenge for us has been this: they’re passionate about racing, but how do you make them passionate about Tabcorp and create the emotional connection with Tabcorp? We’re on a journey on that front; we’re doing quite a bit of work right now on the Tabcorp brand. It’s about making the connection between the consumer brand and the employer brand.

MD: I think the organisation gets hamstrung, more so than HR. Having performance conversations is a great example, where the conversation is too much about outcomes and not enough about values. For me the best way to deal with that is to put a values lens or dimension on a question, on a deliverable, so that we’re always shining a light on that element.

HRD: Can that disconnect be bridged? MD: For existing employees, particularly as values are clarified and the organisation becomes clearer on their expectations, what can happen is that people who perhaps once fitted with the culture no longer fit. It then becomes how, in a respectful way, you have conversations with employees. For example, you might say, “You’ve been really valuable in the past but right now how you’re contributing and how you contribute in the future needs to change. If you can’t contribute, then

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respectfully, perhaps Tabcorp is no longer the place for you to be”. You can also assess the values of people as they come into the organisation. We’ve spent the last few years building processes around selection and recruitment. For example, for every senior job role – that is, any GM,

HR, what does think big look like? What are you doing in practice? What does it look like if you’re doing it consistently and what does it look like when you’re a star player so that we can differentiate it around behaviours as well. You can then drive a connection that’s really relevant in the local context

“The challenge for us has been this: employees are passionate about racing, but how do you make them passionate about Tabcorp and create the emotional connection with Tabcorp?” Merryl Dooley frontline manager or senior executive leader – we’ve built success profiles which take into account leadership capability requirements along with Tabcorp ways of working. We then use those success profiles to run full-day assessment centres, which include business simulations, psychometric testing and personality profiling. Coupled with good interviewing and behavioural interviewing, it gives us a good sense of people as they come in.

HRD: How would you suggest HR can tap into employee values without ‘selling back’ the values associated with day-to-day work, and instead empower employees to find their own meaning? MD: What’s worked for this is this approach: we have five ways of working – think customer, think big, be accountable, be one team, and do the right thing. With those ways of working, or values, we’ve then described what they are and what they aren’t, and we’ve used that as a construct team by team. If we use ‘think big’, for example, in the context of

and environment. We’re doing some work now to ensure the Tabcorp EVP and our ways of working are completely connected and aligned.

HRD: How do you build values that resonate with employees? How do Tabcorp’s values shape the culture you have? MD: Culture and values are one and the same, and they have to be. For instance, at Tabcorp we have one value around doing the right thing, which is important to us in the context of the nature of our business. We can’t on one hand say that’s one of our values, and then have a culture that allows behaviour and conduct where people are not doing the right thing. For HR it’s about ensuring you have the right systems and processes in place to make that connection really clear and to drive towards the culture you’re looking for. That’s where you can make those connections really deep and ultimately enabling because this is about culture being an enabler of business performance.

VALUES AND DIVERSITY “Some might say values and diversity are separate issues, but I take the opposite tack,” says Dooley. “I believe diversity is intertwined with culture because diversity is about culture. It’s about conversations and ways of working.” Since 2011, Tabcorp has been on a journey towards gender equality. As a male-dominated industry, Tabcorp started with senior leadership conversations about diversity, connecting it to being a driver and enabler of performance. From there the company has concentrated on developing pipelines of female leadership talent, encouraging senior managers to “stretch their thinking” about how to get the best candidate for the job at hand. A mentoring program for both men and women has also been introduced. Two key milestones indicate the company is making progress: Tabcorp was recognised in 2015 as the first organisation in its industry to achieve Workplace Gender Equality Agency citation as an Employer of Choice. The number of senior women leaders has grown from 25% to 33% in two years.

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FEATURES

CHANGE MANAGEMENT

HOW TO MANAGE YOUR EXEC TEAM THROUGH CHANGE Supporting executives through change initiatives can make any transition easier. Christopher Paterson looks at how HR can do this effectively IN 1996 John Kotter from Harvard Business School famously stated that 70% of change programs fail. Twelve years later, in 2008, McKinsey surveyed 3,199 executives and showed that nothing had changed, with the fail rate holding at an obstinate 70%. More recently, in 2013, Willis Towers Watson reported that despite the sophisticated change management advice available, only 25% of transformation projects were successful. The reasons identified for such dominant fail rates ranged from failing to ‘prepare managers as effective change leaders’ and ‘management behaviour not supporting change’ to ‘neglecting the remaining staff ’ and managers ‘completing the change process too early’. Regardless of the study, the causality is centred around the people side of change. To the career coaches at ALCHEMY, this link between organisational success and the human factor is not a surprise, yet we are consistently surprised by the lack of resources deployed to manage the people side of change, despite the evidence clearly showing that businesses are healthier when we get this right. HR professionals are ideally placed to facilitate success by leading the people side of change.

Engagement formula A range of success variables are highlighted in change management research; however, there is agreement that strong cultures keep good people (retention) and that those people are effective (productivity). Furthermore, staff engagement is consistently correlated with both higher retention rates and productivity.

and demonstrable role in guiding the executive and the organisation through change, to their colleagues who find themselves in a passenger role with limited influence. Interestingly, this variance is not always defined by age and experience, and some experienced HR practitioners still play a support role rather than a leadership role while their less

As long as people are treated with professionalism, respect and dignity, it’s very difficult to make fundamental mistakes This simple formula can be used to manage the people side of change and to measure the effectiveness of HR’s initiatives:

STAFF ENGAGEMENT

WANTED RETENTION & PRODUCTIVITY

Staff engagement has also been correlated with higher discretionary effort, more profit, higher customer loyalty, greater creativity and innovation, so we can be confident in the central role this plays in facilitating a strong business and a healthy balance sheet.

Managing the executive At ALCHEMY we work with a spectrum of HR professionals, from those who play a pivotal

experienced counterparts demonstrate the ability to advise and influence. We also observe first-hand the impact that strong HR leadership has on staff and managers internally as well as on the brand perception in the external market (ie customers, suppliers and the media). I have highlighted below four elements that differentiate effective HR leaders when managing their executives through change.

Know your role

Effective HR leaders understand that when it comes to the people side of change, they are the authority. They own the people

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side of change in an uncompromising way and take responsibility for the decisions that sit within this remit. This often involves defining this remit with the executive up front so decision-making authority is clear and unambiguous. As a guide, anything that influences the change formula (engagement, retention or productivity) is in the remit of the HR leader. Further, effective HR leaders also advise on all issues relating to people, and call out poor decisions or those lacking emotional intelligence. While people factors can be grey and subjective, there are three values that are consistent. As long as people are treated with professionalism, respect and dignity, it’s very difficult to make fundamental mistakes. Strong HR leaders also play the role of adviser, not counsellor. They empathise and actively listen while providing specialist coaching or counselling support where required. This ensures that roles are kept clear and that every member of the executive team has the support they need.

There is not always a happy outcome

As HR professionals we are wired to facilitate positive outcomes. Whether it’s recruiting the best people, developing high-potentials or solving workplace issues, we want to effect a positive outcome. However, effective change leaders understand that most change is inherently difficult, particularly a restructure, merger or downsize. No matter how well this is managed, it still going to be challenging for all and a negative experience for some. Acknowledging this up front allows the HR leader and the executive to recalibrate their expectations and deploy their resources to facilitate the smoothest and most effective change possible. The change formula can be used to set realistic objectives. While engagement, wanted retention and productivity are likely to be impacted, the change plan focuses on what the business can sustain and what

needs to be done in a practical way to manage and measure these variables.

Building your team

Managing the people side of change is a complex enterprise, and there are a unique set of circumstances each time. You cannot be expected to be an expert in all aspects of human behaviour; however, it takes a confident professional to ask for help. Effective HR leaders have a team of advisers that they call on in their network. Some are engaged formally, most informally. The HR leader provides in-depth knowledge of the personalities, the culture and the history of what has worked and what has failed. They are then the conduit of expertise to the executive team. Typical members of this adviser panel include an employment lawyer, an executive coach, a business psychologist, a communications expert, a career transition partner and, increasingly, a wellness adviser. By pooling the combined wisdom and experience of this group you are best placed to advise your executive team with rigour and confidence. You also acquire valuable knowledge in the process, which builds on your own HR and change management assets.

The neurology of wellness

All change adds a level of stress to the human brain and body. However, advances in our understanding of brain function at work and its impact on wellness has added a powerful and practical weapon to the HR arsenal. We know that for successful change to be achieved, the executive team need to operate at their best; however, they are also the group most at risk. Using the available empirical research as our guide, we know that executive teams who make good decisions regarding their wellness have lower stress levels, greater mental alertness, more energy, higher self-esteem, better memory, greater focus and concentration, and higher overall levels of happiness, and they manage

HR CHECKLIST Managing your executive team through change? Try these six tips: Define your role and decision-making remit. Treat people with professionalism, dignity and respect. Be an adviser, not a counsellor. Set realistic expectations for outcomes such as engagement, retention and productivity. Build your own team of advisers. Have an executive wellness plan to ensure that you and the team are at your best. high workloads more effectively. The business case is clear. If we are going to support our executive team through change, we need to make sure that their cognitive, emotional and behavioural wellness is supported. As a starting point, you can use the 6 cylinders of wellness® (alchemycm.com.au/wellness) as a resource for you and your team. A recent global study showed that organisations who focus on staff wellness experience 2.6 times more productivity, 79 times higher engagement, and four times higher retention. So change will always be difficult; however, by learning from what effective HR leaders do, we can manage our executive teams with confidence and achieve stronger people as well as commercial outcomes. Christopher Paterson is the managing director of ALCHEMY Career Management, a firm of coaches and business psychologists who support individuals and organisations with career transition, executive coaching, Wellness@ Work® and business transformation programs. For more information, visit alchemycm.com.

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FEATURES

PSYCHOMETRIC ASSESSMENT

MAKING PSYCHOMETRIC ASSESSMENT WORK FOR YOU

Psychometric assessment has proven itself time and again over the last 100 years, but industry pioneer Scott Ruhfus says organisations will need to rediscover how to make it work effectively in a new, tech-driven age SCOTT RUHFUS has witnessed psychometric assessment evolve in phases over the last 30 years, since he left his career heading the HR function at a series of multinationals to embrace what was then becoming a promising new science.

“HR departments are correctly looking to improve process efficiency, and are increasingly looking to Automated Tracking Systems to control process flow,” Ruhfus explains. “However, they don’t do any of the heavy lifting psychometrics do, and it can be

“Sometimes, there is still confusion about what assessment methods to use at what phase of the selection process” Scott Ruhfus That’s why today, as the managing director of Saville Consulting Asia Pacific, Ruhfus is watching the new innovations in psychometric testing with caution. With a heavy emphasis on technology and process efficiency, he says organisations can risk losing their way and getting psychometrics wrong.

a case of technology wagging the dog to try and make it all work.” The problem with process efficiency alone is it can prioritise the wrong things. While trying to save on costs, HR can actually end up entrenching selection errors. “Sometimes, there is confusion about

what assessment methods to use at what phase of the selection process,” Ruhfus explains. “In graduate selection, for example, aptitude tests are commonly used as an early screen. Over-reliance on this method can mean you lose candidates with other outstanding qualities like building relationships, influencing outcomes, and driving results.” With the new breed of behavioural-style questionnaires like Wave™ and its screening counterpart Work Strengths, Ruhfus says combining aptitude and behavioural assessments at the beginning of the screening process makes more sense.

What to use Cognitive ability testing, otherwise known as aptitude testing, has been the jewel in the crown of psychometric testing science. That’s because research has shown for a long time that test scores correlate well with actual performance on the job across all jobs. While it does work better for more complex jobs – such as managers and professionals – it is still predictive for lower-level jobs as well. This is backed by the most recent research by Saville Consulting on behavioural-style assessment (measuring propensities towards certain kinds of behaviour and styles of interaction with others). Together, they do the ‘heavy lifting’ in quality assessment. “Both have demonstrated pulling power and are cheap and efficient,” Ruhfus says. There are new and growing trends. Situational judgement tests, for example, ask candidates to respond to tailored scenarios and are increasingly being used strategically to project organisational branding in front-end screening. “For example, they can include things like a full video portrayal of a situation, which can be very lifelike. It’s an interesting task

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for a candidate to do and has respectable validity, though not as good as aptitude and behavioural tests.” Then there’s gamification, which turns more standard testing into animated problems and scenarios in a way that is said to appeal more to Gen Y candidates. While it’s fashionable and holds potential, Ruhfus says HR professionals should be cautious. “I haven’t seen any compelling evidence for their validity to date. The literature kind of says, ‘Good idea, keep working on this, it makes sense’, but I don’t think we’ve

In practice, psychometrics are not always used this way. Ruhfus gives the example of continued reliance by many on interviewing at the front end. “Interviewing is very timeconsuming because you usually need busy people to do it, so it is actually a significant cost internally to organisations.” Often, this means an hour or more of management time is wasted when, “in many cases, a candidate could already have told you that they are not for you through more efficient testing”. An added bonus is that the best tests are ‘blind’ to common biases that work

“Interviewing is very time-consuming because you usually need busy people to do it, so it is actually a cost internally to organisations Scott Ruhfus actually cracked it yet.” Some gamified products have even gone “backwards” in time with “quite trivial sorts of questions” that are not job relevant, Ruhfus says, which may be an HR “backlash waiting to happen”. He says to ask for proof. “They may be a new, sexy and fun way of testing, but where is the job relevance in them?”

When to use it Due to the low cost of testing compared with return on investment, Ruhfus says testing is best deployed as early as possible. “We have now made tests extremely accessible at a fraction of the cost. They should really be used more up front, and they should be testing more people. The more people you can survey, the better the return on investment and outcome for a company.” Ruhfus actually trains HR practitioners to evaluate tests and understand the financial impact they can make if used properly.

against organisational performance. “They are relatively blind to things like gender, ethnicity and age. Many companies are moving away from more traditional approaches because they are not getting enough good people. Testing now has the potential to turn that on its head. Testing is being used to increase diversity and inclusion and doesn’t have the sort of unconscious biases we all have as managers,” he says.

CAN CANDIDATES ‘GAME’ A PSYCHOMETRIC TEST? Influencing the results of a psychometric test – through outright lying or ‘impression managing’ – is a possibility. So is getting a smart cousin to complete an aptitude test for you, particularly in an age when tests are performed online. Scott Ruhfus says there are ways to mitigate these risks. 1) A supervised test: A shortlist of candidates can be retested under supervised conditions. Saville, for example, offers parallel versions of the same test, to allow comparison under supervised conditions. 2) Get professional: Recent developments in personality assessment have found better ways to combat impression management, which actually home in on the areas where distortion is likely to have occurred. This allows practitioners to target probing follow-up questions, For those who think interviewing will yield a more truthful gauge of a candidate, think again. “Research shows 97% of candidates lie during an interview, or in some way distort the truth,” Ruhfus says.

How to use it The effectiveness of psychometric testing comes down to getting the highest ‘validity’, or the extent to which results correlate with the outcome HR wants. Ultimately, this means scores that predict job performance. For example, a heavy reliance on résumé culling actually has low validity, in that it is much less effective than psychometric testing in predicting job performance.

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ESSENTIAL STATS 30% – Increase in revenue achievable by managing talent against validated behavioural fit equations 40% – Typical cost of recruitment error as a percentage of annual salary 50% – The increase in validity achieved by changing from a test with a validity of 0.4 to one of 0.6. As return on investment from testing is linear to validity, the potential impact on organisational productivity is huge Source: Saville Consulting

Confusion can arise when test results conflict with what a manager believes based on an interview, Ruhfus says. For example, a manager may claim the results of aptitude are ‘wrong’ based on their interview impression, which is heavily influenced by social rather than cognitive factors. HR practitioners sometimes don’t know how to address this apparent quandary. “The best kind of interview done by the best kind of interviewer makes at least as many mistakes as a test, and the truth is, you don’t actually get to see the job performance of the people that you end up rejecting,” he says. Everyone thinks they are a good interviewer, but the research is unequivocal. Ruhfus says aptitude testing combined with a good interview allows you to achieve incremental improvements in validity, compared to interviewing alone. Organisations can also go wrong before they even start if they fail to do a proper ‘job analysis’, to set the right parameters for testing. Competency frameworks are important to

organisations, and help to underpin change initiatives. However, Ruhfus says they are often implemented without an eye to assessment. He recommends organisations consult an experienced specialist before developing in-house competencies and assessment criteria.

The future Technology will play an increasing role in testing in future – as long as it is used effectively. “I think psychometrics will be intimately connected with technology, because it is a way to deliver testing efficiently and in an attractive way. Down the track, things like gamification could well have legs.” Ruhfus has already introduced a range of virtual assessment centre exercises – Virtual AC™ – into the assessment mix. And while Ruhfus expects continued development in areas as cutting-edge as iris identification technology to stamp out cheats, and one day perhaps even the exploration of genetic testing, HR managers will still need

to know when to show a human touch. “In the end, you want to attract the good candidates to you instead of your competitors, and you have to impress them as much as they need to impress you. To do that, you need to spend quality time with the most suitable candidates. The question really is, what is the optimal point at which to do that, and how can we get those good candidates in front of a hiring manager sooner rather than later.”

SAVILLE CONSULTING ASIA PACIFIC Saville Consulting Asia Pacific, part of the Willis Towers Watson Group, represents world-leading technology and excellence in the research and development of talent assessments. Our world-class psychometric suite, coupled with our passion for enhancing organisational productivity, creates solutions that break bounds in the industry and provide innovative solutions across the talent cycle.

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FEATURES

PAYROLL

ON THE FRONT FOOT WITH PAYROLL COMPLIANCE

Payroll mistakes can be costly, yet there are proactive steps HR can take to ensure their organisation remains compliant – and technology can provide a helping hand

FOR ALL the horror stories related to payroll errors that have emerged over the past 18 months – 7-Eleven being the obvious case – it was refreshing to see plaudits rather than criticism being handed out by the Fair Work Ombudsman recently. McDonald’s Australia was congratulated for placing workplace

its systems and explore ways to further improve the way it manages its workplace relations. The second Partnership also included an agreement that the Fair Work Ombudsman would refer requests for assistance it received from McDonald’s employees back to the company for resolution internally, to the

“Australia has tax changes every year, so realistically we all know that on 1 July every year there will be changes to implement” compliance high on the priority list since signing the Fair Work Ombudsman’s first Compliance Partnership in 2011. The first Partnership was deemed a success, with McDonald’s self-auditing approximately 8,500 pay packets to reveal 100% compliance for wages paid in 2009 and 97% for wages paid in 2010. A second Compliance Partnership was commenced in 2014, with McDonald’s committing to continue to review and evolve

satisfaction of the Fair Work Ombudsman. Fair Work Ombudsman Natalie James revealed that from a national workforce of about 100,000 McDonald’s workers, her Agency received just 33 requests for assistance in the two years ending in June 2016. Only 10 of the requests resulted in a finding that a worker needed to be back-paid. McDonald’s has also put a range of steps in place – auditing of its franchises, an employee hotline, and state-of-the-art time recording –

to ensure that workers get paid for every hour they work. While not all employers can match the resources of McDonald’s in order to remain payroll compliant, the company’s proactive stance is something all employers can strive for.

Prevention is the key Eugene LaFontaine, National Operations Manager – FPS at Frontier Software, says preventative action is critical. “Having a preventative mindset allows you to minimise your risk when it comes to any breaches under the employment legislation in Australia.” How can employers switch their mindset from reactive to proactive? LaFontaine suggests getting to the root causes of payment errors. “The first key cause is software not being configured correctly,” he says. “There is a requirement within our business to ensure that when we’re doing an implementation that data integrity is validated prior to going live.” This process may encompass parallel testing with legacy systems, ensuring the data coming through is correct, that the rules set up behind how the employee is supposed to be paid are true and correct, and most importantly, that the rules applied by the business – the ‘owners’ of the rules – are clearly stipulated prior to setting up the system. “It’s all about ensuring the system is configured correctly according to the rules of the organisation,” LaFontaine says. The business processes around the new software platform also need to be examined. Data integrity is critical. For example, when a new employee is onboarded, efforts should be made to ensure that every data aspect of that person’s employment is checked and validated by the payroll team. Human error will always occur, and sometimes it’s on the side of the employee; for example, when incorrect bank information has been supplied or when leave requests are made. In the latter case, LaFontaine says it’s not unusual to find that there might be an

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CREDIT WHERE IT’S DUE agreement in place between the manager and the individual whereby the manager has approved the employee going into negative leave, but that communication has not been fed through to the payroll team, meaning the individual is underpaid. “Sometimes it’s simply out of the hands of the payroll team,” LaFontaine says.

Eugene LaFontaine, who has worked as part of and with payroll teams for many years, says the importance of the function is too often underestimated. “It’s not just about processing pay,” he says. “Payroll professionals must have a good understanding of finance in relation to posting the payroll results to the appropriate General Ledger accounts. They also need some experience around what we call Award interpretation. With EAs, or Awards, many payroll professionals are given the task of interpreting what should be paid as overtime, what allowances attract overtime and what allowances attract penalties. Most importantly, they have to be exceptional customer service people. They need to be able to explain why someone missed out on overtime pay. Diffusing conflict is a key aspect of their role.”

The critical role of technology Technology can help mitigate the costs of human error. For example, variance reports can be used to ensure an employee is being paid correctly. This involves checking what an individual was paid on the last pay day, compared to what they’re being paid today. The variance may come down to a threshold – for example, it might be a variance of $1 or

$2 – and anything above or below that needs to be investigated. Software solutions can also include an inbuilt ‘Award interpreter’, and LaFontaine suggests the accuracy of this interpretation engine will largely depend on the sophistication of the system being used. “With every product on the marketplace,

and I’ve dealt with plenty of them, you’ll find there are always certain aspects of interpreting Awards where there are gaps,” he says. “If you can get 98% of the interpretation into a solution, the remaining 2% workaround is less significant – but it can still cause an error. The goal is to get 100% of the Award interpretation accurate.”

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RECORD-KEEPING CRACKDOWN At the end of the 2015/16 financial year, the Fair Work Ombudsman released the findings of its checks on the record-keeping practices of businesses throughout Australia. Spot checks of 1,376 businesses in every state and territory found that 988, or 72%, were compliant with their record-keeping and payslip obligations. However, 46 employers were asked to back-pay a total of $620,023 to 336 of their workers who had been shortchanged. Two businesses received a Letter of Caution, putting them on notice that future breaches of workplace laws could result in enforcement action. “It’s important that we check that workers are being paid correctly, but we also want to be proactive about ensuring employers understand their obligations,” said Fair Work Ombudsman Natalie James. “Businesses are required to keep a range of records, and if issues arise, it is usually these records which can show that employees have received their correct entitlements, so we place great importance on correct record-keeping.” Payroll tools and information can be found at fairwork.gov.au.

FRONTIER SOFTWARE Founded in Melbourne, Australia, in 1983, Frontier Software is a global leader in Human Resource, Talent Management and Payroll solutions. Their solution ichris sets the global benchmark for functionality and improved employee experience. With support offices in Melbourne, Brisbane, Sydney, Canberra, Adelaide and Perth and key global locations, Frontier Software are well placed to service their 1,700 clients.

Similar to the variance reports, there will be exceptions to what an Award interpreter can handle. To cite a typical example, if the requirement from the organisation is that each employee must clock on and off, those times will be downloaded to the Award interpreter. That interpreter will look at a range of factors, including the individual’s start and finish times on their roster and whether the person has started and stopped within the threshold of their start and finish times. The system will then interpret the rules that sit behind that employee’s employment with the company. Anything outside of normal roster patterns will be identified and brought to the attention of managers.

Larger organisations should consider system health audits, whereby the software vendor will target specific areas that patrol payments to employees. For example, are the leave rules accruing leave correctly and do these rules reflect changes that may have occurred via an EA or common law requirement? Have any changes been made to the internal HR policy around parental leave and are these reflected in the system? “It’s making sure every two years that what you have in place within the organisation in terms of policies and procedures are set up correctly in the system as well,” LaFontaine says. He adds that such an audit is less expensive than engaging in a tax audit or, worse

“The Frontier system will generate exception reports, which identify anyone who has worked in excess of their hours or if somebody has clocked off before they are supposed to” “The Frontier system, for example, will generate exception reports, which identify anyone who has worked in excess of their hours or if somebody has clocked off before they are supposed to. It will cover those people who don’t fall into the roster pattern that has been set up for each individual – these are essentially the rules of engagement that each employee has with the organisation.”

Further tips While the ‘set and forget’ mentality that business leaders may have had of payroll systems is thankfully largely gone, LaFontaine urges vigilance. “Australia has tax changes every year, so realistically we all know that on 1 July every year there will be changes to implement. Every software vendor should be offering automated updates or, depending on the software being used, it may require rekeying that information into some parts of the system.”

still from a brand perspective, being hit with a Fair Work audit. LaFontaine further recommends doing a once-a-year internal audit. Again, most software providers should offer audit reports within the system, which can provide information in a summarised form that can easily be checked against employees’ personnel records. “The primary component of an audit is checking an employee is engaged on a particular base salary and they are receiving their standard super guarantee percentage. Secondly, are they accruing the right sick leave, annual leave and long-service leave? Further elements, like bonuses and commissions, will be articulated in the engagement letter or the EA. That’s about making sure the rules you have set up, whether it’s a system-driven rule or a manual rule, are being correctly applied to those individuals.”

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FEATURES

TALENT ACQUISITION

RECRUITMENT COMES OF AGE A perfect storm is brewing: workers have new expectations about how they do their work, and employers are embracing the concept of talent ‘on demand’. HRD outlines why recruitment has morphed into talent services and how you can tap into the gig economy REWIND TO 2003. A small tech start-up named LinkedIn launches. Growth is slow initially – some days the fledgling networking platform signs up fewer than 20 new professionals. Today, LinkedIn has over 450 million users globally; on average, two new

industry has faced in the last decade. Behind the change is technology and the new business models that technology has ushered in as companies try to keep up with new consumer and customer behaviours. Enhancing the consumer and customer

“If sourcing the right talent was merely about matching skills and experience to a role, our industry would be in dire straits” Peter Wilson members join every second of every day. Suffice to say, few in the recruitment industry back in 2003 could have predicted what a game changer LinkedIn would become. Indeed, few industries can match the pace and scope of change that the recruitment

experience has become a central focus for businesses – and recruiters have had to react. Is there still a role for recruiters in such an environment? Peter Wilson, CEO of Ignite (formerly Clarius Group), says there unquestionably is – but it’s a different role.

“While it has become easier for businesses to connect with their own talent, there’s still a role for recruiters to play,” he says. “There are 6,900 recruiters in Australia and there’s a reason for that. Recruiting isn’t just about connecting a job opportunity with a potential candidate. If sourcing the right talent was merely about matching skills and experience to a role, our industry would be in dire straits. True recruiting requires you to have a deep understanding of the industry you’re recruiting for, an understanding of the clients’ environment, and an understanding of how a new hire can add lasting value to a client once they are recruited.”

The rise and rise of the gig economy While technology has changed the game, forcing recruiters to do more than put ‘bums on seats’, the labour force itself has also forced their hand. With the growth of the freelance – or gig – economy, the relationship between workers and businesses has shifted. This shift naturally has an impact on recruiters. A report by the Australian Industry Group (Ai Group), The Emergence of the Gig Economy, highlights some of the key challenges facing employers when tapping into these workers (see box opposite). “In response to the complexities surrounding hiring and managing freelancers, freelance management systems are predicted to become standardised,” the report states. “Talent should be viewed as a strategic investment and like any investment there must be a plan in place to engage and measure it to determine a path for future improvement.” A PwC report highlighted the importance of efficient systems and processes as well as maximum operational flexibility to properly integrate freelancers into the workforce. “The 21st century workforce will present new uncertainties to HR and business leaders. Leading companies will need to tackle these

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WHY FREELANCING MAY BE THE WAY OF THE FUTURE In Australia, the largest freelance category in the collaborative or gig economy is web, mobile and software development (44%), followed by design and creative (14%), customer and admin support (13%), sales and marketing (10%), and writing (8%). Data from Deloitte* reveals that 4.1 million Australians, or 32% of the workforce, freelanced between 2014 and 2015.  61% of Australians were aware of collaborative economy services  53% had participated in some form of collaborative economy activity in the past year (formally and informally)  63% planned participating in some form of collaborative economy activity in the near future In terms of employers, the Ai Group identified the three biggest challenges for business leaders looking to engage with the gig economy as:

questions to make freelance work a viable long-term option.” Some recruiters – such as Ignite – have fundamentally changed how they do business in order to better serve clients and meet the demands of a new era of workers.

The best talent, on demand Ignite’s newly launched ‘on-demand’ business model has been driven by the gig economy. “We noticed a growing demand from employers wanting to utilise independent workers for short-term engagements,” says Wilson, who cites Airtasker.com as an example of the gig economy at work in the B2C environment. Ignite wanted to harness something similar for the B2B environment. “We needed to connect people in the gig economy – so these freelancers undertake the work but they also need to be doing that work

in the commercial space alongside established businesses,” Wilson says. Ignite’s ‘online marketplace’ is where this can happen – but it’s far from a free-for-all. The firm has prequalified and vetted any freelancer who wants to be involved. “Essentially what we’ve done is provide prevetted, qualified talent. They’ve had their skills and capability assessed, and in some cases they’ve had security checks done,” says Wilson. While the traditional allure of freelancing has been the ability to work when, where and how you like, Wilson has noticed a slight shift. Now, freelancers are willing to work in traditional office environments for short stints, and employers want them on the premises. “Instead of being in the B2C environment where a lot of this work is done remotely, a lot of our candidates go onto our clients’ sites to work, which is why that

 Legal or regulatory uncertainty  Contingent workers being unreceptive to corporate culture  A lack of understanding among leadership Source: *Deloitte Access Economics based on Collaborative Lab and VisionCritical data (2015)

vetting phase is so important.” The vetting process is also important in removing one of the traditional concerns around engaging freelancers: can they actually get the work done to the standard expected? “When we’re sending a client out on-site, whether it’s for a two-hour gig or a six-month gig, we’re essentially putting our brand behind that. Any risk sits with us,” Wilson says.

From recruitment to talent services Wilson no longer calls his company a recruitment agency. He calls it a talent services

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FEATURES

TALENT ACQUISITION Brought to you by

ALL ABOUT THE GIG ECONOMY ÎÎ The gig economy refers to the growing number of workers abandoning traditional 9–5 employment in favour of working independently on a task-by-task basis for various employers. ÎÎ Workers (particularly millennials) are expressing an increasing demand for flexible and autonomous work, prompting many to engage in freelancing. ÎÎ The emergence of digital talent platforms linking workers and employers is the driving force behind the increasing prominence of the gig economy. ÎÎ As the number of individuals partaking in the gig economy rises, so has the popularity of co-working spaces: environments where professional freelancers work on separate projects in a communal setting. ÎÎ Benefits to employers include a fluid workforce adaptive to change, wider access to hyper-specialised talent, and cost savings. Source: The Emergence of the Gig Economy, Ai Group

IGNITE Ignite is reimagining talent services, providing specialist recruitment, on-demand talent and outsourced recruitment and people services designed to ignite potential for our client organisations, candidates and employees. The company formerly operated under Clarius Group and its brands Alliance, Candle, JavIT, Lloyd Morgan, SouthTech and The One Umbrella.

business. “The key for us is how we triangulate the technical, cultural and strategic alignment of a client’s requirements to a candidate’s ability,” he says. The key to doing this is Ignite’s Future Now Service Delivery Framework, which uses technology (such as search tools), interview techniques, and cultural fit assessments to ensure that when a candidate is put forward to a client they are not only matching a few data points about a person’s skill set, but are matching the holistic requirements of someone being successful in the client’s environment. Coupled with 36 years of specialist industry knowledge (construction & engineering, business support, accounting & finance, information management,

sensitivities. These are critical elements to finding the right person who will have an enduring career in a company, as opposed to finding another warm body to fill a role.”

A rebrand for a new era Clarius Group, a house of specialist brands, will unveil its rebranding as Ignite in November. Wilson outlines why the change is important: “By working under one brand we’re saying to clients that not only do they have the opportunity to engage us to recruit for multiple roles, for which we have deep industry experience, but we can also help with shortterm talent objectives through our on-demand platform. If they have gaps from a performance

“The sourcing of talent has been disrupted, but just like what’s happened in many other industries it’s up to us to understand what disruption is doing to our space and then respond to that” Peter Wilson IT & digital, sales & marketing), the result is a sustainable talent solution. “I have this saying that what is old is new again in recruitment,” says Wilson. “In the old days the best recruiters were heavily tied to everything that was happening in that industry and they did that via a Rolodex. That Rolodex ensured they networked with great clients but also a big pool of talent. And whilst you’ve got technology at the moment that can tap into matching skills, it cannot tell you what’s happening within the culture of the organisation, nor can it tell you the unique challenges that organisation is facing. Then you have to find a candidate who not only has the skills on paper but matches the strategic push of the organisation and also its cultural

management perspective or workforce planning or capability assessment perspective, we can provide them with services that allow them to look at their talent requirements and fill any gaps.” Choice is the key, Wilson adds – and Ignite is committed to giving clients access to talent in multiple ways, whether it’s via the on-demand platform, from its specialist recruitment services, or by providing them with outsourced recruitment and people support for skill gaps they have within their HR department. “The sourcing of talent has been disrupted, but just like what’s happened in many other industries it’s up to us to understand what disruption is doing to our space and then respond to that,” he says.

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PEOPLE

CAREER PATH

GOING HER OWN WAY

Singaporean-born Melissa Wong has achieved much since she arrived in Australia in 1999

SINGAPORE SETS THE FOUNDATION FOR FUTURE SUCCESS

Pre1999

The older of two children, Melissa Wong learnt many lessons growing up in Singapore. In particular, the education system taught her the importance of discipline and hard work from a young age. “I’m grateful to my parents who supported me and knew how hard to challenge me, but also encouraged me to find balance in other pursuits.”

2003

GAINS WIDE EXPERIENCE IN A NUMBER OF FIELDS Work placements are a big component of the professional doctorate program at Melbourne University. Wong opted to work in small consultancies, large consultancies, a manufacturing company, recruitment, and even on a technology project.

“I ended up with my first ‘real’ job working as a consultant in a boutique org psych consultancy as a result of these placements” 2010

MEDIBANK OFFERS A WARM WELCOME The age-old adage is that people leave organisations not because of the work, but because of the people. For Wong, joining Medibank as manager of group learning and organisational development was very much about the people. Her ‘greenfields’ opportunity to shape OD was particularly exciting. “I not only work with an incredible bunch of people, but there are few corporates who I believe are as purpose- and values-driven as Medibank is. Everyone who joins us comments on the warm and welcoming culture. The view that it is our people who make our business strong is one that is held by everyone, including our most senior leaders.”

1999

MAKES A NEW HOME IN AUSTRALIA Wong moved out of home to live in Australia by herself. Prior to that, she had never been to Melbourne, and she remembers immediately feeling like it was like a “second home”. Wong studied a bachelor of arts at Melbourne University, majoring in psychology and economics. “I loved the blend of science, maths – including statistics – and humanities that psychology involves.”

2008

FOLLOWS THE CALL TO HR After several years in consulting, the call to take on an internal HR role was getting stronger, and Wong jumped on an opportunity to join NAB as part of the NAB Academy. She found the move from consulting into a big corporate was exciting, but also required something of a mindset shift. “Working on some of the leadership and talent programs, the capability framework and values were some of the key highlights during my time at NAB. I had the privilege of working with a group of very talented people, and learnt so much about what great practice in OD looks like.”

2016

MOVES TO A SENIOR HR GENERALIST ROLE While Wong has been at Medibank for six years, her roles have changed during that time, as has Medibank – it is now listed on the ASX, for example. Her current role as GM of talent, capability and culture entails leading all aspects of org development, L&D, internal communications and change. “I feel incredibly proud every time I see a Medibank ad, representing the diversity of our customers on TV. It reflects our diversity and inclusion practices – we want people to be able to bring their ‘whole of self’ to work. I’m not only proud of what we’ve done; it is also something that is very personal for me as a working mum with two young children.”

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PEOPLE

OTHER LIFE

Peter Hartnett (above, front row) and his team enjoy the local culture, while helping with the rebuilding efforts (right)

Number of days spent rebuilding the schools

Number of cyclone- and earthquake-proof classrooms built

Number of soccer balls donated to the kids

THE CALM AFTER THE STORM While HR’s prime focus is on people, Peter Hartnett has gone above and beyond this by volunteering in cyclone-ravaged Vanuatu INSTEAD OF holding Sanitarium’s HR conference this year, Peter Hartnett, the company’s head of people and culture, volunteered with 12 staff members on Tanna Island in Vanuatu. Together they helped build two cyclone- and earthquakeproof classrooms to replace the ones destroyed during Cyclone Pam in 2015. “Complete communities were wiped

out as a result of the cyclone. You can still see the devastation of it now. There are so many buildings that haven’t been re-roofed. It’s incredibly tragic,” Hartnett tells HRD. Hartnett and his team were guided through the construction process: mixing concrete, laying foundations, installing side sheeting, and doing lots of painting. On the

last night on the island, Hartnett and his colleagues presented the school principal with a box of books, four blackboards, and some other school resources. “The principal was overwhelmed in tears. He just saw that as being incredibly generous, yet the generosity and warmth that they showed us throughout that week seemed like so much more.”

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