YQ Issue 02

YQ

The Talent Issue

2010 Issue 02

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This edition contains:Too much bureaucracy?Had enough of the Nine Box Grid? Check out how YSC is putting the talent back into talent management.

On the couch: Martin Richenhagen How does the AGCO boss get the best from his people? We head down to the farm to find some answers.

Eastern promiseThere’s no shortage of talent in China and India, but you’ll need very different strategies to tap it.

Stuck in the middleMiddle managers are the unsung heroes of the corporate world. How about investing in them?

Ten ways to keep your talent Practical strategies for hanging onto your best players.

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Spotlight on J. Sainsbury How ‘soft power’ helped make Sainsbury’s great again.

The view from Lake WobegonWe asked Australian managers to rate themselves against their peers, both nationally and internationally.

ReviewsOur reviewers eye-up the talent in the X-Factor, and put Malcolm Gladwell and Joshua Cooper Ramo under the spotlight.

Agony uncle: Tiger, TigerDr Ken’s bedside guide to getting out of bunkers.

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28Publisher: Matthew Sinclair Executive editor: Gurnek BainsEditor: Jock EncombeAssistant editor: Sam GilpinConsultant editor: Jane LewisProduction executive: Shane SweeneyGraphic design: Simon Fincham

Feedback: please send feedback including ideas for future articles to [email protected]

Subscribe: for a complimentary subscription to YQ, please register your details at www.ysc.com/yq

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Welcome to YQ

Welcome to the second issue of YQ. In our first issue we focused on leadership in challenging times, considering how leaders could create meaning and engagement as they sought to navigate their businesses through the mire of challenges thrown up by the economic crisis. While the world hasn’t turned rosy overnight, many of the companies we deal with feel that the worst is behind them and they now look forward, with guarded optimism, to the future. In this new phase, we are seeing more and more businesses thinking deeply about how they identify and retain their talent and what they do to accelerate the promotion of talented individuals into positions of responsibility. This is the focus of our second issue.

Talent management can be something of a bureaucratic exercise, with managers poring over various types of grids and rating forms. Ken Rowe and Katja Pempelfort consider how it can be transformed into a more meaningful and practical process. Sam Gilpin and Nicholas Hastings provide some tips on how to keep your talent – an issue we think companies will begin to focus on as economies start to grow again. Kylie Bains looks at identifying and developing talent at the middle management level. All too often, companies only concentrate on developing people at the most senior levels and at graduate entry; this risks neglecting those in the middle ranks.

by Gurnek Bains

At YSC our mission is to release the power of people. We do this by combining industry leading psychological insight with a thorough understanding of our clients’ business needs. We work with clients across their entire talent lifecycles, including: recruitment, induction, development, the identification of potential, internal selection, role change, measurement and departure. Our key client offerings include 1:1 and team assessment and development, executive coaching and organisational consulting.

About us...

As we were putting this issue together, one thing that struck us deeply was that preoccupations about talent are markedly different across the globe. We have contributions from our consultants in India, China, Australia, South Africa, Germany, the Netherlands, North and South America and the UK on the critical talent issues in their regions.

We are delighted to have Martin Richenhagen, CEO of AGCO, one of the world’s largest manufacturers of agricultural equipment, discussing his leadership experiences as the only German CEO of a Fortune 500 company. Finally, our client spotlight this time is on Sainsbury’s where a fantastic leadership team, led by Justin King, has been instrumental in turning around performance. The key aspect of the ‘Making Sainsbury’s Great Again’ story was the focus on creating the right culture to release the potential of people at all levels.

We received excellent reactions to the first issue of YQ. We hope you enjoy this one and continue to provide us with support and feedback.

Gurnek Bains is the Chief Executive of YSC. T: +44 (0) 20 7520 5555 / [email protected]

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a hand-grenade at established notions of corporate talent.

According to Bolchover it is nonsense to suggest that, say, in an organisation of 20,000 people, you can measure the contribution of a small cadre of people at the top. Indeed, many companies perform well despite poor leadership – helped along by buoyant economies, market positions put in place by predecessors, or excellent middle managers. The idea that there is a true market for top executives is therefore a myth. “It is a marketplace based on entirely subjective assessments which render it corruptible.” And furthermore, modern talent ‘ideology’ has been constructed and jealously guarded by senior executives as a means of “furthering their own financial agenda”.

Incendiary and thought provoking … but way over the top. Bolchover’s views may resonate when we consider the remuneration of some senior executives – but they are not compelling with respect to talent. Common sense and experience tells us that skilled and capable individuals do exist, and that the best do have the power to transform organisational performance. Moreover, the idea that talent is a myth invented by a cabal of senior executives to promote their own interests is surely fanciful conspiracy theorising. Nonetheless, Bolchover may have a point when it comes to highlighting the inherent difficulty of pinning down and defining the contribution of individuals. Talent does exist, but it remains fiendishly difficult to identify and tap.

by Ken Rowe and Katja Pempelfort

Talent management: too much bureaucracy?

YSC’s Deputy CEO Ken Rowe and Senior Consultant Katja Pempelfort consider how organisations can steer a course beyond flashy presentations and mind-numbing metrics to put the talent back into talent management.

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The war against talentTalent as a concept is under increasing pressure. Indeed, judging by the spate of recent books and articles lambasting “the talent myth”, it feels like we’re in the midst of a period of full-scale revisionism, with established orthodoxies about executive performance and potential increasingly under siege.

A good example would be Malcolm Gladwell who, in Outliers (which we review on page 29), argues that exceptional performance invariably reflects circumstance and opportunity – rather than the native talent residing in an individual. While in Pay Check: Are Top Earners Really Worth It?, management thinker David Bolchover lobs

And it is not for want of trying. As YSC’s Ken Rowe points out, “Over the past decade, companies have spent a fortune on developing systems to help them better define, evaluate and develop talent. There’s been a huge growth in talent management as a function and discipline.” Yet the ‘War for Talent’, identified by McKinsey way back in 1997, appears no closer to ending.

“And there is a real bottleneck in terms of capability around the leadership table,” agrees Katja Pempelfort. “There just doesn’t seem to be the calibre coming through.” The challenge of finding, growing and retaining talented executives remains acute and, if anything, has become worse. Factor in the worsening demographic outlook in many regions, and the failure of education systems to generate sufficient quantities of the raw material organisations need for 21st Century success, and the situation is still bleaker.

McKinsey’s follow-up study in 2009 concluded that – despite intensive investment and effort over the past decade – organisations have still not been able to reap significant rewards from their talent management investments.

But why is this? Rowe and Pemplefort’s hypothesis is that, despite the growth of talent management functions within organisations, there has been an over-reliance on metric-based initiatives. Too often these deconstruct individuals into numbers and values to be plotted on a chart, resulting in an over-simplification of something that is actually rather complex and tricky to quantify: talent. This loss of nuance and subtlety results in a decreased ability to make fine-grained judgements about an individual’s unique set of skills, motivation and spike strengths. But it is these unique strengths that, when fully utilised, can be genuinely transformative.

This situation has arisen in part because some members of the HR community have felt a need to enhance the credibility of HR by speaking the language of business leaders. A numbers, formula and metric-based approach appears to do this. In addition, these initiatives were seen as ‘innovative and ‘the way forward’ – just like mission and value statements were in the ‘90s – and thus widely replicated.

“ “The time is now ripe for talent management as a discipline to re-evaluate how it operates. “In our experience there is a real risk that processes are put in place that are not rigorously thought through or embedded,” says Rowe. He goes on to identify three steps that need to be driven through if talent management strategy is to succeed.

Step 1: Ensure that criteria defining the talent you need are intimately entwined with the strategic agenda.

The organisations most successful at creating and sustaining powerful talent pools are those whose talent agenda has been set by the Chief Executive. There needs to be a symbiotic relationship between the strategic challenges facing an organisation and the capabilities and qualities available to meet them. A useful test is the extent to which senior managers are able to articulate a simple and compelling ‘talent story’. This story should connect the organisation’s purpose, vision and strategy with the functional and leadership capabilities it needs for long-term success. It should also take into account the unique cultural and organisational challenges it faces.

In YSC’s experience, organisations that powerfully link purpose, vision, strategy and talent can create cultures with the right kind of focus on talent and leadership performance.

Two examples: in the late 1990s, John Sunderland was appointed Chief Executive of Cadbury Schweppes. His first task was to define a new strategy for the business, part of which involved close questioning of the implications of that strategy for the leadership qualities and functional capabilities needed at the top end of his organisation. This placed an onus on Cadbury to become more nimble, aggressive and forward-thinking.

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There has been an over-reliance on metric-based initiatives. Too often, these deconstruct individuals into numbers and values to be plotted on a chart

Subsequently, Cadbury did achieve considerable success in creating a powerful, focused leadership ethos.

In a similar way, Sir Terry Leahy, the Chief Executive of Tesco, took ownership with his team for defining the leadership challenge and characteristics needed to implement the retailer’s strategy. Tesco’s customer focus was seamlessly integrated into how its leaders needed to operate and develop.

Done properly, articulating a statement of talent criteria in a distinctive, organisation-specific way can help to create a compelling, action-oriented narrative. This story empowers line managers to understand their own needs with respect to talent and in turn, helps employees to understand specifically what they need to do to succeed.

Early collaboration with the strategy function is critical to identifying the core capabilities, role functions and organisational structures needed to deliver long-term business objectives. Clarity around the critical organisational competencies, combined with a subtle analysis of the challenges involved in delivering these, is therefore the critical starting point for defining the talent and leadership capabilities required.

Step 2: Put the talent back into talent management

As one senior line manager noted: “Habits of mind are the real blockage to successful talent management”. HR leaders and top management need to ask themselves, therefore, if the growth of process and the attachment of numbers to individuals, has inadvertently led to a reduction in the amount of rich discussion taking place about people in their organisation. Plotting individuals into Nine-Box Grids may give an illusion of control – but too often it is at the cost of meaningful dialogue, or a recognition of the subtleties of human behaviour.

For example, the basic human tendency to fall into the Fundamental Attribution Error (the assumption, or attribution, that others’ failings are down to their character rather than the circumstances affecting their behaviour) means that, all too often, people are not given a second chance, or an opportunity to discover circumstances that will allow their unique talents to flourish.

And if HR traditionally takes the rap for failing to engage in sufficient depth with the rest of the business on talent management, it is rarely a one-way street.

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“You’ll never meet a chief executive or line manager who doesn’t think they know their people,” says Rowe. “But although your line manager might know you very well personally, they often baulk at having candid, two-way conversations about development. Nor are these conversations often enough linked to the organisation’s strategic and talent objectives.”

Trust and candour are the bedrock of successful conversations. As Laurence Barrett, Director of Group Resourcing & Development at Prudential, told us: “Our ability to create meaningful insights and rich conversations lies at the heart of effective talent management. We can take ownership of our own development only when we fully understand our capability, and the implications this has for our performance and our aspirations. This is true at both an individual and organisational level.”

Ultimately, there’s everything to be gained from engaging in “strategic discussions that get people thinking deeply about their performance and potential on a regular basis: where their spikes and capacity for transformational impact lie; where their shortfalls are and how you might breach them,” concludes Rowe. “That might seem quite simple, but it’s actually very hard to do”.

Step 3: Ensure there is scope for distinctive individuals to grow and be valued

A key challenge facing organisations is driving consistency while enabling innovation. With respect to talent, this can lead to risk averse talent processes that reward conformity and that seek to ‘round out’ individuals in order to fit them

Ken Rowe, Deputy CEO of YSC, & Katja Pempelfort, Senior Consultant, are both based in YSC’s London office. T: +44 (0)20 7520 5555 / [email protected] / [email protected]

into an abstract model of leadership. In reality, however, successful people typically demonstrate a deep strength in one or two areas only – with, of course, corresponding development needs in others. These spike strengths need to be identified and carefully nourished – just as much as their development needs have to be attended to. Doing this properly also ensures that talented, ‘maverick’ individuals are given a chance to prove themselves – and increases the likelihood of organisations motivating, leveraging and retaining them. Organisations like Procter & Gamble suffered in the ‘90s from recruiting people with great talent, and then stifling them by processes and structures that tried to ‘round them out’ and drive consistency in their behaviour. The result was a tangible loss of innovation by the business and a failure to retain talented, ‘spikey’ individuals.

Latin AmericaLatin America has always been an important proving ground for talent. Historically, many US multinationals sent potential leaders to Mexico and Brazil to test their mettle before they graduated to the top jobs. But these countries are now powers in their own right, enjoying income per capita growth of over 4% this year. This is a region rich with opportunities. The big change in recent years has been the growing influence of home-grown multinationals (aka multi-latinas) such as Grupo Modelo, Cemex and Petrobras, which have the scale, scope and resources to grow talent. For the first time in Brazil, there’s real interest in investing in emerging leaders and the development of middle management. Because of the scale of growth in these countries there’s a lot more upward mobility and that is having a big impact on company dynamics. Traditionally, senior leaders used to stay in place for years, blocking the way to those coming up. No longer. What sort of talent is most prized? Leaders need to be flexible enough to navigate what is often still a volatile economic environment, and they need a sense of strategic orientation to put that into context. Change leadership, collaboration, integrity and the ability to influence are also seen as key – as is the ability to recognise that local differences count.

Andra Brooks is a Managing Consultant based in YSC’s Houston office. [email protected]

International Perspective:

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In summaryThe challenge facing the talent management function in many ways parallels those faced by marketing in the 1990s. The rising sophistication of marketing techniques and processes came at the cost of the spotlight being taken off the consumer. But in the last 10 years marketing has refocused its energies on bringing the consumer back into sharp relief. The need for this was in some ways counter-intuitive: wasn’t marketing always about the consumer? But the failure of marketing to deliver provoked a change. Talent management faces the same challenge now – and the opportunity, if it rises to that challenge, to create organisations with talent processes that are flexible, psychologically real, forward looking and, above all, relevant.

1. Critically audit the effectiveness of your current talent initiatives.2. Ensure that organisational purpose, vision and strategy are clearly and compellingly linked to your talent strategy and processes – and that your senior people can tell the story of how they fit together. 3. Train people to have meaningful conversations about performance and potential.4. Take risks with your talent – help people understand their unique potential and give them real opportunities to apply it.5. Build talent systems that are both flexible and fit for purpose, and that unleash rather than stifle talent.6. For HR and talent management professionals: engage fully with the line, but don’t be beholden to it.7. Evaluate and demonstrate the ROI on your talent processes, promoting and celebrating progress.

Top Talent Management Tips

On the couch with . . .

Martin Richenhagen

Philosopher king, Martin Richenhagen of AGCO, discusses Sartre, succession-planning and his faith in human ingenuity.

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AGCO Corporation

Martin Richenhagen has been advised by Wolfgang Ottmann, head of YSC’s German office, since 2003. T: +49 (0)2102 892690 / [email protected]

The Coach’s Notes: Martin Richenhagen has been CEO of AGCO, the world’s third largest manufacturer of agricultural equipment (and the power behind the Massey Ferguson, Challenger, Fendt and Valtra brands) since 2004. Widely credited with rebuilding a business reeling from the double blow of losing its CEO and sales chief in an air-crash in 2002, he is the only German to lead a Fortune 500 company and is responsible for some 15,000 people worldwide. A polymath and talented linguist, Richenhagen, 56, studied for degrees in theology, French literature and philosophy at the Sorbonne and the University of Bonn. After toying with the idea of becoming a professional horse-trainer he became a teacher, eventually launching his business career with the German steel group Hille & Müller. Richenhagen has evolved a distinctive management style and written extensively about it. Dividing his time between AGCO’s Atlanta HQ and his German estate in Westphalia, he loves tinkering with vintage tractors. But horses are still his main passion. He was Chef D’Equipe of the German dressage team at the 2008 Beijing Olympics, returning triumphant with the gold medal.

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You enjoyed an unusually varied early career. Would you recommend that to any young person starting out in life? I would certainly recommend being open-minded, flexible and creative – trying things out to see what you can achieve. I never expected to run a big company. But I always wanted to learn new things and I was never afraid of change. If you don’t have a plan, you are more versatile and more receptive to new experiences. I see myself as a lifetime student: if you want to get one step higher, it’s much better to learn than to get into intrigues and politics.

Do you view yourself as an internationalist? Before coming to the US, I worked in Germany, Switzerland, the Netherlands and France.My first girlfriend came from Liverpool – I met her in London.I like to understand different cultures and countries. People aren’t as flexible today as companies would like them to be. When a job was offered in a new city or a new country, I was usually pretty keen to take it – and it helped that I could speak English, French, German and Italian. You can differentiate yourself by speaking more languages.

You’re the only German CEO in the Fortune 500. How does your approach differ from that of other US business leaders? I was hired because the company was looking for a true international guy and that’s more difficult to find in the US than in Europe: Americans tend to like staying in their own country – and they don’t learn languages. I think AGCO is a lot less hierarchical than many US companies. On the surface, it is an egalitarian society, but my impression is that Americans are more hierarchical than they look. As a result, our decision-making is very much consensus-driven.

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I’m more straightforward and outspoken, and I invite my people to be very open. In our culture, you’re allowed to disagree.

Is management an art or a science?A bit of both. There are some fairly scientific guidelines in my book Simply Management, but they’re based on my own experiences. The art part of management is down to style. I don’t present myself as the Godfather – I believe in the empowerment of people, and in delegation. And I think a sense of humour is crucial.

Forbes describes you as “conservative, patient, philosophical”. True?I’m conservative in terms of my business beliefs; but modern in terms of how I manage people. I try to be patient, but I don’t like it when people are very slow. I don’t lose my temper at work – that happens more at home. But, according to my wife, I’m improving... On the whole, friends and family say I’m the same person I’ve always been. I have kept my feet on the ground.

How has your Roman Catholic background and your study of philosophy influenced the way you manage? Having that kind of background makes you broader as a person: you understand the world better than if you study law or economics. It gives you an understanding of ethics that goes way beyond just doing

business responsibly. It makes you think about other people and the wider environment. I studied in Paris for a year and my favourite philosopher is Jean-Paul Sartre [whose existentialist philosophy stresses the uniqueness of the individual experience, the importance of freedom of choice and of taking responsibility for one’s actions].

How did you respond to the financial crisis? 2008 was actually a very good year for our industry. We caught the impact somewhat later. Last year was difficult, but the downturn was much less radical than in other industries. Overall, I was always more optimistic than most people – and I still am. If this was the biggest financial crisis in history, I think mankind survived it much better than anyone expected; mainly because we reacted fast.

Do you think it will lead to a big change in the way companies are managed, or do you predict a return to business as usual?There’s been a lot of political discussion around that question: President Obama seems to have a tendency towards heading in a more European direction. But, although I’m in favour of good guidelines and rules, I don’t believe in the state running business, or managing the economy. The positive result of the crisis is that it has forced companies to start concentrating on their financial strength and independence again. We saw too many mergers in which size was the only benchmark. I think companies will now be much more diligent about analysing the risks – and ensuring that their debt-to-capital ratio is reasonable.

How have you applied that philosophy at AGCO?When I took over in 2004, debt-to-capital at AGCO stood at 60%; we’re now down to zero. We had some pretty good years and I made a priority of paying down debt. AGCO was founded in 1990 and grew rapidly, achieving revenues of around $4bn within 15 years – mainly because the company made around 30 acquisitions. But it lacked a clear strategy, so it was vital to focus on post-merger integration and to develop mission and vision. We came up with a major programme of 100 strategic initiatives and, within five years, doubled the top line and made the company much more profitable. We don’t make acquisitions any more; we’re focusing on generating growth internally.

What processes have you introduced to encourage talent?There was a lot of work to be done. We didn’t, for instance, have a proper HR department – though that is perhaps an advantage if you want to create something from scratch. So we defined a global organisational structure, introduced a grading process, and then reviewed the portfolio of existing managers. The aim is to have a development plan for every individual in the company. A typical plan would describe an individual’s strengths and weaknesses and define their development goals, including a road-map and a game-plan. We address any weaknesses either

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Training horses is about coaching and encouragement – very like training humans really. A difficult horse needs a lot of time and the right balance between motivation – such as hugging and candy – and tougher incentives...

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by giving them dedicated training [Richenhagen has founded an AGCO University], or by rotating them into a different department.

How do you achieve ‘buy-in’?Most of the management students we train go from being a student to a teacher – when you’re a teacher, you identify much more with the programme. Making someone a change agent isn’t easy. But the more openly you talk about it, the better. Sometimes people think that you don’t need passion in business, but the more passion the better.

You say you’d like to stay on at AGCO for many more years. Doesn’t that go against the prevailing trend for ever shorter CEO tenures? I’m not in favour of short assignments. CEOs in US companies last an average of two and half years. That’s far too short. You need a five-to-ten year timeframe to understand a company properly and develop and roll out strategies. I’ve been here six years and we’re not yet where we want to be. As long as I keep delivering results, and my board and shareholders appreciate what I’m doing, I’ll stay.

How important is succession-planning, given AGCO’s past experiences?Very. We have a succession committee at board level and get pretty positive feedback from Wall Street. But we concentrate on succession right the way through the organisation: we

run a two-day workshop on it every year and there’s a detailed succession-planning system. For any one position we identify three potential successors – but obviously every candidate has to have an alternative roadmap too. We don’t make the process 100% transparent because we don’t want to make it over-competitive. The important thing is people know what they have to do to get there.

How do you see the agricultural industry evolving? Every minute, 156 people are added to the world population – we’ll reach ten billion within twenty years. The change towards a more protein-based diet in developing countries adds to the strain on resources: you need around six times the crops to raise animals. And there’s increasing competition for land for renewable fuel crops. All this at a time when we are losing 100 hectares of farmland globally every day: either to desertification or building infrastructure. So the challenge is huge.

Are you optimistic about meeting that challenge?Our role is to provide technology solutions to make farming more efficient and productive. The agricultural sector has a great track record: there’s no other industry in the world that has shown such great leaps in productivity. Our vision for the future is for high-tech solutions to tackle increasing demand. I’m confident we will find a way.

What’s your position on GM crops? Broadly very positive. I’m on the board of a company with a director from Monsanto and I’m reassured there’s no negative impact on human health. The intention is to help humanity. If, for instance, you could develop a corn crop that needs just 20% of the water needed today, that would help a lot. There are a lot of myths surrounding bio-engineered crops. Most people don’t understand what they really mean – they’re just scared. I find it interesting that the main opposition comes from the cities of Europe. The concept is better understood in places like Brazil and the US where people are closer to farms.

So what does keep you awake at night? Normally I sleep very well. If I’m awake it’s mainly down to private things – like when my youngest son is downtown partying with my car.

What do you like to read? I like reading novels. I’m a Francophile and Balzac is probably my favourite. But I read a lot and I’m a fast reader. The disadvantage of that is that I don’t remember so well! But that’s fine: after a year or so, it’s like having a new book.

What’s your solace in times of trouble? My love of horses. I was a dressage rider – and I’m still a fan. I love the way that horse and rider combine together as a team. Training horses is about coaching and encouragement – very like training humans really. A difficult horse needs a lot of time and the right balance between motivation – such as hugging and candy – and tougher incentives, not all of which you can use with people of course!

Martin Richenhagen spoke to Jane Lewis, YQ’s Consultant Editor

I would recommend being open-minded, flexible and creative – trying things out to see what you can achieve.

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Overview

It’s strange to recall that, only a few years ago, western businesses contemplating the opportunities on offer in Asia would routinely refer to a near mystical land called “Chindia”. The word already seems quaint. The better we have got to know the economies, markets and talent pools of Chindia’s constituent parts, the more distinct and separate they appear.

China and India do, of course, have one thing in common: they’re the world’s fastest growing economies. Forget notions of the world catching a chill when America sneezes; it is eastern sniffles that markets watch with anxiety now. Both countries have proven to be great escape artists in the global downturn – yet both face serious challenges.

With its long history of strong conglomerates and family businesses, India boasts by far the more mature market economy. As Elisa Krantz points out below, the rigour of the local business education has ensured that top managers – such as Indra Nooyi of Pepsi – have become hot global commodities. Activity has been no less intense on the ground where a “deregulation generation” of entrepreneurs has broken new ground in industries like IT outsourcing.

But it’s hard to keep shining when the lights keep going out. And that, in a nutshell, is India’s big problem. Its companies continue to be hobbled by infrastructure problems which, until resolved, will hamper development of

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Eastern Promiseby Elisa Krantz & Phil Smith

Global momentum is shifting inexorably eastwards. What impact will that have on talent management in China and India?

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its vast pool of latent talent. As one business leader recently complained: “It is difficult to take a global front seat when most of our citizens feel we are driving a bullock.”

In China, you might argue, the opposite holds sway. There has been no difficulty in building the physical nuts and bolts: the chief stumbling block, as Phil Smith outlines, is the still-embryonic state of China’s business culture. This is beginning to change – local entrepreneurs such as Jack Ma of Alibaba.com make compelling role models for a new generation of Chinese businesspeople. But the ultimate shape of Chinese capitalism is, as yet, still unclear.

Far more worrying in the short term is the sustainability of China’s breakneck growth. Vast swathes of cash now swirling round the economy are fuelling bubbles in everything from garlic to house-prices. Add in the predicted rush of western talent eastwards, and you have a melting pot that could boil out of control. Optimists believe that the authorities can finesse the economy so that employment stays high, inflation stays low and growth stays pretty rampant. But that’s a difficult course to navigate.

Many companies, surveying the situation in India and China, will take the view that these challenges, while significant, are nothing compared to the prizes on offer. In China alone, consumer consumption is expected to rise from $1.72 trillion in 2009 to top $15 trillion by 2020, according to Credit Suisse. But it could be a bumpy road ahead. Here we take a closer look at some of the conundrums facing companies as they seek to mine the talent – and fulfil the promise – of these Eastern giants.

When looking at the graduate pipeline the numbers are astounding. Moreover, educational institutes and universities have become important filtering mechanisms. At the Indian Institute of Management – one of India’s most prestigious academies – roughly 300,000 students compete for less than 1,350 general seats a year. Once admitted, students must maintain a grade point average of 98.6% or higher to successfully graduate. They go on to become an elite, valued commodity – courted by the best organisations.

Considering the high volume of graduates with prestigious academic qualifications, a strong and plentiful leadership pipeline

Focus on India By Elisa Krantz

The Indian growth story is one of exceptional volume and pace. In a population of 1.2 billion, with a rapidly growing middle class, vast opportunities continue to emerge across all industries. With 54% of its population under 25 years old, one quarter of the world’s youth live in India. As the world looks increasingly Eastward, the question is: what ‘kind’ of future leaders are emerging?

would seem assured. But looking further up the ranks, demand for leadership talent typically outweighs supply. Though India produces close to 3 million graduates a year, only 25% are considered employable. India’s three years of double digit growth prior to 2008 has further compounded this issue. “With tremendous growth in the economy, resulting in huge business opportunities, having people on board was more important than the quality of the workforce” says Tanuj Kapilashrami, Head of HR at HSBC Bank India. “People had unprecedented career growth and many executives landed leadership positions without necessarily being ready for the associated challenges”. To add to this, many of the large Indian conglomerates

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increasingly brought in to coach and develop senior executives around some of these areas; to facilitate higher levels of collaboration and performance among teams; to benchmark talent both nationally and internationally; and to support clients to drive cultural integration and professionalisation across their organisations.

There are certainly some exceptional leaders out there. “If you look at the top 1 – 2% of Indian leaders, they have had access to world class education, international career opportunities and are able to compete toe-to-toe with talent all over the world,” says Animesh Kumar, HR Director for Infrastructure Development Finance Company Ltd (IDFC), one of India’s premier financial services institutions. However, because there is such a rapid level of growth and change, it is not just about selecting the right leaders for today – but also making sure those leaders are ‘future proof’.

are now vying with multinationals on an international stage, increasing the scale and complexity faced by Indian leaders who need to develop adaptable styles and the ability to work cross-culturally.

To better understand India’s future leaders it is worth examining the Indian psyche and the legacy created by the country’s history. Based on YSC’s insights from executive assessment and coaching work in India, the typical Indian executive is very bright, commercially shrewd, logical and analytical. Throw them in at the deep end and they will surely learn to swim. Spotting opportunities, operating in ambiguity, adapting to new challenges and complexities is in their DNA. And for many, a background of having grown up in comparative scarcity – too few opportunities for too many people – has fostered a highly competitive mindset in addition to phenomenal levels of drive and resilience.

We have considered some of the typical characteristics making Indian executives successful – but there are downsides to high levels of competitiveness: it can hold back

collaboration and team working, potentially inhibiting diversity. “Indian talent tends to be exceptional at analysis, rigour and fluency with numbers. They have a strong ability to deal with ambiguity and complexity. Yet they tend to be individualistic. The Indian manager is not typically as effective at collaboration,” says Venkat Chandramouli, Head of HR and Strategy for Cadbury Asia. Indeed, influence in Indian organisations tends to come through hierarchy, status and positional power. As a result, many of the Indian executives we work with do not develop the wider or more subtle range of influencing skills required in the West. We also tend to find that executives are less self-aware as they are less accustomed to giving and receiving feedback – especially ‘negative’ feedback, which is often perceived as criticism.

But are Western leadership values such as collaboration, influencing and self-awareness relevant for leaders in the East? They certainly matter less in locally-based Indian operations, but for organisations competing on an international stage we are seeing increasing demand for these qualities. We are

“ “

Elisa Krantz is head of YSC India, based in Mumbai.T: +91 22 40907142/3 / [email protected]

To understand the mixed picture of talent in India, one needs to understand the Indian psyche and the legacy created by the country’s recent history. The typical Indian executive is intellectually bright, commercially shrewd, logical and analytical. “ “

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Business leaders are bracing themselves for all scenarios. The race for talent in the region is changing gear as we watch, as companies shift their emphasis from people who can help them answer questions, to people who can ask the right questions and shape the future. Global multinationals are turning to their potential leaders in the region, not just to execute in unfamiliar and challenging markets, but also to think and navigate strategically. Regional and local companies are keen to take advantage of the downturn to upgrade their talent, both through attrition and poaching from competitors.

We face some significant challenges in helping them to create opportunities for talent and business success in the region. One is the application of global leadership and talent frameworks. The temptation for expatriate leaders is to encourage literal translation and application of competency frameworks in the interest of global consistency. However, there is no guarantee that this will result in the recognition and reward of the best and most effective people in regional settings. Some capabilities may need significant adaptation

Focus on China By Phil Smith

Hopes and expectations are running high in Southeast Asia. The slowing of growth in China from double digits to mere single figures stands in stark contrast to the negative numbers recently posted in many parts of Europe and the US. But many questions remain. We really don’t know whether we are poised on the brink of an historical shift in the balance of global economic momentum and influence; whether it has already happened; or whether a rosy illusion, based on shaky foundations, is about to be shattered.

to accommodate cultural and behavioural diversity. Even then, we cannot assume that talent algorithms and weightings travel well. It may be that values, rather than competencies and capabilities, provide a better lens through which to focus executive performance. We want people to focus on what really matters, however this plays out on the global stage.

A second challenge is to ensure that there is sufficient opportunity for local and regional talent to gain exposure to the experiences and people they really need to grow their careers and credentials. Currently, the net flow of talent seconded for career acceleration for most of our clients continues to be very disproportionately West to East. This can leave capable, ambitious people in Asia dubious about how they can ever progress beyond a certain level – often leaving them looking for opportunities elsewhere.

A third, emerging issue concerns the ability of capable people and teams in the region to regenerate themselves and develop capability for the future. This is more

complex than it first appears. A lot of western business development in China is done through joint ventures, where there may be less direct opportunity for the widespread dissemination of talent management thinking and practice. Also, China does not have the same legacy of English as a second language as does, say, India – making knowledge transfer and sharing more difficult. Another factor is that most young Chinese managers are operating in a world without precedent. Even among the growing numbers with some advanced management education along Western lines, they have to figure out business in China as they go along. They cannot ask their fathers or mothers how they did it, nor can they turn to textbooks on the shelves. For most of them the Cultural Revolution is within living memory. This is a humbling thought and a constant source of inspiration to those of us working with the young people who are helping to drive and shape China’s modern economy.

China is a nation of pragmatic people for whom theory and principle grow from successful practice, rather than leading it. The action-oriented, ‘can-do’ mentality and drive for personal success among China’s talent is filled with momentum – but this can make it hard to reflect, and thereby extract the lessons that will help to shorten the learning curve for their successors. As we in the West are learning that a global mindset is key to realising the full potential of our partnerships in Southeast Asia, so talented people in the region are developing an increasingly sophisticated understanding of what they need for sustainable success. We need to help our clients stay in the lead in the race for talent in this dynamic part of the world.

EnglandAlthough there is a guarded sense of optimism that things are getting better, we’re still in unknown economic times. Uncertainty is most pronounced in the public sector which has yet to see the retrenchment we’ve witnessed in the private sector. Everyone knows cuts are coming, but no-one knows the extent – so everything is on hold. Within companies, people are being asked to do ever more with ever less. But all sorts of opportunities are opening up: the key is to build the capability to race ahead when the opportunity is right, which means getting the core business as efficient as possible, while giving people a credible sense of moving forward. You can’t underestimate the importance and power of stressing “the moving from, to the moving to”. Increasingly, the key point of differentiation for companies is the customer experience – commercial battles are fought encounter by encounter – and the real determinant of that is employee happiness. So there’s a lot of focus on frontline managers who can inspire by building significance and meaning. YSC is pushing hard on that agenda. We’re using View to spot talented emerging leaders in the middle levels, and our culture practice is doing increasing amounts of work around vision, purpose and values.

Kevin Bright is a Director in YSC’s London office. [email protected]


Phil Smith is head of YSC Hong Kong.T: +852 2804 6006 / [email protected]

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“Currently, the net flow of talent seconded for career acceleration continues for most of our clients to be very disproportionately West to East.

“


GermanyAlthough Germany prides itself on the sound education and strong technical background of its leaders, the most sought-after are those who can manage ambiguity and complexity, while maintaining commercial focus and driving process efficiency. The financial crisis exacerbated existing challenges – such as retaining and developing top talent. Moreover, restrictions on external recruiting made gaps in internal development even more obvious. That made leaders think – and it proved a good opportunity for us to refresh perspectives. We had to come up with new approaches to help clients think more strategically about talent management and how it could be deployed in a more integrated way to address their challenges. One of the simplest, but strongest, levers we pulled was to engage directly with line managers. Discussing the kind of leadership they looked for in senior executives both sharpened their view about which people to invest in and triggered thoughts about how they might themselves develop as leaders.

Cordula Petersen is a Senior Consultant at YSC Germany, based in Ratingen. [email protected]

South AfricaTalent is a big issue here – and the main problem is the scarcity of “desired talent”, which in South Africa equates to meaningful numbers of black people at managerial levels. The “transformation” of a company not only affects its ability to win government contracts (allocated in line with Black Economic Empowerment (BEE) scores) but also, crucially, the employee brand and proposition. Yet because education pre-1994 was so poor, the number of people in their thirties or forties with the right qualifications is low. The best are incredibly marketable, and therefore incredibly mobile. These guys can ask the earth, but only stay a year if competitors offer more. And because they’re continually on the move, there’s no consolidation – no chance to gain and learn in a role – so they might end up in a senior position without the experience to tackle it properly. So the challenge is two-fold: how do you make a company “sticky” for talent, beyond simply paying 20% more; and how do you develop that talent?

Damien Anciano is a Managing Director of YSC, based in Johannesburg. [email protected]

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Identifying Talent at the Middle Management Level

In our experience, development spend in most large organisations tends to be focused in two areas: on senior leaders, where the stakes are of course highest; and on graduate entrants and those moving into their first managerial roles, where key skills such as objective setting and delegation need to be acquired. Sandwiched between senior management and first-line managers is a large population of middle managers who are frequently overlooked. Indeed, the quality of developmental support received by mid-level managers is at best hugely variable and at worst non-existent, determined in the most part by the skills, attitudes and availability of their immediate bosses. This is compounded by the fact that many middle managers are at a natural crossroads in their career – a time when they need a great deal of support.

“There is no doubt that the mid-management role is probably the hardest there is,” observes Lynne Weedall, HR Director of Carphone Warehouse. She’s right. Several years ago

we set up YSC View as a direct response to our clients’ needs for a development and assessment solution tailored to this population. As our View offering has grown, our experience has confirmed that middle managers are indeed very keen for challenge and guidance about how to develop themselves as future leaders. We have also observed the following key themes:

The complexities of being in the middleFirstly, people in the middle layer of organisations tend to be the most stressed. They often take on huge workloads in an effort to prove themselves and to get noticed by talent scouts in their organisations. They also have to fit in and conform to ways of working that may go against their natural grain. They spend most of their careers adapting to what’s around them and then, when they become senior leaders,

suddenly they are told that they need to be distinctive and authentic! “The frustration I see in my dealings across the business world, relates to a feeling, or perception, of lack of control over destination,” says Carol Bagnald, Regional Commercial Director for London at HSBC. Which is why investing in a culture of continuous learning and development is so critical at this stage, she believes. It could be “the biggest differential between those who break through, and those who don’t.”

The lack of role modelsSecondly, many middle managers simply don’t understand what “great” looks like at the next level – and beyond. As a consequence, it can be very challenging for people to prepare for senior leadership, or even to decide whether it is something they genuinely aspire to. They face steep challenges in their work while often receiving minimal coaching or mentoring, and can feel a sense of powerlessness as a result.

Middle management is often the forgotten layer of talent in organisations. Here, Kylie Bains looks at the challenges facing those wedged in the middle of the corporate sandwich and outlines what can be done to help them on the road to successful leadership.

by Kylie Bains

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1. Help your emerging leaders to understand the fundamentals of great leadership and what it takes to create genuine followership.2. Recognise the importance of developing talent early, addressing bad habits before people reach senior levels.

3. Build individuals’ insight into their distinctive spike strengths, demonstrating how these can enable them to make a difference. 4. Support them to establish a leadership mindset rather than getting fixated on career paths which will often be beyond their control.5. Go beyond skills development to helping individuals understand how their personal values and sense of purpose will help them lead and inspire others.

6. Build their understanding of the kinds of people they need around them to complement their own strengths and limitations.7. Develop strong senior leaders, role models and coaches that can help nurture and release potential at the mid-management level.

Tips for supporting your mid-level talent

The need for real leaders Thirdly, we have noticed that there is a stronger emphasis on technical competence for middle managers over leadership capability. As Nick Pope, Global Director of Learning & Salesforce Training at Bausch & Lomb points out, there’s a tendency in the healthcare sector to base promotions on sales skills rather than management competence. The danger is that you end up with a manager acting like “a super sales rep”, saving the day for his team, firefighting issues – but “never truly assuming a leadership position”, he says. The same emphasis on technical competence is often found in banking and financial services. This may be an understandable consequence of the strong regulatory environment, but it makes it more difficult for strong people leaders to emerge.

The “XX” gapFinally, our research on gender differences indicates that women are rated less strongly by others early on in their careers. It is not until mid-way in their career that this pattern starts to change. Typically women place a much stronger emphasis on competence than men and consequently may not be projecting as much confidence as their male counterparts until they are absolutely sure that they are excellent at their jobs.

Some clients have talked about a degree of unwillingness to invest in talent in middle management layers, simply because the populations there are so large. After all, how can you make an impact when the development spend gets spread so thinly? Our response to this is that it just makes it even more important to have robust ways to identify talent at this level so that resources can be targeted most effectively. They are, after all, the leaders of tomorrow.

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Kylie Bains, is a Director of YSC, based in YSC’s London office. Kylie leads the View Practice which provides assessment and development interventions specifically aimed at middle management.. T: +44 (0)20 7520 5555 / [email protected]

As crisis gives way to green shoots, and the immediate threats of redundancy and unemployment recede, employees seem noticeably more upbeat. In back offices and coffee corners, people are beginning to talk about new opportunities, fresh challenges... and, possibly, the tantalising prospect of a new role elsewhere.

This presents a significant challenge for retention – not least because companies, still struggling to regain their footing, may find it harder to offer the financial packages that were previously their best defence for fighting off the attentions of unwanted suitors. So how can you hang on to your best people without recourse to the “golden handcuffs”? Here we offer some tips.

tips on how to keep your talent

by Sam Gilpin & Nicholas Hastings

Defending the treasure trove

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Engage on an individual basis

Having identified your key people, get to know them better. Develop a deep and nuanced understanding of them as individuals. What drives them? What are their ambitions and aspirations? Why do they like being in the organisation? The insights of line managers could be very useful here. But, as Emma West, Global Talent & OD Director at Cadbury, argues: “there’s no substitute for direct engagement. It’s easy to make assumptions about what support a talented person might need without getting their own view first-hand”. So find ways of talking to your talent on a one-to-one basis, in a way that is genuinely engaging.

Meaning matters – especially to talent

In 2007, YSC published Meaning Inc, which looked at how highly successful companies create a strong sense of meaning for everyone involved in them. Three years on, the book is even more pertinent as companies look to find relevance in a new landscape. Our research suggests that those with an invigorating purpose have a significant advantage in attracting and retaining talent. When working with up-and-coming leaders in the John Lewis Partnership – a major UK retailer with a unique culture of co-ownership and a strongly held set of values – it is immediately clear that many choose to work there because of a deep sense of personal connection with what it stands for.

Use the full range of levers

Once you really know a person – and understand what drives them – make a point of using that information to keep them feeling valued. The flip side of straitened financial times is that they force companies to be more imaginative about how they keep talented people motivated. Think beyond traditional development programmes. One of our consumer goods clients majors on giving individuals focused mentoring and exposure to senior leaders. You might also foster a sense of community by creating e-based networks to link your talent globally. Other companies are looking at ways to further their talent development and CSR agendas simultaneously – perhaps by encouraging sabbaticals or engagement in projects in developing countries.

Be clear on who the “talented” areIt is a truism that if you do not know who your talent is, then it is impossible to retain it – and, in some organisations, the identification process has lapsed into a bureaucratic exercise in box-filling, based on loose criteria and subjective data. As a first step, then, define what you mean by talent. At YSC we have identified the underlying personal qualities that often drive success – Judgement, Drive and Influence (see model, right). But the missing link in many companies is that talent isn’t aligned closely enough with core purpose and strategic direction. Before you can identify the talented, therefore, you need to define “talent” on your own terms – by understanding where the business is heading and what roles will be critical to its future.

Drive• Drive to

have impact • Personal initiative

• Self-assurance

Influence• Self-

awareness• Environmental

radar• Range of influence

Judgement• Analytical rigour• Identifying issues

• Problem resolution• Framing

Impact

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…But exit is tooPerhaps unsurprisingly, statistical research in the US indicates that people are more likely to quit jobs that other people have left. Naturally, every organisation will lose key people from time to time (big macro changes in the working landscape and in the psychological contract between employer and employee dictate as much). But it is vital to understand why they are leaving and fix any problems fast – before their replacements follow them out of the door. Also remember that the way talented individuals are treated when they leave will have a significant impact on those left behind, including their retention.

Make sure line managers are really engaged on talentOne of the key reasons people leave organisations is because of their relationship with their boss. In many businesses, the pressure of delivering short-term results comes at the expense of everything else. The risk is that line managers may miss opportunities to celebrate success and provide meaningful developmental support for their teams. One of our global leisure clients overcame this problem by recognising and rewarding managers every time someone in their team was promoted. It helped breed a culture in which talent truly flourished.

“ “

Join it upSo far, we’ve focused on a highly individualistic approach to retaining talent, but there is also a wider angle. Clients with a knack for making talent stick tend to be those who think about the issue in a holistic way. Different parts of the business are not allowed to operate as “talent fiefdoms”. On the contrary, gifted people are allowed to move freely around the organisation, broadening their skills and experience. Moreover, by linking resourcing and succession-planning to personal development plans, companies ensure that the pathways to individual growth are matched with the needs of the business as a whole.

There’s no substitute for direct engagement. It’s easy to make assumptions about what support a talented person might need without getting their own view first-hand.

Entry is vital…The first step to keeping talent is to ensure that new joiners feel welcome and valued. Getting the entry process right and understanding the needs of new hires at the outset pays long-term dividends. In a recent 18-month project with one global client, we interviewed 300 employees worldwide to identify the key psychological challenges they faced when joining the company. We used the findings to build a new, more consistent approach to induction. Similarly, many clients use us for our Transition Coaching offering, which supports new joiners in their first 100 days through a blend of 3-ways, stakeholder feedback and 1:1 coaching.


AmericasAt the beginning of our financial year we held our collective breath and wondered how the year would shape up. The activity of our clients is a barometer of the economic recovery and we have noticed a couple of trends so far. Those organizations that remained wholly invested in the development of their people throughout the recession are retaining their best talent as we tip-toe towards recovery. They found innovative, creative ways of nurturing, growing and stretching their people while operating in a fiscally responsible way. Clients who had suspended hiring new talent are starting to come back on board and are more specific than ever in their requirements. Finally, we are seeing clients thinking at a macro level about talent, revisiting leadership essentials and the type of culture they want to create in their business. They are asking questions like “Are the leadership behaviors that got us here the ones that will carry us into the future?”. The Meaning Inc platform is gathering momentum in the US and clients are curious to know how they can create a sense of invigorating purpose and engagement for their people.

Neil Jacobs is a Director of YSC Americas, based in New York. [email protected]

The NetherlandsThe Dutch economy is still in quite a difficult situation. Things have stabilised, but organisations are still being very careful about hiring people. They would like to attract talent while simultaneously reducing headcount, which makes for a stressful situation. In Holland there are a lot of regulations: different age groups have to be represented when making redundancies. So organisations are homing in on individuals. They’re using performance management systems to measure capabilities, and showing increasing interest in leadership programmes. There’s still a great sense of the importance of engaging talent. But perhaps the upside of the crisis is that companies are being forced to be more imaginative about how they encourage staff. They are searching for different ways of doing that on a budget – for example by extending the range of offers in their “cafeteria” system of benefits, or tackling issues like ageism. There’s a growing belief in Dutch companies that the societal contract needs to change.

Sandra Terwolbeck is a Consultant in YSC Netherlands, based in Arnhem. [email protected]

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Take risks to stretch the best

Be courageous. The best talent nurseries are those prepared to place “bets” on individuals. People identified as having high potential usually benefit from being given stretching roles to accelerate their growth – provided it is accompanied with the right level of support. This may be the resources needed to do the job properly, or coaching and mentoring to see them through the transition. Successful companies also appreciate that – while risks do not always come off – a perceived “failure” can be the best kind of learning experience, so long as it is properly positioned.

Develop a distinctive organisational signature for talent

The final piece in the retention jigsaw? Become known as a beacon for talent. Developing a reputation as a great place to work for talented individuals at all levels is the best means of both retaining and attracting talent. Think of it as the icing on your employee brand. This is one of General Electric’s secrets: its centre of leadership at Crotonville is a powerful, symbolic indicator of the value placed on developing and supporting talent. As Emma West of Cadbury concludes: “The employment experience promise – what’s special about working here – needs to be clear and compelling for talent; just as our brand messaging articulates what is special and distinctive about each of our products.”

Sam Gilpin, Managing Consultant, & Nicholas Hastings, Consultant, are based in YSC’s London office. T: +44 (0)20 7520 5555 / [email protected] / [email protected]

Justin King’s turnaround of J Sainsbury Plc – one of the UK’s leading and longest established retailers – is rapidly becoming the stuff of corporate legend. When he took over in 2004, the supermarket chain had lost market share for fourteen consecutive years, outpaced by the momentum of Tesco. Falling financial figures were accompanied by a distinct feeling of malaise: employees were demotivated, and managers were unclear on where the business was heading.

In 2005, King announced his ambitious plan to revive the retailer’s fortunes, what he called “Making Sainsbury’s Great Again”. Three years later, Sainsbury’s had achieved 13 successive quarters of like-for-like sales growth and doubled profits to nearly £500 million. Sales figures, released in January 2010, showed that the retailer had served a record 24 million customers in the week leading up to Christmas Eve, one million more than for the same period the year before, with like-for-like sales up too.

When King took over, Sainsbury’s was already an established client of ours. We had worked with them on individual development and selection, and, as a result, had developed a good “feel” for the organisation. We were able to share our insights with the incoming CEO, identifying particular challenges around performance management and a hierarchical, bureaucratic culture. King was to see a pertinent example of this when he went to a meeting with store managers. Having been impressed by the quality of the debate, he then found a printed sheet on the floor, written by store managers’ bosses, with all the questions on them... and the names of who was to ask them!

King realised that he needed to shift the mindset of the organisation radically and he engaged YSC as a partner on this journey. We worked with an internal team to understand in more depth what the cultural issues and blockers were. We then spent two days with

the board, helping them to reflect on their individual sense of purpose, sharing our key insights about the business and exploring how we could shift the culture by building on Sainsbury’s core identity.

Some members of the board questioned the wisdom of spending time on this while there were so many problems that needed fixing. But King was resolute, and convinced of the importance of setting a clear vision for the business in parallel with addressing the operational challenges. At the end of the two days, the board had drafted a new goal and set of values. The month after the values were launched, Sainsbury’s started to post month-on-month increases in market share for the first time after years of decline.

A few months later, we then went through a similar process to identify a set of core leadership “principles” to bring the values to life (see inset). “On My Watch” encouraged leaders to take accountability and not hide

When faced with a turnaround situation, many CEOs focus on the “hard levers” exclusively, cutting jobs and driving operational efficiencies. Here Gurnek Bains and Georgia Samolada outline how YSC contributed to “Making Sainsbury’s Great Again” by applying our insight into the “soft levers” that can reinvigorate an organisation’s culture and release the power of its people.

Spotlight on

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by Gurnek Bains & Georgia Samolada

YSC was an important partner in “Making Sainsbury’s Great Again”. Gurnek and his team challenged our thinking – particularly at board level – helping us to examine our culture and working practices with objectivity and a fresh perspective. YSC helped us identify our key strengths but also the blockers and issues that were hindering our long-term objectives. Importantly – we felt that YSC was committed to us and our success ‘for the long haul’. They genuinely cared about our vision, our people and our brand, making them invaluable partners and great people to work with.

Imelda Walsh, HR Director, Sainsbury’s plc


behind processes. “Tough Love” focused on coaching and honest conversations. We then assisted with the design, delivery and roll-out of workshops for the retailer’s top 1000 leaders, to embed the new behaviours and help individuals take ownership for their own development.

Turning a culture around is not something that can be achieved in a few months – it is an ongoing journey with periods of great shake-ups and quieter times of embedding change. Three years after the introduction of the new goal, values and behaviours we repeated a similar ‘fact-finding’ process to understand how far the culture had moved. We worked again with the board and the Top 60 to help them take an honest look at what were some of the more persistent blockers, then used this as the basis for further workshops. This work is ongoing to date, supported by a number of other complementary initiatives, such as coaching for leaders, authentic leadership and talent workshops.

By giving his leaders greater clarity on why the organisation existed and the role they had to play, and then giving them the freedom to make their own decisions, King not only sparked a sensational turnaround, he also created the conditions in which talent was able to flourish.

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AustraliaThe Australian economy has had a whirlwind ride through the beginnings of a recession and back into confident times. When it looked like recession at the start of last year, budgets tightened and investment in talent dried up – but we’re seeing that reverse rapidly. Is it a return to business as usual? It depends how badly organisations were hit. Many are trying to return to the course they were on, but – given continuing global uncertainty and a heavy dependency on China’s economy – they’re being more rigorous about whom they’re selecting and developing. Australian companies have traditionally majored on off-the-shelf talent management packages. We’re now seeing a lot more interest in in-depth, holistic measures, which go far beyond competency-based interventions. Companies are increasingly trying to differentiate potential from performance, and we’re also seeing more investment in coaching at the senior executive level. The Australian down-to-earth leadership style and desire not to stand out too much from the crowd (often dubbed ‘Mateship’ and the ‘Tall Poppy Syndrome’ respectively) offer an interesting challenge when working on talent issues. Finding the balance between benchmarking globally while retaining a culturally appropriate style is a delicate act.

Shelley Winter is a Managing Consultant, based in Sydney. [email protected]

“ Leadership is about creating the right environment, where people can fulfil their potential; creating a clear vision and sense of purpose and excitement about what might be achieved.

Justin King, CEO, Sainsbury’s plc

“

Sainsbury’s Leadership Principles:

WinningCommitment is EarnedOn My WatchTry Something NewTough LoveCustomers Pay our Wages

“

“

Gurnek Bains, CEO, & Georgia Samolada, Managing Consultant, are based in YSC’s London office. T: +44 (0)20 7520 5555 / [email protected] / [email protected]

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What we asked Australians in business are credited with optimism, directness and a can-do attitude. They are proud of their reputation for hard work, honesty and open-mindedness – and trade on these attributes, especially when doing business overseas. But how do they believe they rank against their contemporaries in other markets? Do they have an accurate picture of their strengths and weaknesses? Our survey uncovered some surprising insights about how Australians think they measure up.

Surveying employees, from middle to senior management level across a range of industries, we asked how they believe they benchmark within their organisation, within Australia, and globally. We also asked whether the knowledge of how they ranked was important and what information was used to establish self-perception.

The results were not what we expected. An astounding 93% of respondents rated themselves above average (50%) or ‘best in class’ (43%) compared to their peer group – a surprising outcome given Australians’ tendency to humility and self-deprecation in company. Although the majority claimed some knowledge of how they benchmarked within their organisation, 41% said they had no idea how they were performing against other Australian peers and 56% admitted ignorance globally.

Mind the gap!The findings highlight an alarming knowledge gap. Despite this, respondents expressed high self-confidence. If most Australians think they are better than their peers, clearly not all have a realistic perception of their abilities. Are they in denial or masking insecurities with bravado? Given that most wanted to know more about how

they benchmarked – half expressed a strong desire to obtain extra feedback – this seems unlikely. Perhaps, it is more a case of business leaders failing to provide staff with accurate, comprehensive appraisals on which to form grounded perceptions.

Rather than seeking to generalise about the complex subject of the Australian psyche, we opted to consider how this knowledge deficit might relate to organisational culture and its ability to give constructive feedback to employees. Respondents referred to performance appraisals and 360 reviews as their primary source of insight, with intelligence from headhunters and recruitment professionals rating very low. This indicates an over-reliance on internal feedback, which we can infer is mostly positive. Lacking a broad or deep enough range of performance measures, employees are left to extrapolate favourable messages, obtained from a too narrow data set to fit wider Australian and global contexts.

The view from Lake Wobegon

The ‘Lake Wobegon effect’: a cognitive bias causing people to overestimate their positive qualities and abilities whilst underestimating their negative qualities, relative to others.

Research from Down Under suggests this might just be happening in Australia’s management population.

by Shelley Winter & Stacy Richardson

International Perspective: ScotlandIt’s been a tough year for Scotland. Clients are trying to get a fix on life after the crunch. Retention is a real issue, particularly in financial services: senior people have been moving and taking talent with them. Companies are steering a difficult course: when times are hard, the development budget is clearly at risk. So Scottish companies are intent on figuring out how to balance developing talent while simultaneously reducing head count and limiting discretionary spend. There are signs of optimism, however. Clients are investing in talent development and we’ve seen an increased focus on benchmarking talent and on helping leaders play to their strengths. Yet there’s a dilemma. Many Scottish companies have a long-service culture. It means there’s a palpable sense of loyalty, pride and historical context. But it has sometimes led to a “not-invented-here” bias which means companies can become quite insular. There is evidence that some companies are ready to face this challenge. We’re encouraged at new requests for support from companies taking thoughtful steps to engage people in redefining their vision and purpose. Team development and executive coaching are on the increase and we are seeing an emerging focus on harnessing the best of the past in order to deliver a more meaningful, sustainable future.

Joanna Bleau is a ManagingConsultant, based in Edinburgh. [email protected]

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Dangerous MisperceptionsThe potential cost to Australian business of this misperception demands consideration. Any workforce, or individual, that falsely believes it is operating at optimal levels will struggle to find the impetus to stretch, exceed expectations, or evolve creatively.

Benchmarking deserves greater attention in order for businesses to remain competitive. With employees forming judgements from internal measures, and thereby rating themselves very highly, we can surmise that the organisational trend is for overly positive performance messages or no feedback at all. This hypothesis resonates with our observation that many companies still struggle to give constructive feedback. Some managers either avoid, or dilute with humour, tough performance conversations. Others exhibit an inability to communicate, such that feedback is not heard in a way that can be integrated into the employee’s sense

of self. There is also a tendency to treat all staff the same, applying a homogenised review process that fails to identify high performers or employees who have reached their ceiling.

Think globally Rather than reassuring staff that they are doing just fine, managers should be doing more to push, inspire and motivate their people. If they don’t, employees with the potential to shine may be lost, and those employees who have reached the summit of their potential may become complacent and ‘stuck’. Neither scenario is good for growth or long-term prosperity and competitiveness. However, both can be avoided by introducing more robust, accurate and honest benchmarking that gives employees a fair and realistic perception of how they rank, not only internally but on a national and international stage. It is also far more meaningful and empowering for an employee to know where they rank globally, not just within the relatively small pond of the organisation. Likewise, comprehensive benchmarking provides a company with a full and accurate snapshot of its people’s strengths and weaknesses as compared with other organisations around the world.

Performed effectively, benchmarking requires the commitment and resources to assess each employee individually. It also requires leaders who are not afraid to speak the truth, even if it may not be what their people want to hear.

Shelley Winter, Managing Consultant, & Stacy Richardson, YSC Online Project Manager, are based in YSC’s Sydney office. T: +61 2 9252 3332 / [email protected] / [email protected]

The article was written by Belinda Burns, Director of WordBuff Inc.

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by Nicholas Hastings & Clare Morse-Brown

What to Watch

The 2009 final of the UK X Factor may have attracted 20 million viewers, but what did it really tell us about talent? Can organisations learn anything from talent show formats when managing their own talent pool?

Since The Original Amateur Hour in the 1940s, talent shows have evolved into one of the most pervasive reality TV formulas. Typical formats include panel judged open auditions, mentoring sessions and ‘boot-camp’ scenarios. The eventual aim is that a select group of contestants will be deemed of a high enough standard to be subjected to a wider critique – that of the public vote.

Arguably, there are three key elements that seem to permeate the shows:1) The public and judges vote. 2) An element of coaching or mentoring.3) Commentary by the judging panel on

performance, potential or growth.

What do these elements achieve? A few thoughts…1) The public vote may engender a sense

of involvement for the audience who are able to protect their favourite ‘in-group’ starlet from the exile of anonymity. Voting is also core to the sense of competition – individuals are pitted against each other; not everyone will succeed.

Similarly, individuals who are driven to be better than their peers and their external competitors help push organisational success. Competition allows a weeding out

From The X Factor and Got Talent series and their international equivalents (Le X-Factor, Ethiopian Idols or India’s Sa Re Da Ma Pa), the modern talent show phenomenon seems – as yet – to have no saturation point.

Nicholas Hastings, Consultant, & Clare Morse-Brown, Research Consultant, are based in YSC’s London office. T: +44 (0)20 7520 5566 / [email protected] / [email protected]

of those without the drive, commitment, and ultimately, the talent to succeed.

2) The coaching element in talent shows is often provided by mentors who guide choices, provide feedback and nurture growth. Even in shows such as the UK’s The Apprentice, with Sir Alan Sugar’s authoritarian style, we see examples of strong peer coaching. The contestants might be in direct competition but the audience is further entertained by seeing them pull together, comfort each other and even form strong personal bonds.

Likewise, in organisations, talent that is developed and nurtured creates the success stories of tomorrow. Organisations that both raise the bar and offer support in parallel will be more likely to realise the full potential of their talent.

3) Most talent shows have a panel of judges who provide feedback after performances. Anti-heros like Simon Cowell in the UK and US and Kuba Wojewodski in Poland are renowned for their direct and even caustic comments.

Although organisations can be keen to protect their staff from hard truths, these truths can be liberating. Not just for the organisation, but for the individual. Honest, timely feedback facilitates positive change – it’s developmental and can even serve to heighten in-group bonding.

Whatever we might think about some of the ethical dimensions of these shows, part of their success seems rooted in the balance between feedback that is both challenging and supportive, in combination with a robust spirit of competition. These are elements which organisations would also be wise to keep in mind.

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What to Readby Sam Gilpin & Jock Encombe

Joshua Cooper Ramo’s book The Age of the Unthinkable has received impressively high levels of interest in Washington, Whitehall and other influential policy circles around the world. His argument is a familiar one: that as a result of new technologies and a rise in non-linear change the future has become ever more unpredictable. Traditional, top-down hierarchical organisations are therefore increasingly obsolete. Instead, the future belongs to more adaptive models of organisation and leadership.

Similar ideas have of course been around for some time, with their roots in complexity theory, systems thinking and the 1960s counter-culture. Where Cooper Ramo has an edge is in the breadth of his learning and research and the vigour of his prose. The book includes fascinating interviews with both Hezbollah and Mossad, and describes the innovative tactics they have both used to steal an advantage. Indeed, part of his argument is that for organisations to succeed, their leaders will increasingly need to think and operate like revolutionaries or spymasters. At a more fundamental level he identifies the need to embed ‘change agility’ and resilience in organisations, and for leaders to think of themselves more like gardeners than craftsman.

Standing back from the force of Cooper Ramo’s persuasiveness, however, a basic problem emerges: very few if any large corporations or organisations are paying more than lip service to these ideas. Even if he were to argue that this proves his point, it is difficult to square his proposals with the realities of organisational life. How exactly a CEO is meant to incorporate the book’s ideas into the disciplines required to run a substantial enterprise is, therefore, unclear. And the idea that any CEO who has worked all his life to get to the top of the pile will willingly relinquish power is probably just wishful thinking.

The Age of the Unthinkable: Why the New World Disorder Constantly Surprises Us and What We Can Do About ItAuthor: Joshua Cooper RamoPublisher: Hachette Book GroupPrice: £20.00/US $25.99 hardback

Malcolm Gladwell has made a career out of sifting through academic research and popularising key insights and eye-catching themes, like his most famous book Tipping Point, or Blink, his book on intuition. Outliers, his third book (published 2008) is his take on talent and is no less stimulating than his previous two, although it lacks some of their thematic coherence.

His key point about talent is that it is a product of its environment and he draws on examples as diverse as the fact that Czech international footballers tend to be born in the same month (because children who are older are stronger and more coordinated than their peers, and so get rewarded with more playing time and more coaching) or the fact that the Silicon Valley pioneers were all born within a few years of each other (because they came of age just at the point when computers became widespread enough for students to code on them).

He then goes on to an equally fascinating but less relevant excursion on cultural context and what drives behaviours at a national level: looking at oddities like why Korean airlines had such poor safety records (because of a hierarchical culture in which co-pilots felt unable to challenge the decision making of the pilots) and why Asian children are better at maths than their Western counterparts (because their numerical naming systems are more systematic and their heritage of wet rice agriculture leads to cultural valuing of persistence). What Gladwell avoids, partly because there is less research on the topic and partly because it is a much thornier issue, is what makes particular individuals thrive or struggle in the same environment; the true psychological qualities of success.

Outliers: The Story of SuccessAuthor: Malcolm GladwellPublisher: Penguin Group/Hachette Book GroupPrice: £9.99 paperback/US $27.99 hardback

Sam Gilpin, Managing Consultant, is based in YSC’s London office, T: +44 (0)20 7520 5555 / [email protected]. Jock Encombe, Director of YSC & YQ Editor,, is based in YSC’s Edinburgh office. T: +44 (0)131 228 7940 / [email protected].

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To seek advice from Dr Ken, please email your question to him at [email protected]

Dear Dr KenDear Dr Ken

First things first. I do not need any more psychologists. I’ve done my time and I’m over it. I’ve said I was sorry. I’ve been to hell and back making peace with my demons, what more do you want?! I’ve won 14 majors. I was immortal! I even beat that Rocco Mediate on one leg for goodness sake. So what if I had a few affairs?. So I like to gamble… who doesn’t? You’ve no idea what it’s like to have people stalking you the whole time. Success brings with it great vulnerability and loneliness. I’ll be back though. I am Tiger. Elin will be back too won’t she? She needs me. You all need me. Don’t you?

Yours truly,

Tiger

Dear Tiger

You have got yourself into a monumental pickle haven’t you? Most people with a model wife, a billion dollars and a couple of kids would be pretty happy. Not you. So where did it all go wrong? I’ve considered your case and I’m sure you’ll bounce back from the sorry place you find yourself in. All it takes is a little self-knowledge. Here are the potted thoughts of a bunch of shrinks to help you on your way.

A brilliant intellectual who might bring some perspective is WILLIAM JAMES, viewed by many as the father of modern psychology. You mentioned your opponents saw you as immortal; they trembled in front of you. But did they tremble because you were invincible, or were you invincible because they trembled? Mr. James would say the former. Your sense of your own invincibility was a primitive physical response. You couldn’t possibly have engaged your brain while under the influence of such powerful emotional drivers. You just had to give into them. So to that extent you’re off the hook. Forgive yourself, there was nothing you could do.

If that doesn’t bring relief, consider what another eminent psychologist, B.F. SKINNER, has to say. He majored on operant conditioning: the belief that behaviour is trained by positive or negative

consequences. When you won all those tournaments, the trophies reinforced the feeling that you were doing something right. The problem is you’re now stuck. You crave that feeling – it consumes you. But you can’t always find it on the golf course, so you seek it in more unlikely places. I guess it was only a matter of time before you substituted your silver trophies for ‘alternatives’.

One final thought comes to mind. If I was listening to my friend MARTIN SELIGMAN, I’d say you had a dose of SUCCESS DEPRESSION. This happens when lots of great things happen to you, simply because of who you are, rather than what you do. Faced with this, rats have been found to do random things in an effort to generate a sense of efficacy. Ring any bells? But Tiger, there are limits. I would suggest instead that you try to find a more balanced, even keel. Recognise your own imperfection and get your internal moral compass back on track. Life’s too short, isn’t it?

I do hope these ideas help you. If all else fails, might I suggest you try Jenga? It’s got a US tour as well, but every time you fall down, you just build yourself back up again. Quite apt don’t you think?

Yours sincerely,

Dr Ken

As part of YSC’s CSR commitments and in line with our mission statement, which is to release the power of people, we are committed to supporting emerging talent.

The image featured on the front cover of YQ is Similarity by Bundit Puangthong. Born in Thailand and now based in Melbourne, Bundit works as a contemporary artist who incorporates elements from Thai art, American pop art and contemporary street art in an attempt to strike a balance between the cultures in which he lives. Bundit was a finalist in the 2008 Sovereign Asian Art Prize, an annual competition that celebrates the best artists from the Asia Pacific region. It is run by The Sovereign Art Foundation which uses the funds it raises through the auctioning of the finalists’ work to help disadvantaged children through arts as rehabilitation, education and therapy. www.SovereignArtFoundation.com

The image on page 3 of YQ is Untitled by Ashim Karmakar. First exhibited at The Menier Gallery in London on the 1st of April 2009. The inaugural exhibition – sponsored by YSC – was curated by R.B. Sharma, founder of IMA (Indian Modern Art), to showcase the work of emerging Indian artists. To find out more about the artwork, including purchasing, please contact R.B. Sharma on +44 (0)7796 957639 or by email to [email protected]

YSC – where psychology means business

As a result of continued client demand for our services we are currently recruiting across all geographies. We are looking for senior business psychologists to join YSC’s primary consulting team and also more junior psychologists (including graduates) to support our growing middle-management level practice, YSC View. YSC’s clients include almost half the FTSE100 and also government bodies and non-profit organisations. We are a collegiate, global company with 13 offices in 8 countries and 130 staff (of whom 80 are client-facing consultants). Successful applicants for both types of role will bring intellectual challenge and edge to their environment and a real commitment to business development. Candidates will demonstrate

outstanding insight into individuals, teams and the culture of organisations – as well as the capacity to work with clients in a relaxed yet professional manner. A post-graduate degree in Psychology would be highly desirable, but not essential if you have a proven track record of success and can demonstrate extensive, relevant business experience in the following areas: • Deep psychological assessment• Developing leaders and high performing

teams • Executive coaching • Organisational consulting • Workshop design and facilitation • 360 feedback If you are dynamic and ambitious with a real passion for leadership consulting, creating

meaning for executives and organisations, developing new business, managing client systems and innovating with colleagues to find the next big thing in our field – we’d love to hear from you. Please send your CV/resume and a covering letter, based on the geography you are interested in, to: [email protected] (UK & Hong Kong)[email protected] (Australia)[email protected] (Germany)[email protected] (Netherlands)[email protected] (USA)[email protected] (India)[email protected] (South Africa) Please note: you must be eligible to live and work in the country to which you are applying. For more information about our story, products and services, please visit www.ysc.com

We’re hiring!Business Psychologists – All Regions

www.ysc.comReleasing the power of people

© YSC Ltd. 2010. YSC is the trading name of Young Samuel Chambers (“YSC”) Limited. Registered in England at 50 Floral Street, London, WC2E 9DA. Company Number 2402857

LondonTel: +44 (0)20 7520 5555

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MumbaiTel: +91 22 40907142/3

At YSC our mission is to release the power of people. We do this by combining industry leading psychological insight with a thorough understanding of our clients’ business needs. We work with clients across their entire talent lifecycles, including: recruitment, induction, development, the identification of potential, internal selection, role change, measurement and departure. Our key client offerings include 1:1 and team assessment, executive coaching and organisational consulting.

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YQ Issue 02

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Transcript of YQ Issue 02