human capital
HC issue 7.10
Profile
Warner Village Theme Parks
Teambuilder
Fitness First
REVEALED! WHAT EMPLOYEES WANT & HOW TO PROVIDE IT
Absenteeism: The hidden KPI Beating bullies at work L&D: Cost effective training solutions
editor’s letter issue 7.10
EDITORIAL Proving HR’s worth
t
his month in Human Capital we feature two tricky topics, which seem to appear regularly on HR’s list of ‘most dreaded’ things to deal with: bullying and absenteeism. Bullying seems to be topic of the month, with media coverage concentrating on school bullying and, less prominently, workplace bullying. The direct cost of bullying has been estimated at $160,000 per 100 employees per annum. This equates to $1,600 per person per year. But even this high figure does not factor in the many indirect costs such as loss of productivity and medical bills – not to mention litigation and court proceedings. Absenteeism is no less costly, with research from Direct Health Solutions putting the overall cost of absence to the Australian economy at $26.6bn per annum – or $3,017 per employee. A typical organisation of 1,000 staff will lose 8,620 days of productivity valued at over $3m. As our feature on page 26 reveals, dealing with this ‘hidden KPI’ effectively can allow HR to play a significant operational role in driving better organisational efficiency – as well as enhancing the care, wellness and engagement of employees. Judging by the results of this year’s Human Capital/CareersMultiList candidate values survey, HR could do with a helping hand in providing evidence of their benefit to the organisation. This year, remuneration has dropped down the list of candidate priorities, but many candidates still expect training & career development from their employer. This puts many HR professionals in a tough position. In a separate survey 52% of HR professionals reported their budgets have either been frozen or cut over the past 12 months. The ability to do more with less and to demonstrate impact on bottom line results has never been keener.
In the first person… “Executive officers should realise that victims and even alleged bullies are seeking resolution. Victims want someone to hear their story and to be believed, while bullies may be seeking confirmation that their actions were reasonable and legitimate” – Bernie Althofer, managing director of EGL I Assessments, on handling workplace bullying (page 20)
“I’ve been very lucky to work for a company that doesn’t look at me as a woman on the board, but rather a great leader who brings different viewpoints and insight” – Nic Monteforte, operations director, NSW, Fitness First, on gender diversity (page 52)
“It has been the actions of employers to retain staff and cut back working hours rather than cutting people altogether that has been crucial in terms of improving consumer confidence and consumer spending” – Craig James, chief equities
managing director chief operating officer editor journalist production editor contributors marketing manager marketing coordinator traffic manager design manager designer photographer senior web developers it/is manager sales director
Mike Shipley George Walmsley Iain Hopkins Daniela Aroche Tim Stewart MatthewsFolbigg Frontier Software Chifley Business School The Next Step Chandler Macleod Group Danielle Tan Jessica Lee Stacey Rudd Jacqui Alexander Christopher Newman Thilo Pulch Kevin Kim Colin Chan Justin Kennedy
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economist at CommSec, on Australia’s economic fortitude (page 12)
“The role of HR has undergone big changes. In the early days of my career, HR was seen more as the ‘hirer and firer’ and very much an administrative role” – Tony Lines, HR business partner for Warner Village Theme Parks, on HR’s evolution (page 44)
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1
this issue
inside
HUMAN CAPITAL
HC ISSUE 7.10
PROFILE
WARNER VILLAGE THEME PARKS
TEAMBUILDER
FITNESS FIRST
REVEALED! WHAT EMPLOYEES WANT & HOW TO PROVIDE IT
12 What employees want
Now into its sixth year, the Human Capital/ CareersMultiList candidate values survey provides some valuable insights into what employees are really looking for from their employers
Absenteeism: The hidden KPI Beating bullies at work L&D: Cost effective training solutions OFC_SPINE.indd 2
16/10/2009 8:37:31 AM
20 Beating bullies
Bullying has major repercussions for the health, productivity and financial performance of the workforce. Iain Hopkins outlines the problem and what can be done about it
contents features 26
Absenteeism
32
How not to train
38
From survive to thrive
48
Future gazing: Work habits in the 21st century
Absenteeism is a costly drain on resources for most organisations, yet many business leaders don’t know the basics of how to manage the problem effectively. Dr Martin Cross provides some tips
Pouring money down the drain on ineffective and ‘tick the box’ L&D solutions? Charles Jennings has an alternative
The 2009 HR Business Outlook revealed that Australia coped with the GFC better than any other developed nation, but we’re not out of the woods yet
KPMG demographer Bernard Salt reveals some seismic shifts in the way in which Australians are working – and outlines why employers need to keep up
regulars 4 In Step 6 Legal 8T raining & development 9C orporate Culture 10 HR technology
Letters to the editor Do you have a burning HR or people management issue you would like to share with others? Would you like to share your thoughts on the challenges you’ve faced and how you’ve overcome them? Want to kick off some debate about your industry? If so, Human Capital would like to hear from you. Send through your comments to editor@ hcamag.com.
instep HR Career Experts
Page 4
No Thanks for HR
T
he Human Resources Director of one of Australia’s leading professional services firms recently quipped: “if you want to be thanked for what you do at work, don’t go into HR!” She went on to say that people need to “build a bridge and get over it, if they think that they are going to be thrown bouquets for their work in HR.” Why is this the case? This is the focus of this month’s Instep column.
Why no thanks?
yy counselling companies to adopt a long-term view yy reminding companies that talent has been hard to find in the past and will be just as hard to find in the future yy educating that short-term decisions have significantly negative impacts on the company’s employment brand, as well as its overall brand in the market
HR leaders often echo the sentiment that their efforts frequently go unnoticed unless something goes wrong. HR is not alone in this regard. This is the reality for most supporting professional areas such as IT and Finance. No doubt IT professionals bemoan the fact that the business doesn’t think about them until the IT system crashes. There are many elements of HR that are only noticed if they go pear-shaped – that’s the reality! While appreciation for work done in HR may be hoped for, the view of many HR directors is that it shouldn’t be expected. Having said this, many big picture and smaller scale achievements have been realised through HR. With an economic downturn, many commentators said that HR would need to step up – and it did, for the whole economy.
With these conversations and practices in place, many businesses have shown a longer-term focus to their employees, which will hopefully be recognised with increased employee loyalty and engagement. Companies that disregarded good HR practice will also undoubtably reap what they have sown.
HR delivered for the economy
The big picture
It is well known that Australia is emerging from the GFC in better shape than most other countries – particularly developed nations. As has been documented, there are a range of reasons for this. Depending on your political persuasion and general beliefs, various factors have more or less weight. The stimulus package, the resources boom, the strength of our banking system and our superannuation regime are all no doubt significant contributors to Australia being in relatively good shape. Two of the other contributors to our relatively good economic status are: our comparatively low unemployment rate, and our high levels of consumer confidence leading to better than expected lower-end residential property and retail sales. These indicators of economic health have outstripped expectations. This is where HR comes into it.
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Simple logic would suggest that consumers who spend money on houses and in shops are confident. Consumers are confident when they know they (or the family bread winner) isn’t going to lose their job. Why aren’t people losing their jobs? The answer is that the majority of companies have designed ways to cut costs without cutting heads – and HR has driven this effort. Throughout the end of 2008 and the beginning of 2009, HR professionals convinced business leaders not to ‘knee jerk’ and make reactionary and short-term jobs cuts. This significantly reinforced consumer confidence. You think that’s a stretch? Well that may be the case, but the reality is that HR professionals in most businesses over the past 18 months have been:
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HR people aren’t self promoters
There are many HR professionals who disdain the notion of self promotion. The reality is that all support services and professionals need to be on the front foot and saying: “Look what we have done for your business. You now have a commercial competitive advantage because of the clever stuff we have done” …or words to that effect. We aren’t saying that sound HR thinking and practices are the only reason that Australia is in good shape, but the knee jerk reactions of past downturns haven’t been as prevalent at a time when legislative changes affecting employment should have spooked employers to ‘cut hard and cut early’. This has helped the economy – there is no doubt about that. The question is: does anyone outside HR make the connection? Craig Mason is a Director with The Next Step, a specialist consulting practice in the human resources market. For information call (02) 8256 2500 or email cmason@thenextstep.com.au website: www.thenextstep.com.au
Recent HR Market Moves supplied by The Next Step
Priscilla Mather has recently been appointed Global Head, Compensation and Benefits with Lend Lease. Previously Priscilla was with Tabcorp Group GM – Reward, Policy & Performance. Lisa Sgubin has been appointed HR Director Parcel Direct Group Pty Limited. Before this appointment Lisa was with Fairfax Business Media as Human Resource Director. Vanessa Lorford-Brown has been appointed the Head of HR for Mission Australia. Previously Vanessa was with Bendon and AsureQuality / AgriQuality Ltd in Senior HR Managerial roles. Breville recently appointed Jennifer Kapp as HR Manager. Previously Jennifer held HR Manager roles with The National Trust of Australia, GUD Group - Sunbeam Limited & CSR. Francine McCallum recently joined Luxottica Retail as Senior Human Resources Manager. Francine’s most recent role was with Telstra as Senior Human Resources Advisor.
Eli Lilly recently appointed Christina Tsingos to the role of Remuneration and Benefits Manager. Previously Christina was with Deloitte in the role of Shared Services Director, People & Performance. Tim Youle accepted the role of Senior Project Leader OD with Energy Australia. Most recently Tim was with Blackdot Consulting as a Senior Consultant & previously Talent & Capability Manager with MBF. Kate Collins joins GE Capital as the HR Services Leader. Kate joins GE Capital after developing her career within GM Holden and Mars Incorporated. Lisa Burrell has accepted the role of Manager - Workplace Relations Operations with Vecci. Lisa’s most recent role was Senior Employee Relations Consultant with Department of Human Services.
Therese Impey has recently been appointed HR Business Partner Emma Baker will join OAMPS as an HR Business Partner. Most recently Emma worked in the UK with Accenture and Shell with Becton Dickinson. Most recently Therese held the role of International Petroleum. Manager, HR with QBE Lenders’ Mortgage Insurance. Caltex Australia recently appointed Sarah Elliott in the role of Manager Rewards. Previously Sarah was with Westpac Banking and St.George where she held senior Remuneration and Benefits roles.
Rosa Hull has joined Eastern Health as HR Manager. Rosa has gained her HR experience with organisations such as Department of Human Services and Southern Health.
By supplying Market Moves, The Next Step is not implying placement involvement in any way.
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issue 5.10
news
Page Legal Experts
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Absent from Work under fair WORK
M
anaging employee absenteeism and its effects on productivity remains a challenge for employers who must tread carefully in their dealings with chronically absent employees to avoid unfair dismissal, discrimination or adverse action claims. A common issue for employers, this article will address the following reader question: ‘Employee X routinely called in sick and provided a medical certificate. Her sickness equalled 20% of her working time. Is there anything I can or cannot do from a legal standpoint when it comes to absenteeism? Is there a point where it has to be addressed?’
Potential exposure to unlawful termination, discrimination and adverse action claims Under the Fair Work Act 2009 (Cth) (the Act), an employee may make a claim alleging adverse action or unlawful termination if his/her employment is terminated while absent from work. State and Federal Anti-Discrimination jurisdictions continue to be available to employees who allege the employer has discriminated against them. Employer liability will depend on the particular facts and circumstances, including the length and extent of the absence, the reasons for the absence and whether the employee has provided substantiating evidence. Temporary absence due to illness or injury Under the Act, an employer is prohibited from terminating an employee’s employment because the employee is temporarily absent from work because of illness or injury. A temporary absence is defined as an absence from work: (a) on paid sick leave; or (b) of not more than three months in any 12 month period, where the employee has provided substantiating evidence in accordance with the requirements of the Act. Whilst an absence on workers compensation will count toward the three month temporary absence threshold in (b) above, it is no longer considered an absence on “paid sick leave” for the purpose of (a) above. Has the employee provided a valid medical certificate? Generally, a certificate provided by a medical practitioner is sufficient proof of illness. The recent court case of Kaur v DHL Exel Supply Chain (Aust) Pty Ltd demonstrates that employers who do not
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recognise medical certificates will risk legal exposure. In that case, a worker was already on workers compensation leave when she requested annual leave. Whilst overseas, she faxed a medical certificate to the employer who terminated her employment on the basis it was a ‘clearly convenient coincidence’. The employee’s dismissal was considered unfair as it was held her failure to return to work was substantiated by an appropriately certified medical certificate. An employer should only challenge the validity of a medical certificate in exceptional circumstances where the employer has evidence to substantiate an employee was fit for work on the day of absence. In Anderson v Crown Melbourne Ltd an employee was dismissed for attending a football match, despite providing a medical certificate. The employee had been discussing the game with colleagues and a manager had spoken to him about alternatives to using sick leave for the game. As the employer was able to adduce evidence of the ‘inappropriate’ use of the medical certificate, the employee’s unfair dismissal claim was rejected. Has the employee abandoned his/her employment? Abandonment of employment occurs when an employee leaves employment without any intention of resuming work. If an employee is covered by an Award or Agreement, these should be reviewed as they often contain provisions regarding abandonment. Employers are obliged to make every effort to contact an employee who is absent to ascertain whether the employee is absent for a reasonable cause. If such attempts are unsuccessful, the employer should write to the employee and direct him or her to contact the employer and attend at a meeting to discuss their employment before simply concluding abandonment. If all options have been exhausted and the employee appears to have genuinely abandoned the employment, an employer may consider dismissal. However, it is strongly recommended given the many risks and exposures in these circumstances that legal advice is sought before any action is taken.
What should employers do?
To manage absenteeism employers should: 1. Develop and implement a consistently enforced policy outlining: yy circumstances where personal leave entitlements can be used in accordance with the Act/relevant Industrial Instrument yy procedures to be followed in the event of absence, including notification requirements and provision of reasonable evidence substantiating absence in accordance with the Act or relevant industrial instrument yy clear counselling or disciplinary guidelines to be followed in the event of non-compliance. 2. Keep records and maintain a paper trail when dealing with employees by recording details of all conversations and meetings regarding absenteeism and warning letters issued in accordance with employer procedures. 3. Seek legal advice on a case by case basis regarding management of absenteeism given the minefield of possible exposures in this onerous area of law. Fay Calderone is a Senior Associate with MatthewsFolbigg Lawyers. For more information call: (02) 9806 7412 or e-mail: fayc@matthewsfolbigg.com.au
Training & Development
Page 8 Professional Development Experts
THERE CAN BE NO CHANGE WITHOUT BEHAVIOURAL CHANGE
B
ack in the early 90s, I headed Australia’s Office of Multicultural Affairs (OMA). It was an exciting time. Trade and investment were rapidly globalising, and as a migrant country, Australia had a head start. Our population was comprised of people who had personal knowledge of the languages and cultures of more than 150 countries. At OMA we instigated a national project called Productive Diversity to promote the economic advantage in Australia’s diversity. This advantage was readily seen by Australian exporters who brought non-English speaking background representatives into their sales teams; by corporations who set up technical support centres in Sydney or Adelaide to service customers in multiple countries; and even by foodie tourists who found in Australia’s combination of cuisines and fresh produce an unmatched dining experience. Today, all successful trading nations and multinationals have woken up to the diversity advantage – consider Shanghai’s cosmopolitanism and Shell’s chameleon-like global presence. But we also learned that managing diversity well isn’t just about matching your sales force to your customers in a global marketplace, and that it comes with its own challenges. Managing diversity can also be about building teams and about creating the right climate for innovation. Often when we mention teamwork we visualise that poster of the rowing crew whose oars hit the water in unison, so the temptation is to imagine that to create a great team we must ironout the differences between individuals. Twenty-first century management reality is not like a boat race. Instead, business competition is complex and ever-changing – an endless race. Identifying new opportunities, problem-solving and innovation are par for the course. Successful contemporary enterprises draw on a wide range of knowledge, working styles and skills, and stimulate flexible interplay between people with divergent talents. Few modern managers would build a team comprising of people with a single professional discipline and a uniform working style and expect a well-rounded (let alone creative) result. Indeed, tools like the Team
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Management Index are popular because they help identify the different talents individuals bring to a mix. Equally, to avoid the stultifying and dangerous impact of group-think requires encouraging challenge, and that means valuing dissonant voices. So can it be with utilising the cultural and linguistic differences in the members of a team. Every language shapes the way the world is perceived (ask someone who is multilingual, if you doubt that), and every culture brings a wisdom and ways of behaving drawn from its history. The management skill is to encourage the expression of alternative perspectives, productively rather than wastefully. Hence the challenge: how is it possible to extract the gifts of difference while avoiding the misunderstandings which arise from less-than-perfect skills in English – and worse, the resentments which arise from the appearance of special treatment as consideration is given to cultural values, either mainstream or minority? There can be no doubt that managing diversity does require real effort. One early study compared the performance of monocultural and multicultural teams and found that when monocultural teams were set a task they were quicker to complete them. They did not require the time multicultural teams needed to sort out team norms. Yet once completed, the multicultural teams’ solutions to the task were almost always richer in commercial or technical possibility – that is, potentially more valuable because more innovative. The effort is worth it. Investing in learning cross-cultural management skills is the key. Managing across cultures requires sorting out the ground rules for communication, taking the time to hear what everyone has to say regardless of their way of saying it, and also insisting that respect for each individual is an absolute requirement. Indeed, at its heart, managing cultural diversity is simply good team management with the dimension of language and culture added. Most important, it is about recognising the value of every individual – not despite their culture, but respecting their culture to the extent that it is important to them as an individual. Equally it is vital not to treat individuals as just representatives of a culture, however well-meaning, because as individuals they also bring many other attributes to the team. Finally, of course, Australia’s multicultural advantage is there because that’s who we are. Look around you. We manage diversity in the workplace every day. We may as well do it better. Contributed by Neil Edwards Neil is Chief Executive of Chifley Business School.
Phone 1300 CHIFLEY | 1300 244 353 Visit www.chifley.edu.au
Corporate Culture Column Corporate Culture Specialists
Page 9
Catapult Your Company to a Leading Position through Mentoring
O
rganisations today are constantly striving for costeffective ways to strengthen the work performance of their talent. The degree of their success in this process is often crucial in determining which organisations thrive, which merely survive and which eventually disappear. One of the most significant drivers that motivates or demotivates employees is the organisation’s culture. Other drivers include reward systems, job design, performance management and resource allocation processes. One of the core objectives of culture is to create a common bond or camaraderie between employees. This can be achieved through concurrently driving various cultural levers such as fostering a mutual reliance and friendship among co-workers; creating value collaboration and teamwork; encouraging the sharing of best practices; and emphasising key behaviours that are acceptable. When embarking on a culture development program, it is critical that organisations implement an initiative that will nurture influencers of the culture within the company. A proven way of achieving this is through a strategic mentoring program.
Mentoring is not a new phenomenon – The word ‘mentor’ comes from an ancient Greek Myth
Odysseus, a king and hero, set off for the Trojan War knowing that he might not return for many years. Mentor was the wise helper and teacher who Odysseus chose to guide the development of his son while he was away. Today, in most organisations, some form of mentoring is going on somewhere – formally or informally. Academically speaking, mentoring is a process of creating a supporting relationship that has benefits for both parties. A mentor will guide and support a mentoree, often gaining new insights into their own operating style. A mentoree will benefit from the support of a colleague who brings with them a higher level of experience. There are different levels of mentoring that organisations can implement – each with differing levels of effectiveness. Mentoring can be formal in nature and may be offered to participants as part of a leadership and management development program. A formalised approach to mentoring involves the selection and
matching of mentors with mentorees by the group accountable for the program. Program guidelines are usually established for the mentor/mentorees, as well as resources to help identify specific individual and organisational goals. A formal mentoring program offers ongoing support to participants, and constantly monitors the program to the ensure outcomes are achieved. Informal mentoring, on the other hand, has a less structured approach. The mentor relationship often develops in a more spontaneous way. However, the same mentoring process and principles that underpin a formalised process should apply, providing the mentoree with the opportunity to identify and develop plans to achieve career and organisational goals. Mentoring in isolation will not necessarily support the overall objective of the culture or the organisation.
Mentoring is a very effective tool to encourage employee engagement and positively influence the culture
This is partly due to the relationships that form through the program. Additionally, effectively-implemented mentoring programs can contribute to the achievement of the organisation’s strategy. This can be realised by focusing on reducing staff turnover, providing support in challenging environments (ie, a merger), developing and nurturing cultural influencers, supporting career planning, managing knowledge, extending leadership abilities and over time becoming an employer of choice Mentoring appears a simple concept and is often confused with coaching. Most people have experienced informal mentoring at some point in their careers, but making a structured mentoring program work effectively in your organisation can be a challenge.
Craig McCallum
www.chandlermacleod.com
General Manager Marketing: Specialist Recruitment & Consulting Services Tel: 02 9269 8879 Craig.McCallum@chandlermacleod.com
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issue 5.10
international
HR TECHNOLOGY
Page 10
Leveraging talent in the workforce Question:
How can I utilise my existing HRIS to leverage talent within my organisation more effectively?
Answer:
In the current economic climate, the workforce represents an enormous opportunity for HR practitioners to deliver a competitive advantage to their organisations. In order to achieve this, however, HR departments need the vision and tools to enable them to leverage workforce investments and reduce the costs associated with employee turnover. By taking a more holistic approach to talent management you can leverage both your software solution and workforce more effectively. Often organisations do not fully utilise all of the modules offered by their HR solution and are missing opportunities to streamline processes, increase productivity and maximise workforce effectiveness. After some investigation you may find that your existing HRIS has a variety of modules and tools that will assist you to harness your workforce more effectively and support employee lifecycle management. Like never before we are operating in a knowledge and skills-based economy, so the most competitive and effective enterprises are those with a dedicated, well trained and highly skilled workforce. An effective employee lifecycle management methodology will underpin your initiatives and you may be surprised to find that you already have the tools to support streamlined processes. Employee lifecycle management includes managing your workforce from recruitment through to separation. Once you have hired and on-boarded your employees, there are three continual steps in employee lifecycle management that are reviewed regularly. These phases are career planning, learning (to support job function and career growth) and review, which feeds back into the initial planning step. By implementing an effective employee lifecycle management (ELM) methodology your organisation will leverage talent and align workforce goals with company goals which impact the bottom line. The phase where new employees enter your ELM process is largely dependent on your on-boarding procedures.
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Regardless of where new hires enter, it is a continual process until separation/termination. Let’s review ELM in more detail. The first step in any ELM process is recruitment. Your e-recruitment system should save time, streamline processing and assist with identification of quality candidates. While the candidate shortage may have abated for the time being, many organisations are now inundated with applicants for one position and spend hours reviewing unsuitable applications. By utilising your e-recruitment tool effectively, this time-wasting activity can be eliminated and recruitment processes automated via workflow processing. Applicant tracking can be time consuming and an administrative burden. Your e-recruitment system can ease the load by automating candidate correspondence, minimising data capture, improving service levels and streamlining the onboarding process. Once on-boarding is complete it is vital that the manager and employee meet and plan for career progression – this initial step heightens engagement and identifies learning opportunities. The outcome of this step is a formal career plan that is stored within your HRIS and reviewed or updated as needed. Regular reviews are conducted – these may be annual or six-monthly – and during the review process the career plan is updated, and further learning opportunities identified. The next step of the process is learning, and this is done either on the job, through mentoring or formal training. Your HRIS can capture the learning and skills gained, ensuring employee capability frameworks are maintained. The review phase is the most important step to the employer, as this is the opportunity to provide feedback and guidance on employee performance. In addition, the review phase is an ideal time to align corporate goals and strategy with employee key performance indicators (KPIs). Many HRISs will initiate the review process by sending off forms to be completed by employees being reviewed, ensuring this important phase of employee lifecycle management is not overlooked. Goals for the coming year are captured and agreed upon during this step, ensuring workforce alignment with the enterprise. Your employees represent one of your organisation’s largest expenses, yet they should be viewed as an asset – when managed effectively they can significantly impact the bottom line. By utilising the tools provided by your HRIS, the administration burden can be greatly reduced to provide HR with the time to analyse the data stored within your system and perform more strategic functions. Nick Southcombe General Manager Frontier Software Pty Ltd (03) 9639 0777 www.frontiersoftware.com
news issue 7.10
‘Shock’ events the key to top employees leaving
I
t’s been well established that most employees don’t leave an organisation – they leave a boss. A Deakin University researcher has said that employers wondering why some of their good employees are leaving should look at the behaviour of their managers. Dr John McWilliams, from Deakin’s Business School, interviewed 62 technology workers who had voluntarily left their jobs. “The problem was that these were high-performing employees – assets to their companies – and their employers didn’t want them to leave. Their departure was classified as regrettable, yet it could have been avoided had the companies taken the time to evaluate the relationship between the person and their manager, and developed the interpersonal competencies of their senior staff,” Dr McWilliams explained.
Unusually, his exploratory study looked at the events which precipitated the person’s decision to quit and the final shock or jarring event which challenged the way they thought about work and led to their resignation. Such shocks are a good predictor of turnover. “The first and largest source of shocks was the behaviour of managers,” Dr McWilliams said. “This ranged from controlling behaviour to a lack of social awareness. One person, for instance, had been doing two jobs clocking up 350 hours of overtime. His request for overtime payment was declined, and he was then torn to shreds at a hostile performance review and offered an unacceptably low pay-rise. Dr McWilliams said another source of ‘shock’ were calls from head hunters. “Many
NEWS people reported regular ‘testing’ approaches from competitors and customers as a matter of course. Dr McWilliams noted that stories like these frequently go unnoticed in exit surveys. “It’s so difficult to collect the data. No one tells the truth in exit surveys. They should not be carried out by HR, or the manager, but an independent third party who can give you the bad or good news.”
Executive remuneration: latest trends revealed
D
espite the turbulent economic conditions, senior executives at some of Australia’s top-listed companies received increased short-term incentives, such as cash bonuses, in lieu of long-term incentives for performance, Mercer’s ASX 200 Executive Remuneration Survey has found.
Mercer’s analysis of pay for the top four reporting levels in some of the top ASX listed companies found that the average short-term incentive (STI) payment for some incumbent executives (those who remained in the same job for the same period) was 14% higher than what was paid out in 2008, but the average
Deadline looms: Fair Work Act
A
ustralian businesses are being urged to update and finalise their work policies and practices as the deadline looms for complying with the Federal Government’s Fair Work Act. There are now less than three months until the deadline, but according to The Human Resources Centre managing director, Katherine Graham, many businesses are still unprepared and should “get to work, now” on moving to the new employment framework. By 1 January, 2010, all Australian businesses will need to be compliant and prepared to manage the changes and challenges of the country’s new industrial relations laws, including: »» National Employment Standards, a set of minimum conditions for all Australians, which provides for more flexible working arrangements and more generous severance conditions.
»» Modern Awards, which will affect pay scales and employment terms and conditions, such as leave entitlements. »» Unfair Dismal laws, which will now only exempt businesses with fewer than 15 staff, compared to fewer than 100 staff under the previous system. Graham said the changes under the Fair Work Act are not complicated, but they are time-consuming to interpret and implement. “Not getting it right from the outset means more time and money spent backdating correct awards and conditions,” she said. “For example, businesses need to get their job classifications right; they need to update employment agreements and work practices in line with the new penalty rates; they need to ensure their policies support these new Fair Work guidelines; and they need to tell staff, in writing, about any changes to their employment provisions.
long-term incentive (LTI) was 11% lower than in 2008. Yolande Foord, head of executive remuneration at Mercer, said STIs may have been favoured over longer term rewards this year as boards and management focused on ensuring strong near-term performance and maintaining productivity during these difficult times. “On the surface an increase in STI payments may seem like a bitter pill for shareholders to swallow given the market conditions over the past year, but the aggregate hides the fact that more than half of the same incumbents received a lower bonus than the previous year,” Foord said. “It indicates that bonuses are only being awarded to those who were able to meet their performance targets, and that companies are being disciplined in managing their performance programs,” she said. Mercer’s survey reported a 17% decline in executives receiving LTI grants this year, with lower LTIs reflecting the decline in share prices. For those who received an LTI, their average STI bonus remained relatively unchanged against the previous year. Mercer’s survey also found that about one third (32%) of incumbent executives did not receive a pay rise at all, but those who did fared better than expected. The total average pay increase was 5.7%. www.hcamag.com
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issue 7.10
cover story
WHAT EMPLOYEES WANT
AND HOW TO PROVIDE IT
Now into its sixth year, the Human Capital/CareersMultiList candidate values survey provides some valuable insights into what employees are really looking for from their employers
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cover story
E
very month Human Capital aims to expose readers to organisations that are leading the way in terms of HR practice and people management initiatives. These organisations – often voted ‘employers of choice’ by their own employees via external consultants – set the benchmark for other organisations to follow. Yet how do these organisations know if their efforts are truly hitting the mark? Following a year
of unprecedented volatility, have the expectations and demands of employees shifted from previous years? Do the ‘nice to haves’ like extravagant employee benefits and plush office fitouts really matter when simply having a job is reward enough? Most importantly, are employers focusing on the things that employees want in their job offerings and employer branding – or are they just pouring resources and funds down the drain?
issue 7.10
The fundamentals
As in previous years, 300 candidates applying for jobs across a range of industries through the CareersMultiList network of employment agencies were asked a series of questions about what they wanted from their job, what they thought about recruitment agencies and why they left their previous roles. Candidates were able to choose the top three benefits or features (from a list of 10) that were most important to them when
Who’s getting it right? Case study: TNS Australia Human Capital talks to Nicole Green, executive director, people & culture, at market research consultants TNS, about her company’s commitment to flexible working conditions and being an employer of choice for women.
HC: How do you know what your employees or potential employees want from you as an employer? NG: We have an employee survey which is conducted once a year globally, giving us feedback about what is important across all sectors of the business. In recruiting, one of the key things candidates are looking for is work-life balance. In some cases, they’re asking about it even before they ask about salary. We’re seeing a lot more women in the workforce, and applying for positions with work-life balance is an important consideration for them. We’re finding it’s the same for Gen Y, who are thinking ahead to how their work-life balance will affect them down the track. For our employees who have family commitments or are about to have a family, work-life balance is very important. HC: Has this changed given the tough economic conditions over the past 12 months? NG: I haven’t seen a change. Employees still value work-life balance the same as before, and interest in flexible working hours and part-time options is at the same level. For example, we’ve had a lot of employees who have gone from full-time to part-time, but very few who have gone the other way. However, we’ve noticed more seeking the flexibility to work from home.
HC: Where do you focus your attention in terms of the retention of good employees? NG: Our workplace program, which we call Achieving Balance, focuses on policies for claiming back extra hours put in as time in lieu, flexible working hours, paid parental leave, festive leave and birthday leave. We encourage managers to take advantage of and promote use of the time in lieu policy as it is really important in our industry, which is project-based. We offer paid parental leave to both male and female staff; there is no policy we offer to a female that we don’t offer to a male. The majority of women who have gone on maternity leave have come back, because we are able to offer them flexible working conditions when they return in addition to the support when on leave. HC: Is this what you believe gives you an edge over competitors? NG: Since becoming EOWA [Equal Opportunities for Women Association] accredited, our workplace program has been a big advantage for us, with clients asking for more information about it – especially government clients. We are currently the only Australian research company to have accreditation. HC: Have you noticed any differences in what employees expect from you as an employer over the last 10 years? NG: Yes. More women want to come back into the workforce, so there is a desire for more flexible working conditions. Career development & training is also a big thing now women coming back into the workforce. The opportunities to be trained and upskilled make a big difference – especially in our industry, because it is dynamic and heavily affected by advances in technology. Most encouragingly, we’ve noticed that women are more confident that they can do their job.
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choosing a new employer. The survey results revealed that the ‘big three’ (salary & remuneration, career development & training and workplace culture & environment) remain firmly entrenched at the top of the list. When weighted responses were tallied (totals
“ If candidates believe a company doesn’t provide career opportunities and the sort of work culture they want to work in, then even if the salary is reasonably high they won’t take the job” – Greg Riley of those candidates voting one, two and three), the top three for 2009 emerged: career development & training (28%), work culture & environment (20%), and salary & remuneration (15%). This is similar to last year’s results, which saw culture at number one (24%) closely followed by career development
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and salary/remuneration coming in equal second with 20% each. Greg Riley, director of CareersMultiList, believes that in the current environment most candidates are simply happy be employed – hence the drop in traditional priorities such as salary & remuneration. But the rise of career development & training is a surprise. “I wouldn’t have thought too many people were looking to push forward their careers just at the moment. I’d think paying off a mortgage might be more of a concern – but it certainly appears that candidates are looking beyond remuneration as a factor for switching jobs,” he says. This will come as good news for L&D professionals who have seen their budgets slashed over the past 12 months. Riley feels the trend has been several years in the making. He notes that when the survey was first taken four or five years ago, the job market was going through a quieter time and candidates were less keen to move. Organisations were competitive with salaries, so other elements started to creep into the priority list as employers struggled to define their ‘point of difference’. To put it even more plainly, even in this market where there are more candidates than jobs, people will not take a job just for money – especially if they feel relatively secure in their current job. Indeed, concern over the economy has shaded many responses to this year’s survey, as people ‘make do’ with their current positions. However, the fundamentals still ring true. “If candidates believe a company doesn’t provide career opportunities and the sort of work culture they want to work in, then even if the salary is reasonably high they won’t take the job,” Riley says. There is greater interest to be seen in
Who’s getting it right? Case stud
Human Capital talks to Rhonda Brighton, Luxottica Australia’s general manager of human resources, about what her company does to attract and retain the best employees. HC: How do you know what your employees or potential employees want from you as an employer? RB: We ask them! Once a year we spend time asking our employees lots of questions about what matters to them, and what we can do to help them enjoy working here. This starts as a survey, but then ends up in lots of store visits, roadshows and open question times, really drilling down to what’s most important to get right. We ask potential employees too. Every interview is half us asking questions of them, and half them asking questions of us. Of course, we have worked hard to have a good understanding of ourselves as a business: what we do well, and what we’re not so good at delivering. For example, people who love it here, say: “I love the speed!”. People who don’t love it
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dy: Luxottica so much, say: “It’s way too fast!”. We implement this awareness into our branding and our communication to the market. We’re clear about our culture and we want our reputation to be real. When a person is attracted by what we say we are, we want them to find that’s exactly what they get from day one. Perhaps, unusually, we do expect people who join us to challenge the kind of employer we are. It’s really important to us that we understand what each person is looking to contribute to the business. Long-term engagement is built on feeling you’ve added something, made a difference and had an impact. And, of course, how well we’ve supported you to make that contribution. HC: Has this changed given the tough economic conditions over the past 12 months? RB: What we’ve found in the last 12 months is that some new things have become important, but equally many of the same priorities remain on the list of what matters to employees. Examples of things that have mattered before and during the last 12 months are investment in development, a good boss to learn from, and fair rewards. An examples of a new thing is access to senior management. We describe it this way: ‘my store is OK, my boss is good, and I know my brand is doing really well, but every day I read about difficult times. I want to meet my CEO and the executive team. I want to know that they’re competent and honest and can run this company through difficult times. And while I’m making sure that’s true, I’ll tell them my ideas to make things better as well. I see the customer every day and I want my voice heard!’ Our people have been fundamental to our business being so successful
during such a difficult economy. We appreciate this every day. As such, we’re working harder than ever to be available to them, to hear their feedback and implement the things that are most important to them. HC: Where do you focus your attention in terms of retention of good employees? RB: People are recognised as the real drivers of the Luxottica business. Attracting and retaining the right people is a fundamental piece of getting the business right. Over the last three years, we’ve set out to build a high-performing, highly-engaged and creative culture. And, with it, a strong recognition that people and culture are the driving forces behind great business results. Simple strategies were built to develop the potential of all our people – our focus being not only to retain great people but to attract great people to our business. The fact that Luxottica remains a place where people really want to contribute their best is one of our continued measures of success. How we treat our people – customers and our team – creates an atmosphere that empowers and makes people courageous about their contribution and the difference they make every day. Developing our people and allowing them to be themselves has delivered very positive outcomes for the business. Business growth and prosperity funds an increased investment in leadership development, improved communication and career pathing for our best. Our processes for talent acquisition and development are simple – and very effective. Forms are just one page, so the most important thing is always the conversation. A great conversation has a fundamental role to play in valuing
and retaining good people. Since introducing this approach and shifting the culture to be highly collaborative and connected, we have see engagement up by 17% and attrition down by 8%. That’s been our simple focus for retaining good people. HC: Have you noticed any differences in what employees expect from you as an employer over the last 10 years? RB: Our business has changed substantially over the last 10 years, as we’ve grown and grown. We now operate more retail and product brands than we ever have, and we look after a larger region of the global business. But against all that change we probably employ many of the same types of people. The demographics of our workforce have changed as our brands have changed, but we still need people who are strongly customer-centric, who like connecting with customers, and who work collaboratively having fun with their team. We essentially have a workplace spanning four decades, and a customer base that expands across six. As a consequence, our management approach needs to flexible and adaptable enough to connect with each employee. We call it ‘getting the people equation right for you’, and it’s all about being able to adapt to what each person on the team needs. We teach leaders flexibility and change, not rigidity and compliance. One thing that has changed is that as we’ve grown the business, our team all expect a little more. They expect more of themselves and more of us. That’s more than fair and we’re happy for the next 10 years to take that even higher.
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Graph 1 Survey response: age brackets
Graph 2 Survey response: industry/profession breakdown 3%
6% 11%
30%
16–25
13%
46–55 33%
admin & office
13%
banking & finance
4%
26–35
customer service 7%
36–45 20%
accountancy
56 & over
human resources 37%
3% 11%
IT marketing/communication
9%
sales scientific & technical
Promises fulfilled? Is there usually consistency between what an employer promises and what they deliver in terms of employment conditions and benefits? Yes (81%): “ There is consistency if you ask all the right questions 4 at interview and review conditions of employment before committing.” 4 “ Most of the employers I have worked with have always delivered as promised.” “They do deliver on promises – otherwise they know 4 you lose trust in the company.” No (19%): “ More often than not the promise of promotion/career 8 development is not fulfilled.” “Change is a difficult process and some organisations 8 struggle to cope with it.” 8 “Employers usually oversell positions.”
Promises fulfilled? Have recruitment companies assisted you in finding employment in the past? Yes (54%): 4 “ Most smaller, specialist agencies are very good in terms of customer service and candidate care.” 4 “ Two out of the four agencies I went to were really good and got me the job I wanted. The other two didn’t offer much follow-up service.” No (46%): 8 “ I’ve been with recruitment agencies twice before and have not been happy with the results. There was no follow through and I had to keep contacting them.” 8 “I haven’t needed their services – I’ve used my own personal networks in the past.”
fourth place, where values & ethics came in with 13% of votes. This is consistent with the 2008 results, when also came fourth with 12% of votes. This has moved from sixth place just three years ago. To a world that has witnessed an economic meltdown, partly triggered by loans being approved to people who would clearly never be able to afford to repay their debt – as well as countless examples of poorly-handled redundancies and downsizing – this result is probably no surprise. Corporate social responsibility and sustainability have taken a back seat as organisations go into survival mode, but candidates are clearly still interested in working for ‘good corporate citizens’. “Organisations are increasingly promoting the values they stand for, and will actively demonstrate their involvement in social awareness programs and social responsibility programs. Candidates are becoming aware of which companies contribute to the community and which don’t. We know from experience that there are some companies and industries that it’s very difficult to recruit for. There are some that would prefer not to display their brand, for instance, in display advertising. They don’t feel their brand is an attractor for candidates – that could be because they’ve got a reputation for cutting costs, or because people have been made redundant. Or there could be all sorts of reputational reasons for people not liking them,” Riley comments.
Does age matter?
As most HR professionals and recruiters are no doubt aware, the attractors of a job will be different for different people – especially when it comes to age. It’s interesting to note that the top priority specified by the 16–25 age group was job flexibility. For ‘preferred employer type’ the top choice for this bracket was fast growing/dynamic company. For the 26–35 age group the priorities shifted towards factors like management style and the ethics & values of the company. The two primary concerns for the 36–45s meanwhile were work culture & environment and salary & remuneration – no doubt as
cover story Graph 3 What employees want
Graph 4 Reasons for leaving current/past job brand prestige
3% 1%
closer to home
4%
career development/training
20%
company culture
company resources
management style
28%
reputation as employer of choice
10%
21%
flexible hours 13%
values/ethics of company
5%
2%
3%
4%
12% 10% 11%
18% 8%
workplace culture/environment
9%
2%
terminated
2%
fast-growing dynamic 19%
lower base salary with company profit share
large stable company
21%
local (Australian)
11%
multinational 24% 9%
more money
Graph 6 Preferred salary/remuneration option
12%
9%
made redundant
want a change
employer of choice 7%
job security job with more meaning
work from home
Graph 5 Type of company sought
didn’t like my boss improved career options
2%
salary/remuneration
15% 10%
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75%
small/medium
lower base salary with non-salary benefits lower base salary with performance bonuses strong base salary only
strong brand very profitable
raising families and paying mortgages off becomes a priority. Both age brackets favoured large/stable organisations as their employer of choice. Although they only represented a small percentage of the overall survey respondents, for those aged 46+ there was a marked shift towards placing the values and ethics of the company as a top priority. This age group have many years of workplace experience under their belt, and are aware of what works for them in terms of management style and work culture. They are possibly in a position to look at their personal and professional legacy with a more critical eye. “Some of the generational clichés appear to stand true. Gen Y are less concerned about security: they want to keep their options open and are eager to work for vibrant upcoming organisations. Remuneration is a higher priority for them than in previous years. Reasons for leaving previous employment comes as no surprise: for the 25–36-year-olds redundancy is the prime reason – perhaps as organisations shed middle management positions,” Riley comments.
Nice but not yet essential
Given the brouhaha and the amount of time and resources dedicated to allowing workplace flexibility, it’s surprising to see how low down these ranked as priorities. Flexible work hours garnered only 5% of weighted votes, while work from home garnered a negligible 1%. With the parental leave debate hotting up and the right to request flexible work arrangements kicking in as part of the National Employment Standards from 1 January 2010, it will be interesting to see the results for these benefits in coming years.
Why are they leaving?
It’s also apparent that the reasons people give for leaving one employer are different to the reasons they give for joining another. “The question of how you attract candidates cannot be answered by asking current employees why they’re there, and that’s why a survey of job hunters is useful,” Riley maintains. Again, it’s not money (or lack thereof) that is the overwhelming ‘push’ factor. Only 10% of respondents listed that www.hcamag.com
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as a reason for leaving their previous employer. Nor is it conflict with a direct manager, which is frequently cited as a major reason for people leaving. Coming out on top was simply the need for a change (21%) or improved career options (12%). Again, this is a strong indication that it is the organisations that can offer clearly defined career paths and the resources to help employees follow those paths that will stand to benefit. Redundancies accounted for 18% of respondents, the majority coming from the 25–36 age bracket. This is a significant rise from last year’s 6%.
For those aged 46+ there was a shift towards placing the values and ethics of the company as a top priority As for which organisation type is most attractive, large stable companies came out on top with 24% of the votes. Rapidly growing dynamic companies took out 19% of the vote, while SMEs accounted for 11%. “Obviously big and fast growing companies are very attractive, but having said that there’s a large following for small companies. Whether big or small, it’s a worthwhile exercise for organisations to communicate to candidates exactly who they are and what they stand for so they can attract the right kind of candidate,” Riley says. General economic conditions have also likely influenced responses to the question regarding preferred salary/remuneration options. An overwhelming 75% of respondents selected ‘strong base salary only’ as their preferred remuneration package – indicating that cash in hand (or in the bank) is king. “People like the strong base salary, and if they did have a bonus they preferred it to be on a personal basis rather than a company profit – they weren’t particularly keen on non-salary benefits, and no one wants to share the profits at the moment,” Riley says. HC
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HR doing it tough Most HR leaders indicated their budgets had either been cut or were frozen in the new financial year.
frozen
43%
cut 39%
increased
9% 9%
stayed the same
limiting employee travel
Discretionary items including travel, recruitment and outsourcing are the most likely to be cut from HR budgets.
limiting recruitment reducing spend with outsource providers stalling training & conferences limiting staff and client hospitality
3.9% 17.5% 6.0% 6.0%
15.7%
7.9% 13.9%
8.5%
8.8%
11.8%
pay cuts or freezes cutting back workforce reducing capital investments for staff reducing hours for employees other
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bullying
Beating BULLIES
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Bullying has major repercussions for the health, productivity and financial performance of the workforce. Iain Hopkins outlines the problem and what can be done about it
2
009 may go down as the year of the bully. From media reports on the spate of school bullying to high-profile court cases on corporate bullying, it seems that this topic has forced its way to the top of the agenda. Has the situation really escalated out of control? Jo Kamira, principal at Wise Workplace Investigations, believes bullying has always existed, bubbling unseen under the surface. Cases are only now being reported, thanks largely to raised awareness of individual rights and an understanding from the corporate world about the wideranging implications of bullying. “I think there’s greater awareness in the workforce about what’s acceptable and what’s not, and organisations have proper policies and procedures in place. Some of them have very loose ones, but on the whole, most big organisations and government have quite stringent policies in place. I also think that a lot of Gen Y won’t put up with what older Gen X and Baby Boomers put up with – because they’ve never worked in a workplace that hasn’t had an awareness of bullying. Previous generations had a tendency to put up and shut up,” says Kamira.
Bernie Althofer, managing director of EGL I Assessments, notes that the introduction of codes of practices, changes to legislation, and the implementation of resolution options may have provided victims and organisations with a way of detecting, preventing and resolving workplace bullying – but there is still work to be done. “Confidentiality requirements that go with most settlements prevent the wider community from knowing the full extent of workplace bullying in the public and private sector,” he says. “I believe that workplace bullying still exists under the surface. The victims may have little confidence in the effectiveness of the resolution options if they think that little is done about the alleged bully.”
Misconceptions
People often refer to ‘bullying’ in a broad sense, but the term is usually mixed in with other terms such as discrimination and harassment. “I think that people use the terms bullying, discrimination and harassment indiscriminately,” says Kamira. “When they say it they don’t really know what they mean. They’re just trying to articulate what has been happening to
them in the workplace. For me I think there’s a generic term. All bullying and all discrimination is harassment – it just takes different guises.” There are other misconceptions. Kamira notes that often the first things that spring to mind when the word ‘bullying’ is used are the hazing or initiation rites that tradespeople or apprentices suffer; and following on from that, overt sexual harassment comes to mind. She suggests that bullying can take far more subtle forms. “Sometimes it’s hard to put your finger on what’s wrong. It might be something like a person coming into a workplace and finding an established group of friends that constantly go out to lunch together, making the new employee feel ostracised. That’s a type of discrimination. It can be that subtle. If can be little things like assuming that because someone has a position they should be able to do a job, and not giving them the information to do that job. That’s not overt – it could be explained away by saying the workplace is very busy or the manager doesn’t have the time. But if that manager thinks that person isn’t really capable then that’s a subtle type of bullying as well, which is just www.hcamag.com
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In his book, Resolving Workplace Bullying, Bernie Althofer suggests that organisations should use the following checklist: Checklist
NO
YES
There is a workplace bullying policy There is an implementation plan (including an ongoing training plan) There is an audit plan (to see if the policy is working) There is an ongoing staff training and development plan Annual organisational health surveys are conducted The findings from the organisational health surveys are implemented There is an ongoing learning and development plan External investigators are used wherever possible Internal investigators receive ongoing training in relation to bullying There is a risk management strategy in place for continuing or terminating the litigation process in relation to workplace bullying There is a policy in relation to the use of legal professional privilege All staff understand what items can be subjected to actions Directors and senior managers receive ongoing learning and development in relation to their obligations, duties and responsibilities
as insidious as someone doing something overt,” she says. Kamira warns that sometimes bullying is not bullying at all, but rather a lawful direction by a manager to a subordinate. “I’ve recently seen a surge of bullying complaints where a subordinate had complained of being bullied by the boss. The investigation revealed that the complainant, in each case, was disgruntled by their boss’ management style, which forced them to be accountable,” she says.
Fertile ground
Unfortunately, there are environments in which bullies thrive. Kamira says the worst bullies – known as ‘corporate psychopaths’ – are to be found in the top echelons of organisations. These people are often
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rewarded for doing their job, regardless of how they conduct themselves. “So many organisations are geared to the bottom line, and if that bottom line is reserved for shareholders or for profit you can run into trouble. Then you get people who fit the classic corporate psychopath profile. But they’re seen as an expert in their field, they get the job done and they bring in great results – so it doesn’t matter about the body count they leave behind them,” she says. Althofer maintains that workplace bullying is a complex issue, and requires complex solutions. The mere fact that an organisation has a workplace bullying detection, prevention and resolution policy may not be sufficient to defend an allegation. He suggests workplace bullying
can thrive in organisations where: yy poor people management, practices and skills exist yy inappropriate management style or lack of supervision is part of the organisation yy overwork happens on a regular basis yy role ambiguity occurs yy poor consultation processes occur yy there are inconsistent work flows and reporting procedures yy the level and nature of training is inadequate or inappropriate yy there are unreasonable performance expectations yy there are work places with high levels of job dissatisfaction “It’s important to note that if these environmental factors are not addressed, the alleged bully may find some fertile
bullying
grounds in which to enhance their skills. Consequently, they will get the outcomes the organisation is looking for, and they end up being rewarded,” he says.
E-bullying
In some ways, bullies have been aided by the rise of the internet and e-communication. Instant communication such as Twitter makes it easy to transmit messages that are offensive, humiliating or intimidating. But Althofer says that many users – younger people in particular – may not understand that forensic auditors have the skills to trace records even on electronic devices. “While the user may believe they have completely erased the offensive content, the forensic auditor may be able to find the message,” he says. Are e-messages harder to trace? Althofer says the ability to use offshore locations to transmit certain types of information makes it harder to find the original source, and if governments want to legislate against the nefarious use of communication devices, they need international support. At a practical level, it becomes problematic for the victim who is subjected to cyber stalking or cyber bullying. Some victims will automatically delete the offensive material while others might forward it on. “When a victim is traumatised by the bullying behaviours, they may not think to save the ‘evidence’ which might be required in a criminal prosecution,” Althofer says. Kamira says she has been surprised that in the process of investigating several cases of alleged e-bullying by managers, she’s discovered the opposite to be true: the manager is being bullied by employee. This ‘upwards bullying’ is more commonplace than one might believe.
Upwards bullying
Upwards bullying is not new but has been gaining recent publicity. Author Tim
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Types of bullying There may be a perception that workplace bullying is a one-on-one situation. This might be true in some cases, but there is research that suggests others might be involved. In his 1996 book Bully in Sight, Tim Field outlined the following types of bullying:
Pressure or unwitting • stress of the moment – ‘normal’ behaviour • when organisations struggle to adapt to changing markets, reduced income, cuts in budgets, imposed expectations and other external pressures
Organisational • when the employer abuses employees with impunity knowing that the law is weak and jobs are scarce – coercing employees to work 60/70/80 hours a week and then making life hell for anyone who complains
Institutional • when bullying becomes part of the culture and accepted
Client • when employees are bullied by those they serve or when employees bully their clients
Serial • where the source of all dysfunction can be traced to one individual, who picks on one employee after another
Secondary • unwitting bullying which people start exhibiting when there’s a serial bully in the department
Pair • serial bully with a colleague: one talks and the other watches and listens – usually opposite gender and frequently there’s an affair going on
Gang • serial bully with colleagues – they flourish in corporate bullying climates. • bully as an extrovert – shouter and screamer – easily identifiable and recordable • introvert – in background initiating the mayhem – harder to identify – most dangerous
Vicarious • Where two parties are encouraged to engage in adversarial interaction or conflict
Regulation • when the serial bully forces their target to comply with rules, regulations, procedures or laws regardless of their appropriateness, applicability or necessity
Residual • bullying of all kinds that continues after the serial bully has left – like recruits like • promotes like, therefore the serial bully bequeaths a dysfunctional environment to those who are left – this can last for years
Cyber • misuse of e-mail systems or internet forums for sending aggressive flame mail – also called cyber stalking and now referred to by some as cyber bullying
Field, who wrote Bully in Sight in 1996, discussed the various forms of bullying (see boxout on page 32) and highlighted that bullying did from time to time occur from the bottom up – not just top down or sideways. “I’ve also been made aware, not only executive officers, but even managers
and supervisors being bullied by junior personnel who do hold some positions of power within organisations. What is this position of power? Control of information can be a very powerful tool and when abused, can result in an executive officer, manager or supervisor being made to look bad or even to ‘lose face’. It has been www.hcamag.com
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suggested to me that some individuals withhold information to get revenge for some perceived injustice that has occurred to themselves or to a work colleague,” says Althofer. In the competitive job market, upwards bullying may be used to destroy an individual’s reputation. “Imagine a situation when a junior employee perceives that they are entitled to a certain position currently occupied by a long-term employee,” says Althofer. “The position is upgraded and advertised. Suddenly, a rumour starts that the long-term employee is a serial sexual harasser. The long-term employee is suddenly under a cloud and their selection may be hindered until such stage as the rumour is investigated. By then the damage is done.”
The cost of bullying
The cost of bullying has escalated in the past decade. 2008 data puts the cost of
workplace bullying at $160,000 per 100 employees per annum. This equates to $1,600 per person per year. “This data may not take into consideration the diverse range of indirect costs that can be incurred, and there does not appear to be any way of collecting those costs without creating a bureaucratic reporting process,” says Althofer. “Most organisations would have systems or processes that record the direct costs such as those that are easily measureable and that already appear in budgets – albeit without the word bully – and might include a range of legal fees, awards made against the employer by courts, commissions and tribunals,” he adds. However, Althofer says there may be some organisations that do not have systems or processes in place to record bullying costs linked to the following:
Beware of ‘false bullying’ A workplace lawyer from Harmers recently claimed that when employees feel that their employment is threatened, many feel cornered and helpless and some even decide to take matters into their own hands to protect themselves. Given the often high-profile nature of bullying and harassment cases and the negative impact on a company’s reputation, employees can see the bargaining power a claim like this might bring and they hope the claim will mark them off-limits for any future redundancies. Human Capital asked Bernie Althofer for his thoughts on ‘false bullying’ claims. “This has generated considerable interest and discussion, and while I have not been witness to any false claims, I am aware that some victims of less than professional workplace conduct believe that this type of claim is one way of ‘getting back at the organisation’ for not addressing the workplace conduct.” “It seems from talking to victims that the current economy is determining the type of action that a victim will take. For example, some victims have indicated that if they report workplace bullying, they are sure to lose their job, so they keep quiet. At the same time, they continue to make detailed notes of the behaviours they are being subjected to. When the economy improves, they will review their options and may make an allegation then or seek resolution through courts, commissions or tribunals. This could be a ticking time bomb for many organisations where executive officers are not aware of the extent of the problem or risks bubbling away beneath the surface.” “It is also important that employers and employers understand the implications of the unfair dismissal laws under the Fair Work Act.”
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yy Staff – the cost of employees’ time, including the bully, victim(s), manager(s), personnel, union representative and administrators, etc. These costs can include communication, investigation, checking and familiarisation with procedures and attending meetings. yy Overheads – including the use of meeting rooms, facilities, lighting, heating, storage of records, and production of statistics. yy Resources – such as the use of photocopiers, telephones, faxes, computers, hardware, networks, stationery, and consumables. yy Resource support – such as computer costs including ordering and resupply, maintenance, backup, hardware upgrades, installation, network support, storage and retrieval. yy Performance and productivity – such as intangible costs including the impoverishing, draining and exhausting effect on all employees in the hierarchy from experiencing, defending or witnessing the bully’s repeated behaviour. yy Sickness – such as direct and indirect costs including benefits, administration, plus costs associated with medical/illhealth retirement. yy Medical costs – including the provision of welfare and counselling, occupational health services, company/organisational doctor/psychologists/psychiatrists/ counsellors and consultants’ reports. yy Consequential losses – such as those direct and indirect costs including staff leaving, training investment, loss of knowledge and experience of subject, clients, customers, procedures – and the flow on effects from adverse publicity.
What can be done?
Employers keen to avoid the unpleasant task of fronting up to a court, commission or tribunal to defend an allegation of workplace bullying should consider the following:
bullying
yy Does the organisation have a workplace bullying detection, prevention and resolution policy? yy When was it written, implemented or reviewed? yy Who signed it off on it? If your signature is on the policy, you may be asked to give evidence about the policy. yy How many allegations of workplace bullying have been made, and what has been done about them? How were they resolved? yy What have been the costs of workplace bullying? How many claims, what payouts have been made, what improvements have been made? yy How long does it take to resolve workplace bullying incidents – from when they first happen, to the time when all factors have been put ‘to bed’? “Executive officers should realise that victims and even alleged bullies are seeking resolution. Victims want someone to hear their story and to be believed, while bullies may be seeking confirmation that their actions were reasonable and legitimate,” says Althofer. Some executive officers may be extremely proactive, and
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What price bullying? Impact on a person: • High levels of distress, impaired ability to make decisions and poor concentration. • Loss of self-confidence and self-esteem and feelings of social isolation at work. • Panic attacks, anxiety disorders, depression, social phobia (withdrawal from usual social interaction) and deteriorating relationships with family and friends. • Reduced output and performance, incapacity to work, loss of employment. • Sleep disturbances, such as insomnia or severe tiredness.
Impact on a business: • • • • • •
Breakdown of teams and individual relationships, worker health. Reduced efficiency, productivity and profitability Bad publicity, poor public image. Increased absenteeism and staff turnover. Poor morale and erosion of worker loyalty and commitment. Increased HR and legal costs.
engage a workplace bullying consultant or legal advisor to lead them through the array of questions before any allegations are even made. “It’s extremely advantageous to be prepared, rather than face a potential situation where you could be held personally liable for a death or serious injury in your workplace,” Althofer suggests.
Kamira says the key is to deal with issues as they arise. “It’s so easy to sweep it under the carpet. It’s that innocuous thing on a Tuesday afternoon when you’re just about to leave the office that comes back to bite you three months later. You must show that it’s procedurally fair, that natural justice has been satisfied, and that you’re transparent in what you do,” she says. HC
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absence management
Absence management Makes the business stronger and the heart grow fonder
Absenteeism is a costly drain on resources for most organisations, yet many business leaders don’t know the basics of how to manage the problem effectively. Dr Martin Cross provides some tips
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absence management
W
hat is the rate of absence in your organisation? If you don’t immediately know the answer to this important KPI, or if the latest up-to-date figure is not available at your fingertips, you are missing out on some very ‘low hanging fruit’. By simply implementing clear, consistent absence procedures and reporting, HR can play a significant operational role. This will drive better organisational efficiency and will improve the bottom line. It will also enhance the care, wellness and engagement of employees.
Back to basics
For any business to function at its best it needs its employees at work – it’s as simple as that. However, for many organisations sickness and absence are seen as an inevitable and unavoidable ‘cost of doing business’. If management fails to implement clear absence procedures or takes a relaxed attitude to absence notification, this signals to employees that non-attendance is acceptable or expected. This is reflected in Australia’s relatively high rate of absenteeism. A major survey of 1.2 million employees in 185 organisations was undertaken last year by Direct Health Solutions. The study showed that absence across all sectors in Australia was almost nine days per person per year (3.7% of the work force off at any time). In the public sector this figure rose to nearly 11 days. Comparative data from the UK shows absenteeism at about seven days per person per year. In Australia, sick days are often seen as an entitlement – which contributes to the higher rate of absence.
Absenteeism will cost you Poor management of absence impacts organisations in three major ways:
1. Operational efficiency Time is money, and unless there is a seamless process of notification and intervention when an employee is absent, the work is not completed and deadlines are missed. Unless organisations can seamlessly ‘reschedule on the fly’, absence
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negatively affects customers. It also increases workload and decreases the morale of remaining staff. 2. Bottom line Absence is a major cost for most organisations and breaks down into: Lost wages: The Direct Health Solutions survey calculated that the overall cost of absence to the Australian economy was $26.6bn per annum, or $3,017 per employee. A typical organisation of 1,000 staff will lose 8,620 days of productivity, which is valued at over $3m. Lost revenue: For organisations that charge out for their staff (eg, consultants or contract employment organisations) or have staff in critical operational roles that cannot be left empty (eg, drivers, manufacturing production line staff ) there is a ‘double whammy’ as organisations have to pay for both the sick leave and the replacement staff (or lose the billing for the day). Administration and reporting: Accurately logging and correctly reporting absence can often cause a significant administrative workload. Some large manufacturing or transport companies employ dedicated staff at the end of a telephone to accurately log absence by the hour. But for many organisations, absence is not formally reported and recorded until the employee returns to work. Unless there is a robust process of follow-up, reports are frequently not submitted and processed. As a case study, UK-based Unumm was under-reporting absences by a rate of over 20% before it implemented robust processes for tracking absence. The combination of a lack of real-time reporting and poor follow-up can result in very inaccurate absence data. Organisations need to be able to measure to manage, and many companies do not have regular absence reports either at the company, department or individual level. 3. Risk There are four scenarios where the lack of robust absence processing and reporting also exposes the organisation to additional www.hcamag.com
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risks. Firstly, where an organisation does not comply with workplace legislation (eg, accident and Work Cover notification). Secondly, where poor case management results in long-term absence, increased salary continuance insurance or legal action (eg, unfair dismissal). Thirdly, where a lack of auditable and accurate data makes it difficult to defend against litigation. Finally, where there is lower adoption of wellness and Employee Assistance Programs – as it is difficult to link up the employees in need to the service or program being provided.
Absence management makes the business stronger The solution is simple and straight forward. Put in place a transparent absence management framework and policies which are efficiently, consistently and fairly implemented. Focus on the following checklist: 1. Manage the operational consequences of absence to avoid business disruption. yy Ensure the employee notifies as soon as possible when they are unable to work (ideally 365/24/7). yy Set rules on notifying absence. Have a clear policy about how and who the employee needs to contact when they are absent (ensure this is guaranteed and the message will always get through, so it can be immediately acted on). yy Collect consistent information on the absence for all employees: name, first day of absence, expected length of absence, whether it is due to an accident at work, reason for absence and any other information (eg, if stress related, what needs to be done at work?) yy Log and record this information. Find a system that avoids duplicating administration and provides quality management information. yy Ensure everyone that needs to know about the absence is immediately informed (eg, manager, OHS, operations). Reschedule work to ensure disruption to operations is minimal. 2. Consistently intervene on absence to promote employee wellness and help them return to work.
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yy Ensure the manager or an appropriate person speaks to the absent employee. For certain situations or conditions, offer to provide support to the employee (ie, for lower back and muscular skeletal problems, link to specialist advice or treatment. For stress-related illnesses, counselling may be required. For accidents at work, contact Work Cover). For many conditions, early intervention can get the employee back to work in half the time. yy Have proactive trigger points determined by management to inform managers of employees that have relatively high number of absences (eg, six absences in six months). yy For employees who have reached a trigger point with a high number or frequency of absences or have a questionable absence, ensure a formal Absence Meeting takes place on their return to work to understand the reason/s for absence and offer support – but if necessary issue a written warning. This process should formally escalate if unreasonable poor attendance continues. 3. Make absence management a business priority. Constantly review absence trends and proactively manage to better look after employees and reduce absence. yy Make real time, accurate absence reports available for all managers at individual, department and company levels. yy Absence is probably the best objective, surrogate measure of morale a company has available. Ensure absence is a KPI reported at least monthly. yy Ensure that absence and wellness management is a regular topic at management meetings. What kind of interventions can your business bring in to reduce absence or improve the wellness of your organisation? (eg, pay out unused sick leave or other incentives, flu jabs, fitness initiatives, lifting courses, safe driving, stress counseling.)
Technology can help
The development of new absence technology means organisations can find less time-intensive ways of tracking and managing absence, and managers can focus on looking after their staff when
they are absent. In recognition of the need for a web-based solution to managing absence, Voicescape has recently introduced Absence Manager to Australia. It uses interactive voice technology to log the information on absenteeism cases 365/24/7, and immediately notifies everyone who needs to know by SMS and/or e-mail. The system is already widely used in the UK and companies such as Heinz, General Motors and Eddie Stobard ( the UK equivalent to LinFox) have been on the front foot implementing the system. Absence tracking results are available in real time, and the system can churn out a status report instantaneously. It is proving particularly useful to large organisations with over 1000 employees to keep track of, as well as industries which rely heavily on certain roles to function (such as train/truck drivers and production line staff).
The bottom line
Organisations that make absence management a priority see an immediate positive impact on organisational efficiency, the bottom line, wellness and the motivation of staff. Many companies see a reduction in absence of between 10–40% often worth millions of dollars to their bottom line. Unum (UK), which provides work cover insurance, provides a good example of a company that by implementing a clear policy found significant under-reporting of absence. It was able to reduce absence by 29% the following year. In other cases, as part of its absence management program, one major Australian food company pays out unused sick leave at the end of each year. This company has a 1.6% absence rate compared to the Australian average of 3.7%. For both of these companies the financial and staff benefits are clear. Implementation of a sound absence policy and procedures can make your business stronger and your employees’ hearts fonder. hc
About the author Dr Martin Cross is the CEO of Voicescape, a communications technology company. For more information e-mail: martin.cross@voicescape.com.au
diversity awards
issue 7.8
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diversity
Women in Focus Human Capital interviews Gail Hackett, head of Commonwealth Bank Australia’s newly launched Women in Focus program. Targeting women in business, the program focuses on coaching and networking opportunities for women HC: What is your background, and why has Women in Focus been launched? GH: My background is not in coaching, not banking. I’ve been doing business and executive coaching for about five years and my passion has always been in the space of women – but not to the exclusion of everyone else. Women have teams of men and other women around them. The idea is to support female business owners or anyone who’s running a team or department – whether it be a large corporate or a medium-sized company. This new program will offer a range of new and innovative services designed to provide women with the up-to-date knowledge, relationships and support they need to identify and achieve their goals. Whether the qualification assists candidates to land the ‘perfect job’ is debatable. But it should give them a better chance of landing a job than candidates without post-graduate qualifications. For me, the determining questions when recruiting are: ‘which candidate best meets the role’s criteria or specification?’ and ‘which candidate is the best cultural fit?’ I believe the answers to these questions are more important than post-graduate qualifications. Admittedly, tertiary qualifications highlight a person’s self-disciplinary skills – but they don’t necessarily mean a person is more intelligent. HC: Why focus on women? GH: Women are a large proportion of the labour force, and they are a large proportion of business people. A lot of
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women make the decision to start their own business for lifestyle reasons, so they can get more flexibility into their lives. They also make a large proportion of the buying decisions in the home, because they’re often the ones who make the decisions about health insurance, the household budget, etc. Over the past 12 months there has also been a slight shift in labour. A lot of women have now stepped up and are more vocal because they’re still running their business while their partner may have been laid off. With what’s happening in the world, women are looking for more support, and they want to be spoken to in a way that resonates with them. I think a lot of institutions around the world are focusing more and more on women. HC: Do women have special needs? You mentioned flexibility. GH: I think there are needs that men and women share, and there are special needs for men and special needs for women. If you’re running a business, the same issues arise whether you’re male or female. But there are issues very specifically for men that they need support with, and there are issues that are very specific for women. HC: What does the program involve? GH: We’ve launched our first product (there will be many more to follow) and it involves business coaching and networking for women. There are four levels of participation because we know that everyone’s needs are different. Level one is our introductory session, which is a half day: two hours of formal business coaching
diversity
and two hours of networking. It is all done in a group because we know women like to learn from each other and hear the stories of other women. Level two is a day long, with seven hours of business coaching and one hour of formal networking. If you imagine an inverted triangle, we’re bringing the groups down in size. It’s the same topics but we go into more depth. Level three is a workshop series where the group is brought down to 14 people. It’s eight days over eight months, so a day a month. Out of that you’re working on a different module each month and you come out of it with a strategic plan written for your business. It’s very focused networking – any person has 300 contacts, but when you get very targeted in your networking it’s amazing what you can create. Then there’s one-on-one coaching. We’re not about hard selling, and it’s not just for customers of CBA. You can do all of it, or pick and choose. Participating in Women in Focus will enable women to grow professionally and personally by developing new business and personal insights, building meaningful relationships and creating valuable networks. HC: Is it open to all women in business, from executives through to sole traders? GH: Absolutely. You could be a sole trader or you could be managing a team in a corporate. If you’re managing a team in a corporate you’re managing a business. We even have people at the bank who have said ‘this is so fantastic, can I enrol?’ We’ve got employees who are relationship managers who have a portfolio of clients – they’re running a business. Even if your clients are internal, you’re running a business. So all the frameworks we use in business coaching can be applied – it doesn’t matter if you’re one, a few or many. HC: Doesn’t the coach have to know about the business or industry in which the person being coached operates in? GH: It’s the power of the business coach knowing the process and the person being
coached knowing their business. The combination of the two is very powerful. I’ve had people say to me: ‘you don’t really know my industry, so how can you be my business coach?’ The fact that I don’t know actually helps, because if I do know it I go into consulting mode. I’ve done both, and the difference is very profound. When I was a consultant (and even now if I do business coaching in an industry I know) clients sometimes realised I knew the industry and asked: ‘why don’t you just tell me the answer?’ But it’s not about that. I can tell you the answer, but then you’ll never take the journey. It’s self-awareness. This is why HR people get it. Human beings learn from doing. HC: You talk about transferring skills – can you explain? GH: The idea is to transfer the coaching skills, whereas in a consultant relationship the client becomes very dependent on the consultant. When the consultant leaves, those skills walk out the door with them. With business coaching it’s skills transfer, and that’s the whole point of it. You’re coaching someone who then becomes a coach in their own organisation. HC: CBA is already doing good work in this space – as seen by your EOWA [Equal Opportunities for Women Association] citations – does this add to your appeal as an employer? GH: I think so. We do a lot internally anyway. We’ve got a real focus on diversity – not just gender – but all sorts of diversity initiatives. When you show people you’re walking the talk, they’re more likely to take notice. How can you offer a service like this externally if you’re not doing it internally? There is no organisation in this country, financial or non-financial, doing something like this. HC: Why do you think financial services and professional services firms lead the way in these areas? GH: For professional services firms, their assets are their people. They don’t have products, so if they don’t retain the people
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Gail Hackett
they want to retain they’re in trouble. You also need diversity to have a wide range of ideas. If you had everyone looking the same that’s what you get: the same ideas. You also want to mirror society – you want gender diversity, ethnicity diversity, age diversity. The banks need diversity for similar reasons. HC: Do you believe there is still a glass ceiling? What are your thoughts on gender equality in the workplace? GH: I think in some organisations there is a glass ceiling; in others, absolutely not. There have been articles published by McKinsey which demonstrate that if you have the right mix of gender diversity on the board and senior management it affects the culture and therefore the productivity, which affects bottom-line profitability and the share price. That ratio is 3:10, so three females to 10 males. Now companies are saying, ‘this is important’. HC: Is it true that part of the revenue from Women in Focus will go towards women’s charities? GH: Five per cent of Women in Focus revenue will go back to the community via a range of charities to help women most in need. For further information, go to www. commbank.com.au/womeninfocus www.hcamag.com
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learning & development
How not to
train Pouring money down the drain on ineffective and ‘tick the box’ L&D solutions? Charles Jennings has an alternative
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learning & development
I
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magine an HR manager walking into a planning meeting for a new process or system roll out. No, this is not the start to a bad joke – but it is the beginning of a scenario that’s being repeated in organisations worldwide. And what happens next is draining L&D budgets and stifling organisational productivity. When faced with the roll out of a new initiative, particularly for ERM/CRM systems and for new processes, the most common reaction of HR managers and their L&D counterparts is to propose formal training. There’s usually some training spending allocated within the overall project budget, so why not use it and run some classes or build some eLearning? Meanwhile evidence and logic point in a completely different direction. There are alternatives to training that are more effective and incur less cost. First of all, it is worth pondering the effectiveness of training as an agent of change and performance improvement. Formal training for detailed tasks and processes before they need to be carried has been shown to be essentially useless. The approach of “we’re rolling out a new system, so we’ve got to train them” employed by many organisations, and offered as a service by a myriad of training suppliers across the globe, is both inefficient and fundamentally ineffective. The research supports this fact. It might feel comforting to run a class before roll out of a shiny new enterprise system or process, but there are two major flaws to this approach.
use because there is simply too much of it. Some course designers try to counter this by providing a manual for later reference. However, these often expensively-produced user guides tend to be far too detailed, linear, full of screen-grabs and impossible to navigate. They are the last thing people reach for when they need help with a new system. They are far more likely to reach for the phone and call the help desk or find a colleague who can answer their question, which lowers productivity and places demand on internal resources. The manuals become shelfware from day one. The second flaw is a fundamental lack of understanding of how adults learn, and the difference between short-term and long-term memory within the HR community. Embedding knowledge in short-term memory and long-term memory are two very different processes. Even the information that can be recalled immediately after training – and that’s likely to be only a small amount – will be lost if it isn’t reinforced through practice within a few hours to transfer the learning to long-term memory. The neurological processes needed for the latter – involving chemicals in the brain such as serotonin, cyclic AMP and specific binding proteins – are different from the processes that allow us to recall information from short-term memory. Recall from short-term memory is fine to help an employee pass an endof-training assessment, but is not proof of any real learning. It is of no use if the new knowledge, skills and behaviours are not embedded in long-term memory for later use.
Where do we go wrong?
Practice and reinforcement are the key requirements for our brains to build new and persistent connections and patterns and to transfer new knowledge, skills and behaviours to long-term memory. Unfortunately, most systems, process and product training offers only cursory practice opportunities. There’s usually not enough time, as there’s so much ‘knowledge’ to impart – or there’s no access to the system/product before roll out, and any practice that does occur is often on a cut-down system or a simple simulation. There is then a gap between when the information is taught and when it must be applied. This time gap is where the knowledge is lost. Hermann
The first flaw is information overload. Most pre-‘go-live’ training is delivered through instructor led training or eLearning, and is invariably content-heavy. Instructional designers and subject matter experts usually feel the need to cover every possible eventuality in the training, and load courses with scenarios, examples and other ‘ just-in-case’ content. PowerPoint decks of 200-300 slides prepared for delivery over two days are not uncommon. The problem is that unless the employee has a photographic memory, they can’t recall a fraction of the information for later
Rules of engagement
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learning & development
Ebbinghaus’ research as long ago as 1885 told us all about the logarithmic ‘forgetting curve’, and the importance of practice and reinforcement. His research has been repeated many times by other researchers, but many of us don’t seem to have learned the lesson. Harold Stolovitch & Erica Keeps carried out some very interesting research more than 100 years after Ebbinghaus in 2005 on desired versus actual knowledge acquisition and performance improvement. The data from their research uncovered some more important facts about human memory and processing. They found that following an initial dip during the training event – when performance drops as new ways of carrying out tasks are tried and tested – knowledge and performance then improves during the training session. The individual walks out the door knowing more and with higher levels of task performance than when they started the training.
When the problems start
The knowledge drop-off following the training event can kick in very quickly – usually in a matter of a few hours – if there’s no opportunity to reinforce. The employee finishes a day’s training course, goes home, sleeps and by the next morning a lot of what he ‘learned’ has been cleared out of the short-term memory. He returns to work, tries to implement what he learnt in the class and finds he can’t remember exactly what to do. He doesn’t have access to the trainer and the user guide is unfathomable. He may experiment with a few things, but when they fail he will simply go back to doing what he did previously. The result? Performance improvement is zero, there is no value added by the training and the return on the training investment is negative.
Comfort zones and fear of change
So why are HR and learning professionals still using this technique? There are two main reasons. Firstly, some HR managers are simply operating within their comfort zone and refuse to budge from the standard ‘train them’ model because it’s always been done that way. They think that improving an employee’s skills and knowledge naturally leads to an improvement in performance. They believe that if training imparts the right skills and knowledge, it must increase organisational performance – so the role of their department should be to deliver as much training as possible. This is described as a ‘fulfilment’ mindset. The second reason that a training mindset is so ingrained in HR departments is because many managers are unsure of alternative approaches, and are afraid of the spotlight that different approaches may place on their department.
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Management asks for a training course and they simply deliver it – no one measures the performance outcomes and no one is held accountable for the results. If training is eliminated, or only used in a limited capacity, what takes its place?
Performance consultants
The first step in adopting a more effective approach to learning is a shift in thinking, moving from the ‘fulfilment’ training mindset to one that is focused on outcomes and performance. This requires HR to adopt a performance consultancy approach to working with their business managers. They need to go back to first principles of problem solving to identify the root causes of performance issues. This will involve understanding the current and future performance required, and all the options available to solve the performance problem. Management and HR also need to take joint responsibility and work together on a solution for each individual performance requirement. When
Formal training for detailed tasks and processes before they need to be carried has been shown to be essentially useless there is a training request, HR representatives should analyse it as if they are consultants – talking to the manager about what the problem involves, who it affects, the cost of doing nothing, and what changes in employee performance need to occur to constitute success. They then need to lock in some kind of joint responsibility with the business manager for solving the problem. Any performance problem will require input from line managers as well as learning and development staff. In fact, as much as 70–80% of under-performance is a function of organisational factors such as lack of clearly defined objectives, lack of clear feedback, poor leadership and inappropriate incentives. Sometimes it is due to lack of knowledge and skills. So the importance of the strategy being a joint effort is clear. Another important driver in selecting alternative approaches to ‘train them’ is the fact that we now know that approximately 80% of learning in the workplace happens not in formal training environments, but informally. Informal learning could be defined as the unofficial, unscheduled and impromptu ways in which people learn, such as asking a manager, talking to colleagues, looking up reference information, watching an expert
learning & development
perform a task or collaboratively solving problems. Informal coaching in controlled work situations is being found to be effective at improving performance, and technology-enabled podcasts and vodcasts are also being used to provide ‘ just-intime’ support and learning. The other challenge that HR and learning and development professionals need to take into account is the rate of change of much of the information we work with – its halflife. The information available to us to do our jobs is growing at a rapid rate, but the half-life of much of the information we deal with is dramatically shortening. How many times have we found that a process has changed shortly after being implemented? How many change updates have we received following the ‘go-live’? This means that building learning into the day-to-day operation of a business is more important than ever. Instead of relying on memory, the information needs to be available to employees when they need it during the completion of a task, as anything they have learned earlier may have changed. If organisations are to effectively develop their people and help solve business problems they will need to consider all options. This will involve line managers setting goals and monitoring performance, SMEs providing on-demand advice and support, learning professionals providing workplace coaching – as well as other strategies. A powerful concept that is beginning to take hold is Business Process Guidance (BPG), which relies on technology to provide a real-time support environment for employees. BPG tools provide context-sensitive help at the point-of-need. Rather than providing information to employees up-front, they are provided with access to the BPG system to help them navigate their systems and processes. BPG essentially acts like a GPS system in a car. When an employee is learning to follow a process, he just wants to know the next two or three steps he needs to take – not the entire 30-step process. A GPS in a vehicle instructs incrementally. It doesn’t explain every turn required during the journey. The BPG approach not only drastically cuts the need for expensive up-front training, but offers a host of ancillary benefits including faster time to competence, fewer errors and improved customer satisfaction. BPG systems such as Melbourne and Boston-based Panviva’s SupportPoint are economic and straightforward to implement, and they trump training every time when it comes to developing competence in the defined processes found in ERP and CRM systems and other enterprise environments. They are also particularly powerful in supporting customer-facing and call centre applications.
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This brings us back to the initial problem. If HR managers and L&D professionals don’t understand these issues, and don’t adopt strategies to overcome the limitations of the standard ‘train them’ approach, they will continue to provide a suboptimal service to their organisations. Their directors, CEOs and shareholders deserve better than that. HC
About the author Charles Jennings has 30 years experience in L&D. He was chief learning officer at Reuters (Thomson Reuters). He now works as an independent consultant and researcher on learning and performance in Europe, the US and Australia. Visit: www.duntroon.com
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remuneration
You’ve been
automated Lara Kirschner highlights eight key reasons to automate your remuneration review process
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R teams have increasingly sought to streamline processes and practices, increase their efficiency and decrease their administrative work – all in an attempt to free up valuable time that can be better spent adding value to the business. Implementing technology to manage some of the more manual and time-consuming activities is an effective strategy that provides HR with the ability to achieve this goal. Technology is constantly evolving, and there are many software applications and tools that cover the full spectrum of HR functions. Most companies now use some form of software to streamline
and automate a variety of HR processes including recruitment, L&D management, performance, and metrics. Remuneration, however, is one key HR function that is often overlooked with respect to technology, as organisations continue to use cumbersome spreadsheets to manage their annual salary review processes. But there is an alternative available, and if you find yourself approaching remuneration reviews with feelings of fear or anxiety, it may be time to explore the benefits that remuneration review software can deliver to your organisation. Some HRIS have modules to manage remuneration, but these may not always
remuneration meet your specific requirements, and in most cases they require extensive (and costly) customisation. Not all HRIS offer a user-friendly, easily configurable remuneration module with access provided to managers (not just HR). Because every organisation has a unique way of managing their salary review process you need a solution that can easily be configured to meet your specific needs. It is also important that the system can be accessed by managers and is simple, easy to use and intuitive. A web-based salary review tool is more likely to meet your needs. If your data is regularly changing during your review period, then you should be able to organise for your provider to have your web-based solution integrate with your payroll system. Alternatively, most systems also provide you with the ability to simply import and export data between the web-based salary review tool and your HRIS or payroll systems. After comparing the traditional method (spreadsheets) of undertaking salary and bonus reviews with the alternative (web-based technology) we have summarised the case for embracing technology into eight key reasons to automate your remuneration review process.
immediately reflected in the information accessed by managers.
1. Reduced errors
5. Increase compliance
If you are using a spreadsheet-based process to complete your salary and bonus reviews, then you have probably experienced the frustrations of slicing, dicing and consolidating spreadsheets – not to mention the headache that comes with worksheets that have been changed by managers. Remuneration review software provides managers with rolebased access to a single source of data, significantly reducing data errors and omissions.
2. Time savings
Remuneration review software streamlines the review process. Management of the process becomes far less cumbersome as you no longer need to worry about version control, tracking spreadsheets or re-issuing spreadsheets when employee information changes. Changes such as reporting lines, employee status or salary information is
3. Easy access to relevant information
You can provide your managers with easy-to-view access to all the data they need in order to make informed decisions about the remuneration of their employees. Summary data can be provided so that easy comparisons can be made against other team memberss, while detailed information about individual employees can be provided simply by drilling down on the selected employee’s name.
4. Reviews completed within budget and timelines
Remuneration review software allows you to immediately see how a manager, a department, a division or the entire organisation is tracking against budget. You can see which managers have commenced the recommendation process for their team, what they have recommended and how they are tracking to budget. An automated system will also offer a range of reports that you can run on all elements of the process at any time during the review period at the click of a button. Automatic alerts can be generated to managers who make recommendations outside of the recommended guidelines as prescribed by the organisation. These rules may be linked to budget, market position, the level of increase allowed based on performance ratings or any other rules the organisation wishes to implement. Another advantage is that alerts can be used to encourage managers to enter comments when they make recommendations outside of normal parameters. Reports can then be generated to easily view recommendations that are considered exceptions.
6. Improved communication
In organisations maintaining spreadsheetbased reviews, a manager’s salary recommendation may be changed as recommendations progress through the organisation’s approval process.
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Some remuneration review systems offer e-mail alerts so that the recommending manager can be notified as and when changes are made to their recommendations. They also have the ability to see what changes have been made during the process. E-mails can be generated automatically, notifying next level managers that recommendations are ready for their approval, or that a recommendation has been changed and requires attention.
7. Improved security
When compared with the traditional spreadsheet-based approach, the improvement to security is significant. If you use spreadsheets you will be all too familiar with the security measures available – password protection of individual workbooks which must then be e-mailed out to managers. Passwords can be cracked and e-mail can often be accessed by people other than the intended recipient. Remuneration review software offers a much more secure alternative. Access is role-based and passwords are encrypted, ensuring a higher level of security for salary and bonus information.
8. Focus on outcomes
For many remuneration and human resources practitioners the annual salary review process can be stressful, cumbersome and exceptionally time consuming. In many cases HR receive the completed spreadsheets so late in the process that they have very little time to fully analyse the recommendations. Automating the process through the use of remuneration review technology ensures that critical time is freed, up leaving the remuneration and/or human resources teams with the ability to partner with the managers and provide advice, training and assistance rather than just managing the administrative aspects of the process. HC
About the author Lara Kirschner is director of Remesys Remuneration Consulting & Software. For more information e-mail lara.kirschner@remesys.com.au or phone 0411 380 370 www.hcamag.com
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HR Business Outlook 2009
From survive to thrive The 2009 HR Business Outlook revealed that Australia coped with the GFC better than any other developed nation, but we’re not out of the woods yet
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HR Business Outlook 2009
issue 7.10
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he economic activity of the past 12 months has certainly affected HR delivery. Indeed, a quick show of hands around the conference room of this year’s HR Business Outlook revealed that the majority of HR professionals rated 2009 as the toughest year ever. Now in its sixth year, the HR Business Outlook brought together a range of strategic HR leaders from different industry sectors. They had gathered to discuss and interpret how the broader economic outlook will affect business and, more specifically, HR operations. “Do the swings in the All Ords hit HR planning meetings? Do tightening capital markets affect HR professionals? Does the current increase in consumer confidence indicate anything that should be on the HR leader’s radar? They’re all pertinent questions, and by the response to today’s function, there’s significant interest from HR professionals. After the last 12 months the economy has become the big interest story. Anybody in business should be interested. The big question is: how much do HR leaders factor these issues in?” asked Craig Mason, founder of The Next Step and co-organiser of the event. To achieve the purpose of linking the economy to HR planning, the event was broken into two parts. Firstly, a lively overview of the www.hcamag.com
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HR Business Outlook 2009
Aussie, Aussie, Aussie! That was the rallying call from James. His review of the past 12 months revealed Australia has come through the GFC strongly. “Australia is the only advanced nation in the world not to have gone into recession over the last 12–18 months. It’s quite remarkable and it almost feels like we’re Alice in Wonderland: we’ve gone through the looking glass
The panel Facilitator: Sam Mostyn, sustainability consultant and advisor Panellists: Ian Cormack, group HR director, George Weston Foods Melanie Laing, executive general manager, people & culture, Origin Energy Gordon Wilkins, head of people & culture, The Smith Family Colleen Harris, executive general manager, human capital strategy, NAB Gareth Bennett, director, people & development, Freehills
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had been tough, but he said the really hard work begins now in terms of attracting and retaining staff and keeping them engaged. “Now is the time when staff start looking around for jobs elsewhere. We’re in an upturn phase of
Impact of the GFC How have the economic pressures affected your business, and what is your specific HR challenge in this economy?
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Melanie Laing: “Origin Energy is in the fortunate position of being in a growth phase, a transformative phase, and being an energy company generally. People still need energy in their homes and businesses. However, we work very closely with the community and we’ve always had hardship programs for people struggling to pay their bills. We rely on the trust and goodwill of stakeholders and the communities in which we operate.
As for HR issues, nothing has changed in the search for talent. It’s a struggle to find people we want to employ. We are searching globally for talent.”
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Gareth Bennett: “We’re also aware that clients and our own employees may be struggling. It’s important to take a humanistic approach. When we start talking about reductions in numbers and efficiencies, and forget that behind each of those is a human story – then I think we start to lose direction as a company. In terms of HR issues, retention of key talent is the critical thing. Your key people are still very vulnerable – they are the ones who will lead your organisation out of this period.”
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Colleen Harris: “We believe the GFC has stalled the exit of people out of the workforce because of superannuation dropping, so we’re focused on flexibility. As the ageing workforce looks to exit, how do we retain them (perhaps by working part time or remotely) so we can tap into their knowledge and allow them to exit the workforce in a steady fashion, rather than just stopping and moving straight into retirement? We also need flexibility for the next generation of workers. They won’t want to work the same way we’ve worked – nine to five, Monday to Friday. They will want time off to travel or go back to study.”
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The economic outlook
into an alternate world. It’s especially remarkable given the US, Japan, and all the major countries of the world have gone into recession, or backwards, over the last 12 months,” he said. James conceded the last 12 months
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Australian economy provided by Craig James, chief equities economist at CommSec; and secondly, a ‘perspectives from the coal face’ panel discussion from HR business leaders about how they develop their business plans and how much the economy affects their HR strategy.
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HR Business Outlook 2009
Diversity
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What are your thoughts on diversity – of thinking styles, culture, gender – in the current environment??
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Gareth Bennett: “The number of nations represented by those who became Australian citizens last year was 124. We need to reflect that diversity in our executive team and in our workforce” Ian Cormack: “We’re quite diverse, but our biggest diversity issue is gender. Eighteen months ago I had 15 senior women come to a meeting, just to have a conversation about whether gender had been an issue for anyone at any time. Eighty per cent of them said it had been an issue at some point. Two things I gained from that meeting: mentoring works and had made a huge difference for those women; and between the ages of 28–36 juggling work with family life gets frantic.”
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the cycle. What’s going to be important over the next 12 months is what sort of upturn we have. Is it going to be a sharp upswing or is it going to be nice and gentle like the downturn we’ve just had? This is something we’ll have to monitor closely over coming months, because if there’s a sharp upswing HR’s services will be very much in demand,” he added. James proceeded to run through where Australia stands in terms of the global economy and what’s in store for the coming year. Has the past year simply been part of an economic cycle? James believes so: there will always be upswings, and there will always be downswings. “For any business it’s a case of managing your business through the good times as well as the bad. We’ll see an upswing over the next 12 months, but that doesn’t mean to say we’re totally out of the woods. And it doesn’t mean the global economy will continue to face challenges,” he said. A key factor in Australia’s resilience over the past year has been the actions of employers: there has not been much hiring, but there has also been less firing than previous downturns. We’ve also been helped by the Reserve Bank cutting interest rates, by the strength of the Australian dollar and the fortitude of the Australian banking system. Government stimulus of the economy also helped. “But it’s been the actions of employers to retain staff and cut back
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Gordon Wilkins: “Increasing the number of indigenous workers is the main diversity issue for us.”
working hours rather than cutting people altogether that has been crucial in terms of improving consumer confidence and consumer spending,” James explained. Looking ahead, Australia is the only advanced country – alongside the likes of Egypt and Vietnam – likely to grow this year. The guiding lights will continue to be China, India, Brazil and Russia. “These nations will continue to drive the global economy – and certainly Australia’s economy – in coming years. China is Australia’s largest trading
HR delivery How do you view HR’s evolution, and what is the essential difference between delivering value in a line or HR management role?
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Gordon Wilkins: “It’s interesting to see how HR has evolved through the years – from personnel to shared services and then this generic title of ‘HR’. Now look at the titles here – the good news is that the common denominator is still people with nuances concerning the specialist areas we look after. With my title (‘people and culture’) that reflects the phase the business is in.” Ian Cormack: “I think it’s a mindset. If anything in the business today is about people – if there’s a human being involved – then I’m involved. I don’t let other people define my job for me. I don’t see a difference with what I do in HR and what I do in a line role – except that the line roles are usually easier and more fun! Whichever job you’re leading from you can have an impact on the organisation.”
partner. Over the next 10 years it will surpass the US as the largest economy in the world. It will continue to demand our resources and will be fundamentally important to of our success over coming years,” James said. Business and consumer confidence is also on the upswing – although James conceded that confidence does not automatically translate to consumer spend. “Consumers are optimistic but are spending cautiously. Some are saying it’s remarkable that confidence is so high but I don’t know how remarkable it is: we’ve got interest rates at 49-year lows, petrol prices are down, the government is handing out money and people have been holding onto their jobs. If people weren’t confident in this sort of environment I don’t know what it would take,” he said. Other positive signs include movement in the construction sector, with loans for construction of new dwellings at a seven-year high. Commercial, engineering and residential construction projects are crucial, James noted, because of the broad process of activity that such projects require – from architects through to bricklayers and light fitters. James urged caution about interest rates and the sharemarket. “Unfortunately interest rates can’t stay at www.hcamag.com
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Gareth Bennett: “I believe we’re going into a dangerous period. We’re coming out of survival mode into thrive – and that requires a different mindset with different expectations. We must know exactly how engaged our people are. Do we know who’s engaged and who isn’t? Why they want to leave or stay? Now is a great time to take the temperature in terms of engagement, find out where the risk areas really are and then try to work with specific groups. Leading on from that, if we have a good idea of engagement and risk areas, how do we mitigate those risks? Do a review of talent and succession, put in place tailored programs, use projects, and make sure your most valuable talent know they’re wanted, and know you want to keep them.”
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Colleen Harris: “Developing leaders for ambiguous times. I don’t think we’re out of it – times will continue to be ambiguous and challenging. The other area is executive remuneration, especially in financial services. If you’re not in financial services don’t think it’s not coming to you – the Productivity Commission is very close. What I urge you to do is to get together with your risk function people and look at the metrics and performance measurements that take account of risk and results for the medium and long term, to ensure results are sustainable.”
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Gordon Wilkins: “Having survived the last 12 months what have we learnt and how are we going to be different as a society? Are we going to go back to earning $100 a week and spending $110, and existing on credit cards? Are we going to improve basic financial literacy about budgeting and saving?
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Melanie Laing: “Understand what the critical issues are for your organisation and know where you, in HR, add value.”
Ian Cormack “Remember what business we’re in: we’re in the people business. People make decisions for emotional reasons. If you want better workers, be a better boss. Make a start with yourself. HR can be a role model in that area. The other thing is, if nobody sends you financials and you don’t look at the financials every month, why not? Why do they think you don’t need to see how the month went? One way to get yourself into that is understand the power of one. Understand what would happen if market share improved by one, if sales increased by one. Understand the impact in your own business, of which line of the P&L makes a difference, and understand what’s really important.”
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What can be done in the tight labour market, especially when it comes to attracting women back into the workforce following maternity leave?
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Final thoughts
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3% forever. For borrowers this is a key challenge – the fact that interest rates are likely to go up means you’ve got to go back and look at your sums, redo your budgets. The RBA cannot leave it at 3%, because people might get too excited and rush out and buy lots of cars and houses and pay the price later on. The cash rate needs to move up to normal levels. The direction for interest rates is clear: they will go up.” Confidence in the sharemarket has remained relatively strong, but James questioned whether investors have gotten too excited, too quickly. “There are two main drivers of all financial behaviour – fear and greed. The last 12 months have seen a lot of fear. We’re not seeing a lot of greed at the moment, but we’re seeing investors looking to make money – and you tend to get a little excited in the good times. So over the coming months we’re going to see the share market rise and fall gradually over time – we’ll see optimism give way to a degree of doubt,” he said. “We expect the Australian share market to hit 4,900 points by June 2010.” James forecasts the Australian dollar to hit 87 cents by end of the year, and 91 cents by June 2010. With the latest employment figures remaining steady, James noted this shouldn’t come as a shock: 12 months ago employers could not find staff – why would they let them go now? “The unemployment rate is currently 5.8%. Full employment in Australia is regarded as 5%. It’s remarkable we’re sitting just above what we consider full employment,” he said. The last 12 months has been a wake-up call for organisations and in particular Gen Y, but James maintains it’s been a welcome wake up call. “You need periods like this to shake you out of your lethargy and respond to different environments. But we can’t rest on our laurels. We’re now in the recovery stage, and we have to make sure that we’re embracing the opportunities out there rather than focusing too much on the risks,” he concluded. hc
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issue 7.10
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issue 7.10
profile
World of
entertainment This month’s profiled HR professional has moved from the finance industry to heading HR operations at some of the most iconic theme parks in Australia
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ony Lines, HR Business Partner (HRBP) for Warner Village Theme Parks, commenced his career in the HR field in 1980 when the fledgling profession was still known as ‘personnel’. Lines worked in the finance industry at the time, and was selected to be a training officer for the bank he was working for in South Australia. “My manager told me that he recommended me due to my good customer service and communication skills. I guess you could say HR picked me!” he says. Lines worked for the Savings Bank of SA, then worked for three different Building Societies in Adelaide over the next eight years due to mergers. It was, Lines admits, a time of major rationalisation for the finance industry, which brought with it some difficult personal challenges as well (see boxout on page 46). But during those years, Lines added to his experience by working in a
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combination of HR and operational roles, including regional manager and card services manager. He joined Warner Village Theme Parks in 1993 as the training co-ordinator. He’s since held the roles of HR manager, IR manager, show & entertainment manager, director of HR, and now his current role of HRBP. “My current role is HRBP for the Movie World Business Unit of Warner Village Theme Parks. This entails overseeing all HR needs for Warner Bros. Movie World, Wet’n’Wild Water World, Australian Outback Spectacular, Warner Roadshow Studios and Paradise Country,” Lines explains. “I’m involved in enterprise bargaining for the two agreements that we have, co-ordinating the reward and recognition program, providing HR and IR advice to managers, approving recruitment, job analysis and remuneration and performance management.”
Restructuring
Lines has one direct report and employs approximately 1,600 staff in his business unit– in addition to another 900 staff in the Sea World Business Unit, which encompasses Sea World and Sea World Resort. The Warner Village Theme Park Group employs approximately 2,500 people in total. “We’re part of the Village Roadshow Group, so our head office is located in Melbourne. All Village Roadshow businesses are now aligning their HR strategies, policies and procedures. Each business unit in the
“The restructure involved a major change in the way our businesses and departments operated” Tony Lines
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profile
company has an HRBP and we all report to the Group HR director of the Village Roadshow Group,” Lines says. The primary responsibility of each HRBP is to act as an advisor to their respective business unit and to liaise closely with the general manager, directors and mangers of their unit.
Communication is a priority between the groups, with weekly director’s meetings with the senior management team. The various HR units also discuss relevant issues in a bi-weekly tele-conference. Although the new corporate structure is working well, Lines admits it was the
In his own words… What do you consider to be your biggest greatest career achievement so far? Personally, my greatest career achievement is divided between two events. Early in my career while working in HR in the finance industry, I was selected as ‘Employee of the Year’. That was a great honour and my award is still proudly on display. The other was being selected as a trainer and committee member for the International Association of Amusement Parks & Attractions (IAAPA) which led to me being asked to conduct training programs for our industry in the US and Asia. One trip to the US resulted in me arriving on September 11, 2001. I was on the last plane allowed to land before the whole country was shut down – so that was a very different trip to say the least. What has been the biggest challenge you have faced in your career? My greatest career challenge was in the early 1990s when the finance industry was going through a major consolidation with many mergers occurring. In the last one, I was working outside HR in an operational management role and my position was made redundant along with about 40 other middle managers. I suddenly found myself unemployed for the first time in my life. While I was unemployed for about three months, I initially had some quality time with my wife Jo and young daughter and got involved with my daughter’s school, which was great. Then I started looking at what I was going to do, and after applying for a few different roles I was offered three positions within a week. This is when I accepted the training and development role at Warner Bros. Movie World and so started my career at Warner Village Theme Parks. Where do you see HR as a profession heading? Over the last few years, the role of HR has undergone big changes. In the early days of my career, HR was seen more as the ‘hirer and firer’ and very much an administrative role. While there is still a lot of administrative work, HR is now relied upon for advice to management and plays a much more strategic role. It looks at areas like workforce management to ensure the business has a cost effective remuneration structure, and it checks that managers are utilising the flexibilities of whatever industrial instrument they are operating under to maximum effect. Industrial Relations is the area where there has been significant shift. Before enterprise bargaining, we interpreted and paid under awards that were determined by other parties. Now, the HR/IR manager plays a significant role in negotiating agreements on behalf of their employer with their employees and unions. The flexibilities gained through enterprise bargaining can result in a flow on of significant benefits to both the company and employees.
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most significant challenge he encountered over the past 12 months. “The restructure involved a major change in the way our businesses and departments operated. As the HR director for the theme parks at the time, I was very involved in the process. This affected my own department and saw the various components of HR split up with reporting made direct to Melbourne,” he says. To align with the new structure, the organisation has implemented a new wage classification scale as part of its new agreement, and the business leaders are in the process of changing over to the parent company’s payroll system.
Attraction and retention
The restructure has kept Lines and his colleagues busy, but at least there has been one traditional HR priority that has been less pressing for theme parks than just about any other industry: the attraction of talented candidates. With the exception of a tough time in 2006/07 when the employment market was very buoyant and recruiting quality staff became difficult, Lines admits that theme parks have always been a popular place to work. “Being a seven-day business, it’s sometimes difficult to find people who want to work a sevenday rotating roster. But generally we are able to fulfil our recruitment needs,” he says. Helping attraction and retention is the revamped reward & recognition program that Lines rolled out last year. It is the HR initiative he is most proud of. “It stands out because it was well received by staff and managers and certainly had a noticeable impact on staff morale. We are currently reviewing that program for our new structure, and some areas of this are already underway with recognition of our long-serving staff taking place later this month. We’ve formed a staff committee to give feedback and input to the staff programs,” he says. HC
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issue 7.10
work trends
Future gazing Work habits in the 21st century
KPMG demographer Bernard Salt reveals some seismic shifts in the way in which Australians are working – and outlines why employers need to keep up
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indsay Bennelong Developments recently commissioned KPMG’s Bernard Salt to undertake a study on workplace trends, to tie in with the property developer’s Gore Hill business precinct launch. Salt’s research unveils some interesting trends that all employers should be taking note of. Work Habits in the 21st Century reveals a society where work life has fused with home life. The challenge for workers will be to ensure that work does not control their life.
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Work in the 1920s
“I started by looking at the way in which the working life has evolved in Australia over the last 80 years. Go back 80 years and life expectancy in Australia was 63. You qualified for the age pension at 65 so you probably dropped dead two years before you got a pension,” Salt says. “You were a child until 14 years and then you were an adult. You went straight into the workforce. There was no need to plan for retirement because 80 years ago you would die in the workforce. There were very blunt, defined edges,” he adds.
Work in the 1950s
Fast-forward 40 years and the average life expectancy extended to 71 years and there was the birth of a new subspecies: the teenager. There was also been an evolution of a time beyond work: retirement. Working life ranged from 15–65, but after 21 most people (mainly men) were well into the working phase of life. In 1971 the average age of a married woman was 21 and for a male 23.
By that age most people were committed to marriage, mortgage, and children. Most white collar workers accepted that the normal work-a-day life involved leaving the suburbs behind and travelling to the CBD. “This is the model that most Baby Boomers recognise, and it is still relevant to many older workers today,” Salt says.
Work in 2010 and beyond
Today’s model is different again. Life expectancy is 82 years – with 17 years of retirement. The teenage phase of life, which was invented by Baby Boomers, has actually been stretched – a ‘teenager’ can now go up to age 25. “The reason being, 40 years ago all that was required was the year 10 exam or HSC,” Salt explains. “By 2009, the more sophisticated service-based economy based around office work requires higher levels of education. Therefore, secondary school needs to be completed through to age 17 or 18, and then you need further education and training. It’s not until late
work trends 20s that we’re making commitments. The average age of marriage for the Australian woman today is 29.” There is another significant change: forty years ago there was a single breadwinner – and dad worked nine to five, Monday to Friday. The month of January was holiday time. “Now it’s mum and dad working, and more likely in office work, combined with managing the raising of children. From age 33 to 43 the average household goes from two incomes back to one or one and a half. So you’re juggling keeping a household going, raising the kids, and working,” Salt says. There has been a shift at the other end of the age spectrum as well. “From around 55 onwards the Baby Boomers over the last decade have picked up that teenage phase of life – that transition phase – and they’ve re-inserted it at age 50+ as a new transition phase. That’s where the sea change and tree change is driving lifestyle decisions,” Salt says. Furthermore, those ‘hard edges’ have blurred. In the 20th century work was rigidly nine to five, Monday to Friday. Now work is measured on deliverables, outputs and KPIs. “How you deliver that output is entirely up to you,” Salt explains. Work is also being taken hom via Blackberrys and broadband. Most people log in to check work e-mails each night. Equally, Salt argues, when employees go into work, young people in particular will check their Facebook or Twitter accounts. During the day an employee might check their internet banking. “These are home functions that are entering the office and vice-versa,” he says. In the 20th century the office was hierarchical. People starting work at age 20 would have been terrified of ‘the boss’, while today Gen Y are not in any way threatened by the boss – “they’re more likely to provide some tips on how the company should be run”, Salt laughs. Corporate loyalty – once so valued – is also shied away from today. Gen Y prefers to gain exposure in a wide range of jobs rather than sticking with one company for years.
issue 7.10
A new work model
Salt suggests the overwhelming theme in this ‘new work model’ is the pursuit of lifestyle and flexibility. Not only does it require flexible work practices, it involves the decentralisation of certain CBD functions to suburbia, closer to where people live. The office industrial park is the prime example of this, and Salt points to best practice examples in Changi, Singapore, and Milton, Oxfordshire, UK. “This is the ascendancy of a set of values based upon fluidity and the breakdown of old protocols and old arrangements. The ultimate expression of the old way of working is living out in the ‘burbs, commuting to the CBD to perform some sort of back office function that can be performed more efficiently completed in a suburban location – to say nothing of the carbon footprint and productivity waste that goes with that,” Salt comments. This does not necessarily mean the CBD is dead – Salt believes it will remain the home for flagship corporate headquarters (minus the back office functions), and will continue to hold the ASX, law centres and government functions. The CBD fringe has also evolved since the 1990s – Docklands in Melbourne, Southbank in Brisbane, Darling Harbour in Sydney. “What we wanted was almost a ‘third place’ – not home or work – but a place after work with cafes, bars and restaurants. I now think there’s a fourth place – and it’s not necessarily a physical place – where you
Bernard Salt
can phase all of the above: work, home, cafes, bars, parkland, schools. Then you can shuttle between all those. It’s a better mousetrap, instead of commuting to the city centre,” he says. This will mean a more flexible, fluid and integrated life where work can be all-encompassing or remain part of life. But there is a downside: work could potentially become so convenient that it starts to invade private time. “The challenge for workers in the 21st century will be to ensure that they keep control of work and don’t let work control them,” says Salt. HC
Location and retention A research study based on data collected for the 2009 Local Employer Awards in Sydney’s Northern Beaches indicates that work location and commute times has a significant impact on the decision to stay or leave and organisation. 708 participants took part in the study from organisations with 20–200 employees. • Looking at all participants, irrespective of commute time, of the 22% of the population that were ‘at risk’ of leaving, 16% of these employees suggested that workplace location was a factor influencing their leaving decision. • For those employees for whom the commute to work is less than 10 minutes, the proportion of employees ‘at risk’ of leaving reduced from 22% to 19%. On the other hand, in the group that has to commute for over an hour, the at risk population rises from 22% to 28% – indicating that the time that it takes to get to work does have an effect on employee retention. For more information visit www.localemployerawards.com.au
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HR strategy
Harvesting ‘green shoots’ Essential redundancy strategies
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ecent media and market reports have indicated that there are some ‘green shoots’ beginning to emerge in the Australian economy. Economists will, however, say that unemployment rates are often the last indicator to improve and that employment issues will remain volatile for some time. Employers have the difficult task of ensuring that their businesses remain afloat during this period, while maintaining good relationships with staff to enable the business to thrive once those green shoots start to bloom. It is also the unfortunate case that during times of economic downturn, employee claims for compensation because of alleged unfair treatment or injury increase sharply. This is probably a combination of there being more terminations occurring, and employees’ fears of longer periods of unemployment following termination. Employers therefore have the additional threat of expensive litigation which will place even more pressure on the business. Businesses cannot be managed just to minimise legal risks. However, the planned, thoughtful management of employees including the consideration of options instead of redundancy can minimise the risk of disputes and preserve employment relationships.
Union involvement
There are alternatives to redundancies. The key is thoughtful negotiation with employees, unions and other stakeholders, writes Tim Longwill 50
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There is little doubt the Fair Work Act 2009 provides a greater opportunity for union involvement in the workplace, including greater opportunities to represent employees. Workplace bargaining and marginally greater access to work sites combine to increase unions’ profiles. This leads to increased on-site membership and then greater involvement in the work site. Employers will understand that it is a union’s job to look after the industrial interests of its members – particularly when employees’ jobs are at risk. This is their reason for existence. Based on legislation, if an employer intends to make 15 or more employees redundant there is a requirement under the Fair Work Act that they notify relevant unions and give them the opportunity to consult on measures to minimise or avoid terminations or mitigate their effect.
HR strategy Redundancies of fewer employees may give rise to claims by the unions that the terminations are procedurally or actually unfair, and this itself may spark union involvement. In these circumstances, the process of union consultation is left up to the employer and union to determine. The combination of a decline in union numbers in some sectors and recent less favourable union rights of access has meant that, in many workplaces, unions have not had a regular presence and there is little or no ongoing relationship with employers. Often in these circumstances, a union will be seen as an ‘interloper’ when they seek to intervene or question employer’s redundancy decisions. Engaging with a union in these circumstances, and at this time in the economic downturn, is seen by many employers as risky and ‘stirring the pot’. Employers should have a plan for union involvement. If an employer has acted fairly, with knowledge of their responsibilities, any union consultation may be limited to showing fair treatment and fair process. In short, employers will need to be aware that if they are initiating redundancies which may ultimately involve 15 or more employees they will need to make contact with the relevant unions. It is irrelevant if the employer decides to make the redundancies in stages, or if they all arise from the one decision. That is it is no excuse to make 10 employees redundant in the first week and 10 employees redundant in the second week to avoid the provision. In circumstances where fewer than 15 employees are to be made redundant, employers need to consider their relationships with unions and have an understanding of their staff’s attitude to union involvement. It is, however, critical to realise that even in circumstances where the workforce is predominantly non-unionised, unions must be consulted when terminating 15 or more employees.
Discrimination
The Fair Work Act provides some protection for employers who wish to make employees redundant for reasons of ‘economic, technological or structural’ change, but an employer cannot unlawfully
discriminate – even when an employer does not intend to. Direct discrimination is often easy to avoid. An employer who for reasons of reducing staff costs terminates all female staff, or pregnant staff, or all union members would be in clear breach of both the Fair Work Act and state and federal discrimination legislation. What is more difficult is indirect discrimination. This is almost always done unintentionally by an employer. For example, in a sector where employers have taken initiatives to engage young or female employees to address a skills shortage, and then seek to impose a ‘last on – first off’ redundancy policy may find themselves guilty of indirectly discriminating against employees on the basis of age and sex. Similarly, if a company contains mostly female, part-time or casual employees – and these employees are targeted as the first candidates for redundancy – an employer may be discriminating on the basis of sex. That is not to say that if an employer’s process results in a greater proportion of females or people of a certain age being identified for redundancy, that it is automatically unlawful discrimination. But it does highlight the employer’s need to ensure that their selection process is based upon specific criteria which is justifiable as being the best workforce to take the employer’s business forward. If the process does create an unbalanced result, the employer should always ask why, to ensure that they do not fall foul of the law.
Alternatives to redundancy
Many employers learned during the recession of the early 1990s that cutting ties with employees and not acknowledging loyalties had significant long-term consequences for the business. In the short term businesses were able to remain on track, but their longer term prospects of re-engaging employees and growing were significantly impacted. With this in mind, more sophisticated employers are now looking at ways to retain their workforce while reducing labour costs. Almost all of these measures involve two common themes.
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First, a medium-term commitment and cost to the employer of maintaining an employee who is not producing to their capacity because of lack of work. Secondly it involves a sacrifice on behalf of the employee of some of the benefits of the employment relationship. This means that there needs to be consent and commitment by both parties to the strategy for the short to medium term. Traditional initiatives, including reducing staff working hours or overtime, can be combined with redeployment and retraining of staff. While this can involve short-term cost it inevitably enhances the employment relationship. Suggesting, by agreement, that employees take long periods of paid leave which has already been accounted for by the employer is also an easier for both parties when the work is simply not there. The short-term conversion of full time jobs to part time jobs is also available in many sectors, but again this must be done with the complete agreement with the employee.
A plan
Employers in 2009 are becoming aware that burning bridges with employees for short-term financial relief often has a significant affect on future growth of the business and on reputation. Looking at processes from a union and an employee perspective can lead to decisions being made which avoid expensive and disruptive litigation later. A medium-term plan which enables the employer to keep the business afloat while maintaining employment relationships is critical – particularly when we are beginning to see some positive signs in the financial outlook. hc
About the author Tim Longwill is a partner at McCullough Robertson. He can be contacted on (07) 3233 8974 or via e-mail at tlongwill@ mccullough.com.au
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Photo: Thilo Pulch, www.pulchphotography.com
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teambuilder
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Let’s get physical Fitness First has been a phenomenon over the past decade. Human Capital talks to one of the company’s top business drivers about her teambuilding tips
N
ic Monteforte, Fitness First operations director for NSW, is the first to admit her industry has suffered from a lack of credibility over the years. The fitness industry has traditionally been viewed as unstable, with countless gyms going bust or treating members poorly. However, Fitness First Australia has turned that around. The company is undeniably an industry leader and is now being noticed by the wider business world. As the first female director at Fitness First, Monteforte has total responsibility for the overall success and profitability of 45 clubs in NSW. These clubs alone contribute more revenue to the business than any other region in the Fitness First portfolio around the world. Although the company has grown rapidly, the overall strategy of the business is evolving – and the focus is now on maintaining the loyalty of existing members. Monteforte has played a critical role in shaping this change. Not surprisingly, given her degree in Physical Education and Human Movement, she remains hands-on in her management of Fitness First’s employees. “I would say that the people management responsibilities are the most critical part of my job, and always
have been throughout my career,” she says. “I’m responsible for all the clubs in NSW, which includes 45 club managers. I also have a team of regional and divisional managers that sit in between myself and the club staff. My regional/divisional team have been with me, on my team, for anywhere from five to 10 years. This business is dynamic and always changing, especially with its growth and direction, which means I’m always developing people throughout their careers.”
Early career
Monteforte started her journey as a sales consultant, and she consistently overachieved on all her targets. In 1994 she plunged into setting up her own personal training and swim school business, where she built a successful and profitable small business after only two years trade. In 1996 Monteforte sold her business when offered an opportunity to work in the UK. There she commenced a career in organisational training and development, specialising in sales, management and leadership. On returning to Australia in 1997, she continued with training and development, running corporate training programs in the areas of sales, leadership
and behavioural styles (DISC). Being discovered at one of her sessions, she was offered the chance to return to the growing health club industry as a sales manager. She successfully opened up a facility at Randwick NSW with a turnover of $350,000 in the first month of trading. Over the next seven years Monteforte’s career blossomed. She was made the first female director for Fitness First Australia and has been one of the keys drivers behind the company’s success. She is responsible for managing over $250m in annual revenue with over 2,500 staff. Although she’s been something of a pioneer in her industry, Monteforte struggles to understand why barriers still exist for women in business. “The reality is more than half of the population is female – half our members and half our staff are female. Businesses need to recognise that both halves should be represented at senior levels. Not having this representation can create a very one-dimensional way of thinking that can be detrimental to performance and success. More importantly, people should be recognised for their ability to be a successful leader, and this shouldn’t depend on whether they are male or female.” Monteforte believes the greatest challenge for women in www.hcamag.com
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“I’ve been very lucky to work for a company that doesn’t look at me as a woman on the board, but rather a great leader who brings different viewpoints and insight” – Nic Monteforte executive roles remains balancing family and work without feeling guilty for either. “I also think we need to stop competing to be like men but maintain the great strength and intuition that women have. I’ve been very lucky to work for a company that doesn’t look at me as a woman on the board, but rather a great leader who brings different viewpoints and insight,” she says.
Work hard, play hard
While Fitness First employees are selected and recognised internally for their commitment to a core set of values – including Respect, Integrity and Community – when asked to describe the corporate culture of Fitness First, Monteforte doesn’t hesitate. “We work hard and play hard. Fitness First is a unique and amazing place to work. It’s also uplifting and lots of fun. Anyone can succeed in our business if they have the right attitude and the desire to achieve. We are also very aware that we work in a great industry which gives us the ability to change people’s lives for the better by getting more of them fit and healthy. Our Mission Statement is to be famous for making the world a fitter place.”
Top teambuilding tips
Monteforte has some tips on creating winning teams at work. Her first – “knowing when to kick and when to coach” has at its basis a desire to create an environment in which it’s OK to talk to employees about almost anything. “Firstly, to kick does not appropriately reflect its meaning. What it means is to drive or push versus to coach or mentor. Trust is the key to being able to do this, and that takes time to build. However, one of the keys is ‘selflessness’. What many people don’t realise is that true leadership means
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‘servanthood’ or ‘selflessness’. When you adopt this kind of approach, your people can feel how committed you are to their success and future and this builds care and trust – which in turn gives you the permission to drive and coach,” she says. Dealing with highly emotive situations is often the undoing of people managers. Monteforte has some tips for both managers and employees about staying calm under pressure. “The best approach I’ve found is to allow the person to let it out, without trying to fix it for them, and then to acknowledge how they are feeling. This in most cases diffuses the emotion, since the person has felt heard. Then you can start asking questions to find out what the real issues are. Once it’s broken down into facts rather than emotions, I help the person come up with solutions themselves and then work through how they might implement them. I know that’s an ideal situation – but it works more often than not,” she says. “As for me staying calm, I’ve learnt over my 10 years in a leadership role that
ego drives the behaviour and actions of most people and sometimes just listening and not commenting is the best approach. Fighting an emotional battle often ends up in tears, so someone needs to choose to be calm to get a positive outcome for all.” Keeping a high-performance team focused over the long term is also a challenge, especially when the economy is forcing many organisations to focus on the here and now. “People can only sprint for so long,” says Monteforte. “When you really get to know your people, you start to learn about their different strengths and also their desires and what drives them. By setting them new challenges, new focuses – even if only one – and giving them different responsibilities/tasks regularly, you find they’re always on their toes as they don’t have time to get bored. I’m also very passionate about my team’s work-life balance and encourage them to take time out whenever possible.
Future plans
Monteforte believes the industry is just starting out on its future path. With Australia facing a health crisis spearheaded by obesity, depression and heart disease, she believes fitness professionals have a huge role to play in fixing these issues and alleviating the problem for future generations. “Health insurers and the government are only just starting to really get behind what we do,” she says. HC
Nic Monteforte’s tips on goal setting If you’re setting goals for yourself, you must have a visual picture of what you desire first and you must understand the sacrifices you need to make to get there. This is the most important point. Using people above you (or in positions that you would like to be in) as mentors is always a great tool to keep you on track and keep it real. As for goal setting with your team, it all starts with trust and knowledge of your team’s goals and ensuring that you deliver on what you say in helping them get there. One of the biggest downfalls leaders have when it comes to goal setting is that they commit to helping a person get to their goals, but they do not follow through on taking the right actions. This breaks the trust and destroys success. Knowing what values your people have and what’s really important to them is paramount on this journey. There is nothing greater than seeing one of your people achieve their goals. Once you help them get to the first one, you will have a follower for life.
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Teamwork can be fun!
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enry Ford once said “coming together is a beginning, staying together is progress, and working together is success”. Team events are a great way to acknowledge and recognise group-wide contribution to the business’ overall purpose, keeping organisations aligned and playing as one. At RedBalloon, team building events are strategies, not just ‘nice to haves’. They are essential in recognising collective contribution and celebrating group progress toward the organisation’s goals. RedBalloon’s employee experience (HR) manager Megan Simpson, is a qualified HR professional and the mastermind behind the employee experience at RedBalloon. Her objective is to create alignment with company values, and team events are her way of achieving this.
RedBalloon’s Top five team building tips:
1) There’s no ‘I’ in Team: Team building events are an opportunity to reinforce and improve on your everyday team environment in a memorable way. When planning your team event, build on what you have by ensuring your event involves: open communication, trust, idea generation, bonding and intermingling. This removes the sense of ‘I’ and promotes a culture of ‘we’. Now more than ever we need our people feel ‘part of something’, and a little attachment goes a long way when employees begin to have more career options as the economy improves. 2) Choose an event and a supplier that reflects who the company is: Take the time to get to know your people’s interests and what makes them tick. Celebrationary rewards that are worth striving for build momentum behind your company performance. Personalised rewards are the most meaningful and the most effective way of saying genuine thanks. Give them variety according to the business’ budget.
3) Justifying spend: The following questions will help you justify spend on team events: will it increase employee productivity and group cohesiveness? Will it change or enhance employees’ perception of our employer brand? Will it show our customers and those who come in contact that we treat our people well? 4) Use team events as incentives to achieve business goals: At RedBalloon, the trimester that has just passed was themed ‘Attack the Mountain’ and the entire company knew that they had to achieve 90% of their personal promises (KPIs) in order to go on a company-wide trip to the Blue Mountains. The trimester before the team took part in the ‘Hook Me Up’ challenge over four months, with the goal of increasing the business’ Google Rating for each website by one point and lifting our SEO profile. The reward was a red carpet night in our own private theatre to celebrate each team’s part in achieving the desired outcome. Last year the business took part in the Black Diamond Challenge to reach $20m in revenue, and the reward was a weekend at the snow for the entire company, all expenses paid. 5) Make it fun & create excitement: Break down barriers between teams, allow people to show ‘their true colours’, let their hair down and bond with their colleagues. RedBalloon’s art experience is a popular way for employees to do this, as employees are free to douse their team mates in paint
and let loose on the canvas. Rock climbing, abseiling and V8 buggy racing gets your team outdoors, and cooking classes allow people to get their competitive spirit going. Don’t be predictable. Don’t forget the element of surprise, the ‘wow’ factor. Lawn bowling, ten pin bowling, trivia and karaoke nights, trophies that get thrown in the bin or stored away don’t have the initial thrill of a unique team experience people have not done before. It doesn’t have to break the budget: popular team building experiences in high demand by RedBalloon clients are treasure hunts, sailing regattas and team paparazzi competitions around major cities. These also have an element of strategy and allows team dynamics to be put into practice. Create excitement in the lead up to the event and post event. This cements your employer brand and contributes to better engagement levels throughout the business. It fosters a culture of success and winning, which makes people feel they are a company of champions and generates pride. Use Flickr, Facebook and Twitter as your avenues to tell the story creating word of mouth about what your employer brand has done for its people. Marketing collateral is also useful to launch the event in the lead up, or to remind employees of what they have to look forward to. For event ideas suggestions and advice, take a look at our Team Building Experiences or contact our specialised Events Team by e-mailing events@redballoon.com.au or calling us on 1300 87 55 00. www.hcamag.com
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