Human Resources Director 14.08

THE QUIET ACHIEVERS LinkedIn’s global HRD on introverted leaders

HUMAN RESOURCES DIRECTOR HCAMAG.COM ISSUE 14.8

THE MISSING INGREDIENT Where are HR directors on boards?

THE KEY TO EMPOWERMENT Transforming fear-based cultures

2016

ASIA-PACIFIC HR REPORT THE BIG INTERVIEW Challenges, opportunities & future Roger Herbert, Timbertop – Geelong Grammar School forecasting from the front line

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EDITORIAL www.hcamag.com AUGUST 2O16 EDITORIAL

SALES & MARKETING

Editor Iain Hopkins

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ART & PRODUCTION

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CORPORATE

Design Manager Daniel Williams

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Traffic Coordinator Lou Gonzales

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‘I WOULDN’T SWAP IT FOR ANYTHING’ IT’S ALWAYS enlightening reading through the comments from respondents to our annual Asia-Pacific HR Report. HR professionals are open about the challenges they face – and believe me, they don’t hold back – but what struck me this year was the overriding optimism in the industry.

Ninety-two per cent of surveyed HR professionals are optimistic about the future of their profession. Certainly this passion and optimism is also seen in the majority of senior HR directors I’ve interviewed in my time on this publication, including this issue’s Pat Wadors, the global head of HR at LinkedIn. “It’s one of the most important roles across the company – getting the right talent, the right leaders, embedding the right skills. I wouldn’t swap it for anything,” Wadors told HRD.

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What impact are you currently having, and what would you like your legacy to be?

She has funnelled that passion into something that genuinely makes a difference. Despite the negative connotation of diversity & inclusion for many in the tech sector, Wadors has made ‘belonging’ – that all-important human desire to belong – the key component of LinkedIn’s D&I strategy. She’s doing her bit to change her industry – and judging by the esteem in which she’s held (she recently spoke in front of 5,000 female leaders at a conference in San Francisco), she’s doing it successfully.

It’s a nice reminder of the difference HR can make in the wider world.

However, for many, it’s enough to make a positive impact in their place of work. This comment from a reader touches on this essential role: “People are the point of difference, change is constant, and an organisation’s success is reliant on effective and engaged people, HR practices and skilled leadership being in place.”

What impact are you currently having, and what would you like your legacy to be?

Iain Hopkins, editor

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AUGUST 2O16

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

CONTENTS 46

HRDirector_au +Hcamag HumanResourcesDirector

UPFRONT 01 Editorial

Why are HR professionals so optimistic?

04 The data

Diversity & inclusion in the spotlight

06 News analysis FEATURES

18 COVER STORY

UNDER (FINANCIAL) PRESSURE Australians are under enormous financial strain – but what role, if any, do employers play?

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2016 ASIA-PACIFIC HR REPORT

HRD’s readers have spoken. In our second annual HR Report, we get the lowdown from the front line on the key challenges and opportunities facing the profession

PEOPLE

A THINKER IN A WORLD OF TALKERS LinkedIn’s global head of talent, Pat Wadors

HR has always been woefully under-represented at board level, but is this about to change?

08 Upfront: Rewards & benefits How some employers are supporting mothers in the workplace

10 Upfront: L&D

Acing leadership development with mindfulness

PEOPLE 12 Head to head

Is pay transparency good for business?

56 Other life FEATURES

LEADERSHIP DEVELOPMENT

James Letherbarrow, HR director at Edelman Public Relations, prefers to get his hands dirty in his time away from work

Coaching or mentoring: which is better for your circumstances?

52 FEATURES

BUILDING A HIGHTRUST CULTURE Instead of a high-trust culture, too many organisations struggle with fear-based cultures. Can the situation be changed?

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STATISTICS

AUGUST 2016

D&I IN THE SPOTLIGHT

People of ATSI background record 20% lower workforce participation

Employers have made progress with diversity initiatives, but a new report indicates there’s a long way to go NO MATTER which way it’s sliced and diced, Australian society is diverse, yet this diversity is rarely reflected in the workplace. It seems there’s a disconnect between perceived levels of D&I and the reality. Some 60% of all respondents to a recent Chandler Macleod survey indicated their organisation had a high level of diversity, but 46% also said this diversity did not reflect Australian society.

More disturbingly, the outlook is not bright,

1 in 5

number of board members who are female

$275bn

potential value to Australia of doing business with neighbours in the ‘Asian Century’ – yet only 5% of senior executives were born in Asia

DIVERSITY: THE STATE OF PLAY

with only 47% believing their organisation will become more diverse in the future.

It’s also apparent that while areas such as gender and multiculturalism have benefited from public awareness, discussion and policy frameworks, other areas have lagged behind; in particular, inclusion of those with disabilities was rated as poor by nearly 30% of respondents.

Here’s an outline of where Australians currently stand on diversity matters.

1 in 3

number of employers who believe age discrimination is a problem in their industry

The Diversity Council of Australia’s 2015 Benchmarking Diversity & Inclusion Practices in Australia report found that the most common D&I initiatives undertaken were bullying and harassment policies and flexible work arrangements. Practitioners reported these initiatives were very effective at minimising discrimination claims (19%), increasing interactions between employees (13%), improving employee commitment (11%), and improving perceptions of fairness and justice (11%). However, few identified their initiatives as being effective in increasing representation of diverse groups (8%) and reducing turnover costs (5%).

46

percentage of practitioners who believe their organisation is willing to spend resources on promoting and fostering diversity

FUTURE GAZING

INEQUALITY IN DIVERSITY

While 59% of employers think their organisation will become more diverse in the future, less than half (47%) of employees share this positive view.

Both employers and employees agreed that not all forms of diversity are treated equally in the workplace. While gender, age and nationality/culture have gained headlines, 30% of respondents rated disability initiatives as ‘poor’. With over four million Australians identifying as having some form of disability and only a quarter of those with a disability participating in the workplace, this needs to be the next major focus area for employers.

My organisation supports the following forms of diversity in the workplace

Diversity will increase in my organisation over the next five years

Gender

26%

Age

25%

37%

24%

42%

9%

22%

4%

7%

4%

7%

4%

8%

4%

72% 7%

12% 32%

34%

43% 16% Employers

4

8%

34% 12% Employees

Strongly agree

Agree

Neither agree nor disagree

Disagree

Strongly disagree

Sexual identity

20%

Nationality or culture Disability Religion

39%

24% 12%

30% 42%

26%

22% 33%

20%

19%

35% Strongly agree

Agree

37% Neither agree nor disagree

Disagree

10% 5% 3%

Strongly disagree

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39% of LGBTI people hide their sexuality or gender identity at work

1 in 5 people in the workforce will be >65 in 2035*

17.9% – national average gender pay gap

Gen Z will make up 27% of the workforce by 2035^

People with a disability record 30% lower workforce participation

Sources: *CSIRO’s Data61 Group ^McCrindle Research, Australia’s Generational Profile

TOP FIVE CHALLENGES OF EMPLOYING A DIVERSE WORKFORCE

BENEFITS OF A DIVERSE WORKFORCE

Communication barriers far outstripped all other perceived challenges of employing a more diverse workforce – are these challenges holding D&I initiatives back?

variety in communication methods 53%

1. Communication barriers (62%) 2. Opposing values & beliefs (40%)

Employers are well aware of the benefits of a diverse workforce, rating their top three as variety of viewpoints (78%); broad range of values and beliefs (72%); and increased range of skill sets (59%). positive impact on team productivity 45% financial growth 18% variety of viewpoints 78% ability to innovate 44% innovative approach to work 44%

3. Conflicting approach to work (33%) 4. Conflicting viewpoints (31%)

increased range of skill sets 59% positive team culture 55% creative approach to problem-solving 54%

5. Negative impact on team productivity (13%)

broad range of values and beliefs 72% *All statistics sourced from Chandler Macleod’s The Future of Work: Unleashing the Untapped Potential of Diversity white paper, except where otherwise noted

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UPFRONT

NEWS ANALYSIS

WHERE IS HR ON BOARDS? HR has always been woefully under-represented at board level, but a new era reveals the time might be right for senior practitioners to step up SHOWING YOU’RE UP TO IT “Don’t wait to be asked to join a board,” says CEO Kylie Hammond of The Director Institute. “Show your worth.”

How can HR directors get noticed and show their worth?

Demonstrate that you understand human capital strategy: “Know how you implement it, how you roll it out, and what you do when it’s going wrong.”

Understand risk, particularly people-related risk: “Managing risk is very important, so for HR it might be around managing the risk of your key talent, retaining top talent in the business, making sure they’re comped at the right level.”

Demonstrate that you are a genuine HR business partner, not a transactional HR executive: “This really comes down to how you communicate that. You have to be able to communicate with influence. You must be able to present successfully at CXO and board level..”

Build a network: “External to your own organisation you should be building up your own network of other chief executives and board members and board directors. Unfortunately, a lot of people at HR director level get very busy and very insular in their thought process. Your personal network is beneficial to the company because it’s the insights you get from other executives in other industries that you may not even think are relevant to your industry.”

Identify which areas the board needs expertise in and create a pitch as to why you fill the gap: “You know the business inside out, so you should know what assistance the board might need. Learn from others, create strong online profiles detailing your successes in HR, and finally, back yourself.”

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HR PRACTITIONERS with an eye on a future board role have traditionally had the odds stacked against them. Rightly or wrongly, the perception has been that HR is a ‘nice to have’ and is not a strategic business partner. However, change is afoot – and it’s being driven by the unprecedented times in which businesses are operating.

you approach different demographics of employees is really quite a challenge. In addition, you have businesses that must be able to turn on a dime, and that means transformation, dealing with technology change, and so on. We need different skills in the boardroom.”

One of the most prized skill sets, Hammond believes, will come from those with HR backgrounds. “Boards need members who genuinely understand people because there’s only three main ways you can get competitive advantage in the market: through your people; through your systems; and through your processes,” Hammond says.

Hammond adds that there’s plenty of “lip service” about people being at the heart of what companies do, but in her view, if you’re a chief executive or chairperson saying that, there should be an HR director in the boardroom.

“Diversity of skill set and mindset in

“You have to demonstrate that you can hold your own in that boardroom setting and that you have a contribution to make. You have to take control of your personal brand and you have to be networked” Kylie Hammond “There’s growing recognition that we don’t have the right skills to deal with some of the challenges we’re facing,” says Kylie Hammond, CEO of The Director Institute.

“We’re living in volatile times. The market is volatile; we have political uncertainty and legislative change. Businesses are trying to deal at board level with issues that were not on the agenda three years ago.”

In addition, organisations face daunting people-related challenges. “The concept of employee engagement has really shifted in the last few years,” says Hammond. “How

the boardroom is critical because it’s about having better conversations. The way boards have been made up is just so old school; it’s an old paradigm,” Hammond says.

First-hand change experience While boards rightfully focus heavily on governance and compliance, there are essentially two fundamentals they are charged with overseeing: strategy of the business – ensuring the business has the right strategy at the right time with the right team executing on it; and risk.

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Risk covers a range of areas: reputational, financial, operational, resources – specifically, people resources. For example, what if an organisation lost its top executive team?

What if the team in place is not successfully implementing the strategy or are struggling to push it out in the field? What if they’re not getting the change initiatives through the business quickly enough?

“The days of three- to five-year transformation projects are gone,” says Hammond. “You have to be able to transform in six to 12 months in some cases. It’s a huge missed opportunity if you don’t have someone in the boardroom who genuinely understands what’s involved, and it’s not good enough to just have them reporting to the board. It’s not good enough to have them show up for a presentation. They have to be in the room and part of the conversation.”

Research carried out by MGSM and Blenheim Partners, which interviewed over 80 business leaders, chairpersons, directors and CEOs, sums up the desperate need for HR to be on boards.

One director said: “The favourite line of

all companies is that our most important asset is our people. Yet I am not aware of any head of HR or ex-head of HR on boards in Australia. Company culture is key to driving results and those that have built a career in supporting company culture, such as HR executives, for some reason are not on boards. I am reminded of that quote ‘culture eats strategy for breakfast’. If that is the case then culture drives growth. Then I ask the question, would it help to have ex-HR directors on the board? In my opinion, a good HR director is someone who has been a head of division, has run a P&L and then moved into HR and supported the CEO and organisation. That type of person I believe could have a role on the board.”

The time is right Hammond says a “new breed” of chairpersons and board directors “get it”. “They understand the importance of having that skill set and experience in the boardroom,” she says.

“We’re seeing younger board directors being appointed, which is fantastic, and we’re seeing diversity coming in, so more people

with IT, marketing and HR backgrounds.”

However, it’s now up to suitably qualified and experienced HR professionals to step up to the plate.

“You have to demonstrate that you can operate at that level. You have to demonstrate that you can hold your own in that boardroom setting and that you have a contribution to make. You have to take control of your personal brand and you have to be networked. But most important, you have to demonstrate that you can operate at that level before you even get in the door.”

A career capstone Hammond maintains that serving on a board can be “the pinnacle of a career”.

“You have an opportunity to give back, an opportunity to have a major impact on the success of a business, and you have the opportunity to create what can be a second corporate life or career. When your HR director career comes to an end you could transition to having a very successful board career – and be well rewarded and remunerated for doing so.”

BACKGROUNDS OF NEDS IN THE ASX 100 The Blenheim Partners/MGSM research paper, The Challenges of Attaining Growth, interviewed over 80 business leaders, chairpersons, directors and CEOs. The research revealed the majority were quite open to exploring future directors with a broader base of occupational backgrounds than those traditionally preferred.

Here’s a summary of the individual backgrounds of each non-executive director in ASX 100 boardrooms (as at May 2015) Executive industry experience

50%

Previous CEO experience

36%

Female director

24% 15%

Non-resident Senior public servant

3%

Academic

2%

Head of technology

2%

Scientist

2%

HR director

1%

Former politician Trade union leader

1% 0.1%

0

10

20

30

40

50

Percentage of total directors in the ASX 100

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UPFRONT

REWARDS & BENEFITS NEWS BRIEFS Virtual rebirth of the suggestion box

US-based firm AFN Logistics has a unique yet lucrative way of inspiring its employees: a $5k payout for the person with the most innovative idea for the company.

Through a virtual suggestion box, employees can submit ideas on how to make the workplace better. Other employees can ‘up vote’ ideas and make comments on submitted proposals. For the past few months, the dashboard has been open, with 57 suggestions submitted so far. These include ideas such as break-room improvements and transportation management software.

The employee who submits the best idea will receive $5k and a guarantee that it will be implemented.

Investment banks pare back overtime

J.P. Morgan has promised that new recruits won’t be pushed as hard as the bankers of old by delivering a company-wide policy that forbids all staff from working late at night or over weekends unless on a live deal.

In what’s being called a huge cultural shift within the investment banking industry, leaders will no longer expect subordinates to work late into the night.

Staff are being encouraged to work from home through remote log-ins, and younger bankers are no longer required to go to business school to receive a promotion.

Virgin Australia wins out with work-life initiatives

Virgin Australia has been crowned Australia’s Most Attractive Employer, with recent research showing that over half of all Australian employees would like to work for the iconic airline. In May, the airline picked up first prize at the annual Randstad Awards.

It’s the second consecutive year

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that Virgin has topped the list of enviable employers, narrowly beating rival Qantas. The research showed that Virgin is particularly attractive to workers for offering a good work-life balance, a pleasant working atmosphere, and strong management.

Randstad also reported that 84% of workers would leave their current job to work for a company with a better corporate reputation.

Self-talk the key to better performance

Four words – “I can do better” – have been shown to improve work results, according to a major new study.

BBC Lab UK tested which physiological skills would help people improve their scores in an online game. More than 44,000 people took part in the study.

The research examined whether one motivational method would be more effective for any specific aspect of a task.

The methods tested included self-talk, imagery, and if-then planning.

People who used self-talk (for example telling yourself “I can do better next time”) performed better than the control group in every portion of the task.

Who are the top attractors?

LinkedIn’s first-ever ‘top attractors’ list, based on examining the billions of actions of LinkedIn’s over 433 million members, has revealed that KPMG, PwC and Commonwealth Bank are the top three employers in Australia.

The top five things workers take into account when considering a company are a competitive salary (63%), opportunity for growth (53%), health of the business (48%), whether the commute is short (39%), and whether they like their potential boss (37%).

Flexible remote working (56%) and strong healthcare benefits (37%) are the top two perks that are most important to Aussie workers.

SUPPORTING NEW MUMS More employers should take a hint from Mercy Health, which has won numerous accolades for supporting breastfeeding in the workplace Mercy Health has received the seal of approval from the Australian Breastfeeding Association (ABA) for championing breastfeeding in the workplace – the 10th consecutive year the Catholic health organisation has received accreditation from the ABA. As part of its Breastfeeding Friendly Workplace accreditation, Mercy Health offers employment conditions that support women to combine breastfeeding and work, including lactation breaks, flexible work options and access to private rooms to express breast milk.

Executive director people, learning and culture Kate McCormack says breastfeedingfriendly workspaces should accommodate and support women who need to breastfeed or express milk during working hours.

“The organisation, not only HR, has a role in making breastfeeding in the workplace as easy as possible,” McCormack told HC Online.

“If a conversation needs to be had with a manager about the importance of allowing extra short breaks for a limited period, HR should support the staff member with this,” she says. “Ultimately, flexibility is key during this time.”

McCormack says employers need to find a balance between strategic business objectives and a commitment to employee health and wellbeing, equal employment opportunity, diversity and CSR. She says creating a breastfeedingfriendly workplace also goes a long way in helping organisations to retain talented staff, as more mothers will feel supported to return to work while still breastfeeding.

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While some employers may not be able to designate a special room for staff to use for breastfeeding or expressing milk, they can take other practical steps to accommodate their employees, McCormack says.

“Employers should take into account other spaces such as a private office, first aid or meeting room,” she says.

McCormack stresses that toilets are not a suitable option, and encourages employers to consider flexible hours of work, working from

“Organisations need to remember that the needs of a breastfeeding employee are minimal and often for a short period of time” home, or an alternative site with suitable facilities.

The CEO of Mercy Health Group, Stephen Cornelissen, says establishing breastfeeding support as normal in the work environment also has flow-on effects by contributing to a breastfeeding-friendly culture in society more broadly. “Supporting breastfeeding employees is quite simple and inexpensive but makes an enormous difference to working mothers,” he says.

McCormack adds that more employers need to adapt and embrace the needs of mothers who wish to breastfeed for longer.

“Organisations need to remember that the needs of a breastfeeding employee are minimal and often for a short period of time.”

Q&A

TIME FOR A BENEFITS REVIEW? Tracy Mellor Managing director ANZ and group people director REWARD GATEWAY

Fast fact Over 60% of 2,500 new graduates surveyed

by Indeed said they wanted to work for an employer that would put money towards their student debts.

Only about 3% of US employers offered loan assistance in 2015.

How often would you suggest employers undertake a review of their benefits offerings?

Treat benefit reviews like health check-ups. Do one every year, even if it’s just a quick chat with your doctor. Ask yourself the following questions: » Does my benefit strategy still support the business in the right way? » Are my current benefit offerings still ‘healthy’ – are they competitive, compliant, and cost-effective? » Are my benefits understood and getting the appropriate ROI and VOI (value on investment)?

Depending on the responses, you may need to bring them back to ‘health’.

Every two or three years do a more in-depth, structured review, like a comprehensive medical exam. At Reward Gateway we just went through this process: conducted an assessment of each and every benefit, checking them against our ‘health standards’, which were our new benefit principles.

When making a decision about what’s on offer, how should HR professionals decide which rewards are right for their organisation?

It depends on your rewards strategy and the principles you’ve put in place. Are you using rewards to attract talent, engage staff and/or retain employees? If it’s attraction, you’ll need to not only provide a comprehensive rewards package but one that will stand out from your competitors. To improve engagement, consider those that draw employees back to them like a discount program, or create that ‘feel good factor’ like a recognition program. To achieve increased retention, it may be creating something ‘sticky’ like an employee share program.

If something has to be changed (eg a benefit needs to be dropped), how should this be communicated to employees?

Change should always be done in a thoughtful and strategic way and only after you’ve understood the impact. To really engage with your employees, they deserve to know not only what was changed and how it will impact them, but also why the decision was made.

What do you see as being the biggest failure when it comes to withdrawing a benefit?

Line managers have a critical role to play. They have a unique perspective; they aren’t as ‘close’ to benefits as HR are, so may bring a view that we may not have considered.

One of the biggest failures I’ve seen in withdrawing benefits is not being honest about why you’re doing it. If you’re removing or changing a benefit solely based on cost, your employees will know that it’s all about the money – so just say it as it is and don’t pretend otherwise.

Picture yourself on stage. Can you explain it? Can you justify it? Can you do it in an open and honest way, not covering up any of the truth or messages? If you can do this, and communicate the change effectively, you have a much better chance of keeping your employees engaged.

Remember, withdrawing a benefit is a huge decision and should not be taken lightly. It’s important to consider the impact of the change both in the short and long term, and ask yourself if it’s worth it.

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UPFRONT

L&D

ACING LEADERSHIP DEVELOPMENT WITH MINDFULNESS Intense pressure can undermine both leadership and learning. Is mindfulness the answer?

After recently clinching the French Open, Novak Djokovic became the first man in almost half a century to win four consecutive major tennis championships.

The 29-year-old has revealed in multiple interviews that one of the secrets to his success is meditation.

“Obviously, there is a huge amount of pressure and stress and everything involved, so you need to have a place where you know you can switch off and recharge your batteries,” Djokovic said in 2013 when discussing his visits to a Buddhist temple in Wimbledon to meditate.

In fact, Djokovic first became number one in

NEWS BRIEFS

2011, which was also the year he began meditating.

This is just one example of the strong correlation between high performance and steadiness under that pressure, says Michael Bunting, founder of the leadership consultancy WorkSmart Australia and author of The Mindful Leader.

Mindfulness allows you to take control of your mind and obtain a better sense of stillness, openness, curiosity and learning, Bunting tells HRD. “It helps people deal with uncertainty and stress, and over time you get this profound sense of inner balance and equanimity,” he says.

A new training centre for The Good Guys

The consumer electronics retailer The Good Guys has unveiled a new leadership and learning centre in Melbourne called The Refinery.

The centre’s overarching aim is for team members to “become the best versions of themselves by refining their skills through experiential learning and immersing themselves in their own development”, said Jaime Ehrhardt, chief people officer at The Good Guys.

The centre offers experiential programs and includes a range of learning environments, such as workshop settings, a chill-out zone and a library.

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Bunting has asked clients what hampers their learning, and the common response is related to fear or feeling overwhelmed.

This is important because there are two things in particular that learning requires: curiosity and non-defensiveness. He refers to an article written

by Chris Argyris from Harvard University, called Teaching Smart People How to Learn.

“One of the key points Argyris posits in that article is the reason why top executives don’t

“Good mindfulness practice will teach you to start dealing with your difficult feelings, and that is crucial for learning” learn well is because of what he calls a ‘profoundly defensive reasoning posture’,” says Bunting.

“This means that when things go wrong, typically what happens is the blame game or the rationalisation game.”

This defensive reasoning happens when people get feedback, which is very important because asking for feedback is a critical leadership competence.

“They haven’t been taught what mature mindfulness practice teaches you to do, and they haven’t been taught to cope or deal with difficult feelings.”

Consequently, when leaders get difficult feedback they invariably end up defending and rationalising.

White Ribbon to train Triple M staff

Triple M has announced that all on-air staff will undergo training from the domestic violence charity White Ribbon. The announcement comes after the public outrage over Collingwood president Eddie McGuire’s on-air comments about drowning the sports journalist Caroline Wilson.

“The Triple M employees involved in an on-air discussion before the Freeze MND have been counselled and each have apologised for their remarks and acknowledged the importance of stamping out language and behaviour that encourages or appears to tacitly endorse violence, most particularly against women,” said Triple M in a statement.

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Q&A

Paul Leitch Principal NOUS GROUP

and former COO QIC

Fast fact A UK report from the CIPD and Towards Maturity shows that 50% of business leaders believe that L&D staff lack the necessary technical expertise for the digitalised future of work. Moreover, just 23% of L&D leaders believe their teams have the correct skills to exploit technology for business advantage.

PROVING L&D’S WORTH IN TOUGH TIMES How should HR go about proving the value of leadership development?

Is the Kirkpatrick/Phillips model still useful for determining ROI of leadership training?

Building a mandate to invest in leadership development is about focusing on what the business most needs and considering leadership in that context. What challenges can we address and what priorities can we accelerate by investing in leadership development?

I don’t think leadership development is solely an HR responsibility. It must be a whole business imperative, and business leaders play a critical role in determining capability requirements relative to broader goals and aspirations.

Anchoring leadership development in how the organisation will deliver on its aspirations is critical to realising value.

When it comes to leadership, it’s important to be clear about what you’re measuring, and the KP model provides a useful reference.

Research suggests a general over-reliance on softer measures – determined by intuition, perception and observations – rather than harder measures such as productivity or contribution to business success.

The KP model is about having evidence beyond satisfaction levels to truly understand the difference achieved as a result of training investment.

In determining ROI, HR metrics (distinct from business metrics) should seek to identify improvements in such things as productivity, cost-to-income ratio and quality of work. That is, any training investment should focus on results over activity – effectiveness over busyness.

Should we expect instant payback or is this more of a longer-term return on investment?

The 70/20/10 model tells us that we learn 70% of what we need to know in the role. But many traditional training measures fail to capture this. So true ROI lies in how we design roles that have challenge and stretch inbuilt but also highlight when formal development experiences may be required. This is the intersection between performance management and improvement (or development), and timely, constructive feedback is the best example of this.

If employees are awake to the opportunity offered by their role and seek to do it better, we should see payback on leadership investment every day. Longer-term results depend on whether learning in the job remains an ongoing focus.

Complex jobs may guard against cognitive decline

Psychologists, social workers, lawyers and teachers may have stressful jobs, but new research indicates the complex nature of their work and the mentoring/ social engagement involved mean they are more protected against cognitive decline.

However, simple jobs involving taking instruction were deemed less complex and more vulnerable to developing memory loss later in life. A different study (also published at the international conference of the Alzheimer’s Association in Toronto) found that people could protect themselves against memory loss by following a “mentally stimulating lifestyle” and avoiding a poor diet.

How about pre- and post-training assessments – are they a handy way to assess effectiveness?

This is perhaps the most important part of any training or development approach. Setting down the expectations an intervention will have of performance and contribution should be a non-negotiable. It should be agreed up front what difference the experience should make and be proactively monitored.

Failure to do this devalues the investment and undermines the benefits of well-designed, targeted and implemented learning experiences.

The role of respectful language

The Diversity Council of Australia recently announced a campaign to educate the workplace to use language that’s relevant to everyone. This includes avoiding words like ‘guys’ and ‘girls’.

Such training may also reduce friction caused by political differences.

Rosemary Haefner, CHRO of CareerBuilder, said respect and dignity behavioural training was one way to help promote tolerance of different ideas.

However, critics argue that too much focus on appropriate language is political correctness gone mad, time-consuming and harmful to freedom of speech.

Exercise for better memory, says study

Hitting the gym or playing a sport after learning will help boost memory. The catch is that it must be around four hours after the learning has taken place, according to researchers at the Radboud University Medical Centre in the Netherlands.

The results found that people who exercised four hours after learning new material retained information better two days later than those who exercised either immediately after learning or not at all.

The results suggest the potential for exercise to improve long-term memory in educational, corporate and clinical settings. www.hcamag.com

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PEOPLE

HEAD TO HEAD

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

Is pay transparency good for business?

It’s long been a contentious issue – should employees know what others are paid?

Shanyn Payne

General manager, human resources Swinburne Online Definitely – here at Online Education Services, one of our remuneration principles is to be transparent about pay without breaching individual confidentiality. While we haven’t taken the controversial step of publishing everyone’s salary on the intranet, we’re open about how our employees’ salaries are benchmarked. We communicate a lot with our employees about how their salary is set and encourage them to speak with their manager or HR if they have any questions.

Being transparent with our benchmarking and having solid remuneration principles in place helps to eliminate any bias that might occur and keeps our employees satisfied and involved in the process. By removing the issue of salary in the workplace, we can concentrate more on other key performance and engagement initiatives that make OES an accredited Aon Hewitt Best Employer.

Hamish Deery

Head of talent and rewards Willis Towers Watson Organisations must design, deliver and communicate remuneration programs that are perceived as equitable, to attract, engage, motivate and retain talent. Pay transparency can be achieved through mechanisms such as a strong job architecture, where jobs are sized to reflect the scope and content of the roles, and aligned pay structures.

Best-in-class organisations share their remuneration strategy with employees, including their total rewards philosophy, how pay structures keep pace with the market, and the criteria against which variable pay decisions are made. They may also choose to communicate where an individual’s pay falls within a range or relative to a market benchmark. We find these factors are as important to the employee experience of pay equity as the absolute pay level – sometimes even more so.

Amanda Jackson

General manager, human resources LG Electronics Australia We believe employees should have the opportunity to determine where they sit within their peer group remuneration bracket. We also believe that we have a duty to our staff to be transparent with processes and factors determining salary review outcomes.

However, we also believe that an individual’s pay should remain confidential. Firstly, there are few industries where identical workplace packages are the norm.

Secondly, managers need freedom to exercise their strategies for retaining valuable staff.

Ultimately, we believe it is crucial to respect privacy and confidentiality in our workplace, and while we endorse pay transparency, sharing individual packages is where we draw the line.

EMPLOYEE PAY: REVEAL ALL OR KEEP IT SECRET? For workers at the US supermarket chain Whole Foods, company salaries are shared knowledge. The business has an open policy allowing staff to check anyone’s salary or bonus from the previous year, all the way up to CEO level. The goal is to encourage conversations about salary among the staff and to promote competition within the company. Indeed, in a recent article for the Wall Street Journal, Dr David Burkus, an associate professor of management at Oral Roberts University, suggested that a lack of transparency could enforce the gender pay gap and other types of discrimination. Regardless of research, employers need to consider the contractual legal ins and outs of pay transparency and whether pay secrecy is vital to competitive advantage.

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GLOBAL HR LEADER

PAT WADORS – LINKEDIN

A THINKER IN A WORLD OF TALKERS Do you pause before you speak? Do you have what could be described as a ‘rich inner life’? You’re probably an introvert. Iain Hopkins chats to one global HRD who uses introversion to her advantage

PAT WADORS, global head of talent at LinkedIn, starts her conversation with HRD with a personal anecdote from when she first started at LinkedIn three years ago.

“People would see me standing at the back of leadership meetings. Someone said, ‘Pat, what are you doing? You’re head of HR; go sit on the front table’. I said, ‘I can’t do that.’ When I was asked what that meant I explained that I felt overwhelmed and didn’t want to use up all my energy in one go; it was like stranger danger in my head. I felt uncomfortable.”

Wadors elaborates that it wasn’t that she felt overwhelmed by her role, which is the most senior HR position globally at LinkedIn – far from it – but she was displaying the typical traits of an introverted leader.

“Being an introvert has been interesting to me because that’s my energy – I like to read, to be with my family, to spend time with a few close friends. My energy thrives when I’m mainly by myself. When I’m with my work team and my employees, they see me and think I’m extroverted because I give all my energy

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away. They don’t see me at the end of the day when I’m by myself and exhausted.”

Wadors says “unstructured” settings make her anxious – hence she generally does not stick around for happy hour after-work drinks, and networking in her previously held sales

probably not going to happen – introverts want to have fully formed ideas, not halfbaked ideas, before they open their mouths.”

With the help of a coach and also renowned author and TedX speaker Susan Cain, Wadors says she “learned to

“If you want to lead you need to take away the guessing work of people around you as a leader.

You need to tell them who you are so they don’t misinterpret you” roles was difficult. It was only when a coach told her that she was an introvert “but no one else knows that” that things started to click.

“If you want to lead you need to take away the guessing work of people around you as a leader. You need to tell them who you are so they don’t misinterpret you,” Wadors says.

“For example, if you want to bring the best out of me during a brainstorming session it’s

navigate” her own personality type: she discovered her strengths, weaknesses, how she communicated, how people perceived her.

These personal experiences have resulted in a LinkedIn program called Quiet Ambassadors, co-designed by Cain and her organisation, The Quiet Revolution.

“It’s teaching people about how to pull out the best in yourself, no matter your personality.

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PROFILE Name: Pat Wadors Company: LinkedIn Title: Global head of talent Years in the industry: 3 years, 4 months Previous roles: »»HR executive adviser, Twitter »»SVP HR, Yahoo! »»CHRO, Align Technology Honours and awards: 2015 Top 50 Most Powerful Women in Technology – National Diversity Council Honours and awards: Ramapo College of New Jersey – BS Bus Mgmt, HR Mgmt/Minor Psychology First HR role: Senior compensation analyst, Viacom

www.hcamag.com

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GLOBAL HR LEADER

PAT WADORS – LINKEDIN It’s about not feeling overwhelmed by the extrovert who likes to speak over the top of others,” Wadors says.

Those on the pilot program are being taught how to be advocates for others, so it can scale up in every LinkedIn location around the world.

“They’ll be taught how to be an introvert leader or how to manage introverts. We’ll include extroverts next time round so they can manage introverts and get more from them.

“There’s a perception that introverts want to be let off the hook and not have to talk, not have to contribute. That’s not really true.

But it’s getting them to talk in a way that they don’t lose energy. We’ll teach both sides of the coin, so how to get the most out of each other.

The ambassadors are being taught how to do that in a six-month program; they’ll get a certification and then they’ll do the next class,” Wadors explains.

What’s the top tip Wadors has discovered?

She focuses on brainstorming sessions, which for introverts can be scary. “You’re processing a million things really fast, and by the time you format an idea the room has already moved on.

Then people are pressuring you – you’re not adding any value because you’re not talking.

Introverts like to write their notes and submit their notes to the team, but the ship has already left so it leads to frustration,” she says.

Wadors teaches others how to inject their initial thinking into a room of people, and to validate that this initial thinking is worth communicating. It doesn’t have to be 100% right, but it’s getting into the habit of speaking out. She also teaches people how to use their body language to communicate more. “I actually spent time in a leadership meeting a year ago to test my theory out. I said, ‘I communicate more with my body than I do with my words’ – no one believed me. When I was in a three-hour meeting, all I did was lean in, write notes, and nod my head. By the time I walked out my boss said, ‘Great meeting, everyone participated; I know what everyone is thinking’. He never knew I didn’t say a word. He read my body

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language; he knew where I was aligned, where I wasn’t aligned – just because of how I was behaving. That’s powerful.”

Tackling gender inequality Being an introvert advocate is not the only issue Wadors has focused on. She has also targeted D&I. Although she’s undertaken research and spoken on the topic, she says this is not sufficient to “move the needle”. Instead, she says it’s necessary to change people’s minds and hearts and concentrate on ‘belonging’.

“That’s what people need – to feel like they belong,” she says. “They want to know they are wanted, needed, they are safe. It’s one of those things that we as humans seek. If we don’t create belonging moments, if we don’t transform the moments of uncertainty when you’re being hired or onboarded, these people won’t stay. They won’t feel they fit in, they won’t thrive, they won’t show their best selves.”

Wadors has developed the dibs (Diversity, Inclusion, Belonging) initiative, which refers to the practice of ‘calling dibs’ on something – you might call dibs on a last slice of pizza, for example. “I thought it would be interesting to call dibs on diversity,” she says. She spoke to around 5,000 women at a Professional Businesswomen’s Conference in March about the dibs concept and it was well received.

“Since then I’ve been saying that belonging has no borders – it includes everybody. It’s whatever makes you unique – it could be your religion, your socio-economic status, your age, the colour of your skin. It doesn’t matter; everyone wants to belong. It takes the emotional heat out of diversity and asks what is the natural social grace you want to apply to everyone? How do you make people feel warm and welcomed and relaxed and to be themselves?”

Wadors cites myriad research, and one of these studies looked at students and belonging.

This piece of research suggested that around 20–30% of time is wasted when students don’t feel they belong. “It’s the black male at university who worries about how closely he follows a white female through a door. It’s how they

USING INTROVERSION TO YOUR ADVANTAGE Pat Wadors provides three tips for bringing your best self to work: 1. “Introverts love processes and lists.

If you create a development plan for yourself each year and create an agenda for your boss it can be easier to articulate your needs as an introvert. For me, I go to my boss, my CEO, and ask for feedback every other week. I do it as part of a routine. I ask him, what do you need me to do? If I put it as part of my everyday process I’m less shy and reluctant to speak up.”

2. “As part of a typical team meeting there might be, say, eight agenda items.

I’ll highlight two of them that I’m very passionate about. I’ll write one note on each.

I commit to verbalising that idea. I start to voice my internal thinking.”

3. “Another rule of thumb: if you think of something three times, you must say it in that room. Don’t let yourself off the hook. Once you become good at that, do it two times.

If you think it twice, you must speak up. You care about that thought for some reason, so let’s voice it and see what happens. That gives you the power to talk where an introvert would naturally want to recline. You can train yourself and it does get easier.”

dress, how they talk. They put so much energy into that, it distracts them from their study. It distracts them from how they listen and learn in class because they’re worried about the next thing they’re going to say. So the thought to my peers is to create belonging moments and teach moments of belonging behaviours to make it natural, like building blocks.”

To ensure the program is gaining traction, the next bi-annual LinkedIn engagement survey will introduce five new questions about the dibs initiative. “I can’t wait for those results, but I’m super excited to see how we’re tracking,” Wadors adds.

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COVER STORY

HR REPORT

2016

ASIA-PACIFIC HR REPORT The HR profession has spoken. For our second annual Asia-Pacific HR Report, we asked over 3,000 HR professionals about their own aspirations, as well as the hurdles and opportunities they see in HR. The result is a revealing portrait of a dynamic, evolving and challenging industry

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WHAT MAKES HR professionals tick and what’s keeping them up at night? HRD sought to find out from the source: we surveyed 3,184 HR professionals for their views on their profession.

First, the negatives: constant change, fewer resources, less time. Now the positives: unbridled optimism about where HR is heading as a profession, an increasingly stable presence on executive teams, and more effective technology and data tools, which are leading to greater insights and thus credibility.

There are areas to improve and the function itself is something of a constant ‘work in progress’ – some 47% of HR teams have restructured over the past 12–24 months. HR professionals are working on themselves, too. Seventy-two per cent of HR professionals will be undertaking some form of professional development over the next 12 months, with the key focus areas being communication and influencing skills, and building business acumen.

WHERE ARE RESPONDENTS BASED?

WHERE DO RESPONDENTS WORK?

A total of 3,184 respondents from 12 countries took part in this year’s survey, with the bulk coming from Australia, New Zealand and Singapore.

The bulk of respondents came from mid- to largesize companies. 12% of respondents hailed from the healthcare and social assistance sector; 10% came from professional, scientific and technical services fields; 9% from manufacturing and 9% from financial & insurance services; 7% from education & training; and 6% from information, media and telecommunications.

Hong Kong

2% Other

7%

COMPANY SIZE

Singapore

8% Australia

64%

1–99 employees (16%) New Zealand

18%

SURVEY PARTICIPANTS

100–499 employees (31%)

Some 51% of respondents were at HR director level or above.

HOW LONG HAVE YOU WORKED IN HR?

GENDER

27%

58%

male

73%

female 500–999 employees (13%)

JOB TITLE 24% 16%

14%

HR director/VP/manager

37%

HR advisor/consultant/executive HR assistant/coordinator 37%

1% Less than 1 year

CHRO

1–5 years

6–10 years

10+ years

Other

12%

1000+ employees (40%)

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COVER STORY

HR REPORT

2016 CHALLENGES AUSTRALIAN Change may be the new norm but that does not mean it’s getting any easier for HR professionals. They voted ‘managing change’ as their biggest 2016 challenge, followed by employee engagement & retention.

WHAT ARE THE BIGGEST CHALLENGES FACING THE HR PROFESSION?

Least important

Most important

Respondents were asked to score a list of priorities in terms of importance. Here are the overall results, from 1 (least important challenge) to 5 (most important challenge) Average score 3.93

Managing change

3.92

Employee engagement & retention

3.82

Demonstrating value as a business partner

3.72

Building internal credibility and influence

3.60

Other*

3.55

Employee development

3.30

Employee recruitment

3.12

Adapting to new technology

2.96

Dealing with legal changes

*Other responses included managing an ageing workforce, using data and analytics more effectively, industrial and employee relations, and building leadership capabilities

ORGANISATIONS

are operating in unprecedented times.

Uncertainty, wrought by global events (terrorism, political turmoil) and local events (political and economic uncertainty) means many organisations need to be able to turn on a dime; the ability to make rapid responses to external and internal pressures is now de rigueur. Especially in the context of an election year it’s no surprise that managing change was the number one challenge cited by HR leaders. As this reader summarised: “Part of HR’s success comes down to our ability to deal with changing political and economic environments, which have a flow-on to nearly all HR activities and workforce capability.”

Some HR professionals are struggling with the pace of change and the constant battle to do more with less. One HR leader from the building and construction industry in Perth wrote: “Cost and workplace design pressures are our biggest challenges. We get stuck in downsizing cycles but never have enough time to build up before moving into another one. It’s a race to the bottom driven by money, when with money and good HR you could make more.”

For some it’s about creating work cultures that are open to this era of constant transformation, and bracing the workforce for this change: “It’s about changing

HOW IMPORTANT DO YOU THINK THE FOLLOWING TRAITS ARE IN AN HR LEADER?

1 Integrity

2 Emotional intelligence

3 Business acumen

4 Persuasiveness

5 Flexibility

6 Intelligence

7 Other*

8 Assertiveness

9 Humility

*Other responses included communication skills, resilience, adaptability and technical competence

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many readers, it’s the powers of persuasion, influence and the ability to ‘sell’ ideas, concepts and initiatives that remains critical to the function. “We need to change the perception of the HR department as being ‘red tape’,” wrote one reader. And this: “People still don’t trust HR. We need to work on building our integrity and powers of persuasion.”

For those wanting to get ahead in HR, the recurring theme is around business acumen. This rounded out the top three

most important traits. “Part of HR’s problem is convincing other business leaders that we are not just about ‘the soft stuff ’. We need to know how the business operates and what makes other business department heads tick. Only then will we gain credibility,” wrote one HR business partner.

Best of all was this comment: “A good HR professional who truly understands their organisation is the ‘canary in the mine’.

We should be the warning system for the organisation on people issues.”

WHERE IS HR SPENDING ITS TIME? Respondents were asked how much they were personally involved in a number of areas. Each area was rated from 1 to 5 (1 being rarely involved and 5 being heavily involved).

Average score Heavily involved

established mindsets and practices, being open to change,” wrote one Sydney-based HR director in the pharma sector. Another bemoaned the default setting that many people have towards change: “Change management is the greatest barrier. Employees always tend to resist change even when the outcome is positive for everyone.”

Some readers are still on the path of changing perceptions of the HR function itself.

“For me it’s about changing organisational thinking from HR being a reactive resource to be a proactive resource and engaging with them at the beginning of a project/task.”

Another commented: “It’s about shifting from operational/transactional HR work and into the strategic work.”

‘Demonstrating value as business partner’ and ‘building internal capability and influence’ were cited as the number four and five challenges. For some, it’s the age-old problem: the HR function has evolved, but others are stuck in the past.

“My challenge is demonstrating value to a business and influencing old school thinkers who believe HR just hire & fire,” said one reader. Another wrote: “I get bogged down in policy for policy’s sake and not having the ability to change from ‘HR agenda’ to ‘business agenda’.”

Many HR professionals simply cited time – or lack thereof – as being a key challenge. “Having the confidence and time to innovate and try new things. Not seeing barriers as the end of the road but using influence to ensure the best outcomes for the business and the people,” wrote one HR director working in hospitality.

4.03

3.99

3.62

3.55

Staff development and training

Recruiting the best talent

Identifying risks, regulating and ensuring compliance

Reducing costs

3.47

Enhancing employee productivity

2.25

Expanding to new markets

2.18

Helping the sales and marketing departments to acquire, serve or retain clients

When asked which traits are most important for HR leaders to overcome these challenges, it’s refreshing to see that integrity remains the most important, followed by emotional intelligence and business acumen. For

Rarely involved

Getting ahead

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4/08/2016 11:59:08 AM

COVER STORY

HR REPORT

SKILLS, KNOWLEDGE & PROFESSIONAL DEVELOPMENT Communication and influencing skills, followed by business acumen, are viewed as the top skills required by HR. How are they obtaining these skills?

Sixty-one per cent have spent time outside the HR function and 32% have spent time working overseas.

THE ASIA-PACIFIC HR Report provides interesting insights into how HR has gained the experience they have up to this point in their careers, as well as the skills and knowledge they believe will be most critical to their success over the coming 12 months.

WHAT SKILLS AND KNOWLEDGE DO YOU THINK WILL BE MOST CRITICAL TO YOUR PERSONAL SUCCESS OVER THE NEXT YEAR? Respondents were asked to rank a list of 12 skills/competencies in terms of importance. Here are the overall results, from 1 (most important) to 12 (least important).

1 Communication and influencing skills

2 Business acumen

3 Leadership capability

4 Change management

5 Relationship-building and networking

6 Emotional intelligence

7 Coaching and mentoring skills

8 Technology

9 Employment law

10 Big data and analytics

11 Financial management

12 Other*

*Other responses included cultural intelligence, time management and project management

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The journey to now

HAVE YOU WORKED IN OTHER FUNCTIONAL AREAS APART FROM HR?

HAVE YOU EVER WORKED IN AN OVERSEAS ROLE?

HR is often criticised for having ‘siloed careers’ – they have spent time in the HR function and nowhere else. However, 61% of respondents indicated they had worked in functional areas outside of HR. Another surprise, given the perception that HR is removed from client-facing roles, is that ‘customer service’ (32%) was the most frequently cited area that HR spent time in prior to moving into the profession. Other popular areas were finance (21%) and operations (15%).

It also appears that HR professionals have plenty of global experience to draw on.

Thirty-two per cent of professionals have spent time working in countries outside their own. For Australian HR professionals the most popular countries for broadening their work experience were the UK, New Zealand, the Middle East (UAE) and Singapore.

China was only cited by five respondents.

Twenty-four per cent took roles with their parent companies overseas, 14% took on global HR roles, and 31% took regional HR roles – mainly in Southeast Asia.

Attending seminars or conferences

69%

Essential skills of the future

On-the-job/informal learning (job rotations, special projects, etc)

48%

Coaching or mentoring

40%

Short courses

38%

E-learning courses

32%

MBA or master’s degree

12%

Other

6%

As HR continues its fight to gain credibility and sustain its position in the senior leadership ranks, a recurring theme throughout this year’s results was ‘communication and influencing skills’. HR professionals are also keen to build their business acumen and leadership capability. Given the hype around ‘big data and analytics’ it is something of a surprise to see this ranked 10th on the list.

To build these skills and knowledge, the majority (69%) will be attending seminars or conferences, while others will be relying on on-the-job training (48%) and others will undertake coaching/mentoring (40%).

No

Yes

39%

32%

61%

Yes

68%

No

WHAT PROFESSIONAL DEVELOPMENT ARE YOU UNDERTAKING?

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COVER STORY

HR REPORT

HR SUPPORT Over 60% of surveyed HR professionals indicate there is room for improvement when it comes to support from senior management – and there’s a perception that CEOs are not spending quite enough time on HR-related matters.

DO YOU FEEL THAT SENIOR MANAGEMENT SUPPORTS YOU IN YOUR HR INITIATIVES? Yes, senior management is always supportive

12% 26%

No, senior management is not supportive

Yes, most of the time but there is room for improvement

62%

TWENTY-SIX per cent of HR professionals may believe their senior management team is always supportive of the HR function, but this still leaves a lot of room for improvement.

A significant 62% indicated more support was required.

For those HR professionals who do receive sufficient support, in some cases it’s just good business sense, as this reader suggested: “As a services business, 90% of our costs are people-related and so I receive strong support on people initiatives aligned to business goals.”

This HR business partner from the legal sector in New Zealand responded along similar lines: “Our director is super supportive and very employee focused. He realised early in his career that employees are his biggest asset,

CEO SUPPORT: PERCEPTION VS REALITY If CEOs really value the people in their business as highly as they say they do, it stands to reason that they should devote enough time to this area to make a difference – while of course still balancing all their other priorities. However, there’s a disconnect between the amount of time people think a CEO should spend on HR issues, and the time they actually do spend. Forty-six per cent indicated their CEO spent less than 10% of their time on this area. However, 69% felt this should be closer to 11–50% of their time (the reality is just 49% of CEOs spend 11–50% of their time on HR-related matters).

Readers pointed to just how critical CEO support is. “My CEO is very HR-centric and is the driving force behind HR strategies to build an engaged and dynamic workforce to achieve the company vision,” wrote one HR director.

Another commented: “Results improve dramatically when the CEO is in the field, talks with (not ‘to’) employees, understands HR and what it can bring to the business, and sees what the day-to-day operations of the business look like.”

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PERCEPTION

REALITY

How much time do you think the CEO of an organisation should spend on HR-related issues?

In your organisation, how much time do you think your CEO spends on HR-related issues?

More than 50% of time

Less than 10% of time

More than 50% of time

5%

13%

18%

46% 49% 69%

11–50% of time

11–50% of time

Less than 10% of time

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HR SERVICE DELIVERY and without good staff his practice couldn’t succeed.”

Others are making changes at the HR end in order to gain this buy-in. One reader noted: “The key is to make it simple to understand and implement, and connect any initiative to business strategy.” Another wrote: “As long as initiatives can demonstrate ROI, my executive team are usually supportive.”

Can there ever be too much of a good thing? Only when HR gets so embedded that its limited resources are stretched to breaking point, as this reader pointed out: “HR is really embedded in the organisation – sometimes too much as the team is involved in so many things. Sometimes we can lose sight of our strategic influence.”

For the 12% who lack senior support, often it’s a corporate culture issue. “Excessive focus on ‘bottom line’ means that any form of innovation that costs $$ is not considered,” wrote one HR manager. Others lack the tools and insights required to get noticed. “It is very hard to justify what I am trying to do because I do not have access to figures,” said one HR business partner based in Sydney’s financial services industry.

Turning the tables We asked HR professionals to rate from 1 to 5 (with 1 being poor and 5 being excellent) the strength of current leaders in their organisation.

Surprisingly, two areas in which HR is usually considered strong (change management and staff development) are the areas in which other business leaders need the most development.

For those HR professionals looking to bolster the leadership capabilities of their executive colleagues, here’s how their capabilities and skills were rated, from ‘excellent’ to ‘poor’: 1. Client focus 2. Results focus 3. Problem-solving 4. Communication 5. Change management 6. Staff development

UNSURPRISINGLY, THE majority (55%) of respondents follow the traditional and widely used Ulrich model.

Readers were divided but positive overall about the viability of this model, with 65% of those using it saying it was effective in delivering HR services to the business.

As businesses continue to evolve, so too does the HR function. Are the typical structures of HR departments still effective?

IS YOUR HR TEAM STRUCTURED ON THE TRADITIONAL ULRICH MODEL (HR BUSINESS PARTNERS, HR CENTRES OF EXCELLENCE, HR ADMINISTRATION CENTRES)?

No 45%

55%

Yes

IS THE ULRICH MODEL EFFECTIVE IN DELIVERING SERVICES TO THE BUSINESS? “Our HR team is structured in this way, on a significantly smaller model. All team members are responsible for partnering with the business, creating centres of excellence and balancing the administrative aspect of HR practices.”

“We have business partners (as generalists) handling clients directly, specialists as centres of excellence, and HR operations as admin centres/shared services. It works very effectively for us.”

“It works well – though it needs constant massaging to ensure no divisions form.”

“It’s mainly effective, with just some customer service issues with the COEs at times.” ”HRBP roles have been split into strategic or tactical/operational areas. We’ve then centralised the operational side, while keeping the strategic roles aligned to business units. It’s working well so far and feedback from business unit leaders is positive.”

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COVER STORY

HR REPORT

HR SERVICE DELIVERY

THE FUTURE HR professionals are overwhelmingly positive about the future, but they do have several critical priorities to work on over the next 12 months.

IS THE ULRICH MODEL EFFECTIVE IN DELIVERING SERVICES TO THE BUSINESS? “The Ulrich model is not meeting all of our needs. The business engagement model needs work, especially in terms of conflict between what our COEs do and what our BPs do.”

“In some ways it is working, but in many ways it fails to closely integrate with the operational departments within the business. Feedback from business units is that HR is not helpful and that they are too many procedures which inhibit innovation and productivity.”

Change ahead

IN GENERAL, ARE YOU OPTIMISTIC OR PESSIMISTIC ABOUT THE FUTURE OF HR AS A PROFESSION? 8% Pessimistic

92%

Optimistic

It’s telling that participants selected ‘change management’ as their number one priority over the next 12 months because 47% of HR teams themselves have undergone a restructure in the previous 12–24 months, and this looks set to continue. There is a theme of history repeating itself. A number of survey participants suggested their HR function had gone from centralised to decentralised and now back to centralised models. It’s also significant that, despite some of the criticisms of the Ulrich/HR business partner model, this is where most departments that are undergoing change are moving to. Here’s what four readers had to say about future change.

“I changed my team to the Ulrich model and embedded the BPs into the business. I married strategy and employee

WHERE WILL HR be focusing its efforts in the next 12 months?

Survey participants prioritised these five key focus areas: 1. Change management initiatives 2. Developing personal leadership/management skills 3. Succession planning and talent mapping 4. L&D programs across the organisation 5. Incorporating new technologies to improve internal processes However, if optimism wins out, these challenges will be beaten.

These three reader responses sum up the positive sentiment many in the industry feel about the future.

relations/IR into one team to de-operationalize IR and tie them to the strategic intent and broaden their minds, which has led to far greater outcomes and reduced legal costs.”

“It was a decentralised model with the business partner part of each area/unit reporting to the GM of that unit. Now we have

“A personal viewpoint: the glass is half full. See what you can do to improve what you already have and build upon that. I think education at all levels of a business is best to achieve this. Whether that is formal (courses/qualifications) or informal (expanding capability through in-house training/information sessions).”

recentralised and have the BPs reporting to the HRM.” “Moving from a full COE approach to splitting COEs into mini

“The change of name to ‘People and Culture’ in many organisations represents a real shift in thinking about what it is that HR does.”

COEs aligned to business units to create a closer business relationship and stronger business understanding.”

“We traditionally outsourced HR and have brought this function in-house to be better aligned to the needs of the business.”

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“I think those that say HR is not required underestimate the impact of positive, productive and engaged employees. A strong positive employee culture requires continuous work, but can be undone very quickly.”

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AND THE WINNER IS… HRD offered the chance to win an Apple Watch (RRP $499) to the reader who offered the best response to this question: Where will the HR function be 10 years from now? And the winner is…

“I would like to see the leader of HR in an organisation as valued as the COO, CIO or CFO. HR professionals will have more than just operational HR experience, they will have organisational depth with experience in the business, understanding legal frameworks, business operations and financial structures. A more diverse partner than just the specialised HR knowledge.”

As the survey is anonymous, we are unable to publish the name of the respondent; however, the HRD team would like to thank all our survey readers for their comments. Here’s a small sample of what they had to say on where HR will be a decade from now.

ORGANISATIONAL DEVELOPMENT WILL BE CRITICAL ”The ‘HR business partner’ will not exist and ‘business partnering’ should be a given. HR practitioners will be business leaders, with a specialisation in building and sustaining organisational capability.”

TECHNOLOGY WILL REVOLUTIONISE THE FUNCTION “I think with the advancement of technology and the ability to analyse data with greater sophistication, HR will be using business intelligence to drive strategic business directions and decisions.”

“Leveraging state of the art technology to bring performance and development experiences to people that are fun, tailored, personalised, engaging and highly effective.”

THE STRUCTURE AND ORGANISATIONAL POSITION OF HR WILL CHANGE DRAMATICALLY “HR will see a split over the next 10 years. The administration will be completely separate and people strategy will be more closely aligned with the strategic planning process.”

“There will be a HR department undertaking administrative services and supporting systems; somewhere, hopefully, will be an ‘organisational and HR strategic developers’ function but at this point I do not see this unless the next generation are more strategic (or we could end up in marketing and business development). It is a gloomy picture so I advise people wanting to get into HR to do a degree in some form and then look at HR or influence HR management from an operational department.” “... further outsourced as a function, due to advancements in technology; whilst remaining a true strategic partner as practices in managing employees evolve.”

“Sitting at the right-hand side of the CEO on Boards.”

A KEY PRIORITY WILL BE ADDING VALUE TO A NEW GENERATION OF WORKERS “Increasingly involved in a dynamic and transient workforce, and maximising the interchange and recognition of skills and talent across industry sectors.”

“Helping to shape a new model of business, virtual teams, part-time employees and executives, outsourced functions, short-term careers, and yet supporting a corporate culture.”

“The HR focus will change according to the industry it supports. Unions will continue to decline significantly so the IR space will be less of a focus. Talent management will be a significant focus in some industries. There will be an increase in supporting a 24-hour global workforce and HR will need to ensure there is a culture of supporting innovation within the business to remain competitive.”

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FEATURES

SUPERANNUATION

FUTURE PLANNING STARTS NOW

Employers play an important role in keeping Australians engaged with their superannuation.

HRD presents some tips on how to ensure your employees are equipped with the knowledge they need today to plan for their needs of tomorrow

THE DAYS of ‘set and forget’ when it comes to Australians and their superannuation are fast becoming a thing of the past. Today, most working Australians are well aware that super is part of their salary package and could possibly be their second most valuable asset when they retire.

A number of critical factors have combined to ensure that Aussies can no

The end result? Australians are starting to engage with their super earlier – and they are asking for assistance from their employer to do so.

So how do you get your employees interested in their super?

When talking to employees about their super, ask them what sort of retirement they

Australians are starting to engage with their super earlier – and they are asking for assistance from their employer to do so longer turn a blind eye to how they’ll fund their retirement; population growth putting pressure on the Government Age Pension, the increased cost of living and longer life expectancy mean that alternative income sources need to be planned to achieve a comfortable retirement.

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want and encourage them to seek advice on what they could be doing now to make that happen. It may be far into the future, but a little thought now could make a big difference when they retire. The simple truth is the earlier they add to their super where they can, the bigger the impact it may

have on their super balance.

It’s worth reminding them that it’s never too early to consult a financial adviser and it’s possible to access some basic information at no cost through most default funds.

Another important tip is to remind them to review their insurance options.

Most super funds include death, total and permanent disability and income protection insurance as a default for members. You can tell employees what their default cover is, but you can’t advise them on increasing or decreasing it. Basic insurance cover as part of a super account may be enough to protect both the employee and their family – but it’s important that they consider if they have enough insurance to meet their needs.

Here are some other areas you can mention: • Consider simple strategies that can make a difference such as consolidating super accounts, or making additional deposits.

• Seek advice on salary sacrificing and making payments to a spouse’s account • Provide your tax file number to your super fund and avoid paying up to 49% tax on before-tax contributions.

• Look into your eligibility for government co-contributions to boost your super balance.

• Also, check with the ATO about lost super – some people might be pleasantly surprised to find they have a super account they’ve forgotten about.

It’s also worth considering how core messages about super can be tailored to connect more effectively with the demographics of the workforce.

For example, younger employees are likely to be feeling the pressure of high housing costs, HECS fees, etc. They may have other goals to achieve before considering paying extra into their super,

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HOW CAN HR ASSIST EMPLOYEES? There are limits to the type of superannuation advice HR can provide employees. Do you know what is ‘safe’ to discuss without crossing the line? If you’re unsure, the wisest thing to do is ask your employee to contact their super fund or a financial adviser. Below we give you an outline of what you can talk to your employees about.

such as travel. However, educating them about the importance of super early can have a sizeable effect on their super savings – and thus their retirement – down the track.

For mature-age workers, it’s important to provide support and education about their super and retirement. Employers can arrange seminars or education sessions on topics such as salary sacrifice, transition to retirement (TTR), or setting up retirement incomes – AustralianSuper runs such sessions for many businesses.

The basics about super » Details of your business default super fund » How employee super is paid into that fund » How much the business pays into super (typically, a minimum of 9.5% of ordinary earnings) » How often super is paid for employees » How employees can add to their super accounts

Assistance for female employees While there has been plenty of public and media debate about gender pay inequality, less has been said about the inequalities that exist in super savings. The Association of

Superannuation Funds of Australia (ASFA) reports that women retire, on average, with $138,150 in super savings – $154,350 less than men.* Around 90% of women will retire with

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CREATING AN INTEREST IN SUPER »» Educate staff that they have choices when it comes to insurance, contributions, and even their ability to choose superannuation funds. Most super funds have specialists who can deliver workplace seminars and other education, so your business default super fund should be able to help. »» Refer employees to tools and information on your default fund’s website. »» Provide fact sheets from your default fund about more complex super topics, such as before and after tax contributions and transition to retirement. »» Provide contact details for your default fund’s advisers, who can answer the more complex questions for their members.

Remember, employers need to avoid specific financial advice – refer employees with questions specific to their personal needs to a financial adviser, either through their super fund, or independent financial advisers.

AUSTRALIANSUPER As Australia’s largest super fund, we’ve built our services around everyday Australians – and their businesses. In fact, we work with more than 235,000 businesses across almost every industry, with local experts in all states and territories.

Find out how making AustralianSuper your default fund could be the right choice for you and your employees.

Call 1300 697 873.

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inadequate savings to fund a comfortable lifestyle in retirement, and even more alarmingly, one in three women will retire with no superannuation at all.

Georgina Williams, AustralianSuper’s Group Executive, Engagement, Advocacy & Brand, acknowledges that saving a decent super balance is harder for women due to their roles as carers and parents, plus the lower rates of pay women tend to receive.

“But they shouldn’t panic,” she says. “They should take action.”

Some of the steps she suggests women take are: 1. Check that all your super is in one place.

“If you have had several different jobs, you

month to put into super, it could be really worthwhile. As little as $50 extra a month in your 20s can add more than $175,000 to your super balance by the time you retire,” says Williams.

Industry super funds Industry super funds have upped their game in recent years to keep up with the needs of Australian workers.

Combined with their low fees, strong long-term investment returns and ability to provide good-value insurance, industry funds now provide a range of financial advice options, education and online tools to help members. Plus they have a range of employer

“As little as $50 extra a month in your 20s can add more than $175,000 to your super balance by the time you retire” Georgina Williams, AustralianSuper might have accumulated a few different super accounts – and be paying fees on each one,” says Williams. It should be easy to move all your money into one fund via a form on your super fund’s website.

“That simple move can save thousands of dollars in the long term.”

2. Make sure you are paying the lowest fee possible. “Industry funds like AustralianSuper don’t make a profit for shareholders – so our fees are low by industry standards, and any profit goes straight back to members,” says Williams.

3. If you’re still working, find out if you qualify for the government’s Low Income Super Contribution or the renamed Low Income Super Tax Offset of up to $500 a year.

4. And finally, top up while you can. “If you can find even a few dollars each

benefits such as straightforward admin and ongoing support.

For HR professionals struggling to provide competitive benefits and employee offerings in a tight talent market, being able to demonstrate you care about your employees now as well as into their future is vital. *ASFA report on Superannuation account balances by age and gender, December 2015

This article was prepared in July 2016 and is sponsored by AustralianSuper Pty Ltd ABN 94 006 457 987, AFSL 233788 Trustee of AustralianSuper ABN 65 714 394 898. It may contain general financial advice which does not take into account your personal objectives, situation or needs. The views expressed in this article include those of HRD and AustralianSuper. HRD made their comments based on their experience and expertise. Before making a decision about AustralianSuper, consider your financial requirements and read the Product Disclosure Statement, available at www.australiansuper.com/pds or by calling 1300 300 273.

Investment returns are not guaranteed and past performance is not a reliable indicator of future returns. Consider your debt levels before adding to super.

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FEATURES

RECOGNITION

SOMETIMES IT’S the little things in life that have the biggest impact. This is clearly seen when it comes to the powerful yet underutilised impact of recognition in the workplace. For any employee who has worked long hours to meet a deadline, a few words of acknowledgement and thanks from the boss can do wonders for morale and self-esteem. And of course, words don’t cost a thing. So why do so few organisations and managers truly embrace the power of recognition?

Standalone recognition

RECOGNITION FOR A JOB WELL DONE Reward and recognition programs are often grouped together, but savvy employers also realise the value that standalone recognition programs can bring to engagement

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Jeremy Salter, employee solutions lead at Grass Roots, says that while most organisations understand the power of recognition and its real value in terms of encouraging the right behaviours, they are still falling into the trap of rewarding those behaviours instead of just recognising them.

While it’s best practice to group the two together, Salter says the emphasis lies too heavily on the side of reward.

“We know that many organisations still invest significantly more time, effort and money on rewarding the right behaviours than they do recognising them,” Salter says. “Recognition is often contingent upon reward, and levels of recognition activity are dependent on reward budgets.”

Fortunately, the situation may be changing. These same organisations are now refocusing their efforts on increasing the standalone value of employee recognition.

Salter says new technologies and a new generation of employees have created both a need and an opportunity to rethink employee recognition and the relationship between recognition and reward.

Making recognition work Is the best approach to keep recognition separate from reward? It’s not unusual to hear of employers (and service providers

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like Grass Roots) delivering both programs hand in hand, and Salter suggests this is indeed the best approach – with one important disclaimer.

“We’ve found that what matters most is not if both are present; rather, what matters most is the relationship that exists between them,” he says.

For example, issues arise when recognition is contingent upon reward or when reward becomes a financial measure of value.

“Our approach is to separate the act of recognition from reward and over time to reduce an organisation’s dependence on reward,” Salter says. “We achieve this by increasing the standalone value of recognition within an organisation.”

Avoiding entitlement cultures This separation of reward from recognition should not be underestimated. It’s been said that ‘entitlement cultures’ are becoming the norm in Australian workplaces and that some workers – especially younger workers – need an almost constant flow of positive reinforcement, not to mention

“Our approach is to separate the act of recognition from reward and over time to reduce an organisation’s dependence on reward” Jeremy Salter financial reward, for simply doing their jobs.

Employee recognition needs to be applied consistently and fairly, but care must also be taken to ensure this recognition does not become an expectation or entitlement. As expectations, your sincere recognition efforts can become entitlements. For example, if the boss invites employees to lunch every time they work overtime, the lunch becomes an expectation. The recognition for a job well done loses any value. Additionally, for those who miss out, it becomes a source of dissatisfaction.

Technology: the game changer Social technologies have helped businesses to make recognition a powerful standalone

SIMPLE RECOGNITION TIPS Looking to create a culture of recognition? Try these simple approaches.

Recognise in context: Recognition is most effective when it’s given in the context of a larger goal or business-results focused activity. Ad hoc or random recognition is less effective or meaningful than when it’s tied to a business goal. Be as specific as possible about why the recognition is being given: while it’s great that an employee hit a target, it’s even greater if they’ve reinforced one of the company’s values through their actions.

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Recognise in the moment: Wherever possible, be timely. Catch people doing exemplary work and acknowledge their efforts. Social recognition can help with this – but always be specific, descriptive and measured.

2

Be authentic, not automatic: Managers must mean it, and it shouldn’t be tied to automated recognition programs which dole out recognition for tenure or service, for example, without any human touch.

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Tie it to the employee’s perception of value. Each individual has a preference for what he or she finds rewarding and how that recognition is most effective for themselves. One person may enjoy public recognition at a staff meeting; another prefers a private note in their personnel file. In addition, get to know what’s likely to motivate them – and remember that monetary rewards can skew any notion of ‘value’. It may also not be the most effective motivator.

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motivator. Social recognition from peers, managers and other stakeholders has increased the value of recognition by making it more immediate and visible.

Recognition for a job well done has become easier to give and more motivational to receive. The standalone value of employee recognition is further enhanced by integrating it with other business processes, including talent mapping, performance reviews and onboarding.

“The social element of recognition is very important,” Salter reiterates. “Recognitions appear in live recognition feeds that others can comment upon and like. Having your peers see you being recognised in this way amplifies the value of recognition. It positively reinforces an organisation’s values.”

Willis Towers Watson’s Global Recognition Survey asked participants to specify the organisational context in which they had received their most fulfilling recognition.

The majority said their best experience had occurred within their teams or work groups (35% of the respondents) or at the department level (37%). The report stated: “Clearly, people most value appreciation for accomplishments that are familiar to and significant for one’s direct peers. At the broader organisation level, the accomplishments of an unfamiliar person from a distant department are bound to have less meaning.”

Yet social recognition goes further than empowering and encouraging peers to acknowledge the work of others: it reinforces peer relationships and serves a

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RECOGNITION Brought to you by

RECOGNITION

BY THE NUMBERS • 75% of organisations have a recognition program – however, only 58% of employees know about it* • 14% of organisations provide managers with the necessary tools for rewards and recognition^ • 67% of workers say praise and commendation from managers was rated the top motivator for performance, beating out other non-cash and financial incentives^^ • Employers with ‘highly effective’ recognition programs claim to have 31% lower voluntary turnover than employers with ineffective recognition programs* • Organisations with the most sophisticated recognition practices are 12 times more likely to have strong business outcomes* Sources: *Bersin by Deloitte, The State of Employee Recognition, 2012 ^Aberdeen Group, The Power of Employee Recognition, 2013 ^^McKinsey, Motivating People, Getting Beyond Money, 2009

GRASS ROOTS Grass Roots is the world’s largest provider of integrated customer and employee engagement solutions. Our clients trust us with their three most prized assets: their customers, their employees and their brands.

In Australia, we are pioneering new ways to communicate, recognise, reward and inspire people to improve the performance of our clients.

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number of important functions, including communication, coaching and social support.

“Socially astute leaders understand this and use social recognition as a powerful and authentic way to communicate,” says Salter.

And if recognition and reward do indeed work best hand in hand, technology has also changed and improved the delivery of rewards. Digital reward options are on the rise – and delivery takes minutes rather than days. In-store redemptions can be made with a smartphone. However, while technology

A culture of recognition Indeed, leaders play a crucial role in creating a culture of recognition. A culture of recognition means there is a shared belief in the importance of recognition and the values against which behaviours are recognised. A culture of recognition exists when recognition becomes an everyday behaviour within an organisation.

As an organisation’s culture is the sum of all behaviours, a culture of recognition encourages employees to recognise value in all behaviours, big and small.

A culture of recognition means there is a shared belief in the importance of recognition and the values against which behaviours are recognised has changed things for the better, Salter warns that it remains simply a tool.

“Technology can remove certain barriers to recognition but it cannot remove them all,” he says. “Technology will only help those who are motivated to recognise. It won’t motivate those who are not. The motivation to recognise comes from the belief that recognition is important. In our experience this belief is driven more by the actions of leaders than the latest technologies.”

Again, the Willis Towers Watson’s Global Recognition Survey makes the link between manager recognition and performance clear. The report states: “Strong manager performance in recognising employee performance increases engagement by almost 60%, from 33% of employees giving a favorable engagement score to 52%. Even in low-engagement workplaces, recognition from immediate supervisors and managers has a dramatic effect.”

“Organisations that reserve recognition only for the extraordinary will not develop a culture of recognition,” says Salter. “I believe a culture is not something you set up. It’s something that evolves over time. The actions of leaders are key. If an organisation wants to create a culture of recognition the leaders of an organisation should be visibly active within a recognition program. A social recognition makes recognition activity visible to all. Those leaders who do not recognise are as visible to employees as those who do.”

For those doubting the power of recognition it’s worth remembering that human beings are motivated by more than money. They crave positive feedback, recognition when they put the hard work in, and acknowledgement from peers and leaders. It’s the inner glow one gets from knowing an achievement or goal has been seen, appreciated and celebrated.

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FEATURES

CAREER TRANSITION

SIMPLIFYING & STREAMLINING A COMPLEX WORLD Technology can – and does – help HR professionals find success in the boardroom.

James Kissell, marketing director at WFS: A WorkForce Software Company, outlines how this can occur through streamlining workforce management processes

IN MOST organisations, people are the biggest operating expense. And in an era in which companies are still striving to do more with less, reducing the cost of labour while increasing efficiencies can be a boon for smart HR directors, increasing their

their award entitlements, shift preferences, availability, skills, leave requests, and more, can be a mammoth task. Creating rosters and managing time and attendance is no longer a job for manual spreadsheets.

The answer for most organisations is

“Creating rosters and managing time and attendance is no longer a job for manual spreadsheets” James Kissell influence in the boardroom.

Today’s HR directors face more complexity than ever. Geographically dispersed teams, fly-in fly-out workers, remote team members, part-time and jobsharing arrangements; the list goes on.

Keeping track of every employee, along with

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to automate and streamline workforce management. The technology to do this can deliver significant benefits, all of which can help increase the credibility of HR managers in the boardroom.

The following are three key workforce management challenges faced by businesses.

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Finding organisational efficiencies

An IBM study has shown that 96% of Australian CEOs find it difficult to pinpoint talents and skills across organisations. And 64% of Australian workers feel their whole skill set is not being fully exploited.

That demonstrates a challenge on both sides of the employment table that HR managers can help solve.

There is a general trend towards more part-time and casual workers, which creates further complexities for HR directors.

However, with the right technology, HR directors can leverage the increased data available regarding these roles to make smarter, more productive decisions.

A 2014 Aberdeen Group study revealed that 60% of organisations need to improve workforce planning capabilities, 52% need better access to workforce data for decisionmaking, and 44% need more control of labour costs. This demonstrates that organisations are struggling to develop and retain an agile, flexible workforce, and to use data to make better decisions related to the talent pool. If they can achieve those two things, then labour costs are likely to dip in response.

By correlating data on workforce deployment and effectiveness, along with data on peak busy periods and skills required, businesses can more effectively roster employees to work when they’re most needed.

This can help get a handle on labour costs, as well as improving key capabilities such as customer service.

HR directors need a system that takes into account the overall cost of each shift based on rostered workers’ awards and other entitlements. It should also match employee skills and preferences to specific shifts, which can result in more engaged employees that deliver better customer service.

A workforce management solution that can identify the optimum mix of skills based

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on both the needs of the project or shift and the associated costs can dramatically reduce labour costs while improving organisational efficiency. It simply isn’t practical to try to achieve the same results with a manual system.

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Delivering employee satisfaction

More than a quarter of employees say they have no say in their schedules, according to the 2015–2016 Workforce Management Trends Survey. This can have significant flow-on effects, starting with employee dissatisfaction.

Dissatisfied employees tend to take more unplanned leave, such as sick leave, meaning the business has to find a way to cover

that person’s shifts. This can cause other employees to become disgruntled if they feel that they’re always being called on to cover for other people. If that cycle continues unabated, staff will begin to leave the organisation, creating a whole new raft of issues around recruiting and training new people.

By contrast, employees who feel a sense of control over their own lives, who can request and receive time off as well as enjoying their fair share of the most desirable shifts, are more likely to be loyal to the organisation in the long term.

Regardless of absenteeism, employees who feel their managers are regularly under-resourcing projects or shifts are also likely to feel unhappy, as a greater burden

of the work falls to them.

Using an automated, data-driven workforce management system can prevent many of these problems from occurring by taking into account employee preferences and then finding ways to accommodate them.

A mobile system that lets employees communicate with each other to swap shifts when necessary adds to the flexibility offered the employee, and can be a strong contributor to employee satisfaction among younger or remotely based workers.

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Managing risk and compliance

The 2015–2016 Workforce Management Trends Survey found that more than 50% of organisations list litigation as a top concern

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STRETCHED TO BREAKING POINT More than a quarter of employees say they have no say in their schedules, according to the 2015–2016 Workforce Management Trends Survey. Other key findings include: 65% of organisations are burdened by manual processes 1 in 2 don’t hear about payroll errors until an employee complains More than 50% of organisations list litigation as a top concern against modern awards Just 20% of large companies use solutions to automate compliance

WFS AUSTRALIA WFS: A WorkForce Software Company (WFS Australia) is the leader in workforce management software for organisations with complex policies and compliance concerns. Through its EmpCenter® workforce management suite, WFS Australia enables organisations to fully automate time and attendance processes, effectively manage employee absences and leave, optimise staff scheduling, gain real-time visibility into labour costs and productivity, and mitigate the risks associated with employee fatigue. Hundreds of leading organisations rely on WFS Australia’s solutions to achieve strategic HR on a global basis.

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against modern awards, and only 20% of large companies use solutions to automate compliance.

In Australia, companies need to comply with state and federal employment legislation to avoid the penalties related to violating wage and hour regulations.

While some companies have been called to task for underpaying employees, payroll errors can go the other way too, giving employees more than they’re entitled to and costing the company money. The same survey found that 50% of employers only find out about payroll errors when employees complain.

which can be a major source of errors and even injuries.

Finding success in the boardroom These are just a few of the ways that automated workforce management software can help enable organisations to optimise their workforce deployment. To find success in the boardroom, HR directors need to stop thinking in traditional terms such as of recruitment, engagement, and remuneration.

Instead, they need to think in terms of increasing revenue, providing a return on investment, delivering customer satisfaction

“Keeping track of every employee, along with their award entitlements, shift preferences, availability, skills, leave requests, and more, can be a mammoth task. Creating rosters and managing time and attendance is no longer a job for manual spreadsheets” James Kissell If employees quietly pocket the extra cash, businesses end up losing money without even realising it.

Companies also need to provide mandatory rest periods to workers, including a certain number of hours between shifts. Managing this effectively, particularly during especially busy periods, can be challenging. An automated system for rostering, and time and attendance monitoring, will make it impossible for employees to return to work until they have had their mandatory rest time.

This serves the twin functions of managing compliance and reducing employee fatigue,

numbers, and protecting the organisation from non-compliance penalties.

Implementing workforce management software can deliver significant results. For example, it can save up to 10% on payroll costs. It can increase customer satisfaction scores by 6%. It can increase revenue per full-time equivalent employee by 4% and boost workforce utilisation capacity by an average of 9%.

By demonstrating numbers like these in the boardroom, HR directors can prove their strategic relevance and contribution to reducing costs and improving productivity.

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Workforce management solutions should support your full workforce.

Make Work Easy with time and rostering tools for full-time, part-time and contract staff.

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4/08/2016 10:05:19 AM

FEATURES

TECHNOLOGY

HR TECHNOLOGY:

TIME FOR AN UPGRADE?

Investment in HR-related technology and software may be up, but HR leaders still need to build a solid business case to get it over the line

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SPENDING BY HR departments increased by 4% between 2014 and 2015, according to the Bersin by Deloitte 2015 HR Factbook.

Between 5% and 8% of this went towards tools and technology. Large companies unsurprisingly spent the most on technology (almost 10% of their HR budget), and this increased spend has fuelled huge market growth in cloud-based HR technologies. The entire HR software market is over US$10bn in size and Bersin by Deloitte says many segments are growing at double-digit rates.

Closer to home, Kevin Brooks, national sales and marketing manager at Frontier Software, says companies are starting to realise the value of good HR technology and the benefits this can bring to any organisation.

As a result, the investments are increasing – however, many companies are still to actually take the step of actively taking advantage of the full potential of new HR technologies.

“Whilst the majority of decision-makers have realised the need for new HR technologies, many are still not focusing on how to deploy these solutions,” he says.

“One thing companies are investing in is mobilising key features of the HR function, such as self-service. The demand to be mobile is increasing, and as the workforce is mobilising so does the HR department. This not only saves times for HR personnel but also contributes to staff engagement and a positive employee experience.”

What’s hot?

In the second half of 2015, Information Services Group (ISG) conducted its second annual Industry Trends in Human Resources Technology and Service Delivery Survey.

The survey explores the changing landscape of HR technology and service delivery – and therefore provides clues as to where companies are spending. The key findings from this year’s survey suggest: ÎÎ Enterprises continue to migrate

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Brought to you by

from on-premises Human Resource Management Systems (HRMS) to Software-as-a-Service (SaaS)-based HR technologies; more than 70% of respondents have implemented or plan to implement HR SaaS within the next two years.  User experience and usability factors are driving selection criteria and expected benefits for both HR technology and service delivery model decisions.  HR organisations are shifting their focus from cost savings to strategic business alignment, process improvement and employee engagement.  The market is seeing initial signs that enterprise-level HR decision-making is becoming increasingly data-driven.

Who holds the purse strings?

According to a 2013 survey by memberbased advisory firm CEB, CIOs still control about 60% of the average IT budget in a corporation. However, the other 40% is being utilised by a diverse range of internal ‘rogue agents’, including marketing, finance, and

“It’s becoming increasingly common for HR departments to have technology as part of their budget, as more companies realise and acknowledge the business benefits and efficiency achieved from effective HR systems” Kevin Brooks, Frontier Software the new member on the block, HR. “It’s becoming increasingly common for HR departments to have technology as part of their budget, as more companies realise and acknowledge the business benefits and efficiency achieved from effective HR systems,” says Brooks.

And while CEB reports that most CIOs are actually OK with this more democratic approach to IT spending, many CHROs still need the go-ahead for technology investment from the CFO (see box, p42).

Fortunately, the ‘sell’ is getting easier.

MIGRATION TO SAAS IS ACCELERATING Depending on the HR solution, 35–47% of organisations surveyed are considering implementing a new HR technology solution in the next two years. Talent management and HR analytics are two of the fastest-growing areas. Here’s where the SaaS investments are likely to occur.

17% 21%

Workforce administration Payroll/time Benefits administration Talent management HR analytics

19% 17%

15% 19% 19% 15% 9% 17%

Fully implemented

Currently implementing

38% 35% 35% 42% 47% Considering implementing 0–2 years

13% 13%

15% 15%

8%

23% 6% 19% 9% 19%

Considering implementing >2 years

Not considering implementing

Source: 2016 Industry Trends in Human Resources Technology and Service Delivery Survey, Information Services Group

“Mobilising key aspects of your HR practices is very much becoming the norm,” says Brooks. “Increased mobility can enrich the employee experience, which in turn can increase employee engagement and productivity. For employees to be able to access their HR information anywhere at any time is giving them a freedom they haven’t had in the past. If companies don’t acknowledge this they will fall behind very quickly.”

Frontier Software, for example, has seen increased interest and enquiries for core HR and payroll, workforce management and talent management software.

This is not before time: many HR professionals are coping with outmoded and old-fashioned ‘legacy’ systems, which over time simply will not hit the mark.

“At some point it will become unworkable, and manual work-arounds will become unmanageable,” Brooks says. “A review of HR processes can usually help in the decisionmaking process when upgrading or deciding to change their incumbent system.”

Brooks stresses that despite the temptations, when it comes to new technology HR should not jump into industry trends without establishing alignment to their business needs and readiness to deploy such technology.

“A good technology or system vendor

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4/08/2016 10:06:00 AM

FEATURES

TECHNOLOGY Brought to you by

GETTING THE CFO OVER THE LINE

should be able to uncover the requirements based on your HR strategy and overall company objectives,” he says.

Kevin Brooks provides his tips.

“In many cases the CFO is the hardest person to convince that a new HR system is needed, which is why you need to build your business case carefully.

Highlighting the ROI in terms of the efficiencies that will result from automating and streamlining your HR functions is critical to convincing decision-makers.

Measuring an HR system’s ROI can be quantified in the following ways: eRecruitment can significantly increase efficiencies when shortlisting candidates, managing applications and automating rejection letters.

Performance management and succession planning efficiency is greatly increased when using HR technology. Not only will you be able to streamline these processes but also make better business decisions.”

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

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Getting buy-in Further to educating the CFO and other decision-makers about the benefits of new HR systems, the CIO and business analysts need to be involved in the decisions around HR tech investments. The CIO in particular needs to be comfortable that the system can support the company’s data security, data hosting and technical requirements.

use cases that focus on the organisation’s key requirements.

Ask for ‘sandbox testing’ as a component of technology selection. Buyers need a first-hand experience of interacting with the application and navigating in the tool.

Technology providers are adjusting to these demands by having ready-to-configure sandbox environments, detailed user guides and a helpline within the sandbox. Providers unwilling to give open access to clients for testing will find it increasingly challenging to compete.

2

The entire HR software market is over US$10bn in size and Bersin by Deloitte says many segments are growing at double-digit rates Getting buy-in from your employees is also crucial, says Brooks. “By including them in the process they are less likely to resist the change in adopting a new technology or software, which will ultimately drive the success of your new system. A great way to engage your staff in the process is to do an internal survey or pilot group to understand their requirements well before you start speaking to vendors.”

Be sure to go beyond functionality to understand the software vendor’s strategic direction, road map, services and support model.

Final tips For those companies that are considering implementing new technology and/or service delivery model changes, there are a few key points to consider from the ISG report:

Pay significant attention to and invest in change management and process redesign.

New tools applied to old processes, or tools that aren’t used by the majority of employees or managers, will not work as intended.

Understand the specific ways that HR technology can best support the most critical business processes; create detailed

Develop a business case for change that incorporates the strategic, operational and financial benefits for the organisation.

1

3

In making the HR transformation, be sure to address all parts of the overall service delivery model, including shared service centres, HR knowledge base/HR portals and customer support solutions (eg telephony, chat, case management).

4

5

6

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4/08/2016 10:06:03 AM

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4/08/2016 10:06:06 AM

FEATURES

PROFESSIONAL DEVELOPMENT

WHICH WAY TO TURN: TO COACHING OR MENTORING? Which leadership development option is the most suitable for your circumstances – coaching or mentoring? Even though these terms are often used interchangeably, Denise Fleming addresses this eternal conundrum THERE CAN be confusion around the terms ‘coaching’ and ‘mentoring’; they are often seen as the same thing yet there are key differences.

And while both coaching and mentoring have proven to be excellent investments for the development of a senior executive, it’s important to be clear on what each option provides.

Coaching and mentoring definitions One-to-one coaching An investment in senior executive oneto-one coaching is delivered and measured against identifiable objectives. Feedback on progress towards these coaching objectives is provided to the organisation’s sponsors/ stakeholders at regular intervals.

Individual mentoring An investment in individual mentoring is offered to senior executives for their support and development. There are no organisational objectives other than those identified by the individual executive. Therefore there are no measures of success for the organisation and no feedback.

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Issues to consider: The organisational context The context can influence whether a coach or a mentor is the best solution for an engagement to provide an executive with support. The scope and scale of a leader’s accountabilities as well

development; outcomes targeted may include knowledge-broadening and skill and behavioural enhancement. Coaching can also be highly effective in an onboarding scenario.

Executive coaching delivers the objectives of both the client and the organisation.

Mentors, using their experience and knowledge, work with the executive to jointly set the objectives for their engagements as the complexity of the organisation and its environment need to be considered as part of the analysis and decision-making process.

Benefits of coaching An investment in one-to-one executive coaching within an entirely private space enables in-depth, highly confidential discussions within a specific business environment. Customised executive coaching can be offered by the corporation to executives as an investment option for their leadership

Coaching objectives are provided by the organisation’s sponsors – chairman, CEO, HR or line manager, for example. Objectives are also identified by executives for their own coaching, and coaching benefits are measured against those objectives. As noted above, coaching is undertaken within the context of the markets, industries and environments in which the organisation operates and the scope and scale of the executive’s role.

At the highest levels of an organisation, where accountability is for the leadership of all

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or part of the organisation, successful executive coaching improves the leadership strengths of an individual and is leveraged to flow on to broad organisational improvements.

• Coaches have no vested interest in the organisation, are unbiased and independent.

• Coaches should have in-depth professional experience in the role of the executive being coached.

• Successful matching of a suitably experienced coach to the executive being coached is critical to building a trusting relationship and ensuring the success of the investment.

• Confidentiality between the coach and the executive is of utmost importance.

• Through regular feedback loops to sponsors, the coach can modify the objectives to reflect changing needs.

MAKING THE CHOICE: COACHING OR MENTORING?

Identify the purpose of the initiative Does the organisation want to set measurable objectives and receive feedback?

Yes

External coaching

No

Is confidentiality essential to the executive?

Yes

External mentoring

No

In-house mentoring

Benefits of mentoring Mentoring is appropriate when an executive needs/wants a ‘sounding board’. Mentors, using their experience and knowledge, work with the executive to jointly set the objectives for their engagements.

Mentors provide CEOs, group or country heads, for example, with an entirely private space enabling in-depth, highly confidential one-to-one discussions. The engagement is an iterative process and may facilitate a different way of approaching business and people issues, identifying blockages or intransigent issues. It may also challenge and explore different perspectives.

The organisation does not identify any objectives for the investment or have any communication with the mentor. It is a financial investment only for the organisation.

An alternative – in-house mentors for employees Some organisations choose employees to act as in-house or internal mentors for other employees.

An employee mentor appointed from within an organisation is most effective when paired with employees for whom they have no line responsibility, and who are generally

employed at one or two levels below the mentor. In-house mentors may aim to provide a personal contact, a role model and an independent ear outside the employee’s direct area of involvement.

In-house mentoring is a support process; the outcome may be employees feeling more valued by the organisation and having a clearer understanding of where they and their roles fit into the organisation. Generally, there are no objectives set for these internal processes and no overt success measures. Confidentiality for the mentored employees does not form part of the guidelines for this activity.

Confidentiality The coaching model assures critical confidentiality for the executive being coached while providing an opportunity for the organisation/sponsors to measure and engage in the coaching progress.

The mentoring model provides total confidentiality to the executive, with no measurement or feedback to the organisation/sponsors.

In-house mentoring, on the other hand, provides no confidentiality to the executive.

Key considerations 1. What is the purpose of the initiative?

For example, succession planning, leadership development, behavioural change, expansion or change of role.

2. Does the organisation want to set the objectives to be measured by this initiative and to receive feedback? a. If yes – external coaching is required b. If no – an external mentor may be preferred 3. Does the executive want total confidentiality to participate in this initiative? a. If yes – external coaching is required 4. Will the executive be comfortable with the outcomes of the initiative being shared with stakeholders/sponsors? a. If yes – external coaching may be preferred b. If no – external mentoring may be an option

Denise Fleming is the founder and managing director of Foresight’s Global Coaching.

For more information visit globalcoaching.com.au.

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FEATURES

FINANCIAL WELLBEING

UNDER (FINANCIAL) PRESSURE Research shows that Australians are under enormous financial strain – but what role, if any, do employers play in alleviating that strain?

DEATH AND taxes may be the only two certainties in life, but it seems that for the majority of Australians there’s a third contender: financial stress. Financial Fitness of Working Australians, a survey of 1,617 employees conducted by Map My Plan, shows that 48% of working Australians are worried about their financial situation. Top-line statistics include: • Personal finance is a major cause of stress for one in three working Australians • Personal finances keep 23% of working Australians up at night • Only people on an annual salary of $150,000 plus report a slightly lower level of financial stress When asked how much time Australians spend per week thinking about or dealing with personal financial affairs at work, the answer equates to 9.55% of their working hours.

• Thirty-nine per cent spend over two hours per week (with 26% spending more

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than three hours per week) • Gen Y spend an average of four-plus hours per working week worrying about money Purely in terms of dollar value, personal financial stress costs every employer (in

they’re sick or they lose their job,” says Gavin Glozier, co-founder of Your Wealth Hub, who adds that the average amount most people have in emergency savings is just $3,000 (for others it’s as little as $1,000).

Other employees have concerns based

“One of the reasons people don’t seek support is because they don’t know where to turn” Gavin Glozier terms of lost salary) an average of $5,202 per employee, per year. This figure is even higher for government employees, at $5,749 per employee per year.

“There’s a wide range of issues people are concerned about, but for a lot of people they’re really worried about basic things like having emergency savings – how long they will last if

on stage of life: some are concerned about retirement planning; others are looking to save to buy a home or have a family. Others are coping with large debts (see boxout, p47).

Where do employers fit in?

While there are clear productivity issues associated with financial stress, Map My Plan

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FINANCIAL STRESSES

BY GENERATION Gavin Glozier of Your Wealth Hub outlines what’s top of mind for each generation: Gen Y are focused on lifestyle and ensuring they can balance everything life throws at them. There is a concern about getting into the housing market, but they also want guidance on how to save and at the same time spend their hard-earned cash responsibly. Credit card debt can easily mount up after that overseas holiday, and they need advice on paying that down without enduring a crippling lifestyle. They are looking up at what their parents have achieved or are achieving and are thinking ‘it’s all too hard’.

Gen X are in the housing market, so it’s a conversation about investments, be it property or shares. Family planning comes into the equation, and the question becomes whether they can drop back to one wage with kids on the horizon. Spending can be a lot tighter, so smart decisions are critical to making ends meet.

research indicates that only 13% of employers are offering some type of financial wellbeing services. Nineteen per cent offer advice on retirement planning – mainly by inviting representatives of superannuation funds to provide seminars. However, 56% of employees are interested in employersponsored financial wellbeing programs.

“There is a significant gap in what is being provided by employers and what employees are seeking,” says Paul Feeney, ‘chief mapper’ at Map My Plan. “Our meetings with many companies revealed that they place a high priority on the independence of the content and advice that their employees would receive in a financial wellbeing program.”

There are limits and restrictions on the type of advice employers can offer, especially when it comes to superannuation (see HRD’s superannuation feature in this issue) – and Glozier recommends that

employers always advise employees to seek the assistance of qualified financial advisers as early as possible. He concedes it’s a fine line between providing support and services and giving advice.

“First and foremost the line is drawn as soon as you give an opinion around what someone should do with their finances.

The most value that HR can add is to be that person who can guide employees to get help with whichever party is applicable,” he says.

While it’s now commonplace for employers to offer financial counselling via EAPs, a range of dedicated financial wellness options are also available.

Option 1: Your Wealth Hub Your Wealth Hub offers a holistic financial wellness program with in-house engagement and a digital support program. For Glozier the key is continuous learning, and Your

Early Gen X and late baby boomers are interesting. The focus is either on conversations about a blended family, preparation for retirement, or now the kids are out of the nest they may be about revisiting some of the goals in life that have been on hold for some time. People are still taking on significant amounts of debt, so there is a real conversation about how long people will be working for. The stability of the kids is important: they want to ensure the whole family is on the right path.

65-year-olds and three years either side … it’s about making sure they have enough money in super to fund the lifestyle they want into retirement.

Wealth Hub offers an online knowledge centre that is packed with articles, videos and checklists that people can work through and read. In addition, its website allows people to work at their own pace by using various online tools. “One of the reasons people don’t

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FEATURES

FINANCIAL WELLBEING

FINANCIAL STRESS: THE COST TO AUSTRALIA • Employers lose 9.5% of working hours due to individual financial stress.

• Looking for the next generation of talent? Generation Y is the most worried.

• Research shows financial stress is linked to mental and physical health, and is associated with workplace fraud.

• Financial stress costs companies $5,202pa per employee.

Total cost to Australia: $61.2bn per year* $6.6bn Other

(non-profit, university, associations, etc)

$14bn Government

$40.6bn Private sector *Figures based on time spent thinking about personal finances at work.

Conservative estimation of costs based on lowest salary bracket. **ABS September 2015

Total working Australians: 11,769,900**

seek support is because they don’t know where to turn, so that’s why we’ve concentrated on the knowledge centre and these tools,” says Glozier.

The company also offers face-to-face education sessions, which will be based on whatever is timely at various points in the year: financial goal-setting at the start of the year, tax-time tips, or information on the federal budget. Sessions might include getting on top of credit card debt, attacking mortgage debt, investment updates, or information on foreign currency.

Partnerships with a wide range of suppliers, including Flight Centre, The Good Guys, Bupa and AGL, mean that Your Wealth Hub can also offer a member rewards program. “We’re educating but also rewarding at the same time with discounts,” says Glozier.

Your Wealth Hub also has a dedicated business arm, Strictly Super, which specialises in corporate superannuation.

Glozier acknowledges that building a holistic program for employees can be

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daunting, so Your Wealth Hub offers not just a customised communications plan and reporting on program success, but also a face-to-face induction program to alert employees to what’s on offer.

“We understand building something like this for an employer can be tough, so we

and the best way to decrease financial stress is to have a plan. Hence, Map My Plan helps employees build a personalised financial plan.

“We are different to most advisers in that we do not sell any financial products – we just focus on advice. We guarantee to never sell financial products to our clients, essentially eliminating a significant conflict inherent in the industry,” says Feeney.

Map My Plan is an automated and selfdirected service that enables anyone to create a personalised financial road map without the need to engage an adviser. An initial three-minute online survey helps employees get their personal financial fitness score, and from there an automated financial planning tool helps them create their ‘road map’.

“We customise the general Map My Plan service to deliver a unique tool that provides financial education in the form of a personalised holistic financial plan in the context of their goals and current situation,” Feeney says. “The process of building a personalised plan engages an individual to understand their situation and the implication of today’s decision on their goals.”

Feeney adds that, in his view, just hosting seminars or passing on information to employees is not sufficient. The information and knowledge needs to have context for the individual. It needs to help them address

Fifty-six per cent of employees are interested in employer-sponsored financial wellbeing programs have our tailored program ready to go. Our communications plan means the employer just needs to get behind it and live and breathe it to get maximum support,” he says.

Option 2: Map My Plan The goal of any financial wellbeing program should be to improve the financial fitness of employees and reduce their financial stress –

questions or issues they have about their current situation.

“Financial literacy programs are great, but most of them are missing a key ingredient – context. It doesn’t make sense to provide information about getting income from super for someone in their 30s. Generic seminars are useful, but only when the information is personalised does

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EMPLOYEE INTEREST IN FINANCIAL WELLBEING PROGRAMS Gen X

Gen Y

43%

56%

67%

56%

55%

59%

56%

Online tool to manage financial goals

54%

40%

52%

65%

Confidential session(s) with a financial adviser

Financial wellbeing program

All

Overall interest in workplace financial wellbeing program

56%

Retirement planning advice

Baby boomers

54%

44%

53%

63%

Advice on budgeting and day-to-day financial management 49%

32%

46%

62%

Assistance with healthcare cost planning and insurance

33%

41%

57%

45%

Source: Financial Fitness of Working Australians Survey, 2015, n=1,617

it become truly valuable,” he says.

Map My Plan is a living plan that continually changes as someone’s situation changes. “It puts them back in control of their financial planning,” Feeney says.

Specific employee benefits can be incorporated into the employer’s unique ‘version’ of Map My Plan – for example, where a company provides insurance for its employees, information and even an internal HR contact for more information can be incorporated into the online tool.

Employers never see any individual data, but Map My Plan does provide macrolevel information on the financial fitness of their workforce and what pressures their workforce is facing.

Employers pay Map My Plan an annual fee per employee of less than $1 per week.

“There are no products; this is the only fee we receive. There may be a minimum annual fee depending upon the level of customisation,” says Feeney.

AD

The next hot employee benefit?

Glozier believes offering financial literacy and wellness initiatives will be the next “hot benefit” offered by employers. “If we start unravelling the fact that so many businesses have wasted productivity per year, and that by spending a little they’re able to achieve an awful lot by engaging and retaining staff through these programs, I think demand is set to grow.”

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4/08/2016 9:58:47 AM

FEATURES

LEADERSHIP

COLLECTIVE LEADERSHIP INTELLIGENCE:

THE SUM IS GREATER THAN THE PARTS Collective leadership effectiveness and intelligence represent huge untapped potential in most organisations. Robert Anderson and William Adams explain how we can tap into this more effectively LEADERSHIP IS a conversation. Leaders spend most of their days in conversation – meetings, phone calls, emails, and strategic communications. How you show up in these conversations determines your level of effectiveness. How we show up together in these conversations drives our collective effectiveness.

The quality of our collective conversation largely determines our collective leadership effectiveness and business performance.

We work with an extraordinary female leader of a large professional service firm who consistently leverages the best out of her extended leadership team (ELT) because of how she deploys herself in leadership conversations. She told us that in every conversation she has three objectives: 1. Increase understanding and buy-in 2. Achieve the desired outcome 3. Improve the relationship. For instance, she told of having a difficult performance review with a key executive With this framework in mind, she ensured that the content was clearly understood, outcomes were achieved, and the relationship improved. She consistently is seen as being clear, direct, fair, and compassionate. Her people know where they stand with her, and she outperforms her peers in this business at a multiple of three times their results. She is highly effective, in no small measure, because of how she models and orchestrates individual and collective leadership conversations.

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The untapped potential Collective leadership effectiveness and intelligence represent huge untapped potential in most organisations. Management expert Peter Senge notes that the collective intelligence and performance of most groups is well below the average intelligence and performance of the members. We usually dumb down when we come together. We act at the lowest common

leverage point is an action taken or a change made that has a magnified positive and lasting impact on intended results. If you have a long lever, you can move a very heavy object with little effort. In financial language, this is the equivalent of getting a multiple. Businesses invest to get a multiple return on investment. Finding leverage means discovering an innovation, initiative,

When we ask leaders what they would do differently looking back, their most frequent response is this: “I would have made changes in my executive team more quickly” denominator. The dynamics played out in most groups – overly aggressive advocacy of positions, poor listening, reactive responsiveness, political caution, ambitious self-interest, mistrust, withholding of opinions – subvert collective effectiveness.

Consequently, most leadership teams function collectively well below their members’ average intelligence. This results in a leadership quotient (LQ) of less than one, and most organisations with such a low LQ lose market share and end up on the auction block.

Collective intelligence is required for breakthroughs. Senge talked of finding leverage points within the system. A

change, or action that, when taken, has a large, lasting, positive impact well beyond the energy of input.

Using ELT as a leverage point The collective effectiveness of the ELT is often overlooked as leverage. We ask leaders to find leverage here by evaluating the return on their time spent in two ways. First, are you increasing the creative capacity and capability of your organisation at a multiple? If you are not getting a 5-to-1 ratio of return on your time spent, your ROI is subpar. Far too many leaders spend their time on the areas that provide a 1-to-1 return (or worse). These areas are low leverage and

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need to be upgraded or eliminated. Expanding capacity and capability depends on this ratio of return. Second, are you developing effective leadership at all levels within your organisation?

As a leader, you cannot scale the organisation until you understand and perform your role in developing other leaders. When you enter the executive ranks, your job is to develop other leaders – and, to minimise your losses, know when someone cannot be developed in the timeframe required.

When we ask leaders what they would do differently looking back, their most frequent response is this: “I would have made changes in my executive team more quickly.”

They hang on to low-ratio return, high-cost leaders for too long, and it costs them dearly.

Having the right people on the leadership team and investing in the leadership agenda is high leverage. It is key to developing the collective effectiveness and intelligence required to compete. Otherwise, the business cannot grow at the pace required, the return on leadership will be subpar, and even the

best executives will likely burn out.

Collectively, intelligent leadership teams consistently find leverage; those with low collective intelligence are not likely to innovate, create, and find leverage at the rate required to stay competitive. Organisations and their competitive environments are so complex that they defy rational understanding.

Actions or changes in the system that would produce lasting improvement are not obvious.

If they were, we would have already taken them. It is not easy to find the leverage we need amid complexity. It takes more than one brilliant leader to consistently find nonobvious points of leverage and to expand the business’s leadership capacity and capability.

It takes an effective collective leadership team that function well together to have collective intelligence well beyond the average level of brilliance of its members.

Courageous conversations It takes honest, often courageous conversation to find leverage. For example, when we worked

with Carlson Companies, one of the largest privately held companies in the world, the organisation was being led by Marilyn Carlson Nelson, daughter of founder Curt Carlson. Her top team was working through several difficult strategic issues, and the conversation turned to performance and the culture. This team had learned over the years to have honest conversations and to address what really mattered. In one conversation at a particularly controversial moment, Marilyn made a courageous statement that changed the entire dialogue and outcome. She said, “We are defined by what we tolerate.”

Edited extract from Mastering Leadership: An Integrated Framework for Breakthrough Performance and Extraordinary Business Results, by Robert J. Anderson and William A. Adams (Wiley, 2016), available where all good books are sold, or at au.wiley.com.

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FEATURES

CORPORATE CULTURE

IS A HIGH-TRUST CULTURE POSSIBLE? Instead of a high-trust culture, too many organisations struggle with fear-based cultures. Stuart Taylor outlines how to turn the situation around TAKE AN all-too-common situation: the executive team is struggling, targets are not being met, absenteeism is at an all-time high, and morale could not be lower. The only reason people are sticking around is the poor job market. The CEO calls a meeting to energise the team and agree on cost-cutting and higher revenue targets. Where are we going to cut heads? Who can drive higher sales? No one around the table says a word.

Secretly, everyone is thinking the same thing: “The original targets were mandated with no logic and were totally unachievable. Failure is not an option. Yet here we are again about to experience the same carrot and stick.”

Fear-based cultures Fear-based cultures are common and costly.

They occur when staff are afraid to voice their concerns, or staff that do voice opinions are punished. The result is often lost productivity, high staff turnover, absenteeism, distress and burnout. This often starts at the top and then permeates through the organisation. New ideas rarely surface as they are shot down before they are allowed to get off the starting block.

Discretionary effort is non-existent. Staff become very attentive to what the leaders want to hear rather than what is actually the case.

A fear-based culture is one in which leadership is based on implicit or explicit levels of contempt or power between those

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in positions of influence and those that are required to fall in line. The underlying leadership style is typically a commanding or pace-setting style that is often disguised

an intense work environment with very concerning levels of worry, chronic stress symptoms, distress and disengagement.

In part these statistics can be driven by

Fear-based cultures are common and costly.

They occur when staff are afraid to voice their concerns, or staff that do voice opinions are punished by complementing this with a ‘visionary’ leadership style.

In data recently analysed from The Resilience Institute in a study of 16,261 people across 250 companies from 2011 to 2014, the results were quite alarming. The data showed that 81% of staff experience

an organisational culture that operates in a fear-based culture rather than one based on trust and empowerment.

The value of trusting relationships Various studies have postulated that only 50% of staff trust their leaders. Yet trusting

STAFF EXPERIENCES AT WORK

81%

31%

23%

36%

Work intensity

Worry

Chronic stress symptoms

Distress

Source: Extract from Resilience Diagnostic Analysis 2011–2014, The Resilience Institute

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relationships in organisations are fundamental to creating a sustainable high-performing organisation. An organisation created with a unit greater than one can only successfully function if there is an egoless relationship in which one individual can engage the skills of another and have confidence that the need will be met. One individual cannot possibly have the expertise or capacity to deliver all the needs of the organisation’s mission.

Trusting relationships are the mechanism for leveraging and aligning the strengths of many towards a common goal. This interaction is not restricted to a traditional ‘top down’ but actually needs to be 360 degrees. If, over time, the ‘bank account’ of trust between leaders, staff and teams is nurtured, the collective entity is able to achieve higher goals as well as deal with tough situations or challenges. When failure occurs (as happens), they are able to learn from the setback rather than try to hide it or assign blame. When ambiguity exists there is a broader willingness to give the benefit of the doubt.

Building trusting relationships Many would say that building trust is simply ‘doing what you say you will do’. That is absolutely true. However, this is only one of many components of trust – and any of them can build leadership trust or destroy it. Trust is nurtured by attending to a number of components in an egoless way that is consistent with organisational vision and values. Attention to these components must be consistent over time to incrementally build the bank account of trust. It is a truism of trust that it takes many positive leadership actions to eventually build trust and only one negative leadership action to destroy all trust.

The key components of trust are shown in the table above.

Of these components, there are several that really stand out as major drivers of trust.

Transparency of information. There will always be information that cannot be shared by a leadership team with the organisation for reasons such as privacy, competitive strategy

Trust components

Build trust

Destroy trust

Decision-making

Consistent values

Unpredictable

Actions match promises

Yes

No

Tell the truth

Yes

No

Transparency of information

High

Low

Use of power

With respect

Abuse

Culture of speaking truth to power

High

Low

Treatment of contrarians

Reward

Punishment

Goal centre

We

Me

Resolution of conflict

Compassion

Sympathy/ contempt

Admission of mistakes

Responsibility

Deny/Ignore/ Blame

Track record & reputation

Positive consensus

Negative consensus

Level of two-way conversation

HIgh

Low

Judged competence of trustee

High

Low

Personal connection

HIgh

Low

and timing of announcement. However, handled poorly this can lead to distrust and the development of conspiracy theories to fill the absence of information. The trust gap created by the inability to share all information can be bridged by strong communication around what can be communicated and reasons why other information will be released at the appropriate time. Of course, this is all worth naught if there are negative credits in the bank account of trust.

Resolution of conflict. Conflict in organisations and teams is a normal part of business operations that arises due to different opinions and goals and limited resources. Conflict resolution in organisations is often done poorly. As human beings we

have a natural tendency to avoid conflict (“I don’t want to upset the other person”), or to be confronting (power-based contempt) and bulldoze through the conflict. A trust-building leadership team welcomes conflict and aims to address it through the lens of compassion, where there are clear boundaries that define success and an empathic conversation around whether and why the boundaries have been honoured or crossed. The outcome is a caring and respectful conversation focused on an outcome for the greater good.

Personal connection. If we were to identify the top five people in the world that we trust, it is likely they would be those we had the strongest personal connection with.

Compassion-based leadership seeks to achieve this in an organisational setting. This is a style of leadership in which the leader truly cares about their people and takes the time to understand the broader aspects of their lives and what motivates them. This is not the same as being a friend, which can drive a sympathetic, trust-destroying outcome; rather it’s more about mutual awareness and appreciation.

High-trust cultures in challenging times The real test of trust happens in challenging times when an organisation is under threat or there is a significant level of growth and transformation. The work that has been done by the leadership team in building a strong bank account of trust in advance will pay dividends, making the difference between a successful journey to sustainable high performance and an organisation that becomes paralysed by its own politics.

Stuart Taylor, the founder and CEO of The Resilience Institute (Australia), works with organisations, leaders and individuals, guiding them from being at the mercy of their environment to reaching a place of calm and optimism where they see opportunity instead of adversity.

Working with over 60,000 people globally in the last 10 years, The Resilience Institute’s clients include PwC, Shell and NAB.

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PEOPLE

CAREER PATH

‘THE WHAT’ AND ‘THE HOW’ Franck Appleby, people and performance director at Adshel, has found his niche, and it’s at the forefront of emerging technologies

Then-master’s student Franck Appleby puts his studies in political administration to work when he takes a part-time job as a researcher for a social organisation studying social experiments within various local governments in his native Denmark.

1995

DISCOVERS A PASSION FOR PEOPLE

“It sparked an interest in social dynamics, in how people interact and behave in social settings, which has been a fundamental focus for me ever since” 2000

STARTS AT ORANGE

In what Franck describes as the predawn of an emerging industry, he takes responsibility for the HR and LD of the Brisbane call centre for the Orange brand.

“It was a very sexy brand, a cool brand. Telecommunications was starting to come of age. And Orange was meant to be the challenger brand [to legacy telcos].”

2004

SETS UP INDIA; SETTLES IN SYDNEY Three months in the hyper-competitive Indian market setting up 3 Mobile’s offshore operations culminate in a return to Australia and a move to corporate headquarters in Sydney, where Franck concentrates on relationship development and cultural development. Leadership development becomes a key focus for Franck; the catchphrase he coins is “You either get the right leaders or you get the leaders right”.

2015

JUMPS TO OUTDOOR ADVERTISING In a much-changed media landscape, outdoor advertising is on the brink of great technology-driven change, says Franck, as digitalisation allows targeted, real-time ads according to such variables as weather, time of day, and consumer behaviour. And, unlike many forms of advertising, it can’t be blocked or switched off.

“Outdoor advertising is going through a revolution at the moment; Adshel is able to connect communities to smarter advertising solutions. I’m drawn by a strong change agenda with a dash of technology.”

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1996 MEETS HIS AUSTRALIAN WIFE; RELOCATES

Franck meets his now-wife, an Australian backpacking in Europe.

A long-distance relationship follows, culminating in marriage and a move to ‘Brizzy’, where he arrives with no job and plans to study part-time.

Franck’s first job while a student: direct door-to-door sales for Foxtel at the height of summer.

2003

JOINS 3 MOBILE; BUILDS A CULTURE Tasked with building the Australian operations of the first brand to make 3G technology available, Franck distils a new principle. He refers to ‘the what’ and ‘the how’ – the ‘what’ being technical capability, while the ‘how’ is behavioural capability.

“In the beginning we were more focused on ‘the what’ than ‘the how’; as we matured ‘the how’ became more important than ‘the what’. Hiring people for the right cultural fit became a 3 Mobile trademark.”

2010

MERGER, CRISIS AND TURNAROUND The merger of 3 Mobile and Vodafone sees Franck managing the integration of two heritage cultures. A year post-merger the collision of uptake in smartphones, the dramatic increase in data consumption, and an ageing network infrastructure leads to full crisis. The subsequent three-year turnaround plan includes building brand pride back into staff as the network is rebuilt across Australia’s wide brown land.

“At Vodafone I got a three-for-one deal – a merger, a crisis, and a turnaround. It was a great learning opportunity”

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PEOPLE

OTHER LIFE

THE DIY GURU Some HR directors travel the world in their ‘other life’; others undertake unusual hobbies or play an instrument. James Letherbarrow prefers to get his hands dirty EVER SINCE James Letherbarrow, HR director, CFO and company secretary at Edelman Public Relations, bought his first property at the age of 21, he’s loved DIY projects. From designing a new bathroom to repainting a room or creating the perfect garden space, Letherbarrow says he is “passionate about good design, both indoors and out”, and enjoys “getting my hands dirty bashing out walls and ripping up the garden”.

By undertaking the labour himself, he says he’s become quite skilled in electrical, plumbing, carpentry, painting and landscaping work.

“When you do it yourself, you know the job is well done, and I get the great satisfaction of enjoying my completed projects with family and friends as well as my two very spoiled French bulldogs,” he says.

He also sees some unexpected benefits from his ‘other life’ in his work life. “People, like gardens, can grow into amazing things. A little love, a little nurturing and guidance goes a long way. There is a necessary balance in life and business, so even those weekends and nights spent at the office working seem a little shorter and more rewarding when you are able to come to that little place on earth you enjoy most.”

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Number of DIY projects completed

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2

Number of near-death experiences (falling off the roof while painting, and accidentally cutting through the electricity mains with an angle grinder)

25

Number of hours per month spent maintaining current property – but infinite hours are spent on projects (there’s always a new one)

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