Welcome

Chartered Institute of Personnel and Development

HR strategies for changeHR strategies for change

A workshop on the human resource aspects of managing change and

building organisation effectiveness

Jim Cannon and Roger Niven

The reconnaissance visit

Many issues identified as important

• Evaluation and assessment

• Performance management and rewards

• Employee development

• HR planning, utilisation and development

• Retention

• Selection

• What next for FIST

What are the HR problems we face?

Basic Orientation

time

1770 – 1920

time

1930 – 1950

time

1960 – 1980

time

1990 -

Descriptive

Classical economics

- Adam Smith

entrepreneurial challenge

- Schumpeter

entrepreneurial strategy making

- Henry Mintzberg

revolutionary strategy

- Hamel

Strategic leadership

- Kotter

Prescriptive

Neoclassical economics

- Leo Walras

Industrial organisation economics

- Mason / Bain

Managerialism and marginalism

- Ansoff

‘Back to basics’

- Porter

Value systems

- Treacy and Wiersema

After Arto Lahti

The Development of Strategic Thought

Michael Porter - Forces Driving Industry Competition

Potential Entrants

Suppliers

Substitutes

CustomersIndustry Competition

McKinsey’s 7- S - Model

Shared Values SystemsSkills

Staff Style

StructureStrategy

Total business system to deliver value to customers

Management systems

Technology

Organisation CultureBusiness

Processes

Operational excellence

Product leadership

Customer intimacy

Treacy and Wiersema

An illustration of technical and adaptive work

Height

of

high

jump

Years

Scissors

Western Roll

Straddle

Fosbery Flop

From Richard Pascale

The need to involve peopleIn

fluen

ce

Only a few can choose

A wider range of experiments and prototypes

An infinite number of very small scale improvements

After Rosabeth Moss Kanter

“Management’s mandate is to minimise risk and to keep the current system operating. Change, by definition, requires creating a new system, which in turn always demands leadership”.

John P Kotter1995

Leaders and strategy

“I agree … strategy ‘emerges’ … but we are not

helpless. Strategy does not simple emerge … it is

emergent. By creating the right set of preconditions

one can provoke emergence.”

“Too often we work on ‘the strategy’, rather than the

preconditions that could lead to strategic innovation.”

Gary Hamel

Improving business results through peopleBusiness

Results

Customer Satisfaction

Employee Satisfaction

PeopleRequirements

Employee Needs

Human ResourceStrategy:

EmploymentRelationship

Human ResourcesPractices, Policies,

Programmes

Business Strategy

HR roles in building a competitive organisation

Management of StrategicHuman resources - aligning HR and business strategy byorganisational diagnosis

Management of transformation- renewing the organisation

Management of infrastructure- processes to deliver services

Management of employee contribution - listening and responding

Strategic Focus

Operational Focus Source: Ulrich and Conner

PeopleProcesses

Managing change

Exercise: Reactions to change

Think of a major change in your life:

• What were the different reactions you experienced?

• What helped and hindered you come to terms with the change?

• If it happened again, how would you handle it differently?

A spectrum of reactions

Apathy

Reactive

Loss of interest

Passiveresistance

Activeresistance

Acceptance EnthusiasmIndifference

Co-operation under pressure

Protests

“Work to rule”

Slow down

Intentional errors

Supportive

Energy

Ideas

4.11

Complex forces of change

Driving forcesRestraining forces

Forces come from:- outside- the organisation itself- internal groups- individuals

Lewin

4.7

PE

RC

EIV

ED

CO

MP

ET

EN

CE

TIME

HIGH

LOW

2. Rejection

Rejection of new reality.

Defence of existing initiatives.

Detail of problems.

False sense of

competence re-established.

1. Surprise

Immobilisation.

Shock, surprise or

anger at mismatch

between high expectations

of performance

and the new reality.

3. Uncertainty

Sense of anxiety/incompetence.

Frustration.

Uncertainty about how

to deal with new reality.

4. Acceptance

Acceptance of new

reality.‘Letting go’

of the past.

Attitudes and

behaviours

re-examined.

5.Exploring

Testing new behaviours,

new approaches.

Lots of energy, anger

and frustration.

Beginning to deal

with new reality.

6. Developing

Search for clarity.

Developing effective

ways to respond to

new reality.

7.Consolidating

Clear insight into new

reality. Consolidation

of new behaviours.

Individual responses to a new reality :

The Transition Curve

Case study

The Levers of Change

•Self awareness (Do I understand what I need to do differently?)

•Will (Do I want to change?)•Competence (Am I able to change?)•Conscience (Is the change congruent with

my beliefs?)•Pleasure / Fear consequences (Will I benefit

or suffer?)•Vision (Is this change in line with I want

for the future?)

The stages of change (J Kotter)Establish a sense of urgency

Create a guiding coalition

Develop a vision and a strategy

Communicate the new vision

Empower employees with broad based action

Generate short term wins

Consolidate early gains but push on for more change

Anchor new changes in the culture

Activities for successful change management

Avoid over-organising

Provide help and support Communicate like never before ManagingEnsure early changeinvolvement work at gaining Commitment

Turn perceptions of threats into opportunities

‘Crazy time’

Old Newways waysof ofdoing doingthings crazy time things

Start of change ‘end’ of change

When to change?

Extra workUncertaintyFight for resources

Time

“The second curve”

Handy

Relative

performance

4.9

Who helps and hinders change?

Low Influence on change High

Seniority

Looking for the positives in any change‘I learnt something’

‘I won’t make the same mistake again’

‘I was more fortunate than some’

‘Today is the first day of the rest of my life – I can choose to let the past go’

‘I cannot change history, but I can steer a different path into the future’

Group discussion

What change strategies have worked successfully for organisations represented here today?

Human Resource Planning and

Career Development

PRIMARY

EMPLOYEES- key skills

- shared values

- commitment SECONDARY EMPLOYEES

support skills short-term

TEMPORARY EMPLOYEES

Agency Sub- Bought-in Staff consultants contractors services

The Developing HR Model?

Structure of a credit card company. A division of a bank

Management 265 9.9%

Middle level staff 1957.8 73.5

Junior staff 15 0.5

Agency 430 16.1

• Total 2668 100

• Source: Published accounts

Constructing a Human Resource Plan

Analysis of

existing

H.Resources

H.R. DEMAND SCHEDULE

quality & quantity

feedback & review

H.R. PLAN

Recruitment

(input)

Training & Retraining

(change)

Retirements / Dismissals

(output)

feedback & review

- external labour supply- changes in wastage rates

H.R. SUPPLY SCHEDULE

quantity & quality

Corporate plans/

objectives

Sales / Output

Forecasts

Wastage

Forecasts

+

+

- changes in utilisation

- changes in demand

What are the drivers of staff numbers in your business?

Staff Categories

Key

Drivers

2.9

• JUDGEMENT (“GUESSTIMATE”)

• ACTIVITY ANALYSIS (synthetic)

• CORRELATION (Ratio)

• COST BASED (Budget constraint)

• DELPHI (individual experts -> iteration -> consensus) 4.1

METHODS OF DEMAND PLANNING

Productivity measures

Activity

• Output/ person (What drives activity?)

Value

• Cost or Revenue/person cost

Opportunity

• Maximum value produced/hour – actual value produced/hour

• Note: Consider the effect, attendance and efficiency

Productivity improvement

Job analysis

‘Bottlenecking’

Benchmarking

Suggestion schemes (staff and customers)

Trend analysis

Zero based budgeting

Using activity analysis in the European Commission – a case study

Question posed: How many career counsellors were required?

Model created to structure assumptions and see the impact of changed circumstances.

Set agenda to track actual effectiveness and to clarify more realistic assumptions.

European Commission – a case studyStaffing requirements model for career counsellors.

SERVICE DEMANDa) No of staff who may use the service 20000

b) Estimated % who at any time will be using the service 2 %

c) Case load (a x b) 400

d) Client contact is assumed to be once every 4 weeks

e) Number of sessions required each week (c/d) 100

COUNSELLOR SUPPLYKey assumptions:f) working week in hours 40g) Attendance (Training, sickness and hols) 0.8h) Efficiency (time spent on counselling) 0.78(overall effectiveness = gxh) 0.624I) Counselling session length in hours 3

j) Number of sessions a counsellor can complete in a weekf x g xh)/3 8.3

MATCHING SUPPLY AND DEMANDk) Number of counsellors required (e/j) 12.0

Scenario planning

Project plan

Future scenario A

Today’s Environment

Future scenario B

Future scenario C

Signposts

Decision Points

Today Future

Date 1/9 6/9 1/9 6/9 1/9 6/9 1/9 6/9

Project 1Project 2 Scenario A or B Scenario AProject 3 Scenario BProject 4 Scenario C

an case study on planning

Review the notes and information supplied.

In groups, consider the questions asked.

The Texology call centre

Career Development

Career Development Planning

assessing skills & competencies

performance management processes

psychometrics

360° feedback

assessment / development centres

career counselling

re-training

job changes

secondment

Career review

1. Personal stock take

State: experiences, interests, abilities, motivation

Explore: feelings, e.g. boredom, no challenge, outdated skills

Consider: strengths, abilities, likes personal qualities

2. Personal requirements for the future

are skills being properly utilised

where might they be better employed

is job enhancement a possibility?

3. Consider alternatives

in company - different departments

spare time occupation

other companies in same sector

change of occupation

analysis of the market place

4. Plan of action

new horizons

job search strategy

skills update

self - marketing

I WANT

REALITY I AM ABLE

What do I want to do?

Moderate risk

Research?

Low risk

Job seeking?

High risk

Long term?

Moderate risk

Retraining?

Same

work

Different

work

New sector Same sector

Tools for improving utilisation

Competency framework

Skills transition matrix

Succession planning

Human Resource Plan template

Skill Transition Matrix

Entry Level Basic requirements;Qualifications,experience,competencies(% who will remainin 1 year, 3 years)

From Job A Ongoing training tomaintainsatisfactoryperformance

Additional skills,competencies.Time to retrain,(% likely to do job)

From Job B Additional skills,

competencies.Time to retrain,(% likely to do job)

Into Job A Into Job B Into Job C

JOB TITLE

JOB HOLDER

MANAGER

J. BLOGGS

‘49

B

3

YEAR OF BIRTH

PERFORMANCERATING (A-E)

PROMOTABILITYINDEX (1-3)PHILLIPS

EATONIDENTIFIEDREPLACEMENTS

MANAGER

J. BLOGGS

‘49

B

3

PHILLIPS

EATON

HUNT

ARNOLD HUNT

-

SUPERVISOR

I. PHILLIPS

TECHNICIAN

G. EATON

‘53

A

1

‘60

B

2

Succession Planning Chart

KEY

Succession Planning - Ratings

Performance Rating:

A - ‘exceeds expectations’

B -

C - ‘satisfactory performance’

D -

E - ‘unsatisfactory performance’

Promotability Rating:

1 - ready now

2 - likely to be ready during next 24 months

3 - not ready for promotion

Career Development Records

Minimum information required:

1. name & present position

2. date assigned to current job

3. latest performance rating

4. Promotability rating

5. target date for expected move

6. actions required to prepare for (5)

plus record of training / development actions

Career & Succession PlanningProblems And Issues

the ‘Prince’ and the ‘Pauper’

people are unpredictable

planning and the forced choice

planning and the self-fulfilling prophecy

prediction in a world of change

performance v potential

expectation and ambitions

‘as is our confidence so is our capacity’

opportunity and its prediction

the politics of judgement

potential for what, in growth and decline

What should follow the FIST programme for FIST participants?

Company groups

Review the work we have done today

Identify any aspects that may be applicable to you

Discuss any actions you need to take to introduce these ideas

What further do you need to know from the tutors and others to take these ideas further.

Welcome to day 2

What were the key points for you from yesterday

Any queries and questions?

Performance management

How do we get people to perform?

Situation

Performance

How do we get people to perform?

Situation

Vision Behaviour Culture

Mission and goals Group feeling Policies

Strategy

Structure Needs Procedures

Skills Freedom

Performance

Balanced scorecard an example from an international bank

PeopleStrong leadership teamHigh quality people at all levelsDiversity, fairness and opportunityCommitment to employee success

FinancialMaximise SVA over time

ProcessesWorld class efficient processesStrong preventative and detective controlsKey performance indicatorsInnovation and continuous improvement

ClientsMarket leadershipProduct excellenceOutstanding customer service

Vision and Strategy

Measures

Financial – share price, Price/ earnings, ROCE

Clients – Market share, product comparisons in focus groups, service failures, customer surveys

Processes – Benchmark comparisons, mistakes, performance against Key Performance Indicators

People – Absence, turnover, attitude surveys, upward feedback

Case study

Assessment and Selection

A model of good selection

Define the job to be done – the job description

Specify the ideal candidate – the person specification

• Technical experience and knowledge• Behavioural criteria

Define the selection method

Attract suitable candidates

Assess

Attract, appoint and induct

Selection methods

Application form

Interview

• Competency based

Panel interview

Tests

Group discussion

Report / presentation

Assessment centres

Assessment – a banking example

Exceeded performance standard 29.3%

Met standard 70.0

Failed 0.7

Source: Monthly HR statistics

Retention

Controlling Labour Turnover

expect labour wastage

reduce its impact

be competitive in labour market

emphasise areas of satisfaction

reduce areas of dissatisfaction

analyse reasons for turnover

use feedback to change management systems / practices

Some Factors Affectingthe Decision to Leave

Individualjoins

Temporarilycommitted

Reference groupbehavior.Value system,performancefeedback. Paystructure.Chances of promotion expectations,knowledge ofother opportunities.

Reason forjoining

Male/Femalemarital status

Un-decided

Decisionto leave

Externallabourmarket

Needs and satisfaction = Needcontribution balance

Morepermanentcommitted

Ill health & deathretirementfinancial inducement

Termination

Critical factor‘Last Straw’

Age,grade,length ofservice, skill type; level

Employer Influence OnLabour Turnover

most firms are

ACTUALLY

here

but….

THINK they

are here

high

EMPLOYER INFLUENCE

Bevan 1988

low

Internal labour market causes

External labourmarket causes

Tactics for Reducing Turnover

be the best in town

work hard at labour retention

pilot schemes

establish positive role models

research where staff come from

allocate v select/reject

train and retrain

restructure work

career pathing

EXIT INTERVIEW - COMPANY CASE STUDYA SURVEY OF 177 PEOPLE WHO LEFT OVER A SIX MONTH PERIOD

Pregnancy 4 4Marriage 1 0More Money 17 12Better job 23 28Promotion 5 2Leaving the area 7 7Change of career 4 3Wanted a change 8 18Did not get on with boss 2 11Working conditions 4 10Domestic reasons 15 3Dissatisfied 12 3Training 8 5Other 18 22Non voluntary reasons 49 49

Total 177 177

REASON GIVEN AT TERMINATION INTERVIEW

REASON GIVEN 3MONTHS LATER

5.15

Employee development

Training needs analysis

Desired performance minus Actual performance

Gap

Training need Non-training need

Non-training factors affecting behaviour / performance

Organisation

Personnel practices

Job design

Supervision

Environment

Information systems

Non-work problems and worries

Some current ideas

Leadership is for all

• Skills, behaviours, beliefsLeadership is about:

• Behaviour• Coaching• Emphasis on vision and values

• Reading situations• Mentoring

• Self-awareness• 360 feedback

• Choices• Management of time and attention

Strategies for matching how we learn to needs at different levels

Activist Theorist Reflector PragmatistOrganisation

Events Presentations Visibility of Practical supportConferences on strategy senior managers

Team Team problem Goal setting Observe experts Able to experimentsolving

Individual Learn by doing ‘why do I need to Coach/mentor flexibility to findknow that or do it?’ the best way for me

Company groups

Review the work we have done today

Identify any aspects that may be applicable to you

Discuss any actions you need to take to introduce these ideas

What further do you need to know from the tutors and others to take these ideas further.

Thank you for coming

Roger Niven and Jim Cannon