Human Capital magazine issue 9.02

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EXCLUSIVE COVERAGE

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EDITORIAL

Who do you admire?

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here have only been two people in my professional career that I have valued and admired, and therefore tried to emulate. They have not been in positions of power, merely colleagues who struck a chord with me.

I’m always intrigued about how humans learn from others. Do we learn from watching others in action? Do we learn from reading or hearing about what someone has done? Or is it first-hand experience, rolling up the sleeves and getting in there and working side-by-side with others?

Most HR professionals I talk to have usually had some sort of mentor they have learnt a great deal from, either early in their career or throughout their career. More often than not it’s a manager or business leader; sometimes it’s a colleague. In other cases it’s someone far removed from the daily humdrum of working life. Although the cult of the ‘guru’ has some faults (what makes a guru anyway?), even admiring the likes of distant giants such as Jack Welch or Steve Jobs must have some benefits, so long as their world-beating experiences can in some way be related to the layperson’s experience.

Occasionally leaders in other fields have acted, if not as mentors, then as someone to aspire to. During the devastating Queensland floods in January, many praised the inspiring leadership of Premier Anna Bligh. The fact that prior to the event Premier Bligh was riding a crest of disapproval was quickly forgotten. Throughout the crisis she was highly visible, well informed, calm under pressure, showed appropriate emotion and allowed the ‘real’ Anna Bligh to peek through at critical moments, thus helping to put a human face on the tragedy. Suddenly her true value as a leader became apparent. The right leader at the right time? Perhaps.

Certainly in that case, and my personal experiences with the people I’ve admired, it’s been about authenticity. We’re quick to see through false façades, and can sniff out insincerity a mile off. As HR roles continue to evolve into business leadership roles, it’s worth considering the following: without shining a narcissistic mirror up to yourself, how do you come across to others who look to you as a leader? Is there anything you can improve upon? What traits or characteristics in the people you admire can you emulate?

EDITOR Iain Hopkins

SALES & MARKETING NATIONAL COMMERCIAL MANAGER Sophie Knight

COPY & FEATURES

SALES MANAGER Sarah Wiseman

PRODUCTION EDITORS Carolin Wun, Richard Garfield, Jennifer Cross

SENIOR MARKETING EXECUTIVE Kerry Corben MARKETING EXECUTIVE Anna Keane TRAFFIC MANAGER Stacey Rudd

ART & PRODUCTION DESIGN MANAGER Jacqui Alexander

CORPORATE

DESIGNERS Ray Ohanesian, Paul Mansfield

MANAGING DIRECTOR Mike Shipley CHIEF OPERATING OFFICER George Walmsley

CONTRIBUTORS

SALES DIRECTOR Justin Kennedy

Carroll & O’Dea Lawyers, The Next Step

CHIEF INFORMATION OFFICER Colin Chan

Frontier Software

HUMAN RESOURCES MANAGER Julia Bookallil

Iain Hopkins, editor

Editorial enquiries Iain Hopkins tel: +61 2 8437 4703 iain.hopkins@keymedia.com.au Advertising enquiries National commercial manager, HR products Sophie Knight tel: +61 2 8437 4733 sophie.knight@keymedia.com.au Sales manager, HR Products Sarah Wiseman tel: +61 2 8437 4745 sarah.wiseman@keymedia.com.au Subscriptions tel: +61 2 8437 4731 • fax: +61 2 8437 4753 subscriptions@keymedia.com.au Key Media www.keymedia.com.au Key Media Pty Ltd, regional head office, Level 10, 1 Chandos St, St Leonards, NSW 2065, Australia tel: +61 2 8437 4700 fax: +61 2 9439 4599 Offices in Singapore, Hong Kong, Toronto www.hcamag.com Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept as HC can accept no responsibility for loss.

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CONTENTS

Inside this issue

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22 Cover story: Time to shine HR has emerged from the economic downturn firing on all cylinders.

Iain Hopkins interviews four top HR professionals about their greatest challenges, their strategies, and why HR will shine in 2011

10 Migration: knowledge is strength How ‘mobility friendly’ are Australia’s migration policies, and why is it important that businesses stay on top of changing legislation and government direction? Human Capital looks at the importance of immigration education and awareness

44 Incentives: counting the benefits Whichever way your organisation chooses to incentivise staff, Michael Derin reports it is just as important to consider the financial, tax and compliance implications as it is to ensure the scheme will engage your team and assist in reaching business objectives

Regulars 4 In Step – HR career experts 6 Legal 8 HR technology 16 The Forum

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Letters to the editor Do you have a burning HR or people management issue you would like to share with others? If so, Human Capital would like to hear from you. Send through your comments to editor@hcamag.com. Alternatively, express your thoughts on the readers’ forums at www.hcamag.com

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CONTENTS

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INTERVIEW TIPS FOR HR HR Career Experts

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he beginning of the year is a time when many people think about their careers. In this month’s Instep, we discuss some potential interview tips for those HR professionals who enter the market.

Tip 1 – It’s about the business needs… it’s what MDs want The MD of an Australian-listed company recently summarised what he was looking for in his new HRD to exhibit in the interview process. “It’s all about the business needs and how they dealt with it!” This is an MD who over the past 4 years has significantly grown his company in competitive consumer markets in Australia and overseas. He knows what he wants and what works but what did he mean?

There are three levels that HR professionals use when explaining their experience; »» Level 1: ‘HR driven’ – this is where HR stuff is the lone outcome »» Level 2: ‘business results’ – this is where a business outcome is derived from an HR initiative »» Level 3: ‘business driven’ – this is where a business need drives HR efforts which in turn, deliver a result to the business.

Level 1 – HR Driven The reality is that whilst a very large percentage of contemporary HR professionals are aware and focused on the business needs, they don’t recount their experiences this way.

HR professionals often only talk about what they did in the past from a HR perspective. They talk about the HR intervention as the end goal. This inevitably leaves these practitioners open to be asked with this approach – SO WHAT?

Level 2 – Business results Some HR professionals go past a level 1 explanation.

These practitioners describe the business benefits and results that have been delivered to their customer groups from their HR initiatives.

Fortunately, most HR Professionals can discuss their experience in this level 2 format BUT it’s usually after being prompted to do so. Unfortunately, many interviewers don’t prompt their HR candidates and the business results are never discussed. This would be the single most common cause of HR candidates being disappointed by feedback after being told they aren’t progressing. Protesting after the event “that they didn’t ask” unfortunately just doesn’t cut it.

Level 3 – Business Driven Many MDs expect that contemporary senior HR professionals bring to their organisations business insights. The expectation is that this capability can be deployed to proactively observe and address business issues. MDs further expect these business insights to be discussed at interview. They want to understand the subsequent HR activity and the resultant improvements to the business that came from these insights.

A relatively small number of HR professionals relay their experience this way, even if they have good examples from the past.

Tip 2 – Sales Awareness No matter what they say, a lot of HR professionals really don’t how the business sells its products or services. Yes, they know the business sells watches or engineering consulting services or hotel accommodation or whatever, but they really don’t know how this is done and what the front line sales force has to do to generate revenue.

Actually sitting in the business on the coal face is a great way to gather commercial insights that can be displayed to senior managers and future employers at interview.

Tip 3 – Keep it tidy The old adage of not talking badly about past employers and managers is well known. The vast majority of HR professionals are generally acutely aware of this. They generally show respect to their past managers and organisation.

Having said this, there is a tendency for HR professionals to slip into the backdoor of knocking line business leaders when relaying their examples.

This is never a good look but particularly more so when MDs or senior business leaders are the interviewers.

The Final word There is no one or two silver bullets that can be worked on when it comes to interviews in HR as it’s mostly about culture fit. Having said that, addressing some simple points like these three tips could potentially make a difference at a crucial time and enable HR professionals to present their best case.

Craig Mason is a Director with The Next Step, a specialist consulting practice in the human resources market For more information call (02) 8256 2500 or email cmason@thenextstep.com.au, or visit www.thenextstep.com.au

Recent HR Market Moves supplied by The Next Step

Intunity has appointed Louise Bell as their inaugural HR Manager. Louise has gained her experience within the professional and financial services sectors, most recently with Corrs Chambers Westgarth.

in senior HR management roles, including Head of Talent & Diversity and Head of Human Resources for the Financial Planning business.

Prior to AMP, Connie held senior HR roles in a range of industries including Health, Retail and Local Government.

Carlee Lukje has accepted the role of Senior HR Business Partner with Incitec Pivot Ltd. She was previously with Mallesons Stephen Jaques as Head of HR, International based in Hong Kong.

Having been employed with Bankwest as the Head of HR for Business Banking for a number of years, Fiona Ryan is now joining Members Equity Bank as the Group Executive People & Performance.

Leaving BlueScope Steel to join PZ Cussons Australia as HR Director is Renee Monkman. Renee was most recently the National Employee Relations Manager.

WorkCover NSW has appointed Helen Lyons as Director, People & Culture. Previously Helen has held senior HR management roles with the University of Western Sydney, Campbell Arnott’s and AMP.

Elena Clarkin has joined ANZ as their Remuneration Manager.

Leah South has been appointed the Human Resources Director

Elena has been in the Remuneration and Benefits space since 2001, most recently with Transurban in the role of Remuneration & Benefits Manager.

for Nationwide News. Leah has enjoyed senior HR management roles with Lendlease, Jones Lang LaSalle and AMP.

Jemena has appointed Wally O’Carroll to the role of General Manager Human Resources. Wally has a wealth of experience gained within organisations such as Origin Energy, Veolia and BHP. Deloitte has appointed Connie Hansen as the HR Director, for their market leading Private Clients Division. Most recently, Connie has enjoyed a successful career with AMP over the past seven years

Having been with Reckitt Benckiser for the last seven years in senior HR management roles within Australia, America and the UK, Deborah Yates has been promoted into the role of Regional HR Director ANZ.

Rebekah Mark has been appointed to the role of HR General Manager of Alphawest. She previously held the role of Human Resource Manager, Customer Solutions & Services with Optus.

By supplying Market Moves, The Next Step is not implying placement involvement in any way.

Legal Experts

THE USE OF SOCIAL MEDIA AND IMPLICATIONS FOR THE EMPLOYMENT RELATIONSHIP

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he almost universal usage of computers in the workplace and the emergence of new forms of social networking media such as Facebook, YouTube and Twitter are generating novel challenges for employers. Most employers are addressing the social media phenomenon by implementing acceptable use policies and/or monitoring employee internet usage in accordance with applicable surveillance legislation.

The issues relating to employees’ use of social media are not necessarily limited to employee usage whilst at work. Social media/networking sites allow individuals to freely advertise their personal details (such as employment status and details) and publish publicly-accessible opinions on a myriad of subjects including their employment. Posts or tweets by employees that disparage the employer or inappropriately purport to represent the employer’s opinion may give rise for legitimate disciplinary action.

Control and Disciplinary Action An employer is generally not entitled to restrict an employee’s activities outside of working hours, although a valid basis for control over such activities may arise if there is a sufficient connection to the employment activity. In McManus v Scott-Charlton a direction to an employee to refrain from particular out-of-hours conduct was held to be lawful where the conduct arose as a result of the employment relationship and where the conduct had substantial and adverse effects on the ‘efficient, equitable and proper conduct’ of the employer’s business. In Rose v Telstra, it was held that a dismissal for out-ofhours behaviour shall be valid if such conduct is likely to cause serious damage to the employment relationship or damage the employer’s interests.

However, employers should exercise caution when making decisions arising from employees’ use of social media and consider factors such as the connection to the employment, the potential audience for, and effect of, the relevant post or tweet.

This is clearly illustrated in the recent decision of Fitzgerald v Escape Hair Design, where an employee of a hair salon was dismissed for posting comments on her Facebook page disparaging her employer and her modest Christmas bonus. The employee disputed the fairness of the dismissal arguing that her status message could only be read by her Facebook ‘friends’ and that her employer was not identified. www.hcamag.com

It was determined that the Facebook posting may have undermined the strength of the employment relationship, but did not irretrievably damage the essential trust and confidence between employer and employee to justify the dismissal.

Encouragement and Acquiescence Alternatively, an employer may encourage or even require an employee to engage in social media activities. In these circumstances, the employee engaging in such activities is likely to be considered a representative of the employer. Difficulties will arise if such an employee engages in social media activities that potentially damages the reputation or business of the employer. A well-known columnist was recently dismissed by a prominent national newspaper after she made several unsavoury tweets in relation to the 2010 Logie Awards. As the columnist was known for her editorials, readers’ outrage at the tweets was directed towards her employer. The employer publicly justified the dismissal by claiming that the employee’s views expressed in the tweets were not in keeping with the standards set by the employer. The columnist publicly defended her activities and criticised the decision, arguing that the private tweets were ‘taken out of context’ and likened Twitter to ‘passing notes in class’.

As the matter has not been the subject of determined proceedings, it is not clear whether the employer had in place a social media policy, or whether the columnist was subject to contractual conditions in relation to her personal publications and activities.

Practical Solutions Both situations illustrate the need for employers to be cognisant of possible effects that employees’ use of new forms of social media can have on the employer’s operations. Employers should also be aware that an employee’s private use of social media can generally only form the basis for disciplinary proceedings if referable to the circumstances of employment. To minimise the risk of disputes, employers are advised to implement detailed social media policies and consider the use of disclaimers for work-related social networking. www.codea.com.au

Peter Doughman Solicitor Carroll & O’Dea Lawyers Level 18 St James Centre 111 Elizabeth Street Sydney NSW 2000 02 9291 7100

HR Technology

THE IMPORTANCE OF AN AGILE TECHNOLOGY PLATFORM QUESTION: Our organisation is preparing a

Request for Tender for a new payroll and HR solution.

It has been suggested that we should review the technology platform of the solutions as well as functionality. Can you explain why the underlying technology is so important?

ANSWER: The functionality of the application

you select is of paramount importance. Ensuring the system meets your needs and can eliminate manual processing will save you thousands of dollars. While functionality needs should never be overlooked, it is a good idea to understand the technology underpinning any payroll and HR solution that you are reviewing. HRIS software investments can be substantial and the solution should meet your needs for the long term. It is wise to gain an understanding of the basics and also to involve your IT department in the review, even if you are looking at an outsourced or hosted solution.

An HRIS developed on a strong technology platform will future proof your software investment and ensure that you can leverage future technological advancements as they become available. The pace of change across the technology landscape is breathtaking, and selecting an agile solution that is built on an open and robust technology base will ensure your organisation can harness the benefits these advancements provide.

For example, the smart phone has become the device of choice for many executives in the last year or two.

Today, a nimble employee self-service application can harness this device and provide 24/7 access to HR data from anywhere, improving productivity and service levels within the enterprise.

The HRIS technology environment comprises several key components that together should deliver unsurpassed performance and a featurerich user experience. Some areas of technology and architecture that you may consider are: Development environment – what tool does the vendor use to program the system? There are over 550 different programming languages available today, all boasting different strengths – one that can effectively utilise the hardware environment will ensure accelerated performance. This is particularly important for a mission-critical application such as payroll. As processing windows continue to shrink and employee numbers grow, it’s important to know your payroll application can meet tight deadlines. www.hcamag.com

I recently heard of a situation where a company experiencing performance issues with payroll purchased a new server with multiple processors to speed up processing. The application design didn’t support multiple processors, so the added investment in technology was wasted, as the payroll system could only utilise a single processor. The organisation was left with their lengthy 12-hour processing window for payroll which incurred staff overtime costs and increased their exposure to payroll delays.

Portability – an HRIS that works well across multiple environments is essential. These days, one interface is no longer sufficient. Sophisticated users now need access across the web for employee self service. Power users demand a rich user interface on their desktop and mobile employees require access from their smart phones. To do this well, multiple development environments are required. It may be beneficial to understand what tools a software vendor uses and why they have made that choice. To ensure the application can offer a rich user experience and deliver optimal performance, the tool that best suits the environment should be used.

To move at the pace of technology, your software developer needs a large team of trained specialists which ensures the application continues to evolve and deliver value for your investment. Therefore, when reviewing the technology platform consider the vendor’s annual research and development investment as well as the size of their development team. A large team and a generous R&D budget will be evidence of their commitment to the evolution of the solution and ensure the application will continue to deliver value to its client base.

Network response times – the solution architecture will determine the response times you might expect across your network. The system architecture determines where the processing is done and how much data travels between the client machine and the server. A true three-tier client/ server architecture is preferred and will minimise network traffic and ensure fast response times, a key factor in system useability.

While technology discussions can sometimes be daunting, understanding a few basics can protect your investment and ensure you select a solution that is robust and delivers exceptional performance.

Nick Southcombe General Manager Frontier Software Pty Ltd (03) 9639 0777 www.frontiersoftware.com

INTERNATIONAL ISSUE: International recruitment

Relocation blues The challenges of managing a global workforce are manifold. From cultural awareness to recruitment and relocation, KPMG International provides six key tips for managing a global workforce 1. Establish a leadership group within the organisation that will serve as the pool from which new senior executive talent will be drawn. Invest in training and career development programs for this group and ensure that there is sufficient depth to allow for talent to flow in and out.

2. Expose staff to international cultures, especially those in the leadership group, to ensure they have a fuller understanding of local issues and cultural sensitivities when dealing with the people aspect of a global organisation. Support this with local training (including language) programs.

3. Manage staff expectations when leaving for and returning from an international assignment. This especially applies to staff returning to head office after an overseas assignment. Be aware of demographic research that suggests that after working in a foreign location for five years or more there is a tendency to prefer to remain in the adopted city/country.

5. Remunerate to market rates. This requires constant research and benchmarking to ensure that the rates and structure of the remuneration package is commensurate with the market standard for the range of skills and often, the location of the expatriate including hardship and risk issues. Consider techniques such as delayed bonuses to encourage longer-term loyalty.

4. Draw on local staff to manage country offices. Perhaps this is a vestige of the colonial era but interview subjects [from KPMG’s research] strongly feel that local offices are best managed by local staff rather than by an expatriate sent in from overseas. Or, if an expatriate must transfer their ‘know how’ to the local office, a key performance indicator of the expatriate’s role should be to identify a local replacement within five years.

6. Recruit staff with good communication skills. The role of a modern corporate manager has shifted from ‘command and control’ from a distant location to one of ‘managing and communicating’ and perhaps even ‘motivating staff’. The skills required for the former role are different to the highly developed global communications skills required in the current environment.

Source: The Global Skills Convergence, KPMG International, 2008

FEATURE migration

Knowledge is strength 10

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FEATURE migration

How ‘mobility-friendly’ are Australia’s migration policies, and why is it important that businesses stay on top of changing legislation and government directions? Human Capital looks at the importance of immigration education and awareness

I

t is the ‘perfect storm’ for overseas candidates looking to move to Australia. An environment of low local unemployment rates, positive business growth and the acute skills shortage means that there simply is not enough talent in Australia.

Organisations are once again casting their nets overseas for talent.

Therefore, what areas do businesses need to be aware of to ensure movement of overseas workers is smooth and trouble-free? Perhaps more importantly, are Australia’s constant policy and legislative changes conducive to attracting overseas talent?

Setting the scene On the launch of KPMG’s Skilled Migration Survey in September 2010, Karen Waller, executive director of KPMG’s Migration practice, said 85% of respondents had felt no impact from the GFC when it came to skilled migration. More than half were suffering from a skills shortage, with Queensland and South Australia the hardest hit states.

“Queensland and South Australia are suffering a skill shortage because they have been less inclined to engage in the Federal Government's 457 visa scheme. In contrast, companies in Western Australia also feel a squeeze on headcount but are using skilled migration much more aggressively,” Waller said.

The survey indicated that employers are trying

to meet their workforce needs by using the 457 visa program as it allows them to recruit foreign workers in approved occupations, for up to four years. And more than half of KPMG’s survey respondents expected to hire additional workers under this scheme in the current financial year. “The 457 visa offers businesses flexibility in meeting temporary skills shortages. Up to half the people entering Australia under a 457 visa have subsequently been granted permanent residency. For both employers and workers, 457 visas offer the advantages of a ‘try before you buy’ system,” Waller added.

Ron Kessels, special counsel in Australia for global immigration services firm Fragomen, says his firm regularly speaks with employers who have not previously considered sponsoring talent from overseas, but who now see this as the only way to find people they need. He says a growing problem for many employers in the construction sector comes from the fact that the resources boom is drawing labour from all over Australia, leaving many small and medium employers looking for tradespeople.

He expects to see the same in the IT sector if the National Broadband Network, or some alternative, gets off the ground. “Given that homegrown talent produced by higher education is not meeting the skills shortfalls, particularly in the short to medium term, the real challenge for many employers is not so

“The challenge for government is to ensure there is independent and rigorous discussion about what role skilled migration plays in Australia to help businesses grow” – Karen Waller

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FEATURE migration much the willingness to hire from overseas, but how they can access that talent pool,” Kessels says.

Internal business repercussions With the realisation of the importance of overseas workers in the Australian talent mix, there is also growing awareness of the issues that accompany this shift in attitude. Immigration issues can affect businesses in a number of ways. The politics of immigration and the use of foreign labour can lead to mistrust and disharmony in the workplace, and breaches of immigration rules can lead to serious penalties – including fines and the denial of access for foreign workers.

While most HR professionals understand the rules and the politics, their challenge is to raise awareness in their organisations about the importance of these matters to the organisation as a whole (and to the individuals directly affected), and also to ensure that there are robust policies in place to avoid any trouble.

Room for improvement If knowledge is strength, HR professionals need to be aware of the larger issues at play. It’s undeniable that Australia is a popular destination for ex-pats, but how do we rank on a global scale in terms of best practice for global mobility?

The Centre for International Employment and

Dotting the i’s, crossing the t’s

What policies and procedures should employers have in place to ensure compliance and raise awareness? Here is CENTIEM’s list: »» A recruitment policy that outlines whether permanent residence is supported and at what stage and in what circumstances, whether ‘Living Away From Home Allowance’ (AFHA) will be offered and when it will be withdrawn, and whether dependents will be allowed to be included in an application for 457 and in what circumstances. »» A procedure for checking that a person has appropriate work permission before being hired or renewing an existing contract – even through a recruiter, arranging for an intra-company transfer or short assignment or engaging the person as an independent contractor. »» A policy for the appropriate use of ‘Business Visitor’ visas (eg, Business ETA, Business e-Visa or Business Short Stay subclass 456 visas) including the circumstances in which these ‘Business Visitor’ visas may be used; who may use them; and who within the business can approve the use of ‘Business Visitor’ visas. Appropriate systems also need to be in place for monitoring and tracking the use of these visas. »» A clear escalation policy to deal with issues of corporate liability and risk in relation to migration matters. »» Policies and procedures to ensure compliance with any sponsorship obligations, including market rate compliance, recording and reporting to government as required (particularly in relation to sponsored employees who have ceased employment) and the payment of return travel costs.

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Migration (CENTIEM) is an initiative of Fragomen Australia. CENTIEM brings together experts in the field to produce research, commentary and educational tools designed to inform individuals and organisations interested in global mobility.

Kessels, CENTIEM’s spokesperson, believes that Australia’s 457 visa system is up there with the best worldwide; it is demand driven, allows for sponsorship in a wide range of occupations and provides residence and work rights for dependent family members. Kessels feels that where the system lets employers down is with lack of flexibility when it comes to intra-company transfers or short-term assignments. This leads to problems when employers are forced to re-invent their internal HR and payroll requirements in order to meet Australian visa rules.

One of CENTIEM’s key projects for 2011 will be to lobby for changes to the short-term work visa system and to accommodate the needs of global corporations with internationally mobile workforces.

In relation to Australia’s permanent migration system, Kessels says Australia is still struggling to formulate an effective system to ensure we get the people we need. “Recent changes to the points test for the ‘General Skilled Migration’ [GSM] program were designed to decouple Australia's migration system from the education sector and to ensure that migrants help to fill the skills shortages that Australia faces,” he says. “The changes certainly ‘decouple’ the GSM program from the vocational education sector and will mean the death of many cooking and hairdressing colleges throughout Australia. The new program does not adequately address skills shortages in key areas such as the construction trades, and nothing in the semi-skilled or unskilled areas,” he adds.

Kessels says that this is consistent with the increased emphasis by the government on the use of employer demand-driven programs such as 457 and the employer nominated scheme (ENS) to supply the labour market with tradespeople and to fill short-term skills shortages. For Australian businesses needing labour, this will mean more recruitment from overseas with little supply being pumped directly into the labour market through the general migration program.

While employer-sponsored programs can be used to top up areas with skills shortages, how businesses will access lesser-skilled workers is a big issue – and a looming hot political debate.

Business implications On a more practical level, a combination of vague laws and flexible policy results in a situation where business cannot know with certainty how the migration rules will be applied in any given circumstance.

FEATURE migration It raises the question: is the government doing enough to work with employers on these issues?

Waller noted that nearly two-thirds of businesses that took part in KPMG’s survey believed the government could better leverage its skilled migration program to support population growth, and the exodus of Baby Boomers from the workforce.

“The challenge for government is to ensure there is independent and rigorous discussion about what role skilled migration plays in Australia to help businesses grow,” she said.

Kessels agrees, and feels there should be more consultation with corporate Australia about the impact of migration rules on their businesses. He notes that one of CENTIEM’s key objectives is to facilitate this by engaging with government on immigration issues relevant to business.

“In our experience, a lack of consultation about business needs and how proposed changes may work in practice has led to migration law and policy that creates real issues for many employers of overseas workers,” he says.

“One example is in relation to temporary business visas such as the 456 visa and ‘Electronic Travel Authorities’. These visas are granted with a

“A lack of consultation about business needs and how proposed changes may work in practice has led to migration law and policy that creates real issues for many employers of overseas workers” – Ron Kessels

condition that the visa holder must not engage in work that might otherwise be done by an Australian citizen or permanent resident.

“Although this seems clear and would allow for short-term employment of an overseas worker in many situations, the department’s policy provides a much stricter interpretation that effectively prohibits employment of more than six weeks’ duration – and even then only in very limited circumstances and where the position is not ongoing. The inconsistency between the law and policy leads to a large degree of uncertainty about how these visas can and should be used,” says Kessels.

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FEATURE migration

Who’s responsible?

STATISTICS KPMG’s 2010 Skilled Migration Survey was completed by 268 listed and private Australian companies, showing their practices in recruiting and retaining skilled migrant workers under the 457– visa program n 85% of respondent employers felt no impact from the GFC when it comes to skilled migration, half are suffering from a skills shortage n More than 60% of respondents maintained their current levels of skilled migration over the past 12 months n 55% of respondents felt keeping up-to-date on immigration law changes posed the greatest concern for their business 14

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According to KPMG’s survey, 55% of respondents felt that keeping up-to-date on changes to immigration law posed the greatest concern for their business.

With constant changes to legislation and even government direction on migration issues, where does the responsibility lie within an organisation for keeping on top of the situation?

Kessels believes this will vary from organisation to organisation, but ultimately there are serious risks that could affect the business in a financial and reputational way. The level of responsibility for ultimate decision making should reflect this.

“Organisations need to take migration compliance seriously and decide where responsibility should lie for decisions that could result in a financial penalty on the company, suspension of the company’s sponsorship rights or an adverse media story,” he says. “Different levels of responsibility may be needed for different decisions.”

At the highest level, Kessels says senior management should be aware that the organisation is involved in the employment or sponsorship of overseas workers, and understand the associated compliance obligations and risks of managing all their overseas workers. They should ensure adequate planning, policies and procedures are in place that will establish that the corporation takes reasonable precautions and exercises due diligence to avoid conduct that would amount to a breach of migration law. This would include ensuring that managers are aware of the laws and their individual responsibilities in relation to these obligations, and that there is a professional undertaking and culture of compliance and disclosure amongst management teams.

HR teams must ensure that the general migration laws and sponsorship obligations are strictly complied with. This is likely to require education and training of managers/supervisors with responsibility over temporary visa holders, so they will report anything that may affect the organisation's obligations. It would also be prudent to involve inhouse counsel or an external expert to ensure that policies and procedures are compliant and robust.

“HR teams regularly tell us their main challenge in relation to migration compliance is ensuring that their line managers and others with responsibility over the day to day management of sponsored employees fully comprehend the importance of migration compliance to the organisation and understand the highly disruptive impact of exposing the business to these risks,” Kessels says. “Project managers and line managers have their own deadlines and delivery pressures which mean they are less likely to be concerned about migration rules, which they often see as an annoying hurdle and something to get around

– rather than as legally binding obligations that can cause severe business interruption.”

The costs of non-compliance KPMG’s survey revealed that only 10% of respondents are preparing for a review of their foreign recruitment programs by the Department of Immigration and Citizenship (DIAC) in the coming 12 months. “This small figure reflects that businesses aren’t concerned about being monitored by DIAC. However, they should be ensuring that their processes and 457 visa obligations, like paying the correct salary levels, are up to date,” Waller notes.

Many organisations may not be aware that it is a criminal offence for an employer to knowingly or recklessly allow a temporary visa holder to work in breach of a work condition on their visa. This could include: »» allowing a student visa holder to work for more than 20 hours a week when their course is in session »» requiring a 457 visa holder to carry out work in a lower position than the one they were sponsored for »» employing a ‘Working Holiday’ visa holder for more than six months where they have not been granted permission to do so »» on-hiring a 457 visa holder to an unassociated business when your organisation does not have an approved labour agreement in place While prosecutions are uncommon, Kessels says the penalty for any such offence can be as severe as imprisonment of up to two years or a fine of up to $66,000 for a corporation. Higher penalties can apply if the person is being exploited. There are also serious penalties for breaching the sponsorship obligations that are imposed on employers employing sponsored workers. If an organisation fails to comply with any sponsorship obligation this can result in financial penalties of up to $33,000 for each breach, possible cancellation/suspension of the organisation’s right to sponsor workers, and even cancellation of the visas of the existing visa holders.

Kessels adds that these administrative penalties (eg, suspension) are more common than financial penalties, and are considered by most sponsors to be more serious. They mean that the organisation will not be able to sponsor new staff or even renew existing visas – which can be disastrous if the business depends to any extent on overseas employees. Add to the mix reputational damage for those organisations that breach immigration laws and Kessels believes there is more than enough motivation for companies to take extra steps to ensure that immigration compliance “is part and parcel of their usual business practices”. HC

DIVERSITY Indigenous recruitment EXPERT INSIGHT international hiring

WHY SHOULD ORGANISATIONS SOURCE TALENT FROM ABROAD?

S

imply put, because your competitors probably are.

As we move into a labour market where the unemployment rate is set to dip under 5%, international recruitment is a modern reality. Skills shortages in specific industries are already biting, and as we move into 2011/12 this will turn into a general labour shortage across the economy.

After the expected slowdown caused by the GFC, there has been a dramatic increase in vacancies almost across the board. With the recovery, skills are as hard to find now as they were 24 months ago and over the past six months, we’ve seen an increase in the number of employers who are realising that offering sponsored work visas to offshore talent is an excellent way to secure world-class skills.

Nowadays, there is no reason to restrict yourself to the finite resource pool available within our borders.

International sourcing has become a standard feature on many workforce planning strategies, and to avoid being left behind, you should be considering it as another tool in your recruitment plans.

What are the key questions to ask?

There are a number of visa options available to employers wishing to access overseas skills, but before you investigate these, you need to ensure that you have the systems and processes in place to ensure that your initiative is a success: 1. Buy-in from the business – successful international recruitment requires the whole business to be behind it. There is no point in this being an HR initiative with C-level support if the line managers are not on board. Take the time to discuss the strategy with all key stakeholders.

2. Relocation – have a set policy in place to handle relocation. Check what your competitors offer to make sure that you are favourably placed with candidates and understand the cost implications.

3. On boarding - international candidates need a more robust induction than those from Australia.

Issues like transportation, office hours, dress code and OH&S may be radically different to what they’ve experienced previously, and time taken to explain these logistical issues as well as following the standard induction process will positively impact on the retention of your new employee.

4. Skills development – in order to sponsor international candidates, organisations must be

able to show that they are investing in local skills development too. This isn’t just a matter of meeting DIAC’s requirements, but is a critical element in ensuring that the skills shortage is addressed locally in the present to minimise its impact in the future.

5. Future proofing – have a policy in place that ensures that you retain the skills of any international candidate for as long as possible. Although most are generally loyal as a result of the opportunity afforded to them to move to Australia, having several small retention focussed steps in place for the first five years yields an even greater ROI. Examples include agreeing to sponsor for permanent residency, writing off visa application costs on a pro-rata basis over a number of years, and offering a bonus after an agreed service period.

How can Australian employers ensure they target the right audience?

Attracting international applicants requires a different approach to accessing the local market.

After all, you want to make sure that you get applications from not only the most qualified, but also from the most ‘move-ready’ applicants. The standard tools of local job boards, word-of-mouth and local recruitment companies aren’t sufficient to ensure your success, and you should ideally adopt a multifaceted approach. The types of strategies that have proven to yield the best results include: 1. Advertising on job boards that are specifically targeted towards the international job seeker such as www.workingin-australia.com. Log onto google.co.uk and search for phrases that are relevant to your industry, like “engineering jobs in Australia” to see what the most active boards are. This will ensure that you’re marketing to the right audience.

2. Have a presence at international employment fairs and migration events held in countries that you would like to source skills from such as the Opportunities Australia Expos www.expoaustralia.com. In choosing which countries to focus on, consider issues like the importance of language skills for your vacancies, ease of visa application and general quality of skill.

3. Partner with a migration firm who will be able to quickly assess any applicants that you are interested in to make sure that they will be eligible for a visa. Find out whether they are prepared to refer suitable existing migration clients to you.

About the author Mandy Harris is Corporate Migration Manager, WorkingIn (Australian MARN 0958730, New Zealand Immigration Advisers Authority License 201002215). For more information please contact 02 9291 2300 or visit www.workingin-australia.com www.hcamag.com

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THE FORUM social media & recruitment

The issue of social media and one’s online reputation has the potential to polarise different generations, employers and employees. For this month’s forum, Human Capital attended Randstad’s ‘Great Debate’ in November. The objective was to discuss and thoroughly understand issues relevant to the recruitment sector. The outcome: social media is changing the game – but not the rules – for employers 16

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THE FORUM social media & recruitment

Changing the game T

opic: are prospective employers entitled to use social media such as Facebook, LinkedIn and Twitter to investigate potential candidates?

Jane Adams (moderator): Mia Freedman, a wellknown journalist, recently commented on her blog about the validity of using the Internet, particularly social networking sites, when making decisions on hiring employees. She was looking for an assistant.

Without even thinking about it she jumped onto Twitter and Facebook to check out the pool of candidates she had available to her – and the pool of candidates halved in a matter of minutes.

She said she didn’t need to look at a single CV to eliminate three girls based on their social media profile alone. One had a constant stream of updates on Facebook complaining about her previous job, another seemed to spend most of her time getting drunk, and a third had strident views that Freedman disagreed with.

She said it’s absurd to believe that the way you behave on social media sites can be quarantined from your work life. It can’t be – what you say online and what you choose to post on Facebook and Twitter is like your shop window.

This is one example of how the internet is being used to weed-out undesirable candidates, but to what extent can employers trust what they see online?

According to a study by Harris Interactive, more than half the employers surveyed said that provocative photos were the biggest factor contributing to a decision not to hire a potential employee. The other warning signs were drinking, drug use, bagging out previous employers and colleagues, and poor online communication skills.

The report showed Facebook is the most popular online destination for employers conducting online investigations, followed by LinkedIn and MySpace.

We want to discuss whether this happens in Australia, and more importantly, should this happen?

Is it ethical? Is it legal?

Carey Eaton: I’m not aware of any company that says you must check social media profiles. There are ethical and moral questions around that and interesting questions about the role of the individual and of the company itself in their activities. You could argue that material on the Internet is there to be read, and there’s absolutely nothing wrong with reading it. The key question is what you do after you’ve read it: whether you are discriminating or making judgments. I think half the population understand the

consequences and perhaps the other half don’t. The idea that you can look at the Internet and assume that everyone is approaching it in the same way is clearly false. There will be people putting information up there designed to give a certain impression and there will be people putting information there not thinking about it at all. To make a hiring judgment based on what’s pretty much a blind guess is bad practice.

Anna Elliott: From a legal perspective, it can be risky to vet candidates via their online profile. As potential employers, you need to be aware of the legal risks. Ensure you are making recruitment decisions based on merit, namely a candidate’s skills, experience, credentials and other objective selection criteria for the position, rather than on any irrelevant attributes that may be depicted or written on their social media webpage. As a candidate, if you have not activated your privacy settings, you should anticipate that potential employers or recruiters may view your social media profiles as part of their referencechecking or vetting process.

In terms of legal ramifications, the key risks to be aware of are discrimination and adverse action claims. From a discrimination perspective, Federal and State legislation provides protection for candidates if you do not offer them employment based on a protected attribute that they possess. The protected grounds vary from state to state, and some are obvious – such as sex, race, age or disability.

However, other grounds are less so, such as religion, political beliefs, personal association with someone with a protected attribute, or merely assuming someone has one of those characteristics.

This means that if you view someone’s Facebook page and see pictures of them at Mardi Gras and assume that person is gay, that is an assumption about someone’s sexual orientation and is a protected ground under discrimination law. Such presumptions have the potential to lead to discrimination claims

“When we talk about social media and about discrepancies, we must talk about the context in which something is posted” Guy Cary

The panel

»»Carey Eaton, CIO of Seek »»Anna Elliott, senior associate at Holding Redlich »»Guy Cary, managing director of First Advantage »»Michael Specht, social media expert »»Dr Judith MacCormick, Australian School of Business, UNSW & AGSM »»Meaghan Kemeny, university student »»Jane Adams, group director of Randstad www.hcamag.com

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THE FORUM social media & recruitment if that is the reason a candidate is not offered employment. For example, you may interview and shortlist a great candidate and, on paper, decide they are the best person for the job. However, you subsequently look at their Facebook profile and you see they have six children and assume this will impact on their time-keeping, or that they have extreme political views that you may not agree with.

If those attributes are the reason for the candidate being unsuccessful, it could give rise to a potential discrimination claim.

The other potential claim that was introduced by the Fair Work Act 2009 (Cth) from 1 July 2009 is a general protection from adverse action. This protection provides that a person, such as a prospective employer, must not take adverse action against another person, such as a prospective employee, based on a workplace right. In the current context, adverse action means if you refuse to employ someone or discriminate against them, including in the terms and conditions of employment offered.

In addition to discriminatory grounds, having a workplace right is also protected. A workplace right includes being entitled to the benefit of (or having a role or responsibility) under a workplace law or instrument, being able to initiate proceedings, or make a complaint or enquiry under a workplace law.

For example, if you look on Facebook and see that a candidate is an active union member, and refuse to offer them employment on that basis, this potentially exposes you to an adverse action complaint.

The kicker is the reverse onus of proof. If a prospective employee does bring a claim, the onus is on the potential employer to prove that their union membership was not a reason for refusing to employ them. It only has to be one reason why you did not offer employment to that person. There is no cap on damages available so such a claim is a scary prospect. To date, there have not been any reported adverse action cases in a recruitment context – however, the potential is there.

From a privacy perspective, in Australia there is currently no restriction or legislation in place that expressly prevents you from viewing someone’s Facebook or online profile in terms of making recruitment decisions. However, the lack of such restrictions does not obviate other legal ramifications. Further, the National Privacy Principles govern the use of information once received and must also be considered. When using recruitment agents, often candidates also sign a privacy form, which may specify how information will be used and how references are obtained.

Candidates may also request a copy of their file retained by a recruiter which, again, may give them access to information to build a potential case.

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“There is a pendulum that swings back: technology brings some problems but technology may address them as well” Judith MacCormick

Prospective employers and recruiters may elect to search social media web pages as part of their selection process. It is important to be aware of potential legal claims that can arise if decisions can’t be objectively justified and are based on an irrelevant characteristic, rather than a candidate’s merit.

Meaghan Kemeny: I think as a generation we’re aware that it’s unacceptable to not be online.

Anonymity is not an option. At the same time we understand that it’s hypocritical for us to think, ‘you can’t search for me on Google’ because we use search engines every day. Personally, I set my Facebook page up for a personal form of communication with my friends and family, not for people to find me and pass judgment. It’s my concern that employers will find a way to get in there and make judgments. If they’re looking at photos... they’ve got no idea where it’s come from or what they’re looking at.

For example, I was overseas for four months and a lot of the photos are of parties, friends and social events. If someone was to see that they might be unaware of what happened before that, which was six months of three part-time jobs, and no social life.

If anything, that shows a determined, motivated person working towards a goal. It is our generational concern but I think we’re starting to realise what we put online is not in pencil, it’s in ink.

Guy Cary: From an organisational point of view our stand on this is we don’t use social media as a check on candidates. We rely on the consented background information that we collect via factual databases.

We find discrepancies raised for nearly one-third of candidates – in other words information that we report back to the client. We advise clients in every discussion we have with them to talk to the candidate and discuss the information that comes back.

Just one example: a criminal history came back for a candidate who had 29 convictions. We must disclose the information as we find it from the authorities. Our client acted absolutely correctly, sat down with the candidate and went through this process of checking with the police forces, and the candidate ended up having to provide fingerprints to prove it was not actually him.

So just from that example, when we talk about social media and discrepancies, you can see we must talk about the context in which something is posted.

I know that every day when I walk past my team’s desks there are pictures of them with their friends, partying, and I’ve no objection to that whatsoever, because it’s in the context of how they spend their time away from work. From a more personal view, I would differentiate between the likes of Facebook, MySpace and LinkedIn.

THE FORUM social media & recruitment For example, I would go into LinkedIn when I have a candidate because they have posted there, as far as I’m concerned, as part of a professional network: so they want themselves to be seen from that professional point of view.

Judith MacCormick: Research from Microsoft indicates that 75% of recruiters and HR managers were required by their organisation to look online and 70% of those had not recruited people because of what they found. Other industry research from the University of Texas looked at the validity of people’s profiles, finding them to be fairly accurate. In terms of psychological profiling there was a close match – so at this preliminary stage it is fairly accurate.

In Europe they are doing a campaign, ‘think before you post’. You can also use privacy nudges so if you are going on Facebook after midnight it makes you do a little maths problem before you post something. Then there are expiration dates, so whatever you post you can encrypt so that it shatters the keys for that data on a certain date. So there is a pendulum that swings back: technology brings some problems but technology may address them as well.

Michael Specht: A lot of people view Facebook as their own private environment – regardless of the fact that it’s public. If we go back 15–20 years when people started having mobile phones they stood out, whereas now everyone has one and you don’t think about it. The more people who have internet information online, the less relevant it becomes because there is so much of it there.

You’ve still got to be careful. You’ve got a workplace issue where suddenly employees have to participate in social media as part of their job, so they

have to put information up there. Where does that cross the line? It’s extending the boundary of what is a workplace. There are so many different issues to be aware of, especially agency recruiters bound by national privacy principles.

There’s not enough recognition about the ramifications by employers and users of social media.

Employers should be spending more time making sure their employees understand what’s going on. If these conversations are public we need to educate people on the best way to act.

When I advise companies, I always ask, as part of your induction process, do you have information on social media? You want to do it as a duty of care, but also to protect your own brand.

“It is our generational concern but I think we’re starting to realise what we put online is not in pencil, it’s in ink” Meaghan Kemeny

Carey Eaton: Over the last 10–15 years privacy issues have grown and are likely to keep growing. A great example is email: a lot of people will remember the first day society realised the implications of the forward button. People learned that what you put in email can go everywhere very quickly.

We’re starting to see the implications of good social media practice, and what bad social media practice is. Yes, there are moral, ethical and legal ramifications from this, but it has just started. For example, this idea that individuals have ‘a brand’ is starting to become real. The CEO of Google is quoted as saying that in about 20 years we’ll see a lot more people changing their names. This idea that ‘what goes on the Internet is for now’ is also changing.

I think we’ll also see this concept of privacy being sold as a product or tool, or tools to manage privacy. Even now on Facebook you have to choose what level of privacy you want, as opposed to having some general entitlement to it. HC

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THE FORUM social media & recruitment

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THE FORUM social media & recruitment

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COVER STORY HR summit 2011

Time to shine HR has emerged from the economic downturn firing on all cylinders. Iain Hopkins interviews four top HR professionals about their greatest challenges, their strategies, and why HR will shine in 2011

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COVER STORY HR summit 2011

Jasmine Stringer

national HR manager, general counsel & company secretary Organisation: Mazda Australia Industry: Auto manufacturer Biggest HR issue in 2011: Firstly, providing upstream opportunities for people. You bring in talented, excited, engaged people and you keep them engaged, but pretty soon they want to be pushed, they want the next opportunity, and they want to progress because they love being here. In a small, flat company it’s quite hard to have opportunities for people at the right time in their careers. We do our best with cross-functional projects, secondments, etc, but largely people have to manage projects within their existing workloads because we’re too small to have designated project teams and have people step out of their old roles.

The other challenge is KPIs. I’m very proud of what we’ve achieved, it really is a great place to be, all the signs are positive, but I currently don’t measure any of it. So it’s deciding what HR KPIs will help me show the business – especially to our parent company in Japan – that we’re doing a good job.

HRSUMMIT2011 SEE JASMINE STRINGER TALK ABOUT THE LINK BETWEEN TALENT AND CORPORATE VALUES AT THE HR SUMMIT SYDNEY, 6–7 APRIL

“I

’ve got friends in HR and every now and then their organisations will re-do their corporate values. I think, how do you re-do your corporate values?” says Jasmine Stringer, national HR manager, general counsel & company secretary, Mazda Australia.

It’s a valid point. Too often corporate values and mission statements are bland vanilla efforts, with little or nothing concrete to back up ‘words on a page’. It’s something Stringer was keen not to replicate when the company ‘codified’ its values recently as part of a global initiative known as ‘One Mazda’. “It was an interesting process to go through, to actually codify the values, but it wasn’t necessary in order for staff to understand what they are,” she says. “Mazda Australia already had these values.

When you codify something that already exists, then it sits well with people. When you have a third www.hcamag.com

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COVER STORY HR summit 2011

“If the company meets or exceeds its KPIs everybody gets a bonus – it might be two weeks’ extra salary or four weeks, depending on how well we’ve done. No matter who you are or what you’ve contributed, or even what level, everybody gets the same. I think that sends a strong message that we generally believe that every person has the ability to contribute equally to the business” – Jasmine Stringer

party come in or a committee put together to develop what your ethics or standards or values are going to be, and they come up with catchphrases using alliteration or rhymes, that’s when it starts to sound false,” she says.

The company utilises the seven guiding principles of ‘The Mazda Way’, which summarises the perspectives that are vital for every Mazda employee to bring to work every day, including integrity, continuous improvement (kaizen), selfinitiative, and collaborative learning (tomoiku).

Significantly, when Stringer surveyed employees prior to the codifying exercise, most people pointed to the same key characteristics, even if they had slightly different ways of describing it based on their perspective.

She says one principle in particular stands out: challenger spirit. This boils down to robust debate, challenging the status quo, challenging one’s own views, and challenging decisions that are yet to be made. “At the end of the day a decision will be made – we’re not a democracy and we don’t make decisions by committee,” says Stringer.

“But once a decision is made and you’ve had the opportunity to provide input, then you’re expected to get behind that decision as if it was your own.

Everybody understands that’s the case and it’s encouraged in every meeting, in every interaction.”

Stringer believes the key is the ‘One Mazda’ concept. “You can’t just say ‘One Mazda’ and that’s enough. It actually has to be the case. I know there are many other companies that use a similar phrase – Ford has just started using it – but unless you behave as if you are one then it falls on deaf ears,” she says.

So how does ‘One Mazda’ move from being mere words to actions and behaviours? More than a feel-good ‘team’ catchcry, Stringer says the phrase sums up the ability for everyone’s activities in the organisation to affect the whole business. There are several ways in which this manifests itself.

Firstly, when KPIs and goals are set for individual staff and individual departments, they all stem from five or six corporate KPIs. “You know wherever you are in the business what your job is doing to contribute to one of those five KPIs,” says Stringer. Secondly, the company bonus structure is

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COVER STORY HR summit 2011

based on company-wide performance, rather than individual, department or regional performance. As Stringer says, this is quite unusual in sales companies, where common practice is to incentivise individuals based on their numbers or distribution area. “To me that’s the very opposite of being ‘One Mazda’ because you’re getting people who you want to work in a team environment and pitting them against each other.

We don’t do that. If the company meets or exceeds its KPIs everybody gets a bonus – it might be two weeks’ extra salary or four weeks, depending on how well we’ve done. No matter who you are or what you’ve contributed, or even what level, everybody gets the same. I think that sends a strong message that we generally believe that every person has the ability to contribute equally to the business.”

Not surprisingly, Mazda recruits for culture fit and trains for skills. All recruitment is handled inhouse, for the simple reason that Stringer “can’t think of anything better to do with my time than making sure I’ve got the right humans in the right place”. She is not an advocate of outsourcing this element of HR. Mazda uses a cross-functional recruitment panel,

which will typically include someone in the business who will have no interaction whatsoever with the role, someone from the actual department, someone from a department that will deal with that role, and a HR representative.

“We assume the skills are there, or the assumption to learn the skills is there. The questions we ask are what are you passionate about? I love asking that.

I want to see the ability to feel passion. I don’t care what the passion is about, but the fact that passion can be spontaneously demonstrated to me.”

Another question to candidates – do you feel you are lucky? – also receives mixed responses. Some, of course, believe that you make your own luck. Others will relate a personal or a work-related story that demonstrates their belief that they are lucky. “Even that’s an interesting differential,” says Stringer.

“These questions are not planned, and there is no right answer. I’ve got a couple of favourite questions because I like to see the reactions, but there’s no science behind them. They are designed to give you some more information to confirm a gut feel whether that person is the right fit or not.”

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COVER STORY HR summit 2011

Tim Sprague

director, human resources, Macquarie University Organisation: Macquarie University Industry: Tertiary education

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Biggest HR issue in 2011: The ageing workforce is a huge issue in the higher education sector. In the 1970s we had an influx of staff and this continued to a lesser extent in the 1980s. The problem is that this has been accompanied by a steady decline in government funding. Further complicating the issue, those who are most likely to retire are often our professoriate who are our best performers and have traditionally mentored the staff coming up behind them. There is a heavy war for talent in the sector and we are fighting on three fronts – the acquisition, retention and development of staff.

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COVER STORY HR summit 2011

O

ne frequently heard criticism of HR is that it too often ‘does its own thing’ and fails to tie its strategies to organisational strategies.

Tim Sprague, director, human resources, Macquarie University, agrees and adds that HR departments are often advocates for the latest best-practice tool or organisational design. For him there is no one best practice. “The best practice for your organisation is the one that works,” he says. “You can be caught out on this on at least two levels: either not getting the strategy right; or not getting the organisation right.”

Sprague provides one example of this misfit.

When he joined Macquarie the organisation only had a very rudimentary performance management system in place, together with a low level of compliance and an even lower level of staff buyin. Macquarie went through a fairly standard consultation, design and training program for a new performance management system but ended up back on the drawing board with a more modest system, when it became apparent that the organisation wasn’t ready for ‘best practice’.

On a wider front, Sprague believes “HR isn’t just a passive recipient of strategy. Strategy setting is an iterative and collaborative process. We contribute to strategy and then we implement projects in line with the strategy and then the outcome of these projects becomes the platform for us to achieve our next goals. One of the ways we’ve increased our contribution is through the provision of data. Our first climate survey six years ago showed very few staff knew our vision – to be one of the Top 8 research

universities in the country – or our strategies to get there.”

As an example of this strategic contribution, the data supplied by HR spawned a communication strategy, whereby the Vice Chancellor undertook a series of large town hall meetings and road shows for each faculty. When staff were re-surveyed two years later, the result was a 30-point increase in understanding the organisational direction.

“In my first few years at Macquarie my key focus was on lifting the performance of the organisation as a whole,” says Sprague. “The priority was to get the right structures in place, including establishing a new leadership team and the support teams that would realise their vision. Integral to this process was providing managers with the skills and tools to lead while streamlining cumbersome industrial conditions.”

It was while pushing this very full change agenda across the university that Sprague realised HR as a function was falling behind in the provision of service. The HR team commenced an extensive review of its own area; part of that process involved drawing on outside knowledge. “We brought in PricewaterhouseCoopers to review the full suite of HR processes and structures. There are points in time where you need an external perspective and to hear the feedback,” Sprague explains.

As a result of the external review, a comprehensive ‘HR renewal’ program was launched at the start of 2010.

The basic objective was to improve the level of service and advice to clients and streamline HR processes to improve the experience that managers, staff and

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COVER STORY HR summit 2011

“In HR we have shifted the emphasis from just pushing paper to focusing our skills on supporting decision making and change in the university. There are positive environmental outcomes as well. We plan to be truly paperless within five years with all processes on line and all files digitised” – Tim Sprague

applicants had when dealing with HR. “The ultimate aim is to release our academic and administrative staff from onerous administrative tasks – such as filling out endless forms – so they can get on with their real jobs,” Sprague explains.

“Likewise in HR we have shifted the emphasis from just pushing paper to focusing our skills on supporting decision making and change in the university. There are positive environmental outcomes as well. We plan to be truly paperless within five years with all processes on line and all files digitised.”

The HR renewal is an all-encompassing two-year program. Sprague explains that there are “no sacred cows” and already there have been changes to the management structure, implementation of automated systems to reduce work, swathes cut through paperwork and arcane processes, and cross-training and refocusing of HR staff on the customer rather than the process. Even the offices have been remodelled to provide a better environment for HR staff and staff who come to the department with problems or issues.

“Of course the hardest change to make is always to cultures, not systems,” he adds. “So each change project is led by an improvement team which includes

HRSUMMIT2011 28

HR staff, who have now been trained in process mapping and process improvement. In addition, the process improvement teams include staff from client areas. This allows us to include a customer perspective from the design stage all the way through to implementation. This also means that process improvement won’t be a one-off. Now our clients have the expectation that we will continue to run these sessions and implement service-oriented processes.”

The payoffs at the end of the first year have been dramatic, and Sprague notes there has been a huge change in the perception of HR from staff across the organisation. “While the improvements in efficiency are gratifying, the greatest rewards are the improved interactions,” he says.

“We now have a praise session in our HR staff meetings where we read out the positive feedback staff in HR have received from across the university.

Most importantly we are invited into projects, even those which would not normally be conceived as HRrelated, because we are seen to add value in areas of organisational design, staff communications, change management and process design – as well as the traditional areas of staff development and IR.”

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Relationships Australia

Maximus International

Relationships Australia is a not-for-profit organisation and leading provider of professional services for relationship support and training – including counselling and relationship skills training for individuals, couples and families. For 60 years, the organisation has been helping people develop and maintain better relationships.

In the past 5 years, Relationships Australia have provided a range of services to workplaces including Employee Assistance programs, workplace mediations, training in relationship building and negotiating and management coaching.

Maximus International is a niche organisational development consultancy that offers commercially savvy, unique solutions to maximise people and organisational potential.

We create a measurable and immediate impact to your business and bottom line, and our commercially focused approach to transformation is encapsulated in our philosophy: Better Results. Faster.

Maximus seeks to discover where a business is losing value in its people. This knowledge, combined with our commercial aptitude and backed by robust research, ensures a flawless delivery of innovative and customised solutions.

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COVER STORY HR summit 2011

Ed Cooley

HR business partner, personal insurance Organisation: Suncorp Industry: Insurance/finance

Thilo Pulch, www.pulchphotography.com

Biggest HR issue in 2011: We’ve got one internal issue and one external issue. Internally we’re one year into a significant organisational restructure. At the end of Year One, we’ve done all the hard things around new structures, reporting lines, new roles and responsibilities, and so on.

Year Two is where we need to refocus on culture and building a new mindset amongst our people that is very customer-focused and also aligned around being ‘one company’ with many great brands. That culture transformation will be our biggest internal challenge next year.

Externally, and linked to that, is employment branding. Many of our brands have had compelling employee propositions in the market, and there’s a great opportunity to strengthen those propositions. Powering up our employment brands and accelerating the flow of quality candidates into the company will be a big focus for us in 2011.

HRSUMMIT2011 ED COOLEY, ALONGSIDE CEO MARK MILLINER, WILL BE PROVIDING INSIGHTS FROM THE C-SUITE ON HOW HR IMPACTS ON BUSINESS STRATEGY AT HR SUMMIT SYDNEY, 6–7 APRIL

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Power2Motivate is Australia’s leading solution for employee reward & recognition, benefits and incentive programs. Top companies around the globe have discovered how easy it is to launch highly effective and motivating programs for their employees, channel partners and customers with P2M. Our breakthrough On-Demand technology, based on a unique “Software as a Service” design, delivers one universal solution with infinite flexibility to drive results. For ease of use, unsurpassed technical leadership and value, and a simple pricing structure, nothing is more powerful than P2M.

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COVER STORY HR summit 2011

F

or several years, culminating around 2003, the great debate among HR professionals was how to get a position on the executive table.

This debate has, for the most part, come to an end; it’s now common practice to see HR professionals standing shoulder-to-shoulder with CFOs and heads of marketing or operations.

Yet there are still lingering reminders of that past struggle to be seen as an equal. For example, in recent years the term ‘business partner’ has been appended to many HR job titles. It’s this concept of ‘partner’ that Ed Cooley, HR leader for personal insurance with Suncorp, has some issues with.

“I think it’s time we started getting beyond this paradigm of being seen as a partner,” he says.

“That suggests we’re not part of the core. The term partner suggests you’re added on; you’re not integral to it. I think the challenge for HR as a discipline is to start thinking of ourselves as business leaders who have accountability for the people dimension of business performance.”

As the term ‘business leader’ suggests, the implication is that HR should have in-depth knowledge of all aspects of the business, and also acutely understand their own contribution to the business. Cooley suggests that HR should be having conversations about the financials with as much authority as the finance department. “We need to understand the cost benefits of our initiatives, to understand the value drivers of everything we’re doing.

We also need to be able to present our programs in commercial and financial terms,” he says.

Are upcoming HR professionals up to that task?

HRSUMMIT2011 30

Cooley believes they are. “They are more sophisticated and more financially literate than they were even five years ago,” he says. “I think the challenge for the profession is to make the connection between financial literacy and our HR practices, drawing out the value contribution that we make.”

Two separate but interwoven elements will be essential to HR being viewed as business leaders: the ability to tie HR strategy to corporate strategy; and the relationship the HR professional has with the CEO and other executives in the business.

On the first point, Cooley says it’s not difficult to tie the two strategies together – but it depends on your mindset. “We talk about people strategy rather than HR strategy – a subtle difference – but the people strategy is around linking your people initiatives to the value drivers of the business strategy. The HR strategy is the functional plan to deliver the people strategy to the business. Is it hard to achieve? If you have a commercial mindset and you have a deep understanding of the value drivers of your business strategy, then it’s not that hard,” he says.

However, there are mitigating circumstances: success also depends on the sophistication of the executive team. “Where I operate, the business plan is quite explicit about a number of the people drivers that need to be addressed, but there’s also a lot of implicit assumptions about some of the other strategic initiatives – for example, about capability, leadership, and the employment proposition,” Cooley says.

“The skill for an HR leader is to identify the value elements of those implicit parts of the business plan and make them explicit.”

“We need to understand the cost benefits of our initiatives, to understand the value drivers of everything we’re doing. We also need to be able to present our programs in commercial and financial terms” – Ed Cooley

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CPP Asia Pacific is the distributor and certification provider of the MyersBriggs Type Indicator® (MBTI®) instrument, the world’s best-known and most trusted personality assessment tool.

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COVER STORY HR summit 2011

Not surprisingly, a key to this is being able to demonstrate performance results through appropriate qualitative and quantitative metrics. Cooley believes these results must work across several levels. “CEOs and other executives want to hear the core metrics around financials – FTEs, labour costs, absenteeism – all the traditional stuff. Increasingly they then want to look at ratios, whether they’re productivity ratios or cost-based ratios. For example, labour cost per customer or labour cost per policy. The other layer is around the softer intangible elements like employee engagement, the impact of the EVP, and so on. What we find important is the ability to identify leading indicators of those engagement drivers. For example, we report on employee recognition as we see a direct correlation between higher levels of recognition and higher levels of engagement,” he says.

On the second point – the relationship with the CEO – Cooley says it’s crucial that HR is “able to talk their language, talk to them as a business leader and understand what their key drivers and objectives are”.

He adds that it’s essential to have a sound conceptual framework for the HR work undertaken and it must be presented in a commercial, business manner.

“As an HR professional you’ve got to base what you’re recommending in sound concepts and sound theory, but most of the CEOs I’ve worked with aren’t too interested in the theory. They want to know what the practical things they need to do are. You need to be able to provide the confidence that what’s being presented will help them achieve the commercial goals of the business,” he says.

Secondly, Cooley suggests that HR must have an opinion when sitting on the executive table, regardless

of whether it’s a financial, operational or marketing issue. “We should have an opinion and we should have the courage to express it and certainly then be able to link that to the people impact of whatever is being discussed,” he says.

Cooley, who has worked with his CEO Mark Milliner for 12 months, says trust is perhaps the most important element of that relationship. He built trust with his CEO by delivering and having an opinion on the things that mattered, and by having the courage to challenge when he thought there was a different or better way of doing things.

“The key is trust. Without both the CEO and the HR professional being able to say everything that needs to be said, you can’t perform the role that you need to at the top table,” he says. But Cooley concedes he had a touch of good fortune too.

“In the first couple of months I was in the role, I was able to jump in, roll up my sleeves and fix things [for Mark.] I think that’s a key consideration when working with a new CEO – take away the distractions that they don’t need to get involved in,” he concludes.

“As an HR professional you’ve got to base what you’re recommending in sound concepts and sound theory, but most of the CEOs I’ve worked with aren’t too interested in the theory. They want to know what the practical things they need to do are ” – Ed Cooley

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API Leisure & Lifestyle

Operitel

API Leisure & Lifestyle is the leading provider of employee benefits programs with over 90 years experience in implementing sophisticated and successful systems Australia-wide. API’s programs provide an extensive range of over 1500 lifestyle and financial benefits designed to enhance the employment value proposition and assist with the retention of quality employees.

Operitel Australia is an eLearning solutions company that provides an Enterprise Learning Management System LearnFlex, Custom Content Development and Rapid Authoring tools. We partner with companies to deliver best of breed eLearning solutions to support their learning and development needs. Operitel Australia is a joint venture between B Online Learning and Operitel Corporation.

Contact: Kylie Green, business development manager

Contact: Sue Fell, business development manager

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COVER STORY HR summit 2011

Amy Stanley

human resources director Organisation: Coca-Cola South Pacific Industry: Beverages

Thilo Pulch, www.pulchphotography.com

Biggest HR issue in 2011: The biggest challenge we face in 2011 is embedding the new HR structure we’ve just rolled out globally. We need to work with our managers to get them used to receiving their HR support virtually. We also need to work with them to be more proactive and selfsufficient in managing their people. A lot of HR processes are now online and managers need to complete these themselves rather than having HR do it for them.

Another challenge will be continuing to ensure we are recognised as a great place to work. One of the key things we’re looking at to ensure we do this is by providing more flexible work arrangements for employees.

We’ve done a lot around this already but recognise this is a key issue to continue to improve on.

From a global perspective, diversity and women’s leadership will be a key focus in 2011.

HRSUMMIT2011 SEE AMY STANLEY TALK ABOUT BUILDING A GREAT PLACE TO WORK AND LEVERAGING AN EFFECTIVE EVP AT HR SUMMIT SYDNEY, 6–7 APRIL

HRSUMMIT2011 32

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Charles Sturt University

Frontier Software

Charles Sturt University (CSU) is a national university for excellence in education for the professions, strategic and applied research and flexible delivery of learning. CSU offers several courses via distance education and has a proven track record as a distance provider. Our AHRI-accredited Master of Human Research Management and MBA are highly regarded in the public and private sectors.

Founded in Melbourne, Australia in 1983, Frontier Software is a global leader in human resource, talent management and payroll solutions. Their flagship solution chris21 sets the benchmark in functionality and useability. With support offices in every Australian capital city and key global locations, Frontier Software is well placed to service their 1600 clients.

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Contact: Maria Farrell, course manager

Contact: Nick Southcombe, general manager

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COVER STORY HR summit 2011

I

n an age of dotcom upstarts, Coca-Cola remains one of the most recognised brands worldwide.

Walk into any small town or settlement anywhere in the world and there’s a good chance the familiar Coca-Cola logo will be seen. With a massive team of strong marketers and significant marketing budgets, is it any surprise that Coca-Cola is leading the pack in terms of employer branding, in particular leveraging an effective employee value proposition (EVP)?

Recently recognised as one of the top 20 ‘Great Places to Work’ by The Great Place to Work Institute, Amy Stanley, human resources director, CocaCola South Pacific, has recently been assessing the benefits of such an accolade. She will also be speaking at the HR Summit Sydney about how to best utilise a well-known brand by emphasising the EVP. “There is undeniably a great deal that can be gained from being recognised as an employer of choice and a great place to work,” she says.

“It’s certainly easier to attract external candidates for roles when you have this reputation – the best people in their fields are keen to come and work for you. It also means that current employees can feel proud of the company they work for – and this in turn leads to greater commitment.”

However, Stanley adds that even a company like Coca-Cola cannot afford to rest on its laurels. “You have to continue to ensure you live up to and deliver on your EVP every day,” she says.

While many companies possibly never really ‘got’ the importance of the EVP – essentially the essence of why people want to work for you – the situation has been further muddied by the GFC.

Since that turmoil, many organisations have been confused about their EVP, especially since circumstances (and their employee offerings) may have altered.

Stanley says Coca-Cola remains very clear on its EVP. “The tag line we use in our EVP is ‘potential unleashed’. This describes the partnership that exists between employees and Coca-Cola South Pacific. If employees bring their passion and energy to work then we will help them unleash their potential and take their careers where they want them to go. Being a large global company means that people also have the opportunity to take their career overseas, for either short or long periods. We also work hard to ensure that our benefits are market-leading.”

Coca-Cola employees have good reason to be positive. They benefit from a wide range of programs and workplace initiatives that encourage flexible working hours, enhance collaboration and deliver on work-life balance. CCSP’s turnover rate is low at 5.2% over the past 12 months, and management credits the strong employer brand, open communication and career development as cornerstones in retaining the best people.

Stanley adds that this market-leading reputation has not occurred by accident. Extensive market research is extremely important before developing any type of EVP. The Coca-Cola team spent time upfront speaking to prospective candidates, recruitment agencies, new employees, employees who had been with the company for a long time and employees who had left the company as well. “You need to understand all of this before you can build

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Healthcorp

Asperity

Healthcorp is a leading Occupational Health & Safety organisation, providing an extensive range of integrated health, safety and training solutions. With offices in every Australian capital city, Healthcorp is one of few registered training organisations able to provide fully accredited First Aid and Safety Training in addition to Health and Wellbeing Services nation-wide.

Asperity is an international leading provider of employee discounts that deliver exceptional, measurable engagement to over 400 employers and over 1 million employees. Founded in 2006 as a partnership between an online technology firm specialising in customer loyalty and a communications agency, we’ve become leaders by leveraging our expertise in these areas.

Contact: Wendy Clarke, training development manager

Contact: Chris Barton, national manager

P: 02 8244 3754 E: wendy.clarke@healthcorp.com.au W: www.healthcorp.com.au

P: 02 92480127 E: chris.barton@asperity.com.au W: www.asperity.com.au

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COVER STORY HR summit 2011

“It’s certainly easier to attract external candidates for roles when you have this reputation – the best people in their fields are keen to come and work for you. It also means that current employees can feel proud of the company they work for – and this in turn leads to greater commitment.”

– Amy Stanley

a strong EVP,” she says.

Once established, Stanley and her team concentrated on marketing the EVP both internally and externally. A booklet was produced for internal use, which went into detail about the benefits on offer, and how these contributed to Coca-Cola South Pacific being a great place to work. They also asked employees to spend time determining how they could ‘unleash their potential’ and what support they needed from their managers to do this.

The team also developed a set of images that align to the key pillars of the HR strategy.

“We ensure these images are used whenever we communicate about people initiatives,” Stanley explains. “These images are also placed around the office. At every opportunity we talk to employees about ‘unleashing their potential’.”

A second booklet is used externally, which includes the same information but offered at a different level of detail. Stanley ensures that the company’s panel of recruitment agencies have a copy of this booklet to give to prospective candidates.

While ‘official’ branding material is easy to control, in the Web 3.0 age, the white noise feedback

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Sage MicrOpay

Alsco – Managed First Aid Services

Sage MicrOpay is a leading supplier of people and payroll management software and services. For over 25 years, Sage MicrOpay has provided solutions for thousands of Australian organisations of all sizes in various industries. Our systems are fully featured, easy to learn and use while providing flexible HR and payroll management.

Our Managed First Aid Training Services offer a complete solution including: 1. Workplace first aid risk assessment 2. First Aid Plan 3. First class training experience 4. On-going support with 24/7 access to our secure online database 5. Email alerts when refresher training is due and reminders of scheduled training

Contact: Marketing department P: 1300 729 229 E: marketing@micropay.com.au W: www.sagemicropay.com.au

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about a brand – some positive, some negative – becomes almost impossible to control. Stanley concedes that the likes of Twitter and Facebook mean that everyone can read and hear about a company instantly.

“It’s not possible to ‘control’ your brand or what people say about it, but HR should ensure that what a company portrays their employee value proposition and brand as is matched by reality,” she says. “This is important from a potential candidate’s very first interaction with you until the moment they leave your organisation.” However, she adds that HR should not bury its head in the sand and ignore the technology of the Web 3.0 age.

“These technologies should be used to proactively talk to people about your company.

They should also be used wherever possible to get meaningful insights into what people are looking for in a company. The challenge is how to get these insights. Coca-Cola has embraced the use of Facebook and Twitter to talk to our consumers.

One of our focuses for 2011 is how we use these technologies in the same way to talk to potential employees,” she concludes. HC

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Contact: Michael Hutcheson, First Aid Training Manager P: 1300 651 706 E: michaelh@cleanroom.com.au W: www.alscofirstaid.com.au

COVER STORY HR summit 2011

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LEADERSHIP INSIGHT Joseph Grenny

I don’t know how to tell you this but...

Difficult conversations have been ranked with public speaking as something people are loathe to have – but why is this? From performance conversations to those of a more personal nature, it seems to be human nature to skirt around the topic, procrastinate or sugar-coat the issue at hand. Yet we underestimate the impact of not holding these conversations at our peril

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LEADERSHIP INSIGHT Joseph Grenny

T

o take one of 2010’s biggest corporate scandals as an example, if someone had sat down with the CEO of David Jones and talked to him about his inappropriate behaviour early in his career, would the eventual fallout, both emotional and financial, have been different? Human Capital talks to Joseph Grenny, the New York Times’ bestselling author of Influencer and Crucial Conversations, about how to handle those conversations better.

Human Capital: Why do most humans hate having ‘difficult’ conversations?

Joseph Grenny: We lack confidence in having these conversations largely because we lack competence.

We don’t have an explicit skillset or strategies that we can continuously retrieve in those moments, so that undermines our confidence.

HC: In the workplace, do you think these conversations are so tied up with annual performance reviews that we are loathe to do it more regularly?

JG: To a degree, HR’s primary focus on performance management is the annual review cycle, and HR is part of the problem. There is so much attention given to those ritualistic exchanges because we really haven’t done the job in clearing the decks all year long. The performance review is a distraction. The real work in HR comes in creating a culture where people have crucial conversations immediately and directly with the person they need to address. If HR is doing their job they never again have to remind or harangue people about the performance review because that really is just closure – it’s not candour.

HC: What would be your top tip for having a genuine crucial conversation?

JG: One of the most remarkable findings in our observational research is that if people use one principle well, it’s the principle of safety. When observing people who are skilled at creating safety having a crucial conversation, it’s remarkable because it’s hard to tell if there’s a power differential or not. Many times, people in HR are intimidated because they’ve got to speak with the CEO or senior-level person, or someone who has more formal authority than they do, and they must deliver news that person may not like. That’s where part of our reluctance comes in. If somebody is more powerful than you, the way you have a crucial conversation is to sugar-coat or understate your concerns.

We believe the message itself might provoke defensiveness and upset some, but it turns out the message is the last part of what creates that feeling. It’s not the message itself; it’s how safe people feel hearing

that content. People are capable of hearing bad news, of letting people disagree with them, provided they feel psychologically safe with you. That’s an interesting concept when you’re talking about someone who has more power than you do – that your job is to make them feel safe, because you’re the one who feels unsafe!

The truth is, most senior leaders in organisations, when they feel that the person addressing them really understands their full agenda, their intent, their concerns, and their larger problems – rather than just advocating from their own parochial interests – they want candour and they are desperate for honesty.

The biggest complaint from senior leaders is no one tells them the truth. When they finally have confidence in somebody telling them the truth, that chosen person tends to gain more respect and will actually be solicited for input.

HC: How important is the introduction to one of these crucial conversations?

JG: We call the first 30 seconds of a crucial conversation the hazardous half-minute. In our research we can predict how a crucial conversation will end with about 97% precision, by watching just those first 30 seconds. We put our microscope on those 30 seconds to try to find out what needs to be accomplished there. Two conditions need to exist when you finish that introduction. The first is the person needs to know you care about their problems and concerns as much as they do – that’s called mutual purpose. The second is they need to know not just that you care about their problems but that you also respect them and care for their wellbeing.

That might sound strange in the workplace because we think it’s not supposed to be personal, but that’s wrong. When you believe someone fundamentally disrespects you, that corrupts the entire conversation. One of the problems in a performance review, for example, is that the manager holds the conversation when they harbour a lot of bad news that they need to share, so they go beyond the bad news in their mind and they start to lose respect for the individual they’re sharing it with.

Those who are good at crucial conversations don’t make that mistake. They find a way to maintain a sense of regard, a sense of civility, and a sense of respect for that individual.

HC: Often we’re fearful of these conversations because we think we’ll upset the person we’re dealing with. How do you remain firm – yet not totally destroy the other person?

JG: What you’re describing is actually a skill. Our automatic reflex when we’re thinking about the need www.hcamag.com

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LEADERSHIP INSIGHT Joseph Grenny

“People are capable of hearing bad news, of letting people disagree with them, provided they feel psychologically safe with you” Joseph Grenny

to hold one of these conversations is to go to the risks and threats. You tend to think about all the bad things that could happen. If that’s the sum total of your risk assessment for having a crucial conversation, you can see why we almost never hold them. We train people to reverse that.

The first question you should ask isn’t ‘what are the risks of holding this conversation?’ but ‘what are the risks of not holding it?’ By forcing yourself to go through a conscious inventory like that, you tend to create a different set of emotions in yourself.

You tend to be conscious, for example, that if you don’t talk to your under-performing peer, your resentment will increase, the relationship will be strained, the projects will continue to be late – and when that’s loaded into your brain it inclines you more towards speaking up.

HC: How about non-verbal communication – do you need to consider that?

JG: Studies show that up to 80% of communication is non-verbal, so you certainly do need to consider it. However, if you manage some of your internal emotions well and in an effective way, using some of the crucial conversation skills, 80% of the nonverbals take care of themselves. If you don’t feel disrespectful towards the other person, and if you truly do care about their interests, you then lose the need for a lot of non-verbal masking that you otherwise would have had to do.

The first thing to do is get your own heart right, get your motives right, get the attitude right for the other person, then 80% of the non-verbals disappear. The other 20% you still need to manage, but it’s less of an acting problem.

HC: Do the same principles apply if you need to have a crucial conversation with a direct report who is older than you are?

JG: It’s a common scenario. When we teach people to hold crucial conversations one of the core principles is authenticity. If you believe in your own mind, ‘boy, I’m giving negative feedback to somebody who has a great deal more experience than I have’, then rather than pretending that issue isn’t there, you should surface that issue, be authentic, be open about it. That person knows you have a formal responsibility to have a review with them. But they also know they are smarter than you are in some ways, even if there wasn’t an age gap. It’s perfectly appropriate to open a crucial conversation by just acknowledging it, being self

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deprecating in a sense. Say, ‘I feel a little intimidated by this, you’ve got a lot more experience in some ways, yet it’s my job to manage the team and I do have a couple of concerns and I want to be able to address those’.

All I’ve done is legitimise the resistance that the person might have, while putting the other element of meaning in the pool too – which is, ‘I’ve got a job to do here, and I hope you’re going to be okay with me doing it’. There’s absolutely nothing wrong with doing that, just be authentic.

HC: You don’t lose respect doing it that way?

JG: If you had respect before it was false respect; and secondly, the false respect you might have gained from the other person never more than compensates for the disrespect you have for yourself, when you’re being disingenuous. People putting up a front and trying to gain false credibility tend to telegraph that in their conversations.

HC: HR is always looking to be more influential and persuasive in business. Do you think these sorts of conversations can potentially help them become more influential?

JG: I’ve worked with over 100 very senior HR people over the years and I’d describe maybe six of them as true business leaders. The other 94 were functional specialists, and they were seen that way and treated that way. They were talked to when someone had a ‘HR issue’ but when there were real enterprise-level problems they were never in the room. For those six, however, no one would ever have a conversation about strategic enterprise level issues without them being in the room. It was interesting to watch this six compared to the others. One of the most important differences was the six were far more willing and able to step up to some of the controversial conversations.

They had more respect in others’ eyes because they were seen as somebody who would raise the tough issues and address them in an effective way, with an enterprise view. This skillset is really at the heart of an HR executive’s influence repertoire.

In their private moments you will hear even the most tyrannical, autocratic CEOs complaining that no one tells them the truth. They are unaware of the fact that they are shutting the truth down, but when those individuals find someone who they believe cares about the enterprise level issues and talks to them directly, they tend to embrace them. There’s lots of room to increase your influence even in that kind of culture. HC

FEATURE sustainability

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PROFILE jill johnston

HR on air In the highly competitive commercial radio industry, employer brand and reputation matters almost as much as the on-air talent. Human Capital talks HR best practice with Austereo’s Jill Johnston

I

f it’s true that the employer brand is inextricably linked to the consumer brand, then Austereo is in a prime position to connect with candidates.

As Australia’s largest commercial radio network, and home of the Today FM and Triple M stations, Austereo could be content to let the consumer brands of its leading stations do the talking. Yet this is far from the case.

Working tirelessly behind the scenes is Austereo’s dedicated HR team, led by head of HR, Jill Johnston. Johnston says that the strong employer branding connects people to the company’s brands – that is, the stations – which in turn connects them to the company’s values, people strategy and HR policies. This level of engagement places the organisation in a strong position when it comes to attracting and retaining the best talent.

“People already have a connection with our stations and they find it desirable to further their relationship with those brands through their work.

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That’s why most people who start work at Austereo are passionate about the brands from the outset, as they already have that connection to a station and our on-air talent,” Johnston says.

The hard work in HR has paid off. In 2010 Austereo was recognised as a ‘Great Place to Work’ via an independent survey by The Great Place to Work Institute. The primary purpose of the annual study is to facilitate the sharing of knowledge and information among all organisations that have a sincere desire to improve the quality of their workplaces. Austereo was benchmarked against 160 top employers in Australia, in the process of receiving the award.

Although it’s been a professional and personal goal of Johnston’s for a few years, she firmly believes that this accolade is recognition that an effective HR team with a focus on adding value to the business can also contribute enormously to creating a great workplace, one where talented people can perform at their very best.

PROFILE jill johnston

PERSONAL FILE

Jill Johnston

Family: Daughter Katie, 14 Favourite sports: Athletics Favourite movie or TV: Bridget Jones’s Diary (the modern Pride and Prejudice)

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Favourite band: The Cure Best advice ever received: If you don’t come out of your comfort zone, you can never grow and be the best you can. Learn to be comfortable with being uncomfortable Self-described: Humble, compassionate, optimistic and dedicated Hobbies: Music, reading, movies, travelling Worst job: Housekeeping If not in HR: A gardener www.hcamag.com

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PROFILE jill johnston

As such, she’s passionate about several key HR issues: employee engagement, best practice management, leadership and the development of people. “We should never stop learning about ourselves and how we can be better at what we do,” she says.

Road to HR at Austereo Hailing from the UK with HR qualifications from the University of Westminster, Johnston says it took some time to settle on the profession she wanted to pursue. “I wanted a career with a blue-chip company but was unsure which profession to follow,” she says.

“I landed a traineeship with GlaxoSmithKline and, after gaining experience in several areas, I decided

In her own words…

What are your thoughts on the future of HR as a profession?

HR professionals must be partners to the business so they consistently deliver to ensure organisations achieve their objectives. We should be constantly ensuring we are adding value in all the right areas so that CEOs, other key stakeholders and employees see how we make a difference and add to the bottom line.

What has been your greatest career challenge and how did you overcome it?

Going from a non-unionised environment to a heavily unionised environment. Everything seemed so difficult as there was onerous consultation and negotiation to go through before anything got done.

The unions had a perception that management was the enemy. I worked very hard to build some really constructive relationships with key union reps to try and understand where they were coming from.

I very quickly learnt to negotiate and started to experience much more give-and-take on both sides. We were able to deliver faster and get some good results, often with a win on both sides. It was about respecting the fact they were there because they wanted the best for their members.

That respect was mutual eventually.

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“We should never stop learning about ourselves and how we can be better at what we do” – Jill Johnston

the HR division was the most rewarding.”

Johnston commenced work in L&D and gained a great deal of satisfaction from contributing to the development of people at all levels. However, after deciding early on that she didn’t want to specialise in any particular aspect of HR, she has concentrated her efforts on developing a career as a generalist ever since. Therefore, after the stint in L&D, she moved into a new role as HR officer.

Prior to moving to Australia, Johnston worked as an HR partner at the BBC, and as an HR manager in commercial television in London. Now firmly entrenched at Austereo, Johnston’s primary objective is to provide direction and management to the Austereo HR team, ensuring activities are focused on key business issues and that an effective operational service is provided.

The HR team provides a service, including recruitment, to a total of 650 employees across five states. The team also delivers the following range of generalist and specialist HR projects to the company. »» Design and implementation of a staff appraisal process and training managers in conducting effective appraisals, giving constructive feedback and advising managers in all matters relating to performance of their staff. »» Implementation of staff surveys and employee engagement initiatives and ensuring continuous improvement in the way Austero leads and manages its people. »» Identification of training and development needs and delivering an overall company training plan that ensures the budget is targeted at those areas, and that development plans are designed to support the company objectives. »» Succession planning and identifying key skills and competencies required to ensure the future growth of the organisation. »» Developing staff recognition schemes. »» Developing leadership and management development programs. »» CSR projects.

Johnston works closely with Austereo’s CEO and senior management team to facilitate organisational change through a simple model, consisting of: design, plan, consult, communicate, implement, support and consolidate. She also provides coaching and advice to managers on best practice across a spectrum of HR issues, including assisting managers and their teams to ensure internal communications are timely, relevant and provide clarity to Austereo employees.

PROFILE jill johnston

A winning culture As one would imagine, working in the radio industry is hard – but also enjoyable. Johnston says the corporate culture can be summed up as “passionate, valuesdriven, collaborative, fun and fiercely competitive”.

Also embedded in the culture is teamwork, which is one of the company values. “We know that if we don’t collaborate, we can’t deliver a great product. We get together within teams and with other teams informally and formally at every opportunity. We totally rely on the sharing of ideas and the collaboration to bring it all together and deliver. Teams gather at the end of every week to celebrate successes,” Johnston says.

When asked which HR initiative she is most proud of in her career, Johnston provides two examples. The first was gaining a ‘Best Employers’ award in the UK when she was HR partner for the World Service Division within the BBC – the first division in the BBC to gain the award.

Second, she says that all the work the HR team has done to get a ‘Great Place to Work’ Award for Austereo is hard to top, and is just reward for the

culture the team has created. “It’s such a thrill when you meet people and find that they want to come and work for Austereo, as they’ve heard it’s got such a great culture,” Johnston says.

Johnston will be working to retain that culture in an era of rapid change. Although she says that emergent change is nothing new, it feels more pressing and more urgent to deal with now than ever before – and this will place unique pressures on the HR function.

“Nowadays, organisations and their stakeholders are demanding increased accountability. There are concerns about sustainability and the environment, and a heightened emphasis on cost-effectiveness, quality improvement and exceptional customer service,” Johnston says.

“These, and many other factors, are putting pressure on companies to be alert, flexible and responsive to continuous change. Our biggest challenge will be responding to these changes while maintaining a great employee value proposition and attracting and retaining talented people,” she concludes. HC

“We know that if we don’t collaborate, we can’t deliver a great product” – Jill Johnston

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REMUNERATION incentive schemes

Counting the benefits There are a number of ways in which your organisation can choose to offer incentives to staff. Michael Derin reports that, before making your decision, you should fully consider the financial, tax and compliance implications of the scheme

To be truly successful a staff incentive scheme must tick a few boxes. It must be valued by employees, be effective in driving performance and productivity and reflect the organisation’s goals

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S

taff incentive schemes are a common strategy used to increase loyalty and improve motivation and productivity, while also reducing employee turnover, particularly for key staff members.

Although recognising the benefits of introducing such a scheme, many businesses don’t consider the financial and tax implications involved. They can end up implementing a scheme that costs more than it should – or worse, isn’t compliant with regulations.

To be truly successful a staff incentive scheme must tick a few boxes. It must be valued by employees, be effective in driving performance and productivity and reflect the organisation’s goals. Also, an incentive scheme should safeguard the company’s financial interests and ensure the business is not exposed to unnecessary liability.

Each and every scheme has different taxation and compliance implications. In essence, the Australian Taxation Office (ATO) has ensured that an employer cannot give an incentive to an employee without it being considered as remuneration in some form. However, some incentives are more attractive than others, based on how they are taxed and the associated costs.

For instance, schemes that award extra leave time to employees can have huge tax advantages as

the actual cash outlay to the employer is nil. Equity incentive packages, while complicated, can also be a tax-effective way of incentivising staff.

Fringe benefits tax The main tax associated with staff incentives is fringe benefits tax (FBT) and it represents a cost to the employer. According to the ATO, FBT is a tax paid on certain benefits you provide to your employees, or your employees’ associates.

It is based on the taxable value of the fringe benefits you provide. FBT impacts noncash incentives, such as gifts, company cars, reimbursements, accommodation and salary sacrifice schemes. There are, however, work-related items that are exempt from FBT. These include portable electronic devices such as laptops, computer software and items considered tools of the trade.

It might seem like a good idea to reward your staff with movie vouchers or even to pay their health insurance premiums, but if you don’t factor in your FBT obligations the business could end up paying almost double.

FBT is a major component of salary packaging, which is often used to attract talented senior staff and offset the costs associated with things like relocating, a car and self education. Some items are exempt

REMUNERATION incentive schemes

from FBT, such as relocation, whereas others are not, like self education. For other items such as a car, the business may be able to receive a concession.

A common FBT mistake made by small businesses is they don’t consider the directors as employees. As such they fail to understand that certain benefits provided to them, like paying a home telephone expense, may attract FBT obligations for the company.

Equity incentives Equity incentives like employee share schemes are known to be a good method of facilitating long-term commitment towards the common goal of building the company. Without having to outlay cash upfront, a business can tie in an employee’s performance with the objectives of the organisation, while at the same time being tax-effective and having a positive effect on the business’ bottom line.

These types of arrangements can also play a big part in start-ups and succession planning. This is when the goal is to tie in the interests of senior staff members who are likely to play an integral part in building and sustaining the business, or those employees who are pegged to take over the organisation.

However, they can be complicated and costly to set up and legalise. In many instances the business will need to establish a trust or a special purpose company to administer the scheme and from which to issue shares or rights.

There are a number of different ways to structure an employee share scheme and this will determine the way the shares are taxed for the employee: either upfront, with or without a reduction, tax-deferred through a salary sacrifice agreement, or under ‘real risk of forfeiture’.

Real risk of forfeiture refers to schemes which include certain conditions, such as the employee remaining with the business for a specified time period or the company achieving certain profit or growth targets. There is a real risk the employee may lose or forfeit their shares if these conditions are not met.

For example, Kim works for Professional Services Ltd and is granted rights to acquire shares in the company under an employee share scheme. Under the conditions of the scheme, Kim’s rights to acquire shares will lapse if she stops working for Professional Services Ltd within the next 12 months.

Here are some key things to consider when implementing employee share schemes: 1. Establish provisions covering what happens to a staff member’s shares once they leave the organisation.

2. Ensure the cost of the shares is realistic and at market value.

3. Private companies may need to make provisions to ensure that control of the company remains with the directors. For instance, issuing B Class shares will give employees equity without having a formal voice in the management of the organisation.

4. The employer will also have to consider how the employees will ‘pay’ for their shares. If an employer provides shares to the employee at a discount (below market value) then the employee share scheme tax laws will apply. If shares are not granted at a discount, these laws will not apply. However, the benefits may be taxed in other ways, such as capital gains tax (CGT).

Whichever scheme your organisation chooses to incentivise staff, it is just as important to consider the financial, tax and compliance implications as it is to ensure the scheme will engage your team, in order to drive the business to achieve its objectives. HC

Michael Derin is the managing director of accounting practice Azure Group, which also provides a virtual CFO service for SMEs. For more information visit www.azuregroup.com.au or call 1300 4 AZURE

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TEAMBUILDER lynda harris

What are the main challenges involved when two long-time rivals come together under one roof? Human Capital talks to Lynda Harris about the HR issues arising from Aussie’s acquisition of Wizard Home Loans

Safe as houses F

ew would dispute that the ability to successfully integrate an acquired company is possibly the single most important factor in the success or failure of the acquisition. On 24 December 2008, Aussie announced its acquisition of Wizard Home Loans from GE, and between January and April 2009 the merger of the two companies was implemented.

Lynda Harris, Aussie’s general manager – people, was responsible for negotiating the delicate people issues that accompany any merger or acquisition activity. Bringing a wealth of senior HR experience to the task (including over 12 years spent at Aussie and time at Qantas and Avis), Harris says the biggest challenge was bringing two vastly different – and formerly rival – cultures together.

“The purchase happened very quickly and the fact that Aussie was the acquirer came as a complete surprise to the Wizard network,” she says. “There was a high level of loyalty to the Wizard brand at the time, and given that both organisations had competed directly against each other for years, the

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result was, not surprisingly, a period of distrust and uncertainty.” Given the uncertainty and the time constraints involved, Harris and her team had their work cut out for them.

First steps Pre-M&A due diligence is standard practice to ensure systems, processes and other crucial elements are analysed, considered and/or discarded, but Harris says the due diligence time frame in this instance was also extremely short as it had to be completed in a matter of weeks, with the sale announced immediately after. “The plan for integration was therefore decided and implemented postannouncement, and with only a four-month period to complete, decisions had to be made as we went,” says Harris, adding that rapid turnaround was only possible due to the way Aussie does business.

“We can make decisions quickly and we are experienced in implementing large, companywide projects by galvanising the entire team into the planning and implementation phases. In this

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TEAMBUILDER lynda harris

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TEAMBUILDER lynda harris

“A key issue was to put a face to the company and not be considered an aggressive, faceless corporate acquirer”

– Lynda Harris

case it meant the team worked long hours – but the excitement and challenge generated within the Aussie team led to a hugely successful outcome.”

The first key decision that needed to be made was branding. Anyone who has seen executive chairman ‘Aussie John’ Symond on television would know that Aussie has a very strong brand, while the Wizard brand (established by Mark Bouris) also had its own presence. Half the team was loyal to the yellow and purple branding of Aussie, while the other half was loyal to the Wizard orange. “We decided to focus on one brand, Aussie, to gain greater synergies from a branding point of view and minimise customer confusion,” Harris explains.

“The process of re-badging every store under Aussie and having John Symond officially open every newly-badged store was an important statement to the new franchisees.”

Best of both parties The second step was to review both businesses, determine strengths and areas of improvement for each, and then combine the strengths. For example, Aussie had a strong customer interface system while Wizard’s strength lay in its customer contact program. “In response to our system review, we are introducing a new end-to-end sales system which will meet all our sales needs, and every member of our team will have the same understanding and experience with that system,” Harris explains.

Harris, who has worked as a university tutor and in corporate L&D, knew that training would have to be provided to the ex-Wizard network to ensure a smooth transition, consistently bringing people up to speed. Within weeks of the announcement, Aussie provided training to all its 220 loan writers on the role of a mortgage broker, and how business is handled at Aussie. All participants were externally accredited at Certificate IV (Financial Services) and went back to their stores with strong knowledge and skills in Aussie’s systems and processes.

Finally, a review of the Aussie and Wizard sales processes was conducted which identified best practice from both. This has been combined to form the new Aussie Sales Process, and the entire team has been trained in the new model to ensure a consistent customer experience is delivered. Indeed, the sales team required special attention. Harris says it was always of paramount importance that the new-look company’s sales team had one focus and one consistent customer proposition, to avoid any ongoing ‘us and them’ mentality.

The Wizard team was provided with as much information as possible about Aussie’s new direction, as well as the benefits the company could offer them. “A key issue was to put a face to the company

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and not be considered an aggressive, faceless corporate acquirer,” says Harris. “We tackled that from a number of fronts. We met with each Wizard franchisee quickly and then regularly through a combination of formal presentations, informal chats and one-on-one meetings.”

Structured communications channels were set up via weekly email updates, including frequentlyasked questions, and comprehensive training was provided on Aussie’s customer proposition, systems and processes. Aussie then moved to integrate the two sales teams into one, by holding state-wide sales meetings and regional meetings. These were combined with informal gatherings to facilitate the sharing of best practice ideas and initiatives across the broader sales team – new and old.

After four months, a sales conference was held with a theme of building one team. Through the formal and informal conference interactions, Harris says relationships between the Aussie and ex-Wizard teams began to take shape. “This was also a great opportunity for executive management and the senior Aussie team to communicate our strategic direction and demonstrate our core values of accessibility and openness,” she says. “The fact that John Symond, our executive chairman, Stephen Porges, our CEO, and James Symond, our executive director – sales, participated in every event, positioning themselves as part of the team, was seen by the ex-Wizard staff as a significant illustration of our culture and what we stand for. This was extremely important to show the level of engagement and passion at all levels in our business.”

Transparent communication was crucial. Mid-way through the integration process Aussie asked all team members to complete a comprehensive engagement survey, and 83% of the retail channel (made up largely of ex-Wizard franchisees) responded. Aussie then followed up with feedback sessions in every state and region: specific feedback was sought on how Aussie could manage the business better. Results were communicated and action plans were then published, to ensure there was follow-through on promises. “This process clearly demonstrated that we were listening, and as a business we gained a number of valuable insights into how we could improve the way we operate and communicate with our team,” Harris says.

Numerous other incentives were implemented to reinforce the message of ‘one team’. This included rewarding and recognising the service of the Wizard franchisees when there was no obligation to do so, and establishing a Chairman’s Club, comprised of both Aussie and ex-Wizard members, which gave access to John Symond and a series of special events. Publication of a leader board of salespeople across the business further reinforced the ‘one team’

TEAMBUILDER lynda harris

“The plan for integration was therefore decided and implemented post-announcement, and with only a four-month period to complete, decisions had to be made as we went ” – Lynda Harris

mentality. “The theme was always that we now have one sales team, and how they had come to join Aussie was irrelevant,” Harris says.

Tying it all together was “visible and accessible” leadership from the executive management level down. “We recognised very quickly that it was not just what we said, but how we behaved, which was ommunicating the message, and we continually reviewed what we were doing to ensure compliance with true leadership and our values.”

Work in progress Almost 12 months on, the new company has 170 staff and 800 brokers located around Australia. Harris believes the acquisition process has been successful, and she now feels that the vast majority of Aussie’s retail channel (the majority of which are ex-Wizard stores) are positive advocates of the Aussie business. The increased volumes of home loan and consumer products sales are also strong statements on the success of the integration.

However, she adds that it would be naive to argue that the company has succeeded 100% in building one team and one culture, acknowledging that there are areas which are still a work in progress. “This is not surprising and was anticipated in our planning,” she says. “We’ve just launched a revised ‘Vision and Values’

as our final step in achieving alignment and consistent focus across our business. Importantly, we’ve taken the previous ‘Vision and Values’ and elevated them to the next level with the help of our combined team. While this has been positioned as ‘evolution’ not ‘revolution’, we saw it as critical to have a vision for the new combined business.”

In addition to the ongoing process of bedding-down the new-look culture, Harris has several goals for 2011 and beyond to lift the business in several key areas, including team member engagement, customer service, volume of business settled and number of products per customer. “Our team isn’t satisfied by only achieving budget, and as a business we need to ensure our sales team has the tools, systems and support to keep lifting the bar,” she says. “This means more products, more skill development, better systems and a team that is committed to achieving higher and higher goals. On top of all that, we need to continue our focus on one team and one culture.” HC Interested in hearing more about insights into change management during acquisition integration? Hear Lynda Harris talk at the 9th annual HR Summit Sydney, 6–7 April 2011

HRSUMMIT2011

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IN BRIEF australian news

Social media cases provide guidance, not certainty

A rising tide of social media legal cases has provided guidance but not certainty for both workers and employers, according to a legal expert.

Lisa Berton, a partner in Kemp Strang’s employment law practice, said while several recent cases have dealt with social media in the workplace, the definition of acceptable conduct is still blurred.

Berton cited two recent cases to illustrate the grey areas. In the first, a worker posted a blog on her MySpace page criticising her employer, and then refused to remove it. The court found that the dismissal was not unreasonable as the blog was an attack on management, bringing the organisation into disrepute.

In the second case, a worker was compensated for being unfairly dismissed after posting insulting comments about her employer on Facebook. It was found that the post hadn’t damaged the business, so fell short of being a valid ground for dismissal.

“There isn’t going to be one blanket decision that covers all the issues,” Berton said.

Employers urged to review employment contracts

Employers have been urged to update their employment contracts, particularly provisions applied to confidential information and restraints of trade, which may be either unsatisfactorily drafted or out of date.

According to Peter Ferraro, a senior associate at Harmers Workplace Lawyers, employers should specifically tailor their restraint of trade clauses for individual employees, as generic ‘boilerplate’ restraint provisions do not provide sufficient safeguards in the event of possible litigation.

“Employers shouldn’t assume that just because there is a restraint in an initial employment contract it will continue to provide requisite protection. If circumstances have changed significantly it may no longer be enforceable.”

Ferraro said a common pitfall for business owners is assuming they are protected from departing employees simply because they have pre-existing restraint provisions in their contracts of employment.

Power balance leans towards employees

Australian employers are continuing to report strong hiring intentions in the first quarter of 2011, while the labour market is expected to tighten further. The results of the Hudson Report: Employment Expectations, an Australia-wide survey of 4,709 employers, shows that 33.1% of employers are planning to increase their permanent staff levels over the coming 3 months.

While this result is a fractional 0.3% lower than that reported last quarter, the ongoing demand for labour is expected to shift the power to employees. “The job market is now growing at its fastest rate in five years, and demand for employees is rapidly translating into higher wages,” said Mark Steyn, the CEO of Hudson Australia/New Zealand.

“With the strong hiring sentiment reflected throughout most markets, employers are having to compete for staff, and candidates are once again able to have some bargaining power when it comes to their wages.”

Fast fact: LinkedIn

Paid Parental Leave is “just the start”: survey

Australia’s first national Paid Parental Leave scheme commenced on 1 January, but a survey conducted by Hays has found that almost 30% of employees feel it’s just the start.

“Most employers we speak to agree with the concept of paid parental leave, and despite compliance costs they generally do support this scheme,” said Nick Deligiannis, a director of Hays.

“But as our survey shows, almost 30% of employees feel that the scheme should become longer or more generous in the future.”

The online survey of 437 people asked “do you support the introduction of the Paid Parental Leave scheme on 1 January?” Forty-one per cent of respondents said it’s a fantastic scheme that’s overdue; 30% said they would like it to become longer/more generous; and 29% said they do not support Paid Parental Leave.

“This is a huge social change for the Australian workplace,” said Deligiannis.

“Ultimately it will become a part of Australian workplace culture.”

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has released the most overused words and phrases in members’ LinkedIn profiles.

Among the top 10 terms that are overused by professionals based in Australia are: extensive experience, innovative, motivated, dynamic and proven track record.

IN BRIEF international news

JAPAN: Four lives lost every hour 3.8 Japanese people committed suicide every hour in 2010. This is the grim statistic recently reported by Japan’s National Police Agency.

The agency said that 31,560 people committed suicide last year in Japan, with an average of 87.6 suicides every day. The country averages 30,000 suicides annually, however the agency noted that the total number for 2010 is 3.9% down on the number of suicides seen in 2009.

The main reasons for suicides in Japan are usually financial, especially for employees in the sectors that are suffering most due to economic and financial difficulties. Not being able to pay back loans, exhaustion caused by overwork, and worries about the future, were specifically cited as contributing factors by social experts.

EUROPE: Promoting equal opportunity The European Commission has launched a new Strategy on Equal Opportunities for the period to 2014.

The strategy hopes to promote a more flexible working environment.

New targets have been set under the strategy, such as an increase in the number of women holding senior and middle management positions as well as for recruitment of women to administrator positions.

Maroš Šefčovič, Commission Vice-President for Inter-institutional Relations and Administration, said that the Commission has already made progress since 1995 by “increasing five-fold the number of women senior managers and doubling the number of female middle managers,” reported business mag EUcommerz.

By 2014, at least 25% of senior management posts are to be occupied by women, compared to the current rate of 21%.

UK: Default retirement age scrapped The UK Government will be scrapping the default retirement age (DRA) from 1 October this year.

The move will prevent employers from forcing staff out of their role when they reach the age of 65.

Despite protests from employer groups, the government will go ahead with the plan, saying that it would give people “more freedom of choice” and employers will be able to utilise older worker’s skills for a longer time.

In a government statement, Employment Relations Minister Edward Davey said “older workers can play an incredibly important role in the workplace and it is high time we ended this outdated form of age discrimination.”

According to Legal Brief Today, business lobby group CBI said that the policy change will not clear the air for businesses on how older employees can leave their organisations.

Fast fact: US homeland security group The Transport Security Administration (TSA) has come up with an ingenious way to attract employees – placing job adverts on pizza boxes. This unusual method of job advertising is part of Washington DC’s efforts to “encourage candidates from all walks of life” to join the TSA. The group has also started advertising on petrol pumps, trains and cinemas for maximum exposure.

Source: The Washington Post

US: Online rant could set precedent

CHINA: Working mums face hiring troubles

Just what, and how much, can employees say about their bosses on Facebook? In the US the answer is about to get even muddier.

In a landmark case, the National Labour Relations Board came to the aid of Dawnmarie Souza, 42, who was sacked after making negative remarks about her employer on Facebook.

Souza was unhappy that her supervisor did not allow her to get union assistance when crafting a response to a customer complaint. She then mocked her supervisor on Facebook, using a wide range of expletives as well as calling her boss a ‘17’ – slang used to describe a psychiatric patient.

The Labour Board argues that employees’ criticising their bosses on a social networking site is a protected concerted activity. The case is expected to set a legal precedent when the Labour Board hearing takes place in late February.

Working mothers in China face a distinct glass ceiling in the corporate world. Chinese companies have been found to be unwilling to employ this group amidst concerns that they would be less committed to their jobs, less flexible and may possess outdated skills.

According to research firm Regus, only 36% of companies in China intend to hire more working mothers in 2011, compared with 44% last year and 50% in 2009.

Globally, 45% of companies intend to recruit working mums in 2011.

Regus also revealed that half of the employers were concerned that working mothers may possess outdated skills and 49% worried about mothers’ lack of worktime flexibility compared with other employees.

However, a majority of firms globally now value returning mothers more, with 72% saying they are a valuable segment of the labour pool.

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VIEWPOINT gary taylor

Job grading tail wagging the dog

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VIEWPOINT gary taylor

Job evaluation is one HR process which has survived decades of challenge and unpopularity. Gary Taylor asks whether it has a place as a strategic HR function

O

ne of the most contentious of our HR processes is that of job grading. Having chaired grading committees for years, I know all the objections, and can recite all the answers. Perhaps we should reflect (well, just amongst ourselves in HR) on what it is that brought us to where we are today, and some of the realities we are still facing.

Okay, so we remember learning about the era of scientific management and assembly lines, when industrial engineers ruled the workplace, until the Hawthorne research revealed that people dynamics made the difference. This heralded the birth of industrial psychology, and modern HR management practices. The ensuing wave of ‘soft-side’ people persons saw personnel management relegated to welfare and administration status, which didn’t suit us. We fought our way to the boardroom table and strategic partnership by introducing more science and structure to our profession.

Job evaluation is one such HR process which has survived decades of challenge and unpopularity, mostly because: »» It allows HR to wield enormous power »» It is the only logical answer to the question “how do you determine the relative value of jobs?” Of course, this assumes that there should be ‘jobs’, but let’s not get too avant garde.

‘Wave one’ in job evaluation saw line managers having to write up job descriptions (according to HR’s template), recording what the incumbents say they do, or rather ought to do. Naïve managers submitted their job descriptions, believing that the job evaluation process will know what they mean, and all will come out right in the end.

The consequence of managers not learning the craft of talking-up their departmental grades often led to comparatively low-grade outcomes, which translates directly into lower pay scales and benefits, making it more difficult to attract and retain staff.

‘Wave two’ witnessed the line manager, now trained in the language of progressive complexity, articulating fluently why the strategic relevance of the secretary’s decision-making is on a par with that of the CEO. Equally shrewd job evaluation panellists are now ‘third dan’ interviewers in the skill of devaluing the job, because they know what the points score needs to be.

‘Wave three’ caused chaos for a while, when someone suggested broad-banding, which threatened evaluators until they embraced it pragmatically.

Some employers took broad-banding all the way, while others succumbed to employee backlash from those wanting ‘promotion’ to assistant deputy manager. New job descriptions had to be written to reverse-engineer the promotion by re-grade.

Getting wider representation onto the grading committee has been a natural counter to rising dissent about buy-in. Trust has always been an issue, and staff remain sceptical about buying the line “…but we’re grading the job, not you”.

Okay, it’s easy to ridicule job evaluation systems and practices, but is there a realistic alternative?

And, by the way, which grading system is the right one? As they are all different, how can they all be scientifically right? Just how do you differentiate the jobs fairly?

Mark Bussin claims that you can use almost any grading system, and that most jobs would be ranked in roughly the same order – and he is probably right. That’s disconcerting for the consulting firms marketing their brand of ‘best-practice grading’, but somewhat comforting to the rest of us. It doesn’t seem to matter what you use, as long as you use it consistently. And this is strategic HR. Just a word of caution about fairness. It has a unique meaning in labour law, but has little relevance in the remuneration ‘market’ which is an abjectly unfair beast, and probably always will be. Although we justify job grading primarily as necessary to establish fair pay scales and benefits, the fickle employment market pays ‘the going rate’ and so do savvy employers, who follow each other.

Oh, we design smart allowances and compa-ratios to make our differentiation look objective, but employers only survive by rewarding scarce skills (no matter what their grade) with the remuneration packages necessary to get ‘em and keep ‘em.

This allows us to appreciate the difference between being ‘fair’ and being ‘equitable’. If you are unfair but do it consistently, you are being equitable, and that’s probably the best we can do in our remuneration practices. So, perhaps grading remains the necessary evil, in the absence of a better ‘science’ in our human science, but this particular HR process is one of many areas in our profession which demands as much art and experimentation as it does structure. HC

About the author Gary Taylor has been in HR for 25 years, starting with National Mutual of Australasia and Unilever, then as HR director at South Africa’s largest health insurer Medscheme for 14 years.

Just over two years ago he was appointed to start up HR for a new university in Saudi Arabia, where he is now Director of the Policy Office. www.hcamag.com

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THE LAST WORD compiled by Suzanne Mercier

5 minutes with...

Chris Lamb – Lend Lease Head of HR Australia

What’s the greatest HR lesson you’ve learned so far?

There is no such thing as the ideal employee.

Everyone brings different experiences and strengths. We need to recognise and appreciate diversity for the value it adds while ensuring we establish teams that will work together.

What is your view on diversity, and the current hot issue of gender diversity?

In Australia right now, unfortunately, we need quotas for a defined period of time to address the gender imbalance we have at senior management and executive level. Having said that, as a non-executive director of the Diversity Council of Australia, I’m concerned that the current emphasis on gender diversity could overshadow other important diversity issues.

Diversity is anything that makes people different.

Organisations that tap into diversity can use it to create a competitive advantage through providing better products, better ways of doing things and different ways of thinking.

Quote of the month “It’s one of the characteristics of a leader that he not doubt for one moment the capacity of the people he’s leading to realise what he’s dreaming.

Imagine if Martin Luther King had said “I have a dream ... of course I’m not sure they’ll be up to it!”

– Benjamin Zander

Your favourite people-management tip?

Leading people is the most important role a manager has. Spend as much time on this aspect as any other – and focus on improving your ability to lead a diverse workforce.

What career advice would you give ambitious HR professionals?

Stephen Covey got it right in 7 Habits of Highly Effective People when he said “seek first to understand and then be understood”. For me, the way that applies to HR is that we have to understand the business we’re in and what are its key success factors. We’re then in a position to provide value to those running the business.

What’s the main challenge facing HR now?

Developing great leaders is the key to long-term success for organisations. Leadership is an increasingly important way to differentiate your organisation.

How can HR professionals overcome that challenge?

Firstly, we need to identify emerging leaders.

Secondly, we need to develop both the technical and leadership skills of those individuals. Thirdly, we need to measure and reward both the emerging leaders and those people responsible for developing them.

Can you believe it?

Forty-three hiring managers shared their memorable interview responses. Here are four: What are your hobbies and interests? [He said] “Well, as you can see, I’m a young, virile man and I’m single – if you ladies know what I’m saying.”

Why did you leave your last job? “I have a problem with authority.”

Events management business: Why should we hire you? “I would be a great asset to the events team because I party all the time.”

Source: CNN Living

n Senior executives admit that employee disengagement is one of their biggest threats, but the issue is rarely discussed at board level Source: Management Issues

n 51% of companies admit that unethical behaviour is on the rise, an increase from 37% in 2008

Source: KPMG (December 2010)

n According to a recent survey, 72% of respondents believe there is a direct connection between a company’s gender diversity and its financial success Source: McKinsey & Co

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