One of my least comfortable memories as an HR Director was presenting a new pay and grading system to my senior leadership team. My team had worked for months on it – and in my view, it was a thing of beauty.
Continue reading HR: Human, Not Process, Experts
Every organisation seems to crave greater levels of innovation. The organisational responses to an innovation drive usually involve the following:
- We add the word “Innovative” to our corporate values
- We set up an Innovation Lab
- We invite the owner of a tech start-up to speak at our annual leadership conference.
And we try and offer innovation solutions in HR too.
- We put on innovation training programmes
- We include “the ability to innovate” in our leadership promotion criteria
- We adapt our psychometric assessments to try and spot the innovators
Unfortunately, these interventions rarely create truly innovative environments. Indeed, I’d like to suggest that much of what we do in our normal HR practices result in crushing the conditions for innovation rather than creating them.
The conditions for innovation are well documented; the ability to work with autonomy, the psychological safety to experiment, creative tensions brought about by working with people who are different, fluidity of organisational structures, etc. But in HR we have grown up seeing our role as driving cost efficiencies and operational effectiveness rather than creating value through innovation, resulting in our core processes having compliance and conformity at their heart. If we want to play a vital role in creating an environment where innovation thrives, we have a lot more to do.
I’d like to offer four suggestions for setting up HR as a force for innovation;
- Re-designing the employee experience
- Getting rid of the annual cycle of HR
- Moving away from traditional team structures and finally,
- HR to remodel itself as an innovator
Redesigning the employee Experience
We need to consider how innovation could run throughout the entire employee experience that we create through our numerous processes, rather than designing these processes in isolation of one another. Here are some examples:
We need to revisit the way in which we develop our employment policies that currently prescribe what’s allowed and what’s not, in minute detail, to “freedom within a framework” to create greater autonomy and trust. We should revisit our assumptions that long-term permanent hires are a good thing and instead embrace the concepts pioneered by Linkedin’s founder Reid Hoffman in The Alliance, ie: short term assignments should be welcomed as they generate fresher thinking and new perspectives. Our onboarding should be refocused and become less about achieving conformity and more about about understanding what each new employee’s unique contribution could be.
We need to get rid of leadership competency frameworks that promote the idea that leaders must be good at everything and instead focus on identifying leaders who can create the conditions where each of their team can play to their strengths. Our succession planning could change too, to include employees’ suggestions of who they’d want to lead them – resulting in leaders who are different to the ones we identify top down. We should consider how our reward practices encourage our people to experiment and risk failure instead of doing more of the same and hitting target. Here’s a great article by Jacob Morgan on how companies such as P&G and Tata have been experimenting with “failure rewards” recognising that feeling safe to fail is critical for an innovation culture.
If we are serious about equipping our organisation for innovation, then we need to re-think our people policies and processes holistically. Innovation should run through them like a stick of rock.
Getting rid of the annual cycle
We also need to look hard at our propensity to deliver people processes on an annual cycle and how this undermines our organisation’s ability to move at speed. Annual performance appraisals. Annual engagement surveys. Annual talent reviews. Annual bonus schemes. These belong to a more sedentary era.
Companies with strong innovative cultures don’t wait to give feedback until the end of the cycle. They don’t only want to know what their employees think and feel every 12 months. They don’t wait until the talent review process draws to a close to move and promote great people. They don’t wait till the bonus scheme has been calibrated to say thanks. Just because the business results follow an annual cycle doesn’t mean that we should.
Moving beyond the org chart
HR has traditionally focused on, supported and reinforced team structures shown on an organisation chart. Our objectives cascade through these hierarchies. Our engagement surveys measure results within these teams. We calibrate talent, performance and reward within these team boundaries. We assign them an HR business partner who services their needs. But innovation typically comes through the connection of individuals who sit in different teams, across traditional departmental lines or even across different companies. Our rigid adherence to the org chart means that we are less able to recognise innovation potential and definitely less able to support it. Marcus Buckingham has highlighted the problem in his In The Real World blog series, but I’ve yet to see many examples of how HR can adapt to this. Just recognising that innovation will happen through the breaking down of traditional silos is a start but it raises some serious questions about how we collect insight and data (greater use of Network analysis?), how we think about recruitment (building broader talent communities within and outside our organisations?) and how we structure our own HR teams (moving away from the HR business partner model?).
HR as Innovation Role Models
Finally – as that motivational poster says “Be the change you want to see” – we need to be role models for innovation ourselves. We can bring new and fresh perspectives to our work by partnering with teams outside of our domain. We can develop our abilities to experiment, to fail fast and move at the pace of our most demanding clients. We can choose not to wait till our competitors have implemented first, thereby making it “safe” for us to do so too. We can extend our learning beyond attending HR conferences and hearing about best practice in our own field. We can focus on outcomes rather than process. We can segment our markets and try to customise for different types of clients. And we can recognise that it doesn’t have to be perfect – that progress may be better for innovation than perfection.
Creating the conditions for innovation is one the biggest challenges for HR and we need to do so much more than a handful of isolated innovation interventions.
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7 Ways for HR To Go Faster
A CEO recently described his HR team to me as being like a set of speed bumps; “They don’t actually stop us doing anything, they just slow us down.” Once I had stopped weeping at this hideous indictment, it made me start to question – how can HR go faster? How can we ensure that we are going at the pace of the fastest? How do we ensure we that we are setting the pace instead of putting the brakes on? This blog explores 7 ways HR can pick up speed.
- Ditch the Annual processes
When was it decided that everything had to be done annually? Annual bonuses, annual appraisals, annual talent reviews, annual engagement surveys, and so on. We have taken the rhythm of the annual reporting cycle and applied it to our people. This has never made a huge amount of sense, but it is even more irrelevant given the pace of business today. Little and often is almost always better than big set annual pieces. So why not …?
Change to your annual appraisal to frequent check-ins (because better performance comes from regular coaching not once a year feedback.)
Change your annual bonus scheme to ad hoc, frequent rewards (because people feel so much valued when they are rewarded in a timely way rather than waiting to the end of year for the scheme to pay out.)
Change your annual talent review to monthly, hour-long discussions (no paperwork!) among groups of leaders (because leaders will get better at it if they do it more frequently and more cross-organisation movement will result.)
Change your annual engagement survey to frequent pulse surveys (because if you really want to know how your people are feeling, then a once a year survey just won’t cut it.)
Not only will the impact be greater but moving to more frequent, light-touch interventions will free up the organisation from the time-consuming annual process and our HR products will be more responsive to changing business needs.
- Let’s Stop Applying Everything to Everyone
If we treated our people as if they were consumers, then we could stop the time we waste applying all of our processes to everyone in the organisation. We are so concerned about appearing to be fair, that we end up pushing irrelevant and unwanted approaches onto employees. And we are so concerned with being efficient that we adopt the one-size-fits-all processes offered by our HRIS without questioning whether they make sense for all our people. If we thought like consumer organisations and instead, segmented our ‘markets’ based on different needs and wants, we would be able to provide a more tailored approach with greater impact. We’re seeing HR teams increasingly tailoring their products and services based on the end-user’s actual needs and preferences such as 3M’s customised approach to career development, based on their motivation for working there, or Regeneron’s four different options for performance management. We can save time by not applying bulky processes to everyone simultaneously.
- Go at the Pace of the Fastest
We can also enhance increase customer responsiveness (and our credibility) if we are not always waiting for the slowest or biggest resistors to catch up. As an HRD, I wasted countless hours trying to persuade the more traditional teams who often needed the most cajoling or the biggest compromises to get them to participate. Meanwhile, the more progressive teams (eg: digital) were getting frustrated with me seeming to drag my heels when they were fully prepared to be early adopters. Instead of providing services that work for the lowest common denominator, we need to provide a range of options that can work for all.
- A Sprint Not a Marathon
HR can learn so much from our digital tech colleagues, many of whom are well down the road with agile design and delivery techniques. Those HR teams that I meet who have embraced agile as a way of working report that, with a little adaptation, these methods can really help us increase our pace of delivery. We are seeing HR teams planning in short bursts or ‘sprints’ instead of the Stalinist Five Year Plans of a bye-gone era. As one HRD told me, this approach has enabled her team to have a broad sense of the direction they are going in, but to identify short-term (6-12 week) priorities for delivery. The benefits to her organisation have been the ability to be responsive to changing needs and to deliver much more quickly as she will only have two or three products on the slate at any one time.
- Progress Not Perfection
Whenever I was about to roll out a new initiative, I would have had to ensure everything was perfect; the full and detailed project plan, the full cascade comms plan with the obligatory FAQs sheet, PowerPoint decks and manager scripts prepared, the unions and the legal, employment policy and often the public relations teams all squared away. Agile teams are moving more quickly through ‘fail-fast’ pilots, delegated decision making and the use of Minimal Viable Product (MVP) techniques. The latter was used to great effect by IBM when they decided to launch a new approach to performance management. Instead of the typical benchmarking, isolated design group and roll out, they decided to create what they called a ‘concept car’ – videos showing what the new approach would look like, so that people could ‘kick the tyres’ and comment (18,000 responses in 24 hours!). They then kept iterating the prototypes based on the feedback until they felt they had something worth taking to a full launch. As their CHRO Diane Gherson put it, ‘The whole process took less time than most companies take to redesign their performance management programs, and we involved about 100,000 employees’.
- HR Doesn’t Have to Own It
Our fears that managers won’t ‘do it properly’ (or, do it all!), often results in us believing we must own the process ourselves. If we control it, our reasoning goes, we can be sure of its quality and that it will get done. So, we own the annual talent review, the performance management process, the induction, the engagement survey, the bonus process and so on. Aside from the fact that our ownership fails to increase leaders’ or employees’ capabilities, it can also slow things down considerably. If we change our focus from checking completion rates and instead explore how we can get it more quickly into the hands of managers and employees, then we can address both of these issues. Let’s look at the engagement survey as a case in point. We design it, distribute it, chase completion of it, collect and collate it, present it, explain it and finally, gather up the obligatory action plans. We determine the dates when it’s issued, closed, and when the results are announced – usually over a three-month time frame. We say, ‘these are the questions you must ask, and these are the issues you need to address’. Our survey, our process, our timeframe.
If we want managers to be thinking about how engaged their people are, to be measuring and using the resulting insights to make changes, then we need to give them the tools to do it for themselves – at a time that suits them. Ideally, we would offer them a range of insight tools and methods and help them think through what would work best for them – and then let them get on with it. No more waiting for the centralised survey, but empowering and enabling managers to get real-time insights about their team instead. Of course, there will be some rubbish line managers who will have no interest and will do nothing. But let’s face it, they would have paid lip service to the annual survey anyway. Let’s at least give those managers who might be a bit more interested something that is easy and quick to use.
- Let them make the decisions
Most of us in HR receive a daily stream of requests from line managers asking for our approval, our permission or the ‘right’ answer. It’s so tempting to give them what they are asking for. We feel good about being helpful. We feel needed. Our authority and our status that comes from being the ‘expert’ gets a well-needed stroke. But maybe we need to question whether the role of ‘approver’, ‘permission-giver’ or ‘expert’ is ultimately doing the right thing for our organisation or for them as leaders? If leaders and line managers remain reluctant to take decisions for themselves and have to involve HR in their choices or judgements, then aren’t we creating an unnecessary extra step? Aren’t we slowing the organisation down? If they felt confident and capable of making a decision to recruit someone, give that pay rise or respond to a flexible working request without recourse to HR, wouldn’t that be quicker and ultimately help them to grow and develop? Some of us in HR shudder at the thought of not being consulted. We consider the risks of the wrong choices and decisions (most of which we then have to sort out!). But maybe we should consider the risks of not enabling them? The consequences of having leaders who are incapable of using their judgement, or making good people decisions in a world that depends upon speed, agility and the ability to handle ambiguity are potentially far greater than an occasional employment tribunal? It is a lot harder to coach a leader to make the right choices than to just give them the answer and it takes time, but in the end, it can be hugely beneficial to them and the organisation. There’s another benefit too. It frees up HR from answering operational queries to focus on what we should be doing – ensuring our organisations, leaders and people can cope and thrive in the future.
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As an HR Director, I spent most of my time on the people whom my processes had designated either as our elite or our problem children. The top 10 percent — the super-talent in our top right-hand box — were showered with attention through fast-track programmes, promotions and higher bonuses. Meanwhile, at the other end of the scale, the ones we didn’t trust, were the motivation behind the vast majority of our HR policies and processes. There are serious downsides to this approach, the main one of which is staring us in the face: we’re ignoring the vast majority of the organisation. I don’t think we can afford to do this any longer, and here’s why.
Letting the Stars fend for themselves
Our primary vehicle for top talent is our High Potential Programmes but recent research by management consultancy CEB report that 73 percent of them fail to produce a positive business outcome. We shouldn’t be surprised by this statistic, as there are glaring errors in how we execute them; the following three problems ought to be sufficient for us to pause and question.
Our ability to define top talent is flawed
The data we use to identify high potentials is flawed by our outdated performance and talent management processes, which have an inherent rater bias. One of my clients was disappointed when, at the launch of his new High Potentials Programme, his opinion was that ‘out of 24 people, there were probably only seven who had any real potential’. This was despite HR spending several weeks nailing the right criteria and coaching senior leaders to help them make sound decisions. How many times have you looked at your Hi-Po nominations and thought, ‘Really? Are they actually the best?’ In my experience we recommend people for this status for a whole range of dubious and subjective reasons: the most common being the person is a perceived flight risk, as an alternative to a pay rise, and because of not knowing how to say no. When I was at Serco, for instance, we ran a leadership course in which it regularly transpired that about half the delegates weren’t as high performing as we’d assumed they were. They’d been sent on it because they had a great relationship with their boss or were doing a job that played to their strengths, but when they were later promoted into a management role they often didn’t perform well.
High Potentials Programmes are inherently divisive
These programmes create a group of perceived favourites, who now have the additional burden of high expectation on their shoulders. What’s more, these anointed ones can become frustrated by a lack of immediate promotional rewards now they’ve been earmarked as ‘special’. This results in a group of pressured, insecure leaders and managers with an insatiable appetite for reward and success — a toxic combination. If you need any convincing that focusing on the ‘stars’ is damaging, check out this wonderful TEDTalk by Margaret Heffernan.
The programmes lack transparency
Leaders worry about the neglected 90 percent discovering they’re not in the elite group. According to CEB, this results in up to a third of businesses concealing from the high potentials that they’ve been identified as such, creating the crazy situation in which the organisations have a group the members don’t even know they’re in!
Like many of our traditional HR talent tools, the High Potentials Programme belongs to a different age — when careers were more linear and predictable, when structures were less flat and when ‘career paths’ made sense. Fortunately, we’re seeing talent management evolving to recognise that we have to widen our focus away from a tiny minority including:
- The availability of coaching to anyone who wants it
- Providing a range of options for people with different career needs and desires
- Empowering people to own and drive their own careers
- Increasing the frequency and quality of career conversations for all
HR teams are beginning to cater for the majority rather than an elite few. The truth is our best people will always be okay, ensuring their voices are heard and pushing for the best opportunities. We don’t have to worry about them too much.
Not letting the Rogues run the show
On the other hand, there’s a danger inherent in designing change around the rogue minority. When we do this, we inflict constraining policies and processes on people who are capable of more, and who have no intention of behaving in the same way as the bottom 10 percent in any case. It’s tempting to tell ourselves if the policy or process doesn’t apply to the 90 percent they can just ignore it, but there are three main reasons why this isn’t good enough.
It discourages innovation and pro-activity
When we force people in the majority to carry out a process designed for the lowest common denominator, we patronise them and — even worse — sap their ability to think for themselves. How irritating is it to be treated as a poor performer when you know you’re not? Does it make you feel like you want to do your best work? Do you feel confident taking a risk that might result in a mistake, when you know the outcome will be a tutting re-write of the company’s procedures manual? This is not a recipe for encouraging people to be brilliant.
It deters poor performers from improving
A brilliant article in the Harvard Business Review refers to this as the Pygmalion Effect. In George Bernard Shaw’s play, Eliza Doolittle famously says: ‘You see, really and truly… the difference between a lady and a flower girl is not how she behaves but how she’s treated. I shall always be a flower girl to Professor Higgins because he always treats me as a flower girl and always will; but I know I can be a lady to you because you always treat me as a lady and always will.’ If we design HR services around people with the assumption they can’t do something, the chances are they won’t; in other words, if we assume they’re useless managers that’s how they’ll behave. On the other hand, if our starting point is they’re capable of managing well rather than us constantly compensating for poor behaviour, we’ll most likely see an improvement.
It rewards poor behaviour
When about to launch a new HR product or approach, most of my energy went into trying to persuade the most negative managers or employees that it was a good idea. Every roadblock they put in the way resulted in delays, compromises or occasionally, giving up. When we spend lots of time on our ‘problem children’, when we lavish them with our undivided support and attention, where’s the incentive for them to change? Why didn’t I simply exclude them? I was recently working on the introduction of a new form of bonus within a media company. Most of the managers liked the idea. It meant they would have their own budget to make discretionary and timely rewards rather than having to be part of an annual and centrally organised bonus scheme. The ones who resisted were worried that having to explain to people in their team why they had chosen to give a reward to one person but not another would be too difficult. Instead of compromising and creating lots more rules and guidance for managers (which would have diluted the positive impact), we decided just to leave the objectors out of the new scheme on the grounds that this was their choice. The impact was fascinating. Many of them changed their mind – worried about being left out. By treating them as adults and ignoring rather than rewarding their negative behaviour, the better managers got the scheme they wanted.
So let’s not worry about the outliers. The best will be fine with or without your help, and if you gear your actions towards the worst you’ll only stifle the rest. That doesn’t mean you shouldn’t have any policies or procedures aimed at these groups, only that they’re best left as back seat passengers rather than being in the driving seat of our HR ambitions. It’s the 80 percent in the middle who should be the main focus of our attention; our job is to cater for everybody, not to nanny and control the minority.
I am going to assume that anyone reading this already gets the need for better and different HR practices. I am not going to bang on about the demands of a “VUCA” world, the pace of change, the rise of the Millennials, or a more globalised, networked economy. Continue reading Treat me as an adult