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UKCSI RESULTS

EMPLOYEE ENGAGEMENT

STAKEHOLDER ANALYSIS

SOCIAL INTELLIGENCE

UK CUSTOMER MANAGEMENT CONFERENCE

Deliveringresults on andoff the pitch at

Manchester Utd

HR AwardsEmployee Engagement

Emotional Intelligence

January 2009 4.50Creating value for customers, employees and shareholders

COMPANIESIN THIS ISSUE

Manchester United FCSouthern Housing Group

Hewlett PackardNorwich Union

O2McLaren

Innocent DrinksJohn Lewis

EMPLOYEE SPECIAL


2/40

TheTogether

Company

I really enjoyed reading this book, the

topics of which will be of extreme interest to

H R practitioners and business leaders.

Topics are approached in a systematic and

balanced manner. I commend Raymond

Robertsons flexible attitude of recognisingthat one size does not fit all and that

different circumstances wi ll attract different

reward soluti ons.

Roberto PonteWorldwide Compensation and Benefits and NorthEU Human Resources ManagerInfineum International Ltd

Rewarding what matters most topeople and organisations

19.95inclP+P

Order your copy at www.leadershipfactor.comor call 0845 293 9480

Learn how reward and recognitionstrategies can help your organisationwork smarter, satisfy customers,generate profits and growth,

encourage people to think likeowners and create a great place towork. Learn how to become aTogether Company.


3/40

6 Diary Dates

Training co urses and Conferencesfrom the UK and Am erica.

23 Case Study

Ray Robertson tells us whyconventional wisdom applies evenat an unc onventional tim e.

7 News

Tips for recession beating

8 Case Study

Manchester Uniteds Anthony Lawlertells us how the c lub d elivers resultsoff the pitch as well as on.

27 Conference

Sarah Stainthorpe reports backfrom this years UK Custom erManagem ent Conference.

29 Employee

Rachel Davies has po werfulthoughts on Emp loyee Engagement.

33 Latest thinking

Rachel Allen continues her look atnew techniques for deciding whoyour stakeholders are and how youshould treat them.

VOLUME 6 ISSUE 1 January 2009

Inthisiss

ue...

37 Fast Guide

Emotional Intelligence

38 Book Review

Social Intelligence by DanielGoleman.

12 Latest thinking

Mark McCall reveals more findingsof new research on employeeengagem ent across the UK.

18 Conference

Nigel Hill reports back from theLeaders in London Conference.

www.stak eholdermagazine. com | January 2009 Stakeholder 3

Employee

Engagement


4/40


5/40

N igel H ill editor

Stakeholder Satisfaction

PO BOX 1426

Huddersfield

HD1 9AW

Tel: 0845 293 9480

N B: Stakeholder Satisfaction doesnot accept

responsibilityfor omissionsor errors. The pointsof

view expressed in the art iclesby contributing writers

and/or in advertisements included in thismagazine

do not necessarily represent those of the publisher.

W hilst every effort ismade to ensure the accuracy

of the information contained within thismagazine, no

legal responsibility will be accepted bythe

publishersfor lossarising from use of information

published. A ll rightsreserved. N o part of thispubli-cation maybe reproduced or stored in a retrievable

system or transmitted in anyform or by anymeans

without prior written consent of the publisher.

CopyrightSTAKEHO LDER SATISFACT IO N 2009

Editor:

Production Editor:

Designer:

Creative Director:

Advertising:

Nigel Hill

(Manchester United)

Chris Newbold

(Manchester United)

Rob Ward

(Ossett Town)!!

Rob Egan

(Liverpool)

Daniel Hodgso n

(Blackpool)

Stakeholder Satisfaction is the magazine

for people who want their organisation to

deliver results to employees, customersand any other stakeholders as part of a

coherent strategy to create value for

shareholders. We publish serious articles

designed to inform, stimulate debate and

sometimes to provoke. We aim to be

thought leaders in the field of managing

relationships with all stakeholder groups.

[email protected]

ISSN 1749-088X

In a recession you want to keep your top talent as well as your customers.

Thats why Jack Welch spent 75% of his time at G E helping his top peo-

ple to perform better, why R ichard R eed of Innocent Drinks advocates

recruiting the best people that match the values of the business, then do

all you can to engage them, and why Charlie M ayfield of John Lewis

Partnership enthuses about the Employee Value Proposition. For these

and the thoughts of other Leaders in London, see page 18.

Thats why Southern Housing G roup has its Brick P lan development and

reward scheme for employees in the Customer Service C entre, and why

several of them have progressed into more senior housing roles within the

G roup. See Ray Robertsons article on page 23 for more details.

Thats why M olson C oors invested in improving employee engagement

and as a result saved $1,721,760 in safety costs alone. R achel Davies

elaborates on page 29.

Thats why at O 2 all managers have an employee satisfaction measure as

part of their annual bonus. See Sarah Stainthorpes article on page 27.

You dont often associate football clubs with the latest business manage-

ment techniques, but M anchester United is one club that puts as much

effort into motivating its top talent off the pitch as it does on it. Thats why

it introduced the UN IT ED Vision and Values, the going the extra mile

award for outstanding performance on a specific project and the high

performance award for consistently strong contribution throughout the

year. T hats why the Club introduced its Performance and Development

Review P rocess and why all employees are rewarded with a free trip to

any C up Final that M anchester United reaches, even if its in M oscow. For

details see Head of H R , Anthony Lawlers article on page 8.

And to check out the football allegiances of all the contributors to this

magazine see their biographies along with each article!

Best wishes

Nigel Hill


Our people a nd their favourite footb all teams:

Printers of

Stakeholder Satisfaction

(Fabio C apellos Barmy Army)


6/40Stakeholder January 2009 | www.stakeholdermagazine.com6

Strategic TalentManagement Summit9th 12th February Stockholm

The theme of the conference is D riving

Strategic C hange through Cutting Edge

Talent and the event covers topics such

as talent identification and assessment,

executive leadership development, proac-

tive succession planning and employer

branding. There are speakers from many

prominent organisations including R olls

R oyce, Siemens, H ilton, M arstons, and

Skanska.

For more information go to:

www.talent-management.se/

Improving EmployeeSatisfaction & Engagement22nd April London

Cost 325

This one day training course begins with

an explanation of how Harvards Value-

Profit Chain principles can be used to

drive employee satisfaction and its down-

line consequences of customer

satisfaction and profitability. To follow

Harvards advice and deliver results toemployees, organisations have to be

world class at using employee surveys to

understand what matters most to

employees, to monitor the extent to which

the company is meeting their require-

ments and to identify specific, actionable

priorities for improvement. The course

covers best practice employee surveys as

well as using the results to drive forward

employee satisfaction and engagement.

For more information call Ruth on

0845 293 9480 or chec k out:

w ww .lea de rshipfac tor.co .uk/products /d

eta ils/2030.htm l

People DevelopmentSummit 200911th 13th March M adrid

The People Development Summit offers

HR professionals from the UK a unique

opportunity for focused business net-

working. This is an event that is effectively

funded by suppliers, so HR professionals

go free. It comprises a series of short

meetings with suppliers, who you can

select beforehand, together with some

seminars plus entertainment, wining and

dining in the evenings.


www.summit-events.com

Advancing the Service Culture5th March | 12th May London

2nd April M anchester

Cost 325

Without the right mindset, organisations will

never deliver a consistently flawless cus-

tomer experience. This is a highly

motivational 1 day training course to help

organisations build a genuinely customer-

focused culture. D elegates leave full of ideas

to build a service culture where staff auto-matically put themselves in the customers

shoes and turn customers into advocates.


0845 293 9480 or check out:

ww w.lead ershipfa cto r.co .uk/products /d

eta ils/7201.htm l

HRD 200921st 23rd April London

Aimed at people and organisational devel-

opment professionals, the conference

focuses on five key areas:

Organisational development

Coaching

Talent management

People development

Learning delivery

It features over 40 seminars delivered by

HR and business speakers.


w w w.c ipd .c o.uk/ca nde /hrd

Employee Engagement Surveys16th JuneLondon

This half day intensive briefing will cover

leading edge thinking on how to develop,

implement and action an effective employee

engagement survey. The briefing will explain

how to collect information on emotional

engagement, cognitive engagement,

physical engagement and vocal engage-

ment as well as calculating and

benchmarking a net engagement index and

identifying specific priorities for improve-

ment. The findings of original research into

employee engagement in the UK will also be

shared. With only 33% of UK employees

engaged, this is a must attend event.


0845 293 9480 or check out:

www.leadershipfactor.com

CIPD Recruitment andRetention Conference17th 18th June London

G iven the current economic climate it is

essential to recruit the right candidates

and improve retention across the organi-

sation. Expert speakers and leading

organisations will provide practical advice

and share how they manage their recruit-

ment and retention. Issues covered

include the latest challenges and trends,

enhancing your online presence, employ-

er branding, flexible working and creating

cultures of engagement.


w w w.c ipd .c o.uk/ca nde /a rrc/

Diary

dates

Diary Dates

C O M ING UP IN 2009


7/40

News


news

Tips for re cess ion beating

Heres advice from M ark Tucker, C EO of

P rudential, C arolyn M cCall, C EO ofG uardian M edia Group, P hilip Rosedale,

Founder and C EO of Second Life and

Steve Tappin, author of Secrets of CEO s.

1) Be very customer-focused, mak ing

sure above all that you keep and devel-

op your existing customers since

winning new ones will be more difficult

and costly than usual.

2) Have a team of leaders at the top who

work together, not just a lone C EO .

3) H ave some non-financial goals such as

customer satisfaction, employee

engagement and market share so that

everyone can get behind an achievable

goal even if sales are falling.

4) Cash is king so conserve it. O ne great

way of doing that is to travel less. U se

conference calls or video conferencing

to save the environment as well as time

and money. (See next note on this

page).

5) C ombat the gloom by introducing

some extra things to have fun at work,

e.g. celebrating the achievement ofnon-financial goals.

6) Be innovative, perhaps by giving

employees a percentage of their time to

work on innovation or improvement

projects. This can provide some good

non-financial goals such as number of

new products launched or percentage

of sales from new products. It can also

help with the next point.

7) Have a plan for how you will come out

of the recession stronger. If you have

cash its a great time to buy a struggling

competitor. If not, you could aim for

stronger customer loyalty, a better

website or new reward strategies for

motivating and retaining top talent.

Travel les s a nd s ave your ma rriag e

According to a survey from The Business

Travel Show, 37% of business travellers

cheat on their partners while they are on

work trips, with 8% claiming to have

joined the mile high club but not with their

regular partner. In terms of travelling less,

only 20% said they would be cutting

down on business trips though 42% now

have tighter spending controls while away.

Luckily theyre a frugal lot. 56% of busi-

ness travellers never leave a hotel room

without removing the complimentary toi-

letries and 23% have accidentally'

packed guest towels or dressing gowns.

20 08 P ersonnel Today Awards

Trophies were awarded at a glittering cere-

mony on London's Park Lane at the end of

November with McDonald's scooping the

overall award, H elen G iles, of charity

Broadway Homelessness & Support, named

HR Director of the Year and Thorntons win-

ning two awards.

The full list of winners is:

Employee Engagement Award:

Heart of England NHS Foundation Trust

Talent Management Award:

M ouchel

Reward & Recognition Award:

Thorntons

Employer Branding Award

IHG

Business Partnering Award

Pfizer UK

HR Through Technology AwardNHS Employers

Diversity in the Workplace Award

British Gas Services

Business Improvement Through

People Award

Harrods

Health at Work Award

C horley Borough C ouncil

HR Impact Award

Thorntons

Innovation in Recruitment &

Retention

Paul UK

Excellence in Training Award

B&Q

HR Director of the Year Award

Helen G iles - Broadway Homelessness

& Support

Best HR Strategy

M cDonald's Restaurants



Case Study

Being successful off the pitch as well as on it requires Manchester United

to have employees who are as committed to the success of the compa-

ny as the players are to winning the Premier League or a major Trophy. To

generate this level of motivation, the business has to make sure that

employees feel valued. They need to know that their efforts to deliver

results for the company will be reciprocated in the companys efforts to

deliver results to them. The starting point is the companys willingness to

listen to employees, to take their views seriously and to take action, where

necessary to improve employee satisfaction.

Delivering results on

and off the pitchAnthony LawlerM anchester United FC

Anthony is Head of Human R esources at

M anchester United. He has worked there for

11 years, experiencing the company as a PLC

and now back in private ownership. He is

responsible for HR across M UFC 's commer-

cial functions, corporate services, venue

operations and M UTV as well as the football

club. When not on a busman's holiday watch-

ing the Reds, Anthony is partial to a bit of golf.


9/40

Case Study


Listening to employees

M anchester United is currently organising

its fourth employee satisfaction survey.

C onducted by specialists in satisfaction

measurement, The Leadership Factor, the

survey is based on employees 24 most

important requirements. T hese includesoft factors such as friendly working envi-

ronment, approachability of my

manager and being proud of my job as

well as more obvious employee require-

ments such as pay, pension scheme

and Job security . A fter each survey The

Leadership Factor has made clear recom-

mendations for improving employee

satisfaction and because it has acted on

these, M anchester United has improved

its employee satisfaction index each year

and is well up in the top quartile of UK

organisations on employee satisfaction.

To see how this has been achieved, lets

look at things through the eyes of a new

employee.

Induction

Like most organisations, starting work at

M anchester United begins with an induc-

tion to make new recruits feel part of the

family and to make sure they understand

a few key things:

How employees behave, based on theUNITED values

How they are rewarded; pay and benefits

How they are judged and how they can

increase their performance.

Just to make sure they havent forgotten that

theyre actually working at M anchester United,

the newcomers are now taken on a tour of the

stadium to admire the museum and trophy

room, inspect the changing rooms and sit in the

dugout to experience Sir Alexs view of the pitch.

Coming gently back down to earth, the induc-

tion now continues at departmental level. Here

they meet their line manager and are introduced

to their colleagues, have an explanation of how

the department works and taken to lunch in the

staff restaurant.



Case Study

How emp loyees be have

A past employee satisfaction surveyasked employees for feedback on the

Vision and Values. Two thirds of the per-

manent staff stated that the Vision and

Values do help them to understand the

companys goals and priorities.

How emp loyees are rewarded : p ay

This is a key part of our new employees

induction and has been one of the main

areas addressed by M anchester United

as a result of the employee satisfaction

survey, which demonstrated that many

staff didnt understand how their annual

salary review was determined. As well as

detailed explanations of the reward sys-

tem in the R edLines employeenewsletter, two new elements were

added to the pay review process. In

addition to the basic pay review (all

employees receiving the same percent-

age increase to base salary) and the

profit share bonus (2.5% of all operating

profit above budget EBIT DA is distrib-

uted to all eligible permanent employees

as a percentage of salary), employees

can now earn additional increases to

basic pay for outstanding performance

or extra responsibility. Awarded at their

managers discretion, extra responsibility

includes changes in the employees role

or responsibilities but also takes into

account staff who have developed their

skills, knowledge or behaviours to such

an extent that their contribution to the

business has now significantly improved.

O ur new employee would hopefully also

be motivated by the fact that outstanding

performance can now be recognised by

a going the extra mile award of up to

5,000 for achievement in a specific

project or activity or a 1,000 net high

performance award for consistent out-

standing performance throughout the

year. N ominations for performance

bonuses are made by the relevant

Executive M anagers and approved by a

R emuneration P anel including the C hief

O perating O fficer, H ead of H R and

chaired by the C hief Executive.

How employees are rewarded:

benefits

All permanent employees are entitled to

an impressive range of benefits including

a contributory defined contribution group

pension scheme, life cover of four times

basic salary, income protection, sick pay

and holiday entitlement. M anchester

United has also stayed true to its paternal-

istic heritage by retaining its fully

subsidised staff restaurant. Employee sat-

isfaction with the pension scheme has

shown one of the biggest increases

across the 24 requirements. O ur new

employee could also take advantage of

perks such as free access to M UTV and

various discounts offered via C lub

Sponsors/P artners.

How employees are rewarded:

recognition

H eres the exciting bit for any new

employee at M anchester United - recog-

nition. Some recognition measures, suchas company events to celebrate success,

have been part of employees total

reward package for many years. If the

team enjoys success it is good for rev-

enue but places more demands on staff

as more matches will be accommodated

at O ld Trafford. To recognise their extra

efforts, all employees plus their guest

have been invited to company events in

celebration of this success. N ewly intro-

duced recognition schemes include the

C hristmas P arty and the end of season

P arty on the Pitch , which our new

employee can enjoy with his whole fami-

ly. T here is also the established V IP

Employees of the M onth scheme for liv-

ing the UNITED values. All monthly

winners attend a premier league match

as guests of the Directors, dining in the

VIP suite and watching the game from the

Directors B ox. Nominated by employees

from the m onthly winners, the first

Employee of the Season, Tony Sinclair,

received his trophy on the pitch at the

Tottenham home game in front of a

capacity crowd and millions of viewers on

Sky T V. Tony, who works as H ead

G roundsman received his award for con-

TO BE THE BESTFOOTBALL CLUB INTHE WORLD BOTHON AND OFF THEPITCH.

United with our fans in our com-mitment and passion for the club

Non-discriminatory in makingM anchester United accessible to all,

irrespective of age, race, gender,

creed or physical ability

Innovative in our ambition to befirst to the ball at all times

Team-orientated in our desire towork together with the same dedi-

cation displayed in every game by

our first team squad

Excelling in our aim to be worldclass in everything we do

Determined in our pursuit of suc-cess while being accountable for

our actions.

The UNITED Vision and Values

Vision: To be the best foo tball club i n

the world both on and off the

pitch.

Values: Incorporate how we intend to

operate on a day to day

basis, they are at th e heart of

everyth ing w e do, they are a

mix of the traditiona l behav-

iours that have buil t

Manchester United into wha t

it is today, a successful and

professionally run football

club.


11/40

sistently displaying excellent levels of per-

formance and L iving the United Values

day in, day out. T here is also the newSA S (Sports and Social C lub, named by

the staff), which the company subsidises.

Amongst other staff events it organises

staff football matches at the end of the

season on the O ld Trafford pitch, 5-a-side

football, mixed netball, badminton, circuit

training and legs, bums and tums ses-

sions. If our new employee is less worried

about health and fitness, there are quiz

and curry nights, trips to the races etc!

How emp loyees are judge d

Following the first employee satisfaction

survey, M anchester United introduced its

P DR (P erformance and D evelopment

R eview) Process. All permanent employ-

ees received training on the process and

managers were trained on how to con-

duct annual reviews. T he first goal of the

PDR process is to link individuals objec-

tives to their departments objectives

which, in turn, are aligned to the compa-

nys strategic objectives. T he second

purpose is to enrich employees working

life by encouraging them to identify per-

sonal development goals and by providing

the necessary training or guidance to helpthem achieve their goals.

The PDR process has been a great suc-

cess. O ver the years, the biggest increase

in employee satisfaction has been with

regular review of my performance.

Personal development

In most SM Es the opportunities for promo-

tion are necessarily limited compared with

those in large companies with thousands

of employees. T his is exacerbated at

M anchester United by the very low

employee turnover rate. Whilst the compa-

ny mak es every effort to promote from

within whenever possible, most employees

recognise the limited opportunities for for-

mal promotion as a fact of life if they

choose to stay at the C lub. T his is why it

has been so important for M anchester

United to maximise employees opportuni-

ties for personal development and to

introduce the performance-related reward

and recognition schemes referred to earlier.

Caring and Com munity

All employees everywhere want to feelthat they work for a caring organisation:

one that cares for them and for its local

community. M anchester United provides

its employees with specialist counselling

and support where necessary, it has a

qualified counsellor in its HR Team, a C lub

C haplain, a health and fitness scheme,

and, as we have already seen, a great

induction scheme to make our new

employee feel welcome.

T he M anchester United Foundationssupport for charity and the local commu-

nity is legendary. O ur new employee

would soon get to hear about the C lubs

strong links with UN IC EF. At the Players

P layer events in recent years, for exam-

ple, all proceeds went to charity. P layers

often make personal appearances for

charity and signed merchandise is fre-

quently donated to charities. All charity

work is co-ordinated by the M anchester

United Foundation, which also organises

an extensive Football in the C ommunity

scheme to give thousands of local young-

sters the opportunity to develop their

footballing potential. M UDSA (M anchester

United Disabled Supporters Association)

organises free match tickets for its mem-

bers and their carers, all housed in the

recently refurbished disabled section of

the stadium. The C lub also fosters exten-

sive educational links, investing in its own

C urriculum M anager in the C lubs muse-

um, plus a second Educational O fficer

employed by the local authority but

based at O ld Trafford. Both work full timeon using football and M anchester United

to increase local childrens engagement

with the educational system.

As well as realising that M anchester

United is a caring organisation, our new

employee would hopefully soon realise

that the company consults and listens to

its employees and takes action to

address areas of concern. A t least thats

what the rest of the workforce think. In

the last employee satisfaction survey,

84.1% were satisfied that M anchester

U nited had taken positive steps in

addressing feedback from the previous

survey.

Case Study


S


12/40

Last Septembers StakeholderSatisfaction article explained why

engaged employees (those who desire

to work to make things better and per-

form at consistently high levels) should be

valued above all others, and emphasised

the importance of being able to see what

motivates and drives these employees. It

explained how employee engagement

can be measured, and in doing so how

we can gain the knowledge required to

get those who are less engaged to

change their ways.

The drivers of engagement

Its absolutely vital to remember that differ-

ent factors work for different people so

every company should aim to discover

what drives engagement in its own organi-

zation. For example, in some organisations,

such as the caring professions, staff may

already identify closely and feel emotionally

attached with what they are doing and see

their work as having a much broader pur-

pose and value. For many other

organisations emotional attachment to the

purpose and value of their work will be

harder to achieve, so good communica-

tions from senior management aboutvision, values and strategy will be essential.

For other organisations pay may be viewed

as a motivator, although this usually only

works up to a point. M ost people become

concerned only if their pay is not competi-

tive with that of others doing similar work.

O ther factors that drive engagement

include training and development and pro-

motion opportunities but these can be

undermined if employees perceive things

are not fair or there is a lack of even-hand-

edness in the way managers behave.

Variations in engagement drivers

O bviously each individual business has to

treat its own employees as unique and

conduct a bespoke survey to identify its

own engagement drivers. H owever, it is

interesting to explore the differences in

employee engagement that can be found

at R egion/Industry/G ender/Job level etc.

The original research conducted by The

Leadership Factor last August using our

own representative panel of employees

provides considerable insight into varia-

tions in employee engagement.

Mark McCallThe Leadership Factor

C lient Manager

[email protected]

Drilling down intoemployee engagement

Secretary of State for Work and Pensions, John Hutton said recently that The most suc-cessful companies recognise that their employees are their m ost valuable asset. Employee

engagement is not just a b uzzword it has a clear link to increased business success. Andthere is growing evidence that business leaders are not simply paying lip service, theyreactually walking the talk. Nowadays, most companies do agree that engaged employees those willing to go the extra mile can have a very strong effect on the success of a busi-ness and so are seeking effective techniques that will allow them to build engagement.

The most successfulcompanies recognise thattheir employees are theirmost valuable asset.Employee engagement isnot just a buzzword ithas a clear link toincreased business success.

Mark works with a varied group of clients such

as Visa, Tarmac, Ferrero, William Jackson andJohnsons.

When not helping his clients to improve employ-ee or customer satisfaction, he spends his time

watching Manchester United win football match-

es.

Stakeholder January 2009 | www.stakeholdermagazine.com12

Latest Thinking


13/40

As already reported in the previous issueof Stakeholder Satisfaction, the main fac-

tors at the overall level that differentiated

engaged employees from indifferent

employees were:

C ommunication from S enior M anagers

R ecognition of your performance

Pay and benefits

Promotion opportunities

Training and development

Interestingly, when cross-checked against

overall employee satisfaction these are

also the five lowest scoring factors, sug-

gesting that there is lots of work to be

done.

Differences by Sector

To demonstrate the need to treat your

employees as unique, lets now start

drilling down by segment. Firstly, lets take

a look by sector. As can be seen in chart

1 there is a significant difference in the

satisfaction indexes, between the top per-

forming industries (education and service

industry) and those near the bottom (gov-

ernment and transport).

There is much support in C hart 1

for Harvards Customer-Employee

Satisfaction M irror theory. Education is not

covered by the UK C ustomer Satisfaction

Index (U K C SI) but the service industry is in

the top 2 for both customer and employ-

ee satisfaction. O thers in the top half for

employee satisfaction are also, if covered,

in the top half on the UK C SI and ditto for

the bottom half. T he only exception is

food retailing, which manages to generate

good levels of customer satisfaction

despite lower than average employee sat-

isfaction. For the latest UK C SI results see

page 31 in this issue of Stakeholder

Satisfaction.

Chart 1: Variationsb y sector (industrieswith sampleslessthan 50 excluded)

60% 70%

SEC TOR

Overall

Education

Service

Financial services

Leisure a nd Tourism

Retail-non food

Health

Telecom munica tions

Manufacturing

Local Government

Retail-food

Government

Tra nsport

80%

67.9%

69.5%

69.4%

69.4%

69.1%

68.5%

68.3%

68.0%

67.2%

66.0%

65.7%

65.7%

62.8%

Latest Thinking



14/40

Its enlightening to look at some key fac-

tors that are driving these sector

differences. C hart 2 shows the satisfac-tion scores of those who work in the top

performing sector, education, against

those in the bottom performing sector,

transport. Those working in education are

more satisfied with all aspects of their

employment, but the biggest differences

in satisfaction are recorded for training

and development, your line manager lis-

tens to you and being treated fairly.

Taking a step further, we can look at the

number of people engaged in those

industries. Shown in Chart 3, the gap

looks much bigger now that we look at

engagement. Education has a net

engagement index (Engaged minus

Disengaged) of 32.7% , whilst Transport

has a negative net engagement index of

2.3% , meaning that they have more

people who are actively disengaged than

engaged.

To improve any index, you need to under-

stand whats driving it. T his can be done

by comparing the scores for each factor

given by the engaged and the less

engaged employees. If there is little or no

difference in the scores, the factor is obvi-

ously not making much difference to

engagement. A big difference in scores

makes it a key driver of employee

engagement.

As education has so few disengaged

staff their priority would be to try and

move employees from their indifferent

status towards active engagement andwe can see from chart 4 that they need to

prioritise pay and benefits and commu-

nication from senior managers to do this.

Cha rt 4: Improving employee eng a ge ment in educ ation

3 4 5 6 7 8 9

Pa y and benefits


Being treated fairly

Recog nition of your performanc e

Relationship with colleagues

Training a nd d evelopment

P hysical working environme nt

Your line m an ag er liste nsto you

Relationship with your line manager

Having the resourcesto d o your job

Work/life ba lanc e

Communication from senior managers

Engaged

Indifferent

Cha rt 2: Driversof enga gement by sector

4 5 6 7 8 9

Your line m a na ger liste nsto you

Training a nd d evelopmen t


Recog nition o f your performance

Comm unica tion from senior managers



P hysical working environmen t


Work/life ba lanc e


Pa y and benefits

Education (101)

Tra nsport (88)

Cha rt 3: Net enga gement by sector

0%

Education

Tra nsport

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

EngagedIndifferent

Disengaged

5.9%

25.0% 47.7% 27.3%

55.4%38.6%


Latest Thinking


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Transport meanwhile needs to explore

why so many staff are disengaged, and

needs to make totally different factorstheir priority, especially being treated fair-

ly, communication from senior

managers training and development

and recognition of your performance as

these show the biggest gaps for the sec-

tor.

Differences by job role

As might be expected, managers in gen-

eral are more satisfied than

non-managers. This is important as an

organisation is represented at all levels by

its management, and an employees

sense of what the company is like will

usually be heavily influenced by the way

immediate managers and senior man-

agers behave.

Senior M anagers (defined here as manag-

ing over 100 people) are much more

satisfied than all other roles, especially

with promotion opportunities, training

and development and recognition of your

performance . Not surprisingly, senior

managers are also far more engaged,

with a net engagement index of 48.9% .

Indeed, any other result would be very

worrying, since engagement starts at the

top. If Senior M anagers are not engaged

there is little chance that they will inspire

engagement amongst those working for

them. It must therefore be of some con-

cern that 38% of senior managers are

indifferent and a further 6% actively disen-

gaged!

C lerical employees record a negative

engagement index of -4.5% . To improve

this situation, organisations need to

address recognition of performance ,

training and development and being

treated fairly .

Cha rt 5: Improving e mployee enga gem ent in tra nsport

3 4 5 6 7 8 9

Engaged

Disengaged


Communication from senior manag ers

Recog nition of your performanc e

Training and deve lopment

P hysical working environme nt


P romotion opportunities


Your line m an ag er liste nsto you


Pa y and benefits

Work/life ba lanc e

Chart 6: S atisfac tion b y job role

60%

Overall

P OS ITION

Mana ger - Of more tha n 100 people

Manag er - Of between 1-9 people

Mana ger - Of between 10-100 people

Non mana ger - professional

Non manager - manual

Non mana ger - clerical

70% 80%

67.9%

75.4%

70.7%

69.2%

67.2%

67.0%

66.8%

Cha rt 7: Net enga ge ment by job role

0%

Manager - Of more

than 100 people

Non manag er

- Clerica l

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Engaged

Indifferent

Disengaged

6.4%

21.9% 51.7% 26.4%

38.3%55.3%

Latest Thinking

www.stakeholdermagazine.com | January 2009 Stakeholder 15


16/40

Differences by gender

G ender differences are not large, but

women are more engaged than men,

showing a net employee engagement index

of 17.2% compared with the mens 11.2% .

However, when we dig deeper, the picture

becomes more complex. A s shown in

C hart 9, part-time employees are more sat-

isfied than full time employees, and more

women work part time than men. It is clear

that female part timers are more satisfied

than male part timers (partially down to

work/life balance, are they mak ing the

choice to work part time?) whilst there is lit-

tle difference between gender satisfaction if

comparing full time employees only.

Having established that part time staff are

more satisfied than full time, it is interesting

to note that the reverse is the case when

comparing engagement. Shown in Chart10, we can see that the net engagement

index for full time employees is 16.3% but

that its only 11.3% for part time staff.

C learly part time staff are happy with their

work-life balance choice, but are often not

particularly engaged in driving the success

of their company or their own career.

Two of the top three drivers of engage-

ment for full time employees are

recognition of your performance and

promotion opportunities. The third is

communication from senior managers ,

which is also important to part timers.

However, the key driver of engagement for

part time employees is pay and benefits.

What have we learnt?

M ost importantly, that you must treat your

own employees as unique and that any

generic study of employees is unlikely to

be transferable to a specific organisation.

Not only do you need to treat your own

staff as different from other organisations,

but its very likely that you also need to

explore what is driving different groups of

people within your organisation, because

managers have different needs from staff,

and that age, gender, full time/part time

workers may all have differing needs and

expectations that need to be met.

Another key learning point is just how

important in driving engagement, com-

munication from senior managers is to

most employees. When measuring satis-faction alone, this factor is rarely top of the

list of priorities, but it has emerged as a

vital factor in turning indifferent employ-

ees into fully engaged staff.

As the credit crunch bites, and companies

need their employees to work smarter and

better to differentiate them from the rest,

employee engagement continues to become

ever more vital to long-term success.

After a decade that has seen employee

engagement levels staying at much the

same level right across the globe, perhaps

we are finally going to see employees treat-

ed as companies most valuable asset.

Cha rt 8: Employee enga gement by g ender

0%

Female

Male

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Engaged

Indifferent

Disengaged

30.2% 50.8% 19.0%

17.4%47.9%34.6%

Chart 9: Sa tisfac tion by hoursof workand g ender

50% 60% 70% 80%

Fema le P art time (458)

Female Full time (742)

Male P art t ime (144)

Male Full time (656)

70.8%

67.1%

68.7%

66.8%

Cha rt 10: Enga gement by hoursof work

0%

Part time

Full time

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

34.0% 48.3% 17.7%

19.0%50.7%30.3%

Engaged

Indifferent

Disengaged


Latest Thinking

S


17/40


18/40

The Thinkers

M any people attend conferences to get

new ideas and / or to provide thinking

time so you would expect full time

thinkers to be just what the doctor

ordered. Especially if theyre in at No. 11

on the T hinkers 50 (the list of the worlds

top business thinkers). Although it seems

like an age ago, I remember sweating

blood over K otlers massive textbook and

always admired his customer-centric view

of marketing, not to mention the millions

of books he must have sold. Imagine my

disappointment when he treated us to a

lecture he could have delivered to his first

year students a few days ago, or worse, a

few years ago. We sat through a thorough

text book account of the evolution of mar-

keting and encouragement to fight the

recession with paradigm shifts but no new

insights as to what these might be.

Surely G ary Hamel would be better. After

all, he co-authored C ompeting for the

Future, the best selling strategy book of

all time and wrote 2007s Best Business

Book (as voted by editors of Amazon),

T he Future of M anagement. Both titles

sound very apt in current times. Well he

was certainly more animated than K otler

and a lot noisier, and much more scathing

about the complete failure of modern

management, which, according to Hamel,

has not really progressed since the 50s or

60s. However, he did suggest some spe-

cific ideas for how to do the paradigmshifting and become 21st century leaders.

O ne idea was to ask thousands of out-

siders to help develop your company

strategy. I think he meant customers. An

interesting idea, and one that was devel-

oped later and far more tangibly, by one of

the doers. M ost of his ideas were focused

internally on employees and culture and

were drawn from his favourite companies

like W L G ore and Semler C orp. For the

latter see the book review in a very early

edition of Stakeholder Satisfaction(December 2003), but there are many

parallels between the two companies.

Both are supreme examples of employee

managed, in fact, employee led organisa-

tions. Work units are self-managed teams

who appoint their own leader and can

do whatever they think appropriate to

achieve agreed revenue targets. No-one

can tell anyone else what to do, but peer

appraisal determines pay, so contributing

is a sensible career strategy. A ll employ-

ees can spend 10% of their time on

whatever they find personally interesting.

As well as helping employee engagement,

this policy generates most of the compa-

nys new products and growth. H amels

Philip KotlerP rofessor

K ellogg School of M anagement

Aspiring leaders gathered in December in the interesting venue of the

Central Hall Westminster. 800 of them, occupying only the lower of the

two tiers of seating in the Grand Hall belt tightening presumably hav-ing a bigger impact on bookings than any belief that leadership is the

way out of the recession. The venue was an interesting choice.

Convenient yes, historic certainly, with the Victorian features from the

ceiling roses to the plumbing still aesthetically pleasing and fully func-

tioning. Interesting and historic but in sharp contrast to the many voices

promoting the need to throw out the old management paradigms and

bring in the new to have any hope of fighting the recession. Apart, that

is, from one very well known, rather crustaceous but very persuasive

voice. More about him later. Im going to start this review of Leaders in

London with the thoughts of the thinkers, the speaker category with the

biggest membership.


Conference


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Conference

www.stakeholdermagazine.com | December 2008 Stakeholder 19


20/40

fundamental point is engaging, empower-

ing and therefore harnessing the creative

potential of all employees. Not a new ideabut certainly a good one. He encourages

organisations to develop a thoughtocra-

cy of ideas. Like the 540,000

suggestions generated last year just by

Toyotas Japanese employees. D ell have

an IdeaStorm. The interesting thing here

is that its on the intranet for all employees

to see and to comment on, like a blog,

often generating many comments for

each suggestion. Now that is a good way

to harness the creative power of the work-

force.

Vijay G ovindarajan is G Es C hief

Innovation C onsultant as well as an aca-

demic. Another paradigm shifter,

G ovindarajan uses an interesting high

jump analogy to illustrate the view that

successful innovation requires outside

the box thinking. In the early days of the

last century the prevailing technique was

the scissors, just like we all did at junior

school, but over the years the much more

efficient techniques of the straddle and

then the Fosbury flop were developed. It

is the completely new techniques that

resulted in advances in the world record.

Its very unlikely that men would be jump-ing almost 2.5 metres and women over 2

metres using the scissors! G ovindarajans

five barriers to innovation are

1.Too much focus on current operations

2.Lack of tolerance for failure

3.Not embedding innovation as an

important responsibility for every

employee

4.Too much silo mentality

5.Lack of a global mindset.

G ovindarajan thinks that overcoming the

first barrier is the biggest challenge for

most organisations, saying: The problem

is not so much getting new ideas in as

getting some of the old ideas out. You

need to forget some of what has made

your core business successful.

Author of M icrotrends: the small forces

behind tomorrows big changes, M ark

Penn was a valued advisor to both Tony

Blair and Bill C linton, helping them to

identify and respond to consumer trends

and voting patterns. P enns key trend is

the transition from the Ford economy to

the Starbucks economy a world of

mass customisation and fast emerging

niche markets. In the Ford economy see-

ing new patterns was less important than

creating them, marketers seeking to cre-

ate markets and manipulate consumer

choices. O f course, you could debate this.

I ve always agreed with P eter Drucker that

the most profitable business model has

always been to sell products that cus-

tomers want to buy rather than persuade

them to buy the products you want to sell.

Where Penn and I would agree, however,

is that burgeoning information and com-

munication channels in the internet age

have made it much more feasible to iden-

tify and respond to niche trends and

needs. N ot just feasible but essential,

since growing consumer confidence

together with widely available informationon niche products and services means

that consumers are no longer prepared to

settle for second best. M icrotrends might

not be a quick fix to battling your way out

of the recession but will surely be a key

element of all good companies innovation

strategies in the 21st century.

The Doers

Some of the doers are technically ex-doers (or is that didders?), but if they run,

or have run proper businesses, theyre in

this section. That doesnt mean they were

all great contributors to the conference.

The one I was most looking forward to as

a champion of entrepreneurs, was the

most disappointing. Luke Johnson, best

known for P izza Express but also suc-

cessful owner of businesses across many

other sectors was a strict verbatim reader

of a speech, much of which was quotes

from other people.

C harlie M ayfield is C hairman of John

Lewis P artnership ( including Waitrose),

clearly admirable businesses. H e

acknowledged that theyre suffering in the

recession, especially on higher tick et

durables, but he isnt changing his strate-

gy. B ased on Harvards Service-P rofit

C hain principles, his key management

beliefs such as the C ustomer Value

P roposition and the Employee Value

Proposition have been widely covered in

earlier editions of Stakeholder

Satisfaction. For details go to www.stake-

holdermagazine.com and see the

December 2003 issue for the C ustomerValue Proposition and the M arch 2004

issue for the Employee Value Proposition.

With the recent withdrawal of Honda,

Formula 1 is not currently a comfortable

place to be, but listening to boss Ron

Dennis, one team thats not quitting is

Gary HamelVisiting Professor

London Business School

Vijay GovindarajanP rofessor

Tuck S chool of Business

Mark PennAuthor and Consultant.

Luke J ohnsonEntrepreneur and Chairman,

C hannel 4

Charlie MayfieldC hairman

John Lewis Partnership


Conference


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M cLaren, home of newly crowned world

champion Lewis Hamilton. S ince their

mission is that they exist to win, youwouldnt expect them to be quitters, but

Dennis had some very interesting mes-

sages of great relevance to business in

the 21st century, especially on the need to

increase the speed of making and imple-

menting decisions without reducing the

quality of outcomes.

Dennis pointed out that over a lap of

almost three miles the difference between

the fastest and slowest car on the grid in

the Brazilian G rand Prix was 1.74 sec-

onds. To maintain an edge in such a

competitive environment, a M cLaren car

will be 2 seconds quicker at the end of the

season than it was at the beginning. To

achieve this, a change to the design of the

car will be made every 20 minutes! To

maintain this pace of change, decisions

about design improvements must be

debated, adopted and implemented at

breakneck speed, but without compromis-ing quality. The cars must obviously remain

safe, thats just a given, but the design

changes, or at least the vast majority of

them also need to work. To give a couple

of examples, it takes a volume car maker

five years to conceive, develop, test and

build a new car. It takes M cLaren ten

months. It takes Ford up to two years to

design and develop a new suspension

system. M cLaren have done it in two

weeks. Dennis emphasised that to suc-

ceed in this pressurised environment,

everyone on the team must be highly

ambitious and totally engaged, so employ-

ees are highly incentivised, but rewards

are not automatic, they follow results and

reward success not mediocrity.

O ne of the most interesting speakers,

and certainly one of the most engaging,

was R ichard R eed, co-founder of

Innocent Drink s, B ritains fastest growing

food and drink company, achieving a

turnover of 100 million in less than 10

years. R eed had 5 messages based on

the lessons hes learned over this period.

First, keep the main thing the main

thing. M aintain focus on a clear product

offering that is designed to match pre-

cisely the needs of a target customer

group. Second, its all about the peop le.

Like Dennis, R eed advises recruiting the

best people that match the values of the

business, then do all you can to engage

them. As an example, on day 1, new

Innocent employees are given a mug and

a bowl with their name on, for the free

drinks and breakfast. T hird, make

money, but only if you can do it ethicallyand sustainably. Fourth, and again echo-

ing Dennis, take care of the details

because if theres parity in a market, its

the little details that make the difference.

Last but not least, open up, listen up.

C ustomer feedback is essential. T he

business needs to know at all times how

customers see it and that they are satis-

fied with what theyre getting.

G ary Hamel suggested that you should

ask thousands of outsiders to help devel-

op your company strategy just what

C arly Fiorina did when she became the

first (and still only) female leader of a

Fortune 20 company in 1999. H ewlett

Packard had just missed its 9th consecu-

tive quarterly forecast. For a technology

company at the height of the dotcom

boom, that was not a good performance.

In the next issue of Stakeholder

Satisfaction well look in detail at the

strategic changes that resulted from this

customer consultation, but in this article

I ll outline her approach to changing the

culture at H P.

Fiorina inherited a very conservative culture

where people were very thorough, took few

risks and were rewarded for beating inter-

nally generated (conservative) targets. T he

first thing she did was to reward people for

satisfying customers before developing

and communicating the companys new

strategy and vision. Although HPs strate-

gic direction was changed massively by

Fiorina, she was at pains to emphasise thatas long as a vision is only the leaders, it

wont succeed. You have to communicate

the vision sufficiently well to motivate some

employees (change warriors) to lead the

others into the new land. There are some

very senior people who dont lead (which is

a big problem) and others lower down who

can be highly motivated and very influential.

To successfully drive through change, you

dont need unanimity but you do need crit-

ical mass. You must therefore identify the

change warriors, recognise and reward

them and celebrate success. O ther people

will be watching this and, apart from the

most diehard change resisters, most will

join the winning team sooner or later.

Ron DennisC hairman and CEO

M cLaren G roup

Richard ReedC o-founder

Innocent D rinks

Conference



22/40

Fiorina also had some very relevant tips

for beating the recession. She pointed out

that people always like comfort zones, butnever more than in tough times, when

theyre inclined to dig down into the

trenches and protect what theyve got. In

fact, its in the tough times that you most

need to change. Darwin explained that

the survivors are not necessarily the

biggest, strongest or even cleverest

species, but the most adaptable. Its the

same for companies, but their leaders

must show the way, above all striking the

right balance between realism and opti-

mism. Leaders must have the ability to

recognise all the threats, obstacles and

challenges with clear eyes and they must

be truthful to employees about these. But

they must also be optimistic, and succeed

in communicating a genuine belief that the

organisation can meet the challenges and

build a better tomorrow.

Someone who never had any difficulty

being truthful with employees was Jack

Welch, who worked for G E for 40 years,

as CEO and C hairman for half of that time,

during which time the companys market

capitalisation surged from $13 billion to

$400 billion. T his earned him Fortune

M agazines accolade of M anager of theC entury. O pinionated, cantankerous but

infinitely wise and with both feet firmly on

the ground, Welch has no time for too

much academic theorising. H e says that

good managers have to be able to eat

while they dream. In other words, they

must continue to produce short term

results whilst looking after the long term

future of the business. The ability to do

this is the hallmark of great companies.

Anybody can do one but not the other.

G reat leadership is the ability to make the

right judgement calls between the two. So

how did Welch allocate his time at GE. He

claims that 75% of it was spent helping

his people to perform better. H e evaluated

his direct reports every three months,

along the simple lines of: Heres what I

like. Heres what you can do to improve.He was very strong on the need to be

candid with your people. T hey should

never get any surprises.

Rather than hiding away in his office,

Welch spent much more time out and

about, talking to employees of all levels

and to customers, saying; Your job is to

touch everyone and get into their soul.

Welchs top 10 tips for creating corporate

momentum are:

1. The right measures

If he had to run the company

on only three numbers they

would be customer satisfaction,

employee satisfaction and cash

flow.

2. Build confidence

Build self-confidence in your

people.

3. Set your people free

Lik e Harvard, Welch believes

that employees have to operate

within a clearly agreed set of

parameters, but youve go t to

have more freedom than you

ever dreamed of.4. Shout when you win

You must celebrate all the victo-

ries, even the little ones.

5. Numbers arent enough

Sales and profit targets are not

the vision. T hey are the product

of the right vision and strategy

successfully implemented.

6. Talent development

At GE, Jack Welch and his top

two HR people visited each divi-

sion for a day and personally

reviewed the top 20 to 50 people.

7. Fair doesnt mean the same

To treat every person fairly you

have to treat them differently.

8. Make people share good ideas

At quarterly divisional head

meetings Welch insisted that allmanagers shared the ideas and

practices most responsible for

their divisions success that

period. We take the best of

diversity and use it.

9. Meet customers more often

Welch made a point of person-

ally meeting all GEs major

customers twice a year.

10. Dont dither. Jump

Ive learned in a hund red ways

that I rarely regretted act ing but

often regretted NOT acting fast

enough.

Carly FiorinaDi rector of several companies

ex-CEO HP

J ack WelchFortune M anager of

the Century

Nigel Hill

Founder of The

Leadership Factor

and editor of

Stakeholder

Satisfaction.

Football highs -

meeting Bobby Charlton twice, the last 3

minutes of the 1999 Champions Leaguefinal and R yan G iggs wonder goal against

Arsenal.

[email protected]


Customer

S

EMPLOYEE SURVEYS

Do you want an average employee

survey based on standard questions

for the typical organisation?

O r would you prefer questionsbased on what's important to your

employees with actionable

outcomes to improve the

engagement of targeted employee

groups.

If youre trying to differentiate rather than

follow the pack, contact Jim Alexander on:

01484 467 [email protected]


23/40

Employee

Engagement- The key tobusiness success

In a recent survey of large UK employers conducted by

Strategic Reward, we asked HR Directors What are

your top three issues, in order of priority, over the next

6 to 12 months? The 150 respondents placed

Employee Engagement in top spot, closely followed by

Leadership Development. Is this what we would have

expected? According to conventional wisdom the

financial crisis, decline in manufacturing output, tough

times on the high street and plenty of negative press

mass redundancies and major restructuring of the

workforce would be nearer the mark. But, why should

conventional wisdom apply when times are definitely

unconventional?

A POSITIVEATTITUDEHELD BY THEEM PLOYEETOWARDS THEORGANISATION

AND ITS VALUES

Case Study




Case Study

Employee engagement is now widely

recognised to be at the heart of business

success in good times and not-so-good. If youre restructuring, engaging

survivors is going to be a tough challenge,

but its far from impossible; I f youre

standing still and in batten down the

hatches mode, motivating, encouraging

and supporting employees who feel inse-

cure about their future is crucial. If parts of

your business are expanding (yes, its not

all doom and gloom out there), having a

compelling proposition about why people

should join your organisation (and stay) is

essential too.

Engagement defined

Not surprisingly, definitions of employee

engagement differ. T he Institute of

Employment Studies2

definition includes

the words a positive attitude held by the

employee towards the organisation and

its values. An engaged employee is

aware of business context, and works

with co lleagues to imp rove performance

within the job for the benefit of the

organisation. Heskett, Sasser and

Schlesinger3

talk about .the frequen-

cy w ith which an employee refers others

for emp loyment with the organisation .

Ask a group of HR D irectors and they

will typically say

Employees showing high organisation-

al commitment, job satisfaction, and

who embrace the brand

A happy, motivated, productive and

loyal workforce

Employees feel valued and that theircontribution has an impact on the

business

Employees regularly work to exceed

expectations, are willing to challenge

the sta tus q uo and ta ke informed risks.

While organisations may have different

definitions of employee engagement, the

end result is the same: desired behaviour,

in particular the extent to which employ-

ees engage in the sort of discretionary

behaviour which is right for customers,

other stakeholders and long term growth.

This behaviour is often referred to as

going the extra mile. For me, this is

about

Customer focus: understands the cus-

tomer; solves their problems

Innovation: challenges assumptions;proposes new wa ys

Tea mwo rk: w orks a cross bounda ries ;

shares knowledge; encourages col-

leagues

Open communications: creates clear

communications and feedback

Recommending the organisation: as a

plac e to work; as a place to do business.

Why is behaviour so important? Surely,

results are what matter most. We have to

look no further than our own experience

for the answer. How do we feel when we

stay at a hotel where employees treat us

like a VIP? G reat, we book again and we

tell our friends. C ontrast that with a retail

store where the sales assistant is interest-

ed only in pushing a specific product,

probably because they have been finan-

cially incentivised to do so, and treats us

like an inconvenience. We are dissatisfied,

we tell our friends and we never shop

there again.

Barriers to engagementand overcoming them

O ur experience raises two important

questions. What are the barriers to

employee engagement and how can we

engender it? T here are lots of organisa-

tions where employees dont understand

how their day-to-day work affects busi-

ness performance. P hilip Addison,

Human Resources Director, Accor UK &

Ireland Hotels, puts it this way: Business

Leaders often take some of the basics forgranted and assume that employees

know whats important if the business is

to succeed, whats expected of them and

what they can receive in return. But , if we,

the Business Leaders, don t set out clear-

ly whats expected of employees and

what well provide in return, how can we

possibly expect employees to know

whats important to our business?

Developing our vision and values with

them really helped us clarify our own

thinking.

O ther, more potentially damaging, rea-

sons are lack of fairness and consistency

in the way HR practices are implemented.

O ur research tells us that this is a big con-

cern. Among the most frequently made

comments at focus groups that I facilitatefor clients are

Pay review isnt transparent

We only get neg a tive feedba ck abo ut

customer satisfaction

Recognition! Whats that?

My manager pays lip service to my

tra ining needs

According to research by the Corporate

Executive Board1

, employees percep-

tions of pay process fairness, that is the

procedures used to evaluate and allocate

pay, not the level of pay, is a 25 times

stronger predictor of employee commit-

ment than is pay satisfaction. Without

fairness and consistency, emotional con-

nections will not exist.

But not dealing with malingerers, people

who go out of their way to upset working

relationships and cynics who criticise the

motives of the organisation, whatever it

does, sets an incredibly bad example to

the majority of employees and is bad for

business.

This is in stark contrast to organisations

where people feel valued and work

together towards common objectives with

which they all understand and agree.

Here, business leaders work tirelessly to

build and retain the trust and confidence

of employees, to create a culture where

employees feel engaged because their

personal success and that of the organi-

sation are tied together. These businessleaders are the role model for the way we

do things around here.

A compelling employee proposition

A truly compelling employee proposition,

which attracts, engages and retains the tal-

ented people the organisation needs, must

be based on everything employees value in

the workplace. Thats a lot to do with intan-

gible factors such as job challenge and

interest, freedom and autonomy, employ-

ees needs at different stages of their life

and reputation of the organisation. T he two-

way nature of the employee proposition can

be set out quite simply, as shown overleaf:


25/40

Case Study


We expect you to .

Put guests at the centre of our

company Help create a positive and engaging

work environment for everybody

Live our company values

Enga ge with performa nce review

Develop yo ur skills a nd w a nt to learn

Work tog ethe r, co ntribute idea s a nd

sha re knowledge

Be o pen and respectful

We provide ..

Very co mpet itive rewa rds in the hos pi-

tality sector

A benefits pac kage that is relevant a nd

of value to you and your dependents

The oppo rtunity to ea rn rew a rds ba sed

on contribution both results and

behaviour

Opportunities for learning, develop-

ment, personal growth and career

progression

A great work environment that recog-

nises excellence and teamwork, and

provides respect and support for the

individual.

While this generic proposition communi-

cates the key principles which underpin

employment, what one type of employee

group finds interesting and engaging,

another may find boring and de-motiva-

tional. So, variations in employee

proposition may be appropriate.

Segmenting the workforce can reveal

powerful insights about what employees

value, and consequently the drivers of

engagement. C ategories include

Employment arrangement full-time,

part-time, fixed term contract,

telecommuter

High performers do they ha ve uniq ue

needs and expectations?

High potential employees those

whom the organisation believes have

the capability to become top leaders

and the vision to take the organisation

to greater success in the future. What

engages them?

Critica l groups do groups o f employ-

ees , such as g r adua tes ,

customer-facing or product develop-

ment have different views about the

wo rkpla ce experience ?

The case study describes how one organ-

isation, Southern Housing Group, delivers

three key aspects of its employee propo-sition providing a talent pipeline,

encouraging and rewarding learning, and

giving employees the opportunity to work

flexibly.

Change Blueprint

C ontrary to much conventional wisdom in

HR , the drivers of engagement are specific

to individual organisations, so general pre-

scriptive actions to improve engagement

levels are of limited use. Actions should

focus on the specific results of the engage-

ment survey. The following five-point plan is

a good way to get things started:

1. Co mmunica te key results of your

engagement survey openly, via team

talk, round tables and business

forums, and say what action will be

ta ken with an indica tion of timesc ale

2. Build on your employee proposition:

what does it really mean for your

brand and employee engagement?

3. Ensure you und erstand employeesperceptions and the importance they

attach to them

4. Recog nise a nd celebrate s ucces s a t

individua l, tea m a nd organisational lev-

els, es pecially in non-moneta ry wa ys

5. Invest in mana gers a nd tea m lead ers.

Help them delega te, trust, coa ch a nd

reward.

Employee engagement is not an end in

itself. It is worthwhile only if translated into

business results, such as increased cus-tomer or stakeholder satisfaction

(ultimately leading to their loyalty), sales

growth, higher productivity, lower cost-

income ratio or higher profits. Will your

organisation take up the challenge?

References

1. C orpora te Exec utive B oa rd: Driving

P erformance Through P ay-J anua ry

2006

2. Institute of Employment Stud ies, The

Drivers of Employee Engagement,

Report 408

3. The Va lue-P rofit C ha in, Hes kett,

Sass er &Schles inge r, The Free P res s

CASE STUDY: Southern Housing Group

Southern Housing G roup is one of south-

ern Englands largest housing

associations. Founded over 100 years

ago, Southern Housing Group owns and

manages 24,000 homes with more than

66,000 residents, employs 900 people

and works with 80 local authorities.

Southern Housing G roup believes that

building communities is as important as

building homes. So as well as developing

and managing quality affordable housing

for rent and ownership, Southern Housing

G roup invests considerable resources to

provide an environment where people

really want to live. Southern Housing

G roup also invests in HR practices which

are designed to encourage high levels of

customer service and meet the needs and

aspirations of employees. T his case study

looks at three aspects of its HR approach.

1. Providing a talent pipeline

The Graduate Development Programme

(G DP), which has been running for seven

years and is recognised to be one of best in

the Housing sector by the National Council

for Work Experience, provides a successful

talent pipeline for Southern Housing G roup.

The G DP is a three-year programme whichfast-tracks graduates into established jobs

in Southern Housing G roup and gives them

the opportunity to continue with specialised

postgraduate studies.

During years 1 and 2 graduates gain

experience in all areas of Southern

Housing G roup. T hey start their training in

the Customer Service Centre and move

onto frontline housing management, poli-

cy work at head office, housing

development projects and group depart-

ments, such as community regeneration,

finance, IT, human resources, and sales

and marketing. In year 3, graduates take

on a specialist job.



Case Study

Throughout the G DP, graduates have a

personalised career development plan

and attend well-established in-housetraining courses and management devel-

opment workshops. Each graduate has a

mentor (a director or senior manager) who

acts as a sounding board and helps them

achieve their full potential.

According to K aren Harvey, Head of HR

and Employee Development: Southern

Housing G roup has a 100 per cent suc-

cess rate for graduates passing their

professional examinations and several of

them now hold key jobs in Southern

Housing G roup.

2. Rewarding learning

Southern Housing G roups approach to

reward includes three schemes which are

designed to encourage learning. First, The

Brick P lan is a structured six month devel-

opment and reward scheme for all

employees starting work in the C ustomer

Service C entre. The scheme gives finan-

cial rewards to employees on successful

completion of each stage of the scheme.

T hese rewards are designed to give

employees a personal development

incentive to gain a good, foundation

knowledge of Southern Housing G roup

and the Housing sector. K aren Harvey

says: Southern Housing G roups recent

successful Investors in P eople review

found that employees working in the

C ustomer Service Centre said that, com-

pared to some call centre environments,

the Brick P lan offered them a better career

path and had a strong learning focus.

Several employees have progressed from

the Customer Service C entre into other

more senior housing roles in Southern

Housing G roup. Since introducing the

Brick P lan, employee retention rates in the

C ustomer Service Centre have improved.

Second, Southern Housing G roup have

recently introduced a new reward scheme

providing employees with Learning

Vouchers which can be used for any learn-

ing activity, work or non-work related. Thescheme enables employees to learn some-

thing new, for example a language or

cooking which may not be work related, but

could bring additional personal benefits.

Third, S outhern Housing Group are

required to have a certain number of quali-

fied employees working in their care

schemes and services, so it offers financial

rewards to employees undertaking an NVQ

in Care. K aren Harvey again: T he extra

financial incentive can encourage employ-ees to take on the extra challenge of

studying and developing, especially as

some of them havent studied for a number

of years. Since introducing this incentive,

we have seen an increase in the number of

employees taking up NVQ qualifications.

3. Working flexibly

Southern Housing G roups Flexitime

scheme gives all employees the opportu-

nity to apply for flexible working. The

scheme is designed to enable employees

to work hours that are more sympathetic

to their lifestyle and personal commit-

ments. As long as their manager

considers there is no adverse business

impact, employees are able to accrue

additional hours to allow them to take up

to one day off every 4 week period, with

prior agreement from their line manager.

In addition to Flexitime, Southern Housing

G roup offer all employees the option to

apply for compressed working. This is

where employees work 70 hours (2 x 35

hour full-time equivalent weeks) over 9

rather than 10 days.

C urrently approximately one third of

employees across Southern H ousing

G roup take advantage of flexible working

opportunities, with around two thirds on

flexitime and a third work on compressed

hours. According to a recent employee

opinion survey, 76% of employees felt

Southern Housing G roup allows them to

adopt working patterns which help them

balance their work and home life and 70%

felt that overall, their terms and conditionsof employment were good.

Raymond RobertsonDirector

Strategic Reward

Ray can be contacted at:

email: [email protected]

Tel: 01666 511347

S

Ray is author of the widely accliamed book ,

T he Together Company and one of the UK s

leading experts on reward. He has worked

with companies such as Porsche, Wildlife

Trust, B&Q , A BB and Whitbread.


27/40

Bob Downie (Founder, UK C ustomer

M anagement C onference and C hief

Executive, T he Royal Yacht Britannia)

opened the conference, reminding us of

the need to deal with internal customer

service before external, maintaining that agenuine customer philosophy comes from

the inside. Staff need to be engaged in

order to deliver good customer service.

He felt it was imperative that staff are

involved in customer service improve-

ments because they are closest to

customers and are therefore more aware

of the problems and their potential solu-

tions. We will see an example of this later

from Norwich Union. Shaun Smith (inter-

nationally-acclaimed business speaker

and best-selling author) also underlined

the interconnectedness between employ-

ees and customers, claiming an 85%

correlation between the way employees

feel and the way customers feel.

Norwich Union employee blogs

Darren C ornish (D irector of Customer

Experience, Aviva, formerly N orwich

Union) gave us an interesting insight into

his unique way of engaging with staff; H ecreated a blog on the intranet to commu-

nicate with staff. He felt strongly that

listening, acting and improving upon the

experience creates engaged and motivat-

ed people. The success of the blog was

supported by the fact that it gets 4,000

unique hits a day and each person

spends an average of eight minutes on

there.

O ne example Cornish gave of listening

and acting on what staff say was where a

new employee at the company posted a

message on the intranet about a problem

with the direct debit form that was sent

out to customers. T he information

This years UK Customer Management Conference strongly featured customer

management in the current economic climate. We will look at this in the next

issue of Stakeholder Satisfaction, as well as the importance of defining the expe-

rience you want your customers to have. Here, we will pick up on another theme

from the conference, that of employee engagement, and in particular its intrinsic

link to customer experience. We will also see some of the examples of best prac-

tice outlined f rom organisations such as Norwich Union and O2.

Conference




required on this form was not clear,

causing hassle for both staff and cus-

tomers. After the message was posted,the staff member was enlisted to help

change the form to be clearer and the

problem was rectified quick ly.

M ore crucially, his story demonstrated the

importance of senior management in

motivating staff and defining the internal

culture. O ne excellent example of this is

shown in an extract from the blog below

Hard to swallow

In NUI I was the Head of C ustomer

Experience. O ne of the things we did was

regular customer listening forums where

complaint customers came and told the

Exec D irectors what it felt like trying to get

a service.

As Head of C ustomer Experience these

sessions helped me no end in getting sen-

ior management attention and action on

what needed to be better. Almost without

fail, the customers would say how badly

we treated them until the complaint teamstepped in and helped sort it out.

Last night I facilitated the NUL Exec team

listening to 6 complaints customers. This

time I had no place to hide. N o other

director to ask to sort it out.

We had one customer in tears, we had

another very angry with us. Another who

said he would do pretty much anything

NO T to put anymore business with us. Id

normally share in detail what was said but

I cant bring myself to.

Apart from one thing. It was said by one

of the customers that they were told it is

company policy for customers not to be

put through to D irectors (or their secre-

taries).

Let me be clear. M y number is 07800

690217. M y email is darren.cornish@ nor-

stakeholder-january-2009_1 (1).pdf

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