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DEMOCRACY DOES IT HAVE A PLACE AT WORK?

ON WITH

THE SHOW

How HR fuels Cirque du Soleil’s global success

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EDITOR’S LETTER

THE MEAT IN THE MIDDLE “You don’t need to be liked as a manager – you just have to be respected.” As harsh as that sounds, it’s probably true. You don’t need to be best friends with your staff, nor do you need to be out every Friday with them for a drink, or have a heart to heart with them on Monday morning. It’s far more important that they respect your decisions and understand that those decisions will sometimes be difficult to make, but will always address the commercial and (hopefully) the human side of business.

It’s tough being a manager. As a senior HR practitioner you possibly understand this more than anyone else in business. And you probably also know that often it’s ‘sink or swim’ with front-line managers.

Throw them in the deep end and see if they swim. If they do swim, they might get the relevant training and support they need to do their critical job more effectively. For it is critical – who connects corporate strategy to day-to-day performance more than a line manager? Who engages staff more than a direct manager?

We’ve all heard horror stories of plain bad management – or if not bad management then management that is forced to act in a

COPY & FEATURES SENIOR EDITOR Vernon Clement Jones EDITOR Iain Hopkins SENIOR WRITER Jill Gregorie CONTRIBUTORS Cameron Edmond, Adam Fraser, Les Hayman, Rachel McNeill-Thompson, Christine O’Donohue, Gary Taylor PRODUCTION EDITOR Roslyn Meredith

ART & PRODUCTION GRAPHIC DESIGNER Marla Morelos DESIGN MANAGER Daniel Williams

SALES & MARKETING BUSINESS DEVELOPMENT MANAGER Sarah J. Fretz NATIONAL ACCOUNTS MANAGER Andrew Cowan GENERAL MANAGER SALES John MacKenzie ASSOCIATE PUBLISHER Trevor Biggs MARKETING AND COMMUNICATIONS Claudine Ting PROJECT COORDINATOR Jessica Duce

CORPORATE PRESIDENT & CEO Tim Duce OFFICE/TRAFFIC MANAGER Marni Parker EVENTS AND CONFERENCE MANAGER Chris Davis

It’s tough being a manager.

As a senior HR practitioner you possibly understand this more than anyone else in business

Editorial enquiries jill.gregorie@keymedia.com tel: 1 720 3167 Ext: 373 Advertising enquiries sarah.fretz@kmimedia.ca tel: 416 644 8740 Ext: 241 Subscriptions tel: 416 644 8740 • fax: 416 203 8940 subscriptions@kmimedia.ca KMI Publishing 312 Adelaide Street West, Suite 800 Toronto, Ontario M5V 1R2 wealthprofessional.ca Copyright is reserved throughout. No part of this publication can be reproduced in whole or in part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as IB magazine can accept no responsibility for loss.

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vacuum; the left hand doesn’t know what the right is doing, and, more damaging, it doesn’t want to know either. Take the building and construction giant that went through the unfortunate process of downsizing recently. When asked who in their team should be let go, a line manager put forward three names, one of whom was the only person in the division who could write business tenders. Upon being alerted to this fact by the very person being laid off, the manager shrugged and said, “I know, but this is what senior management wants.” The employee was let go.

Three months later she was back as a consultant to that same company, being paid three times her former wage.

C’est la vie.

vernon.jones@kmimedia.ca

Iain Hopkins, editor, HRD NOVEMBER 2014 | 1

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CONTENTS

26

REGULARS 06 | News analysis: Management structures 12 | In brief: CEO expectations 48 | Last word: Death of the ATS

Profile: HR goes to the circus There is perhaps no display of the human spirit more stunning than the performances put on

by Cirque du Soleil.

Marie-JosÊe Guilbault and Line Giasson share the secrets to obtaining the rarest and most exceptional talent this world has to offer – and the culture that makes them stay

issue

2.6 24

FEATURES 16 | Are we ready for workplace democracy?

Does democracy have a place in the workplace?

Or is some degree of autocratic rule still required? Les Hayman weighs the pros and cons 20 | On the move: Conquering China An estimated 40 per cent of expatriated workers return home prematurely, costing employers millions of dollars every year.

Chinese broadcasting giant CCTV provides valuable insights on how small considerations can yield huge savings

40 | Recruitment finally comes of age Despite the best of intentions, a diligent interview process, and thorough onboarding, organizations still make ill-advised hiring decisions. HRD outlines how two game changers have reimagined their approach to recruiting

42

Stepping it up: Creating and sustaining high performance Canadian organizations are facing a performance crisis, as labour productivity has been on a steady decline since the 1970s. Two prominent employers, Cisco and Nitro Software, reveal how they created a high-performance culture to combat this trend

2 | NOVEMBER 2014

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INSIGHT / NEW MANAGEMENT STRUCTURES

Rebuild it and they will come:

RETHINKING MANAGEMENT IN 2015

The world of work is changing.

More organizations are adopting flatter structures and even doing away with job titles altogether. Cameron Edmond examines the forces that are toppling the corporate hierarchy Traditional top-down corporate structures remain prominent in many organizations. However, more organizations are shifting to a flatter structure, and some are even doing away with the concept of management completely.

Flatter management is a concept that most HR directors are familiar with. Terri Kelly, CEO of W.L. Gore, has given the nod to the concept, stating: “It’s far better to rely upon a broad base of individuals and leaders who share a common set of values and feel personal ownership for the overall success of the organization. These responsible and empowered individuals will serve as much better watchdogs than any single dominant leader or bureaucratic structure.”

But how does a flat structure manifest? Are bosses completely eradicated, or does their role simply

evolve? How is employee performance boosted?

Two organizations have stood out for their shift to flatter structures: online retailer Zappos and video game industry innovator Valve.

ZAPPOS AND HOLACRACY Featuring prominently in the media lately is the management approach known as ‘Holacracy,’ touted

by HolacracyOne and picked up by a number of organizations – most publicly by online shoe retailer Zappos.

Zappos CEO Tony Hsieh explains the style as allowing employees to self-direct their work and become more entrepreneurial, as opposed to reporting to management.

“Research shows that every time the size of a city doubles, innovation or productivity per resident

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increases by 15 per cent. But when companies get bigger, innovation or productivity per employee generally goes down,” he explains.

“We’re trying to figure out how to structure Zappos more like a city, and less like a bureaucratic corporation.”

HR should not confuse Holacracy with ‘Anarchy.’

While employees are able to chart a personal course and organize themselves, Zappos will maintain a group of people charged with leading the company as a unit and a business.

Zappos describes Holacracy as decoupling the technical and people-focused aspects of management. While traditionally a manager would be responsible for both elements, Holacracy allows the various responsibilities of management to be disseminated among employees best suited to them.

In effect, the role of a manager is made obsolete, and self-direction is brought to the forefront.

Zappos hopes that productivity can be bolstered

this way, as politics and bureaucracy become limited.

Individuals are able to evolve the organization’s structure to respond quickly to market conditions, creating a flexible structure as they go.

The complete overhaul that adopting Holacracy often involves comes with its own set of trials and tribulations.

“Holacracy is super difficult,” Christa Foley, senior HR manager at Zappos, tells HRD. “It is such a dramatic shift from traditional structures that it really takes at least six months for employees to get it and begin to see the value in it … you really need to understand this and make sure your employees understand this so they can rally with you.”

THE STEAM SOLUTION While management across the board is getting flatter and Holacracy is on the rise, US-based video game company Valve has taken the next step and adopted a purely flat, job-title-barren approach to work.

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INSIGHT / NEW MANAGEMENT STRUCTURES

“A fearless adventure in knowing what to do when no one’s there telling you what to do” prefaces the company’s employee handbook.

The organization’s structure is described as one in which employees are able to pick and choose which projects they work on. When someone has an idea, they begin work on it and mention it to others. If other employees are interested, they too will contribute, resulting in the project getting off the ground and developing.

It is here that Valve’s structure begins to resemble circles of management. Instead, these are referred to as ‘cabals.’

Cabals are also referred to as ‘multidisciplinary project teams’ and are self-organized. The groups are temporary and are generated to help ensure a project is shipped, forming organically around the people who work on it.

The temporary structures will often mean that team leaders emerge, but their role is not of traditional management. Instead they act as a resource: other team members can rely on them to be aware of all details of the project at hand. Other temporary internal structures may also develop.

A fluid, flexible structure is the true aim of Valve’s ‘flatland’ approach: codified or persisting structures can become self-serving and result in the projects themselves becoming devalued.

“If you’re thinking to yourself, ‘Wow that sounds like a lot of responsibility’ you’re right,” the handbook

reads. “Any time you interview a potential hire, you need to ask yourself not only if they’re talented or collaborative but also if they’re capable of literally running this company, because they will be.”

However, Valve’s structure has its critics. A former employee, Jeri Elsworth, spoke out against the structure last year in an interview with the Grey Area Podcast.

Elsworth described the structure as “pseudo-flat,” adding that a hidden layer of powerful management had manifested in the company, making it “a lot like high school.”

“There are popular kids that have acquired power in the company, then there’s the trouble makers, and everyone in between.”

LEADERS OF FLATLAND Roma Gaster, director at The Leadership Circle Asia Pacific, feels that traditional management structures will be forced to adjust to meet today’s complex business environment, with collaboration, shared accountability and collective decision-making becoming the norm as adaptive and flatter organizational structures emerge.

Gaster’s primary takeaway for HR directors embarking on a flatter management initiative is an understanding of leadership in a less hierarchy-driven organization.

“It means more than one person is responsible for taking on the role of developing a culture where

Describe what isn’t there The Valve employee handbook includes a number of drawings by employees that help describe the organization’s structure:

VALVE ORGANIZATIONAL CHARTS (as envisioned by employees) Diag. 1 gabe

Diag. 3

Diag. 4

Diag. 5

*

everyone

Diag. 2 everyone

chet

*“I’m the noob, coffee anyone? Hello?”

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All the young dudes

DAMAGE REPORT Coming to grips with the ins and outs of Holacracy isn’t easy. HRD chatted to senior HR manager Christa Foley, of US-based online shoe retailer Zappos, about the switch Does the Holacracy approach affect all parts of the organization?

We started a pilot group with our HR group and a few others in 2013. We’re on track to launch it across the whole organization by the end of 2014.

How has it affected your specific role?

It’s been a whirlwind as we were part of the pilot group.

Much of my time has been learning about Holacracy and assisting the implementation team in preparing to facilitate for other circles. This is a temporary issue, as each circle will eventually be self-sufficient. It’s clear to me that the extra work put in now to get this rocking and rolling is going to be hugely beneficial to the company down the road.

I am a lead link in some circles, and hold roles in others.

For the circle in which I fill the lead link role, Holacracy has been excellent for helping both me and the other role holders get clarity on the work we need to accomplish, our purpose, and who is responsible for each piece of work.

I know there has been a ton of buzz around ‘#nomanagers,’ but I am still responsible for this circle. The difference is the liberation for both me and the other role holders in the

circle to really run with clearly defined work via roles and accountabilities, versus a ‘manager’ directing the work.

Compared to other management styles, how much does Holacracy deviate?

It’s totally different. It’s a complete shift in the concept of leadership, and distributes authority across the organization to every role, as well as giving all your role holders a voice and a fast and effective way to process tensions.

It seems Holacracy most readily functions within the creative part of the organization. How does it carry over to other functions, such as finance? Do these parts of the organization still have a traditional approach?

No, everyone will be on Holacracy. It doesn’t give specifics on how to unpack the work in your organization; you simply use the structure to figure out the best way to do so.

Would you recommend the approach to all organizations, or will it vary?

It’s a bit early to tell. My hesitation would be for organizations that have areas where multiple folks are doing the same work, for example in a call centre. We have close to 500 people in the call centre and haven’t rolled out Holacracy there yet as we have lots to figure out in regard to the best way for Holacracy to work with that type of group. I think there may be similar challenges in a warehouse environment. Not saying it can’t be done, just more to figure out.

While Zappos and game software maker Valve are making headlines for their strides, many other organizations are doing away with traditional corporate hierarchies for flatter or otherwise alternative structures, including: • Google

• KPMG

• Facebook

• Apple

• 37signals people can show up every day and really shine and contribute their best,” she tells HRD. “We need teams in organizations that really understand why this is important. People will always want somebody to take the lead, even if just for a short time.”

Gaster lists five areas the HR team should look to foster in the organization to ensure that when the hierarchy transforms, so do the leaders: zz Recognize leadership potential in all Defining leadership as “the ability to create and/or influence outcomes” allows the possibility for all to assume leadership at some point. By spreading this view throughout the organization, the leadership skills that exist within all employees will flourish. zz Make leadership a part of your organization’s identity The loss of leadership during a switch to a flatter

structure is due to an organization’s culture not incorporating leadership into its ‘common language.’ Leadership needs to be embedded in the values and purpose of the organization to help generate a leadership culture. zz Focus on learning and development To grow leadership, it must be nurtured. A solid L&D strategy can make the difference between a smooth transition in which many leaders emerge and a bumpy road where they start to drop off.

• SoftwareMill

Source: tibbr.com, inc.com, softwaremill.com

zz Encourage collective decision-making Giving others a role in decision-making communicates to them that there is faith and trust in the flatter structure working. This will help boost morale, as well as allowing new approaches and perspectives to come to the forefront, a primary goal of any organization adopting a flatter structure.

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LEGAL INSIGHT / PERFORMANCE MANAGEMENT

Lifting their game:

PERFORMANCE IMPROVEMENT PLANS Employers have a number of options available to manage underperforming employees. Christine O’Donohue explores best practice in performance management

Most employers have some form of performance management or performance appraisal process in place to measure and improve the effectiveness of their employees in the workplace.

Employees whose work performance or work behaviours fall below acceptable workplace standards and who have not responded to more informal corrective measures, including feedback, coaching or training, must be managed more formally. The cost of indifference is too high since inaction may create workplace expectations that such performance is acceptable.

PROGRESSIVE DISCIPLINE Without question, some aspects of misconduct are more serious than others. Progressive discipline aims to correct employee misconduct such as wilful breaches of company policies or procedures. While the objective of progressive discipline is not solely to create a paper trail for the eventual termination of employees, a well-documented file can establish that an employer had just cause to terminate an employee. Justice Echlin stated in Daley v. Depco International Inc.1: While each of these five incidents might not be sufficient to amount to just cause themselves, when viewed collectively, the conclusion that must be drawn in this instance is that the series of acts cumulatively do amount to enough “bricks to constitute a just cause wall.”

A PERFORMANCE IMPROVEMENT PLAN A dismissal following a Performance Improvement Plan (PIP) process is quite often the consequence of more involuntary shortcomings of an employee, 10 | NOVEMBER 2014

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such as incompetence. Incompetence may mean the employee is either incapable of performing the job, or capable but consistently fails to meet a reasonable standard of performance arising from a lack of diligence.

In Iliescu v. Voicegenie Technologies Inc. (2009), 71 C.C.E.L. (3d) 123, Justice Echlin described the purpose of a PIP as follows: [29] A P.I.P. is a set of clear guidelines and goals given to an employee to meet, often as a result of some difficulty that has arisen with the employee’s performance. It provides an explicit listing of where the employee must improve and what metrics they must meet. This is because it is important for an employee to get a clear sense of what is expected of them and provides the room and means to improve. It provides an opportunity to the employee to fully understand what the employer expects in response to those concerns.

As a practical matter, a finding of just cause solely on the basis of incompetence is rare. The onus is on the employer to prove just cause on a balance of probabilities. A termination for just cause is considered akin to ‘capital punishment’ in the employment context. Against this backdrop, the allegations of incompetence of a long-service employee will be considered in the context of the entire employment relationship. If an employee is suddenly failing to meet performance standards, it is often a result of other contributing factors such as burnout, personality conflict with a new manager, changed standards, or disability.

A tenet of successful performance management is taking action to address performance issues early If instead the primary purpose of the PIP is to build a record to support a just cause termination, then given the practical realities of proving just cause, together with the management time and effort required to implement and administer the PIP, an employer should consider simply terminating the employee at once with reasonable notice, or pay in lieu thereof.

Furthermore, even if the court accepts that the employee misconduct justifies a finding of just cause for common law purposes, it does not mean that the court will find the impugned conduct amounts to “wilful misconduct, disobedience or wilful neglect of duty” under the provisions of the Ontario Employment Standards Act, 2000.2 As a result, an employee terminated for just cause may still be entitled to receipt of statutory termination and severance payments.

That said, there are circumstances in which it is imperative that an employer should be able to demonstrate that its decision to terminate an employee was not arbitrary, unfair or discriminatory.

Without a PIP, or other performance records, employers are vulnerable to an inference that any subsequent termination constitutes discrimination or a reprisal.

DETERMINING PRIMARY PURPOSE

ACT EARLY

An employer managing a poor performer must ask itself the threshold question of whether the true objective of the PIP process is to improve future performance that is likely to be sustainable in the long term. If yes, the employer ought to take the following steps: 1. Clearly communicate the performance expectation.

2. Advise the employee of performance gaps that require improvement.

3. Provide necessary support or training to ensure the employee can achieve the desired objectives.

4. Provide reasonable timeframes for improvement and ongoing positive and corrective feedback.

5. Clearly indicate to the employee that the lack of improvement may result in dismissal.

A tenet of successful performance management is taking early action to address performance issues.

Effective performance management can only be successful if the employee buys into and accepts that there is a performance or behavioural issue that needs to be corrected. Where performance management is not a practical solution, and the employer has determined that no amount of coaching, training or feedback will bring the employee’s performance up to an acceptable level, then consideration ought to be given to terminating the employee with notice, or pay in lieu thereof.

1

Daley v. Depco International Inc., [2004] O.J. No. 2675 (Ont. S.C.J.) 2 Oosterbosch v. FAG Aerospace, 2011 ONSC 1538

Christine O’Donohue is an experienced litigation partner at Miller Thomson with special expertise in employment law, executive compensation, privacy, and labour-related injunctions to restrain unlawful picketing.

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IN BRIEF / CEO INSIGHTS

WHAT’S ON YOUR CEO’S MIND?

CEOs are coming out of survival mode, with 44 per cent feeling the global economy will improve over the next 12 months. New challenges and opportunities have emerged – what’s on your CEO’s agenda?

CEO GROWTH PRIORITIES CEOs worry almost as much about a slowdown in the emerging economies as they do about sluggish growth in the advanced economies Q: How concerned are you about the following potential economic and policy/business threats to your organization’s growth prospects?

Continued slow or negative growth in developed countries

47%

Slowdown in high-growth markets

46% Somewhat concerned

24% 19% Extremely concerned

A SHIFT TO ADVANCED ECONOMIES Q: Which three countries, including the country in which you are based, do you consider important for overall growth prospects over the next 12 months? % of CEOs naming country 2014

30%

17%

10%

+7%

+5%

+3%

23%

12%

7%

USA

Germany

UK

33% 7%

7% 5% 7%

+2% +2% 0% 0% 0% China

Japan

Indonesia Mexico Russia

31% 5%

7% 5% 7%

12%

7%

-3% -3% Brazil

India

15%

10%

% of CEOs naming country 2013 Advanced economies

Emerging economies

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WHAT’S HAPPENING WITH THE WORKFORCE?

CEOS IDENTIFIED THREE TRANSFORMATIVE GLOBAL TRENDS

81%

60%

technological advances

demographic shifts

59%

50% say

headcount will increase

shift in global economic power

29% say headcount will remain the same

20% say

headcount will decrease

WHAT OPPORTUNITIES ARE THERE FOR BUSINESS GROWTH? new joint ventures and/or strategic alliances

product/service innovation

9%

M&As

THE PACE OF INNOVATION IS ACCELERATING DRAMATICALLY

35%

11%

new geographic markets

14%

30%

increased share in existing markets

Automobile

THE WORKFORCE

Aeroplane

What questions are CEOs pondering about tomorrow’s workforce?

Mass production

How well prepared is your organization to find, attract and keep tomorrow’s workforce, even as you deal with today’s talent challenges?

Railway

Railway

Electricity

Printing

16th & 17th century

Computer

What are you doing to make your workforce more diverse? And how will you utilize the benefits of diversity?

Lean production

Iron steamship

Steam engine

Internal BioNanocombustion technology technology engine (process)

19th century

Internet

20th century

63%

of CEOs are concerned about the availability of key skills

How will you manage employees with different needs, aspirations and experiences from those of your generation?

Factory system

18th century

DID YOU KNOW?

21st century

How will you address the challenges of dealing with an increasingly autonomous workforce?

What will it cost your organization if you get the talent pipeline wrong?

58%

are worried about rising labour costs in emerging markets

Source: Richard Lipsey, Kenneth I. Carlaw and Clifford T. Bekhar Source: All charts and graphs sourced from PwC’s 17th Annual Global CEO Survey, except where indicated NOVEMBER 2014 | 13

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WORKFORCE BENEFITS / FINANCIAL LITERACY

EDUCATE AND ENGAGE ’EM

Rachel McNeill-Thompson provides tips for upping financial literacy for workplace retirement and savings plan members

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If your organization sponsors a capital accumulation plan, you know the ‘member engagement’ challenges well: • You have complex messages – plan rules, investment options, income projections – in an age of information overload, with limited time and attention spans.

• You’re trying to get plan members to think ahead to an event (retirement) that is often decades away.

• As you work to encourage plan members to save, you’re competing against a wall of more immediate financial priorities – from cars and student loans to home ownership and education.

Here are four strategies that can help you turn up the dial on plan member engagement and improve financial literacy in your organization.

1

MAKE SAVING EASY Never underestimate the power of ‘easy’ in plan design and decision-making. Companies like Amazon and Apple have based and built their brands on making the user experience simple – and it’s clearly a highly effective approach.

It can be for retirement plans too. For example, there may be ways you can make plan enrolment easier – perhaps by wireless enrolment during education sessions, or a ‘welcome app’ that bundles all of the information employees need to join the plan and start saving. Or you can make the actual investment process easier – perhaps with single-fund solutions like target date funds that manage the risk for employees as they inch closer to retirement.

Sun Life Financial recently analyzed data from our CAP Universe of more than 5,000 plans and one million plan members. We were startled to see that the growth of these funds had doubled in the past four years, moving from 10 per cent of new contributions in 2010 to 20 per cent by the end of 2013.

2

MARKET YOUR PLAN Marketing your message is not just a nice-to-have; it’s a need-to-have, especially when you’re trying to get members to take action on something that they won’t benefit from for years to come. Have some fun with your communications – whether traditional or new media – and borrow from marketing and sales practices that encourage interest. Another emerging marketing trend is the use of gamification programs

that can increase financial literacy and plan member engagement.

Gamification brings game mechanics to non-game experiences, such as plan member education, making them more fun, engaging, and motivating. While retail companies have long used game mechanics to increase customer loyalty and engagement, employers are beginning to see the benefits of using this approach to increase financial literacy.

3

SEGMENT YOUR AUDIENCE One of the mantras of great customer service is ensuring each customer feels like they’re the only one that matters. Your plan can ‘tap in’ in the same way, by customizing communications and education to the different needs and preferences of your workforce.

Whether you target by career stage (Millennials versus Boomers), by investment behaviour (default versus active investors), or by savings rate (lower savers versus maximizers), speaking to each group’s unique needs – and using communication channels (from print, to video, to texts and blogs) that mirror their preferences – can help get your message through.

DID YOU KNOW? Canadians with a workplace savings plan expect to save 50 per cent more for retirement by the age of 65 than Canadians who do not have a workplace plan Source: 2013 Sun Life Canadian Unretirement Index

4

TAKE A BROAD APPROACH TO INNOVATION We tend to link innovation with new technologies, and that can often be the case. But innovation can also include the use of more traditional approaches in unexpected ways. We have found that a simple oneon-one telephone call from a customer service representative welcoming a plan member (and their spouse if appropriate) to the plan can significantly improve engagement, as members are prompted to take action or make changes on the spot and have the opportunity to ask questions with the representative on the phone.

A phone call with a customer service representative can improve engagement and help plan members to take action in the moment.

HELP IS AVAILABLE You don’t have to go it alone in meeting your plan member engagement challenges. Workplace plan providers have the knowledge, resources, and experience to help you analyze your engagement needs and provide the tools and support you need to make it happen.

Rachel McNeillThompson is AVP, marketing and communications, group retirement services, at Sun Life Financial

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THOUGHT LEADERSHIP / WORKPLACE DEMOCRACY

Are we ready for

WORKPLACE DEMOCRACY? Does democracy have a place in the workplace?

Or is some degree of autocratic rule still required?

Les Hayman weighs the pros and cons

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“It has been said that democracy is the worst form of government, except all the others that have been tried” – Sir Winston Churchill (1874–1965) I am seeing an increasing amount of discussion about the concept of workplace democracy. In an outstanding example of that trend, the software company Haufe-umantis in Switzerland recently invited all staff members to vote ‘yea or nay’ on the appointment of a new CEO, when the current founder and CEO felt it was time for him to step aside.

The outgoing CEO chose his successor and then asked all staff to vote on whether they agreed with his choice. Luckily they did (although it was not unanimous). This was fortunate, as I feel that this particular partial attempt at the democratic process may have been somewhat short-lived had it been a resounding ‘nay’ vote.

I have also had the privilege in the last year to meet, and hear talks by, Heiko Fischer of Resourceful Humans, who believes that the greater the level of democracy and the less management that exists in a company, the more people will drive themselves and therefore the more they will drive the success of the company.

HAMBURGER OR BURRITO? Heiko likes to compare traditional hierarchical management structures to a hamburger, where the patty (employees) needs a large bun (management) to hold it together, while what he feels is needed today is more like a burrito, which has a thin unobtrusive layer (management) holding all the ingredients (employees) together.

In addition, a hamburger needs considerable structure within the bun, whereas structure is less important in a burrito. Not a bad analogy if you are a supporter of his premise.

GENERATIONAL PRESSURE? I feel that one of the drivers of this flirtation with workplace democracy is the current belief by some that this is exactly what the new generation wants; that young people today have a significantly different set of work expectations than my generation did, particularly in terms of company loyalty (now more to NOVEMBER 2014 | 17

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•

THOUGHT LEADERSHIP / WORKPLACE DEMOCRACY

a role), flexibility of working times (based less on four weeks’ annual leave and more on long breaks as needed), and significantly less management control (less direction from above and a greater say in what they do and how they do it).

But are they really demanding democratic-style freedoms, and just how much structure is too much structure? Are we really ready to do away with traditional management structures and build more democratically based organizations?

DEMOCRATIC LEADERSHIP A democratic manager involves employees in the decision process, and consensus on decisions is sought from the majority, with extensive bidirectional communications. This is supportive of high job satisfaction and quality of work because it tends to drive high engagement, but it can be an incredible barrier to speed of decision-making and execution as there are always many ‘chefs in the broth.’ It can work well in complex projects that require many different subject matter experts for varied inputs to ensure a workable solution.

I have long been against overmanagement, and matrix management in particular. A complex multi­ faceted matrix creates confusion in employees as to where their loyalties lie, amid ongoing turf wars as to who has the strongest line to the employee. It also generally increases the number of managers, particularly when compared to a well-managed and flat-line organization. This has the effect not only of driving up costs by increasing the number of expensive non-revenue-generating heads, but also of driving up the number of meetings to ensure alignment, and slowing down the decision-making processes.

Despite its potential benefits for vocational career development, matrix management is mainly the creation of people who know that change is needed, and who have decided that added complexity is the answer. I have always believed that complexity is never the answer, and that when it is, then it must have been a pretty stupid question to start with. Albert Einstein (1879–1955) nailed it when he said, “If you can’t explain it to a six-year-old, you don’t understand it yourself. Everything should be as simple as possible, but not simpler.”

A MIDDLE GROUND? I have no doubt that the traditional ‘command and control’ management style is totally passé, but I am of

the belief that some structure is still needed, not just for the sake of management control but also more importantly for the benefit of the employees.

When I retired I had a final session with my boss, who asked me for some feedback (the first time this had happened in nearly 15 years). Among other things, I told him he had been a great boss because he had left me entirely alone to do the job in my own way, but that he was also an awful boss because he had left me entirely alone to do the job in my own way.

It was not that I was a needy person who wanted continuous advice, feedback and recognition, but I disagreed with him that being left totally alone, all the time, was something senior people wanted. He believed that as we had monthly board meetings this should have been enough to set the context for all of us to act accordingly. The problem was that, apart from the one annual two-day session to discuss strategy, management meetings were nearly always about content rather than context. As a result, crossdivisional alignment tended to be difficult.

BACK TO BASICS I believe we cannot expect people to have any ability to define what they will do and to know what is expected of them if we do not clearly articulate the reasons ‘why we are here’ in the first place, as a company, as a division, as a team; and if we do not give them enough direction and understanding to help them to be an integral part of the strategy.

People should definitely be given the ability to define how they will handle the content of the role assigned to them, within guidelines for quality and standards that apply. But I also strongly believe that this can work only if the context has been well defined beforehand, and that this context must also include the appointment of those who have been asked to lead the organization.

Structure is less important in a burrito, but it is still necessary. And besides the thin unobtrusive layer (the management), it needs a proper technique for rolling it up and holding all the ingredients (the employees) together.

Les Hayman has extensive senior HR management experience and is co-founder and co-CEO of Chief Executive Organization Ltd, a UK-based company that focuses on business improvement and global competitiveness strategies. Additionally, he is a regular lecturer at universities and business schools, and a sought-after speaker across the globe.

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WORKFORCE MANAGEMENT / GLOBAL MOBILITY

On the move:

CONQUERING

CHINA

An estimated 40 per cent of expatriated workers return home prematurely, costing employers millions of dollars every year.

Chinese broadcasting giant CCTV provides valuable insights on how small considerations can yield huge savings 20 | NOVEMBER 2014

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When New Mexico native Glen Loveland first arrived in Beijing to work for Disney, he was greeted by an intoxicating whirlwind of new sights, smells, and jaw-dropping urban marvels.

The roads, filled with unusual traffic signs not seen in the US, were abuzz with 20 million city residents who all seemed to be in a rush to get to their respective destinations. Ancient Chinese architecture stood next to modern luxury high-rises.

Local butchers hung skinned pigeons, rats, scorpions, and seahorses in storefronts adjacent to immaculate McDonald’s restaurants and Starbucks coffeehouses.

Young children ran around in the smog-filled air in makeshift cloth diapers, stopping occasionally to urinate in nearby creeks.

For even the most seasoned travellers, this backdrop would certainly be jarring.

This is why Loveland, now HR manager of China’s largest television broadcasting network, CCTV, understands the importance of a smooth transition to an overseas country, especially when it involves a long-term relocation for work.

While culture shock may be inevitable, there are steps HR can take to minimize the friction associated with an international move, and to help employees integrate into their new country and workplace. With a typical three-year assignment estimated to cost over US$1 million, every employee mobility initiative should be considered a non-negotiable business investment.

At CCTV’s headquarters, 80 per cent of employees end up renewing their contracts to remain with the company in Beijing. Loveland shares the strategies that have made their relocation program such a marked success.

BEFORE THE TRIP There are several ways that HR can help employees before they even step on the airplane.

First, to ensure that no surprises emerge from a legal standpoint, Loveland recommends that every job posting explicitly outline what is required for candidates to obtain a visa in the new host country.

“For example, most labour bureaus in China will require a university degree and at least two years of postgraduate experience,” he says. “Don’t waste anyone’s time by not being upfront about visa requirements.”

He also applies rigorous selection criteria to ascertain whether candidates can handle the cultural adjustment necessary for a work assignment in East

CCTV studio, Beijing

Asia. Executive-level applicants undergo a Harrison career assessment, and job applicants with a history of adaptability and professional risk-taking are viewed as optimal candidates.

“Generally, if they’re flexible and have a good sense of humour, that’s a good 80 per cent of it,” he says.

Once CCTV extends an offer, the expat must wait for between six weeks and four months before being allowed to start the onboarding process in Beijing.

This gives the employee a sufficient amount of time to place items in storage, terminate phone and internet contracts, and set up an international bank account.

CCTV also provides an informative pre-departure guide, which includes: • recommended city and region-specific travel guides • advice on Chinese power outlets, and where to buy appropriate converters for electronics • suggested books and smartphone apps to assist with Mandarin translations • an overview of the visa registration process • estimates of how much money to have on hand upon arrival, and in what currency • medical guidelines, such as what to expect from hospitals and pharmacies, and suggested vaccinations • detailed information on cell phone carriers and mobile phone offerings “I’d recommend that HR stay in close contact with a candidate and reach out biweekly to keep the candidate informed of their visa paperwork and other matters,” says Loveland.

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WORKFORCE MANAGEMENT / GLOBAL MOBILITY

“Don’t waste anyone’s time by not being upfront about visa requirements” Glen Loveland ADJUSTMENT PERIOD Once new hires arrive in Beijing, CCTV makes a significant effort to ensure the employee feels comfortable and at home in their new environment.

First, the company forbids any work within the first week, besides a quick meeting with managers on the expat’s second day in China. This gives the new employee a chance to overcome jet lag, obtain any medical exams necessary for a visa, and settle into Beijing. Housing is provided for the first 30 days to help eliminate stress as well.

The company also provides an orientation guide, with advice on: • where it’s safe to drink water • acclimatizing to Beijing weather • customary practices when dealing with money, such as slang terms for cash, and etiquette for bartering • suggested grocery stores, restaurants that deliver, housekeeping agencies, and taxi services • emergency phone numbers • where to find expat social groups “Companies really leading the way in employee mobility are also doing things like treating the entire family out to a special meal a few days after arrival – Peking duck in Beijing! – and organizing a get-toknow-your-new-city tour,” says Loveland.

Above and opposite: CCTV’s landmark headquarters, Beijing

A WARM WELCOME Lastly, the company has trained managers to provide a hospitable work environment in which new employees feel eager to participate and be part of the team’s success. These include: • in the days before the expat’s arrival, sending the office an introductory email with background information on the new employee • taking the team to a ‘welcome lunch,’ keeping the expat’s allergies and dietary preferences in mind • assigning a ‘work buddy’ to answer the new employee’s questions and explain office policies • going for a walk around the neighbourhood to point out nearby amenities such as restaurants with English service, places to buy rechargeable cards with phone credit, and other necessities “We also prepare a ‘Welcome’ bag for all new employees, with information about the city, a city map, a prepaid subway card, and other materials that can help them hit the ground running,” says Loveland.

Finally, CCTV works to integrate spouses and children as well.

SAD FAREWELL When expats’ contracts do expire, the company tries to maintain a close relationship with them. To achieve this, it is developing an alumni program in which former expats can go on to work at CCTV outposts in Washington, DC, Nairobi, or Kenya, or serve as freelance correspondents for the network globally.

“These people worked at headquarters; they know what it’s like, and they’re valuable to us,” says Loveland. “We’re asking ourselves, how can we find an opportunity for them to rejoin the organization from another part of the world?”

Ultimately, Loveland takes prides in assisting expatriated workers in assimilating into a new culture, and thereby increasing their quality of life – even if that takes a surprising turn sometimes.

“I remember when I worked at Disney helping to onboard new employees,” he says. “One time I got a call from an employee around midnight, who said, ‘You mentioned to me that McDonald’s has delivery.

Do you have their phone number?’

“On the one hand, it was great that I was approachable when he needed something. But on the other hand, I couldn’t help but think, ‘We need to have a talk about boundaries.’ ”

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RETRAIN YOUR BRAIN TO THINK DIFFERENTLY FRIDAY MORNING KEYNOTE SPEAKER Freakonomics Author

STEPHEN J. DUBNER The New York Times-bestselling Freakonomics changed the way we see the world, exposing the hidden side of just about everything.

Now, taking those concepts to the next level, this captivating keynote offers a revolutionary NEW approach to Presented by thinking. Promising to help you “retrain your brain,” Stephen J. Dubner offers insights into problem solving techniques for both your personal and professional life. Find out how to think more unconventionally and more creatively—to think, that is, like a Freak. www

www.hrpa.ca/AC2015 #HRPA2015 NOVEMBER 2014 | 23

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CORPORATE HEALTH / PHYSICAL WELLBEING

MAKE HEALTHY CHOICES A HABIT IN YOUR WORKPLACE HRD explores the behavioural science behind lifestyle habits – both good and bad – and explains how organizations can help change them for better physical and financial health for all employees Is there any other area of life that thrives on habitual behaviour as much as the modern workplace?

Employees are required to come and go at the same time every day, they have a designated lunch hour, and their meetings take place with the frequency and precision of a Swiss clock.

Every workplace is a breeding ground for habits, but they’re rarely the right ones. Colleagues eat lunch at their desk or take the car to the fast-food place two blocks away. The week starts with a bang – diet resolutions and good intentions! – then limps out in a merry haze of chips and cocktail chatter. In between times, the meeting room and office space are steadily sapped of oxygen by all.that.yawning …

Daily routines often distort bad habits so that they become passable behaviours required to satisfy a work culture that increasingly demands that people do more with fewer and fewer resources. The result is stress, sedentary practices, and, in turn, chronic employee health problems that gnaw into a business’s profit and productivity.

CHANGING IT UP For this to change, employees need first to become aware of the true state of their health; to feel motivated to want to improve their lifestyle; and then to be given

the education and tools for effective behavioural change. This cycle of engagement is self-perpetuating, as employees who see their health improve become more and more motivated to continue this improvement. When combined with a fun and simple wellbeing initiative that brings teams of colleagues together, you start to see a truly healthy ecosystem that is built and supported by employees themselves.

So how important is this really? Look only as far as Glenn Riseley, founder of wellbeing program Global Corporate Challenge (GCC), and a man who sees the consequences of poor habits taking hold at both a global and national level.

“The rise in avoidable chronic lifestyle diseases is reaching epidemic proportions across Canada and is affecting its ability to field a globally competitive workforce,” Riseley explains.

WHO’S RESPONSIBLE? “On the one hand, this is a question of personal responsibility, but business also has a critical role to play in empowering employees to make change,” Riseley says. “The workplace is the perfect environment to help create and maintain a culture of health. In fact, it’s the single biggest legacy a business can leave its people.”

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It’s natural that HR professionals feel a certain reticence to step in and try to change the habits of a lifetime. But, as Riseley outlines, given that we spend more hours at work than we do at home, there’s no one better placed to improve people’s health and performance.

This means buy-in from the CEO, who rolls out company-wide walking meetings and leads them from the front. This means prioritizing the stairs over the elevators. This means fruit and vegetables in place of pastries. Ultimately, this means mobilizing a synchronized, collective effort that becomes part of a workplace’s DNA and makes those who don’t want to change feel like they’re the ones missing out.

After all, the only thing more pervasive in a workplace than habit is the influence of peers.

Staff who work in this kind of environment become empowered to start making individual choices about their lifestyle. This ultimately comes down to each employee, but it helps to know that the neurological processes that drive workers are universal.

THE POWER OF HABIT In his book, The Power of Habit, Charles Duhigg, business reporter at the New York Times, identifies a three-stage neurological loop at the core of every habit – whether it belongs to the CEO or the summer intern.

»» A simple trigger. This could be something as basic as putting a leader board in communal areas. »» A routine that follows on from this cue: scheduling a walking meeting, for example. »» A reward. This can be a feeling of personal achievement, mastery of self-control, or professional camaraderie.

The brain’s rewards system doesn’t discriminate between good and bad habits; a brisk, productive

walking meeting releases dopamine just like a muffin in the middle of a brainstorming session does, so it’s relatively easy to replace unhealthy workplace practices with good ones. There just has to be a payoff that makes staff want to repeat the actions over a sustained length of time.

So how long does it take before change becomes part of an organization’s culture? The general consensus says it can take anything from 18 to 125 days for new habits to come to life, but the average person can acquire and automate new behaviours after just 66 days.

This can seem like a startlingly short amount of time, but the proof is in the pudding. In 2014, the GCC was rolled out to 1,288 staff members by Canadian oil company Cenovus Energy. After 100 days of trying to cultivate the habit of taking at least 10,000 steps every day, Cenovus reported “a genuine cycle of continuous improvement” among their employees.

A survey conducted by the Foundation for Chronic Disease prevention in the Workplace supported this feedback, finding that 84 per cent of Cenovus employees either met or exceeded their 10,000 daily step target, and another 76 per cent said these increased activity levels had become a new habit; ultimately, the cue provided by the wider workplace wellness initiative was then replaced by employees’ own trigger-routine-reward system.

Creating a culture of health and driving long-term behavioural change might seem like a challenging way to improve your organization’s bottom line, but they are two of the most powerful allies HR professionals can have.

Habits are informed by a process that is common to every employee, in every department at every level of the corporate ladder, and where health risk assessments can seem intrusive and discriminatory, few will ever object to a chance to step outside, have some fun with their colleagues – and take a breather from their daily routine.

GCC works with businesses all over the world to improve the health and performance of their employees. Over the past 11 years, our program has transformed the cultures of thousands of the world’s leading organizations and changed the lives of more than 1.5 million employees across 185 countries.

Our scientifically developed, independently proven program takes employees on a journey that fundamentally improves their relationship with exercise, nutrition and sleep, and instils in them a new sense of personal responsibility, self-belief and resilience.

In other words, we deliver a simple and effective solution that optimizes your most valuable asset – your people – and ensures they arrive each day in the right physical and mental shape, so that they’re fully engaged and ready to take on the world.

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PROFILE / CIRQUE DU SOLEIL

HR GOES TO THE

CIRCUS There is perhaps no display of the human spirit more stunning than the performances put on by Cirque du Soleil.

Marie-Josée Guilbault and Line Giasson share the secrets to obtaining the rarest and most exceptional talent this world has to offer – and the culture that makes them stay

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Line Giasson is overseeing an audition for one of the most celebrated athletic events in the world. In her company are former Olympians, prize-winning national champions, and gymnasts who have been competing in the sport since they were infants.

Although these contestants are among the most rigorously trained athletes in the world, she is ordering them to dance goofily around an empty ballroom, pretend to be mimes, and do improvisational acting exercises before a panel of expert judges.

This unusual tryout is for a circus, and not just any elephant and clown affair: a Cirque du Soleil production is more of a fantasy-inspired spectacle that’s equal parts imagination, elegance, athleticism, and childlike wonder.

Meanwhile, at the organization’s headquarters in Montreal, Marie-Josée Guilbault is tasked with managing Cirque’s global employee base. In the hallway, she passes fellow workers and executives whose attire ranges from full-arm tattoo sleeves and brightly dyed blue hair. She smiles and greets them all with respect and admiration.

After all, a production doesn’t make it to the top of show business without a little spunk.

SEARCHING FOR ARTISTS In order to be fully prepared to supply performers to its various productions worldwide, Cirque has a vast databank of artists, performers, singers, and other skilled entertainers that it regularly draws from as required. Just making it onto this roster is considered

an honour, and can happen in many ways.

First, performers can submit a video to Cirque du Soleil demonstrating their athletic aptitude and showmanship. Because of the world-renowned reputation that Cirque boasts, the entertainment producer has no problem attracting tens of thousands of résumés every year. As a result, in addition to open auditions, the company invites contestants based on what they’ve seen in person or online.

“This ensures that we always have a certain skill standard of people coming to our auditions,” says Giasson, Cirque’s director of international casting.

Unlike the “two-minute auditions you see on reality TV shows,” auditions can last a full day, and specialists are forced to perform outside of their comfort zone. Synchronized swimmers may be asked to sing, acrobats to dance, and tumblers to deliver a comedy routine.

This is all done to assess whether athletes have the versatility, charisma, and bravery needed for the theatrical nature of the French-Canadian circus.

“We often choose for personality. One candidate may be lower on the technical side, but we know that person will bring something special to the stage,” says Giasson. “Soft skills are just as important as technical skills.”

In fact, in her 21 years with Cirque, Giasson and her team have always placed the most emphasis for selection on one criterion: whether or not the candidate can entertain the audience in a way that touches the heart.

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PROFILE / CIRQUE DU SOLEIL

“We often choose for personality. One candidate may be lower on the technical side, but we know that person will bring something special to the stage” Line Giasson PARTNERING FOR SUCCESS While many vie for a chance to work at Cirque, this doesn’t make the casting job easy. Oftentimes the process begins two years before a show is fully developed, and directors can request a performer with rare attributes at any moment’s notice, even for productions currently up and running. Thus it is imperative that Giasson’s team continually scouts for fresh acts and rousing personalities.

To do so, the team has had to become creative. When a set designer came up with the idea of having a childlike figure fly a hot-air balloon, the challenge became finding a little person over the age of 18 with acrobatic skills.

After some searching, the casting department found a circus in Israel featuring acrobatic three-foot-tall Russian little people.

“We dig,” says Giasson. “And often we find talent in conventions, other circuses, and places where similar performers tend to congregate.”

Casting also has partnerships with associations such as the International Gymnastics Federation, dance studios, and coaches of various national teams.

FINDING THE JE NE SAIS QUOI While Cirque is constantly recruiting to fill spots in existing shows, it also looks to other regions of the world to find inspiration for new acts and creative content. And at times Giasson’s team works with directors and show developers to share ideas for new acts and performances based on exceptional people it has come across during the casting process.

“We present to directors of creation what we’ve discovered either by travelling or from résumés, and sometimes they get inspired and include those in the show,” Giasson says.

There was one man who showed up to a singing audition, only to whistle. Even though Cirque had never featured whistling in a show, this man’s prowess blew the judges away. They put his name in the databank and showed footage of his recruiting tape to a creative director, who was equally enamoured.

They created a character just for him.

Of course, challenges arise when traits are so special and unique that they become difficult to replace in the event of injury or retirement. “As soon as we find somebody really unique, we are proud and very excited for a possible new creation. But we are playing against ourselves, because there’s only one,” Giasson says.

As a result, the casting team sometimes has to scour the world for highly skilled performers yet again. They look to dance companies, schools, artist conventions, and even overseas social media to see whether there is an entertainer with similar skills that can be transferred to the open position.

The team can almost always find someone capable of adapting to the role, but there are occasions when doing so just isn’t possible. This is a risk inherent in Cirque’s innovative performance model, and is considered a necessary evil for the show’s creativity and artistry.

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and merriment, each production requires an incredible amount of labour to produce. It is HR’s job to communicate to employees just how trying the workload can be.

“Cirque is a great company, but it’s also a very demanding company,” says Guilbault, Cirque’s vice president of organization and culture. “There’s a perception that we’re always having fun, fun, fun, but the reality is we also work very hard.”

This high-performance mentality can make it difficult for new workers to integrate with Cirque culture. As a result, Guilbault’s team has developed strategies that allow new workers to assimilate into the Cirque workforce with as little cultural shock and resistance as possible.

First, she instructs hiring managers to inform new employees that it may take six months to understand and appreciate how the company functions. To help them get there, Guilbault’s department takes strides to incorporate workers in as many operations as possible, allowing them to experience the production from all angles.

“We take them backstage, include them in Cirque events. The more they do that, the easier it is to understand the way we work.”

They also try to recruit administrative and technical staff with previous experience in show production, who can understand the “structured flexibility” needed for a stable but constantly evolving creative field. In reciprocation, Cirque prides itself on remaining accessible and adaptable as an employer.

“We can’t be hierarchical or corporate; it won’t work for the type of business that we are. We’re very careful to be natural,” says Guilbault. “We’re very big, so we can’t be fully organic, but we know we need to be flexible.”

HOLDING ON TO TOP TALENT In addition to the high work standards involved in resident shows, touring often presents its own set of obstacles: long periods away from home, lack of alone time, and the inability to carry out a “normal life.”

As a result, Guilbault’s department goes to great lengths to provide an enjoyable work environment for travelling staff, providing such services as physical therapy, chefs who prepare every meal, and fun parties where employees can let loose and socialize.

In addition, Cirque offers several developmental opportunities that allow workers to learn, grow, and resist becoming stagnant from working in one

“If you want to be excellent, if you want to go further, hire people who have some kind of passion, and then just put a bit of magic in it. It works” Marie-Josée Guilbault

position too long. These include a program called ‘Tapis Vert’, in which young leaders can work side by side with senior managers for a two-day period, as well as have the option to work on new shows, which are developed every two years.

Finally, there is an overarching acceptance of unconventional clothing and appearance, such as tattoos, piercings, and casual attire, even in Cirque’s corporate headquarters.

“It’s not the way you dress that’s important, it’s what you do. If somebody has blue hair, that’s fine; we won’t put any judgments past them,” says Guilbault.

“Some companies could gain to be a bit looser, because at the end of the day it’s the results that matter. It’s not what someone looks like.”

THE SECRET INGREDIENT Whether it’s a trapeze artist who flies 50 feet in the air or an executive who plans business strategy in the Montreal office, Guilbault says one factor sets Cirque employees apart from the rest: passion.

“Today, unfortunately, companies sometimes hire people solely for job skills, and that doesn’t make it,” says Guilbault. “If you want to be excellent, if you want to go further, hire people who have some kind of passion, and then just put a bit of magic in it. It works.”

She points out that this strategy is effective, as a company facing obstacles or experiencing a rough patch needs passionate employees to rally through the tough times.

And of course, she adds, “a bit of craziness doesn’t hurt.”

THE PEOPLE BEHIND THE MAGIC yyCirque du Soleil started with 73 employees in 1984.

It now has over 4,000 workers worldwide, including more than 1,300 artists yy1,500 people work at Cirque du Soleil’s headquarters in Montreal, many of whom were recruited locally yyThe Cirque du Soleil employee base comprises over 100 different professions yyEmployees and artists originate from over 50 countries and speak 25 different languages yyNearly 150 million spectators have seen a Cirque du Soleil show since 1984, and almost 15 million will see one in 2014 Source: www.cirquedusoleil.com

Photo credit: Laurence Labat © 2012 Cirque du Soleil

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CSR / ETHICS

SUPPLY CHAIN ETHICS Mark Fogel was shocked to learn that his multinational company was unknowingly engaged in unethical practices overseas. Here’s what he did to fix it During his time serving as CHRO of a major manufacturing organization, Mark Fogel always believed his employees were provided with safe, healthy, and well-regulated working conditions, no matter their role or location. That all changed during one revealing trip to Southeast China.

“When I was at Leviton, the first two times we went to China our operations team led us on tours through the factories, but we only saw what they wanted to show us,” Fogel says. “On a subsequent visit, I declined the tour and said I wanted to tour on my own. That’s when the curtain came down and I saw what was really going on – they were presenting

an image that wasn’t truthful of what was happening in the factories and dormitories.”

Some of the major issues Fogel came across included faulty plumbing and insufficient hot water for showers.

“I found a lot of issues affecting people’s hygiene and living conditions that were unacceptable to me,” he says.

ENFORCING VALUES Fogel demanded immediate change. “The first thing I did was have a meeting with senior management at the factory. I didn’t ask; I told them that they were

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going to remediate these issues within 24 hours,” Fogel says. “Before I left, those conditions had to be fixed.”

He also reached out to Leviton’s executives in the US and informed them of his findings. Although the factories may have passed compliance measures in China, Fogel insisted on a higher threshold.

“When I found those substandard conditions, I acted upon them regardless of cultural norms.

For HR folks, one of the key elements of working in other countries is understanding what living conditions and cultural norms are there, but also calibrating them to an adequate level of acceptability.”

In both manufacturing firms where Fogel has served as HR chief, his roles have moved beyond merely ticking off legal requirements and instead they have transformed into ‘humane leadership’ positions.

“At Leviton and Marcum, we had a very high standard for working outside of our borders. We didn’t accept ‘Well, this is just the way we do it in our country,’ ” he says. “I think the litmus test is if you had your own teenager working in that situation, would it be acceptable to you?”

HOLISTIC HR ROLE The “dog and pony show” concealing the second-rate, if not hazardous, working conditions that Fogel saw reflects a larger worldwide trend of reducing costs by limiting the resources made available to labour.

He hopes HR leaders and senior managers remain aware of the realities their employees face at each level of their organization.

“Human resources sits at the epicentre because there’s nowhere else to put that responsibility. I want HR to oversee employee living, employee eating, and every aspect of having people 24/7 at one facility,” he says. “Most HR people globally are not skilled in that.”

In particular, it’s important that HR provide instruction when needed on topics such as sex education and health awareness. Also, since many medical conditions are treated in-house, HR executives should be prepared to work with factories’ healthcare practitioners and be able to guide each facility’s medical staff.

“The litmus test is if you had your own teenager working in that situation, would it be acceptable to you?”

Mark Fogel BRAND BENEFIT Fogel brought into effect a wide range of other improvements too. He made sure pregnant women wore coloured vests to indicate that they should not be exposed to chemicals or high-risk areas, and that buildings passed regular maintenance inspections in regions where factories are often neglected because it’s so easy to construct new facilities.

Outside of the moral imperative dictating these efforts, it’s also clearly necessary for the business brand to be well regarded in the global community.

“The last thing you want,” says Fogel, “is to be Apple computers dealing with Foxconn, and waking up to find that your subcontracted factory was on the front page of every newspaper and news service around the world for a hygiene or human rights violation.”

THE FAIR LABOR ASSOCIATION Following Apple’s Foxconn controversy, the company joined the Fair Labor Association (FLA) and, in doing so, it agreed to abide by the FLA’s Workplace Code of Conduct throughout its supply chain. Launched in 1999 by a coalition of industry (including Nike), labour and non-profit advocacy groups, the FLA assesses working conditions and monitors attempts to remedy violations in factories, farms and facilities used by its affiliated companies. Independent assessors schedule random visits to facilities supplying participating companies.

Further information: fairlabor.org

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LEADERSHIP / PSYCHOLOGICAL WELLBEING

Burning the candle at both ends

With great leadership comes great stress, but there are ways to prevent stress from turning into burnout.

Dr Adam Fraser outlines a seven-step guide to sustaining high performance without letting your health suffer 32 | NOVEMBER 2014

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The rock star anthem is “It’s better to burn out than fade away.” Sounds extreme but sadly it seems that the average corporate employee is trying to emulate them. Ask people how they are and you will generally get one of two answers: “Busy” or “Tired.” The pace of life is outrageous; most people I talk to say they feel like they are handcuffed to a roller coaster that is stuck on repeat. I was coaching a CEO, and when I asked her how she would describe her life, she said, “I feel like the hamster is dead but the wheel is still spinning!”

We are jamming more and more into our alreadycrammed lives. An executive recently confessed to me that she gets her eight-year-old to read her four-yearold a story while she sits on the bed and answers emails on her phone. She has outsourced story time.

The fallout of all this haste is that many people have lost the ability to slow down and recharge. As a result, the burnout rates in business are rapidly climbing. So why is it such an epidemic?

There are two big problems in the way we handle burnout: Putting it off – Many times in my conversations with people who are burnt out, I will ask, “What are you going to do about that?” Their reply is, “Well, I have a holiday in three months. I will keep pushing until that date and then I’ll relax!” You can’t put off addressing burnout.

Waiting for things to slow down – I have lost count of the number of times I’ve heard the phrase “I will look after myself/relax when things quiet down.” With margins being constantly squeezed and the rise of leaner organizations, that ship has well and truly sailed. Don’t expect workloads to lessen; it’s simply not in our business DNA.

WHAT TO DO? What is a practical solution? For this we have to turn to the world of elite sport. When I worked with Olympic athletes, burnout was a frequent and very

An executive recently confessed to me that she gets her eight-year-old to read her four-year-old a story while she sits on the bed and answers emails on her phone real challenge. Often you hear in the media that athletes get sick just before or at the Olympics. Why? Because they are always on the verge of overtraining or undertraining.

If you overtrain an athlete you simply push them too hard for too long. Their immune system starts to decline, they get sick, and their performance plummets. Obviously this is a significant problem and one we put a lot of resources into solving. What doesn’t work is pushing an athlete until they show signs of burnout, and then giving them long periods off to recover. In contrast, our solution was to give them small, regular, consistent bursts of recovery.

This involved a shift in mindset. Instead of thinking about how to help them recover when they were feeling burnt out, we looked at how they recovered each day, each week and each month. Recovery became something they did perpetually rather than something they resorted to when exhausted.

Techniques such as meditation, relaxation, and improved quality of sleep were daily rituals that stopped burnout in its tracks.

HOW WE APPLY THIS TO THE BUSINESS WORLD When I transitioned into working with corporations I found that people talked about trying to address burnout, but they wore exhaustion as a badge of honour. People would literally compete with each

DID YOU KNOW? According to official government statistics, employed Canadians worked an average of 36.6 hours per week in 2012. There was significant variation depending on age, gender and location. yyLocation: In Quebec, the average number of working hours was 35.4 hours, compared to 39 hours in Alberta yyGender: Men spent more hours per week at work (39.6 hours) than women (33.2 hours) yyAge: Compared to other age groups, youth aged 15–24 years spent the least time at work, working 28.3 hours on average per week. Those aged 25–54 years worked the longest, for 38.6 hours.

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LEADERSHIP / PSYCHOLOGICAL WELLBEING

other to be the hardest worker, the most tired, and the one closest to complete physical and mental breakdown. Over the last 10 years I have run countless programs with corporate executives to prevent burnout. Here are the critical components that have kept people free from burnout: Step 1: Decide if you are serious about avoiding burnout Notice if you are using burnout as a status symbol.

Does exhaustion define you as a person? Unless you are stressed and exhausted, do you feel guilty and think you are a slacker not pulling your weight?

Step 2: Develop the capacity to say no Your organization and leaders will always try to get more and more out of you. Don’t expect them to manage your burnout. It sounds cynical, but it’s just the way the world works. You have to be responsible for this. Develop the capacity to have some boundaries, and ways to say no.

Step 3: Do something that relaxes you each day Like shutting down your computer, the brain needs the capacity to turn off and recover. Not only does

this let the mind and body recover, but it also builds our capability to put the brakes on when we need it.

Often people reflect on their holidays, saying, “It took me a week to unwind. I had a couple of good days and then started to worry about coming back to work.” We have lost the ability to go slow, and in some instances going slow seems to be punishment.

The actor Will Ferrell put it best: “Before you marry a person you should first make them use a computer with slow internet to find out who they really are!”

Doing something that relaxes you each day, even if it is just for five or 10 minutes, builds up that muscle.

Meditation, listening to a relaxation tape, yoga, and deep breathing while stretching before bed are all great ways to recharge your mind and body each day.

Oh, watching TV doesn’t count.

Step 4: Each week do something that gives you a shot of vitality This is taking the daily relaxation principle and turning it up to 11. We all have things in our life that fuel our soul, whether it is socializing with friends, going out for breakfast, walking on the beach, doing yoga, or being out in nature. It is something that not only relaxes you but also juices you.

A WORLD OF OVERWORKERS According to the OECD Better Life Index, Mexicans work more hours per year than any other OECD country, clocking up 2,250 hours annually. That’s 474 hours more than the OECD average of 1,776.

Here’s how the rest of the world shapes up:

MEXICO

US

2,250 hours worked per person per year 29% of the population work “very long” hours

1,787 hours worked annually 11% of employees work “very long” hours

UK 1,625 hours per person per year 12% of employees work “very long” hours

AUSTRALIA 1,693 hours spent at work per year, 83 hours less than the OECD average 14% of workers put in what is classified as “very long” hours (compared to the OECD average of 9%)

TURKEY 1,855 hours worked annually 46% of the population work “very long” hours – the highest rate in the OECD

CANADA 1,702 hours per person per year 4% of the population work “very long” hours

FRANCE 1,476 hours per person per year (300 hours less than the OECD average) 9% of employees work “very long” hours

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Step 5: Each month have a day with no responsibilities Our lives are so scheduled that there is always something to do. Psychologists report that children are experiencing anxiety in trying to keep up with a vast array of extracurricular activities. When was the last time you had a day when you woke up with nothing to do and no responsibilities? Days like this are restorative and freeing. Each month schedule a day that is responsibility-free. Our research shows that a day like this is ideally spent by yourself. Busy couples with kids can get around this by taking turns with their partner and having the other person look after the kids.

Step 6: Every quarter take a long weekend Four times a year take a day off either side of the weekend and have a mini break, whether you go

somewhere or simply stay at home. These regular mini holidays are great sanity breaks.

Step 7: Have an off season All sports people factor in an off season when they give their body and mind a complete break. No one can keep going all year. Canadians have amassed a concerning amount of holiday leave. Don’t become one of those people who never take a holiday. Aim to wipe out your annual leave each year.

DO IT TODAY There you go: a seven-step process to eradicate burnout from your life. I have used this process with many executives and found that, no matter their external stress, it helps them dramatically reduce their chances of burnout. Go forth and recover.

Dr Adam Fraser is a human performance researcher and consultant who studies how organizations adopt a high-performance culture to thrive in this challenging and evolving business landscape. Visit dradamfraser.com.

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INTERNATIONAL PROFILE / SOUTHWEST

Winging it

The aviation industry is one characterized by employee burnout, high turnover, and recession-fuelled layoffs. Southwest Airlines, however, is out to prove that a ‘people first’ business culture can be all it takes to prevent this operational jet lag.

Jill Gregorie reports

Gary Kelly, CEO of Southwest Airlines, a company recently named one of Fortune magazine’s top 10 ‘World’s Most Admired Companies,’ has shown up to work wearing thick, black eyeliner, beaded hair extensions, colourful head garb, loose-fitting nautical wear, and a sword.

It’s Halloween, and he’s dressed as Jack Sparrow from Pirates of the Caribbean.

As part of the airline’s ‘FUN-LUVing Culture,’ employees can suggest fancy-dress ideas for senior managers, including the CEO. In the past, Kelly has arrived at corporate headquarters dressed as Frankenstein, Toy Story’s Woody, Dorothy from

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The Wizard of Oz, and Gene Simmons of the rock band KISS. This lighthearted tradition is just one highlight of Southwest’s ‘people first’ mission. As founder Herb Kelleher often says, “The intangibles of spirit, in our view, are more important than the tangibles of things.”

This would be an easy mantra for an executive of a luxury brand to espouse, but Southwest’s business model hinges on its identity as a budget carrier with low-cost fares.

This makes its human capital management all the more remarkable. Although the industry is in turmoil and many US airlines are struggling to remain viable, since its inception in 1967 Southwest Airlines has never ceased to remain a global icon for unrivalled corporate culture and employee satisfaction.

Julie Weber, the airline’s vice president of people, is responsible for ensuring these stellar practices are sustained.

EXPERIENCE ISN’T EVERYTHING While the flagging US economy makes it tempting for companies to seek out job candidates with extensive skills and experience already in place, Southwest approaches recruiting differently. For the airline, a positive outlook and customer-oriented mindset are the top priorities when finding new employees.

“We know that happy employees make for happy customers, so we hire for attitude,” says Weber. “As the saying here goes, ‘We hire for attitude and train for skill.’ ” In order to evaluate whether potential workers will be able to uphold the ‘Living the Southwest Way’ principles, HR centres its interviews on three dimensions: spirit, heart, and a fun-loving attitude.

To accomplish this, recruiters ask behavioural questions such as ‘Describe a time you went above and beyond to serve a customer’ and ‘Why are you interested in Southwest Airlines, and what about this particular job appeals to you?’

“We have two main focuses: first, hiring people who feel that this job is a calling; and second, working to get out of their way. We hire good people,

and get out of their way,” says Weber.

This hands-off approach can easily be seen in the unorthodox and jovial way that pilots and flight attendants go about their jobs. In June, a YouTube video featuring a Southwest flight attendant’s comedic safety speech went viral, attracting more than two million viewers. In the video he makes passengers laugh with remarks such as “And that seatbelt needs to be low and tight across your hips just like the hot pink speedo I’m going to be wearing when I finally get the three of us to a hotel hot tub tonight,” and “For those of you travelling with children, why?”

“Other than regulatory rules, we give employees the latitude to make situations light for the customer,” Weber says. “As long as they’re leaning towards the customer, the company will support the employee.”

FOR THE FUN OF IT Throughout its history, Southwest has received so many requests from corporate and public sector organizations to share its world-renowned people strategies that it now hosts an annual gathering called ‘Culture in a Nutshell.’ During the two-day

Fun at work Company-sponsored activities to keep it light yyPajama Day yyRocking chair sessions – before employees retire, they share stories of their time at Southwest yyChilli ‘cook-off’ held every year at an amusement park yyAnnual ‘Spirit Party’ held in a different Southwest destination city every September yySending T-shirts and cards to new employees after acquiring a regional airline yyBirthday, wedding, and special cards for every employee yy‘Gate games’ for customers waiting at a station in a flight delay, such as trivia or offering gift cards to whoever can produce a sock with a hole in it the fastest yyManagers spend one day per quarter in another department, learning tasks such as loading a plane yyOffice decorating contests

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INTERNATIONAL PROFILE / SOUTHWEST

“We hire for attitude and train for skill” Julie Weber

July hot dog cookouts and Easter egg hunts. Halloween is a particularly festive time, with HQ’s business departments competing for ‘best skit’ and ‘best video’ awards, and employees at Southwest’s airport stations engaged in a ‘best decorated gate’ contest.

“No matter where you are, we really work to bring out the fun,” says Weber.

CULTURE AS STRATEGY event, employers converge at the company’s Texas headquarters to attend formal presentations, tour its facilities, and learn how the people department conducts its day-to-day affairs.

These executives quickly discover that humanistic values lie at the core of Southwest’s culture. This starts from the point when every single new hire is flown to Dallas for ‘Freedom, LUV, and You’ (FLY) training, wherein the company’s people principles are explained in detail, and it continues through to the airline’s ‘no layoff’ policy.

“We have a culture services team dedicated to enhancing our culture, focusing on it, and ensuring that we are doing things to keep it fun and celebrating our successes,” says Weber.

These celebrations take many forms, ranging from the CEO commending exemplary employees during his weekly ‘News Line’ broadcast, to local and corporate-wide culture committees hosting 4th of

A portrait of Southwest Airlines’ ‘Family Members’ yyHired 1,521 out of 100,682 applicants in 2013 yy2,830 Southwest employees have spouses who are also Southwest employees, which makes 1,415 married couples yy83 per cent of workers belong to a union yyIn 2013, Southwest employed nearly 45,000 people – 19,003 in-flight, 2,689 in tech operations and maintenance, 15,464 in customer and ground services, and 7,675 in management and administration yy580,000 hours spent on safety and security last year yy0.34 customer complaints per 100,000 passengers – the lowest of all major US airlines yyThe airline was the topic of Harvard University’s first case study on integrated reporting, due to its triple bottom line thinking, which focuses on performance, people, and the planet Source: 2013 Southwest Airlines One Report

While many corporate traditionalists consider fun, satisfaction-driven activities to be frivolous, Southwest’s endeavours actually generate a substantial business impact for the company.

Southwest was the only major US airline to make a profit following the industry upheaval brought about

by September 11; in fact, the company has been profitable for 41 consecutive years. In addition, the company has never dismissed or furloughed an employee or cut salaries due to budgetary concerns, not even at the height of the global recession.

“One of the things that I love about Southwest is even when times are economically challenging, such as in 2009 when so many organizations were laying people off, we didn’t. Those are not the areas we cut,” Weber says.

Instead, Southwest offered voluntary early retirement programs and slashed costs in other areas – parties and festivities excluded.

“We’re a pretty scrappy group. We’re the no-frills airline, so we know how to do things cost-effectively,” says Weber. “It may mean we have to swap out one venue for a different one, but it doesn’t mean we’re going to cancel anything. We just get more creative.”

THE SMALL THINGS DO MATTER While the airline does put tremendous effort into keeping things cheerful and enjoyable, it also has people practices in place for more serious affairs. Weber is particularly proud of a division that sends gifts and care packages to employees in need, whether they’re sick, experiencing misfortune, or have recently lost a member of their family.

“I joined Southwest in 2006 and my grandmother passed away in 2007. I was absolutely floored that the biggest and most beautiful flower arrangement delivered to the funeral home came from Southwest Airlines,” says Weber.

“Just about every employee that you meet will have a story like that. It’s pretty incredible.”

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BEST PRACTICE / RECRUITMENT

Recruitment finally comes of age Despite the best of intentions, a diligent interview process, and thorough onboarding, organizations still make ill-advised hiring decisions. HRD outlines how two game changers have reimagined their approach to recruiting As a prevailing force in the global travel industry, G Adventures has about 2,000 employees stationed in countries ranging from Canada and the US to India and China.

While workers’ ages and demographics vary substantially, all G Adventures employees have one thing in common: they passed an interview consisting of quirky questions such as ‘‘How would you describe your two years in the adult film industry?” and “If stuck on a deserted island, who would you not want among your company?”

While these queries may not seem like a reliable indicator of future job performance, G Adventures has found that it’s actually the conventional methods of recruiting that fail to yield employees well suited to its risk-taking business ethos.

At the other end of the spectrum, renowned investment research specialist Morningstar, Inc. has also revamped its hiring policies in order to attract employees who are ideal for the firm in practice, not just on paper.

What these disparate companies have discovered is simple: oftentimes, in order to attract exceptional

and unconventional thinkers, employers need exceptional and unconventional talent acquisition strategies.

A GOOD FIRST IMPRESSION As a market leader overseeing US$169 billion in assets throughout 27 countries worldwide, Morningstar has little room to hire any candidates who will not meet or exceed expectations if granted employment with the firm.

“We don’t believe that sometimes you just need to get somebody in the door, and thus it’s OK to have a D player,” says Bevin Desmond, head of global markets and HR. In order to select the most qualified from among the countless résumés it receives every year, the firm has developed a system that allows each applicant, regardless of the job in question, to meet with a senior executive at some point during the interview process.

“By including senior managers in the process, it emphasizes to everybody involved how important this is to us,” says Desmond. “It’s also a great recruiting tool. We always hear from people who

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interviewed with five or six companies that we stood out, because the chance to meet the CEO of a company like Morningstar, especially for those who interviewed right out of school, was amazing.”

In addition to the managerial component of its hiring process, Morningstar also conducts crossfunctional team interviews wherein candidates meet with representatives from every department linked with their potential role.

“For example, if it’s a technical position, we will have the applicant meet with product managers, designers, and support people. Anybody who interfaces with that job will be part of the interview process,” says Desmond.

“We don’t believe that sometimes you just need to get somebody in the door, and thus it’s OK to have a D player” Bevin Desmond

ATTITUDE OVER APTITUDE

DEBUNKING MYTHS

It probably isn’t surprising that an organization founded by a 22-year-old entrepreneur maxing out his credit cards would value such traits as audacity, open-mindedness, altruism, and the ability to “embrace the bizarre” among its prospective employees.

But for G Adventures, these are not just core values but prerequisites for employment.

In its efforts to weed out “brilliant jerks,” the company has developed an innovative way to assess whether a candidate is an optimal cultural fit for the organization.

“What we came up with at our headquarters in Toronto, also known as base camp, is the wheel. It’s a roulette wheel with a flapper that lands on preloaded questions. We call it the G Factor wheel,” says VP of global talent and culture Amanda Chew.

Typically, candidates are asked to spin the G Factor wheel after successfully completing a skill and behaviour-based interview either in person or via Skype. Once applicants’ qualifications are verified, they are invited to participate in this test, which is led by three voluntary participants from any team outside of the hiring committee.

“This is not an interview or an assessment about the ability to do the job; it’s simply about cultural fit,” says Chew. “It’s not coloured by any thought, because the questions are random and the wheel determines which are asked.”

Scoring is based on a red, yellow, and green light evaluation structure, and if a candidate receives just one red light, it’s an automatic fail.

“Even our owner and founder had to go through this. It’s just the way it is: it doesn’t matter the position; if a person can’t pass the G Factor test, we have to say goodbye to that candidate,” says Chew.

One of Morningstar’s greatest recruitment success secrets lies within the organization itself. The company abolished its paid referrals program after realizing that these initiatives “don’t get better candidates, just more candidates.”

The firm’s HR team believes that Morningstar’s exemplary flex policies – no start and finish hours, no set vacation policies, and a culture of trust – result in employees organically recommending open positions to talented associates in their networks.

In addition, although Morningstar is a financial services firm specializing in sophisticated analysis and research, the majority of its entry-level graduates are actually liberal arts majors.

“The interesting thing that distinguishes us is that we’re more concerned with the way people think over the training they may have received in the past,” says Desmond.

A major advantage of hiring candidates for cognitive malleability over prior experience, as HR has discovered, is that quick redeployment is possible whenever an open role needs to be filled right away.

In fact, Morningstar Canada’s CEO started out in tech, moved on to products, then data, and “practically every other job until eventually becoming CEO.”

A SMART APPROACH = SMART RECRUITS Although the services they offer are vastly different, Morningstar and G Adventures have both succeeded as a result of their common ability to creatively target and acquire innovative, adaptable, and cooperative talent.

“Smart people who have a great attitude can do all sorts of wonderful things for an organization,” says Chew.

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HR STRATEGY / PERFORMANCE MANAGEMENT

STEPPING IT UP: CREATING AND SUSTAINING HIGH PERFORMANCE Canadian organizations are facing a performance crisis, as labour productivity has been on a steady decline since the 1970s. Two prominent employers, Cisco and Nitro Software, reveal how they’ve created high-performance cultures to combat this trend

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In the past five years, countless accounts of disgruntled employees expressing their job dissatisfaction in vocal public outbursts have made headlines in the news media worldwide.

Some of these HR nightmares have included a viral YouTube video of a young woman quitting her job by detailing her onerous workload while dancing to a Kanye West song. In addition, staff live-tweeted HMV’s mass layoffs via the company’s Twitter account, and then there’s the infamous JetBlue flight attendant who quit his job on the plane’s intercom system, before grabbing two beers and exiting the aircraft by sliding down its emergency chute.

The bad publicity resulting from these outcries was devastating to the brand image and external reputation of the multinational companies involved.

They serve as a cautionary tale for other employers lacking a corporate culture that prioritizes high standards of performance and employee engagement.

Not surprisingly, human capital was the number one business challenge facing corporate leaders worldwide, according to a Conference Board survey of 1,020 CEOs released in January 2014. Likewise, ‘managing people’ was the number one priority cited by HRD’s readers in our global survey (see issue 2.5).

“Boards of directors and CEOs now recognize that workforce productivity, employee engagement, and HR effectiveness are the key to performance and competitive differentiation,” says Ian Cullwick, vice president of leadership and human resources research at the Conference Board of Canada. “More than ever, HR directors and CHROs need to be focused on productivity and performance.”

Fortunately, solutions are simpler than they may seem. Two pre-eminent organizations, Cisco and Nitro Software, share the straightforward, logical steps required for building a high-performance culture and sustaining it well into the future.

STRATEGY DRIVES SUCCESS In his extensive research on performance management practices, Cullwick has discovered the following: performance management processes work best when targets are minimized and performance standards are built into core job functions. While many believe that more sophisticated performance measures make for highly effective practices, in most cases it is quite the opposite.

“Performance standards such as targets and expectations should be woven into the design of the job and the work the team does, so the manager is continually coaching and guiding performance,” says

“Boards of directors and CEOs now recognize that workforce productivity, employee engagement, and HR effectiveness are the key to performance and competitive differentiation” Ian Cullwick Cullwick. “Just think: a human capital intensive or employee intensive business doesn’t have time to shut down a business to do year-end reviews.”

Cisco Canada has championed this practice, after realizing that the speed in which its industry moves makes HR agility a necessity. Instead of the yearly performance review, employees have a digital tool that allows them to access goals 24/7, change targets based on new information, and update performance records in conjunction with manager approval. This way, goals can evolve over time to align with customer needs or evolving requests from internal stakeholders.

DEATH OF THE ANNUAL REVIEW? The results of a 2010 WorldatWork survey indicated that many organizations continue to conduct annual performance reviews simply out of convention; just 1 per cent of US businesses have scrapped them. Yet some 60 per cent of US HR managers rated their employer’s performance management protocols as ‘C or below.’ Two-thirds of appraisals were found to have zero or even negative effects on employee performance after the feedback was given.

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HR STRATEGY / PERFORMANCE MANAGEMENT

“We want employees to be part of change. If you can pull them into the process, if they feel part of the solution, they will go the extra mile for you, and you’ll get superior performance” David Heather “It’s not set in stone, but fluid. It moves with their role and the business they’re supporting,” says David Heather, vice president of HR at Cisco. “We want employees to be part of change. If you can pull them into the process, if they feel part of the solution, they will go the extra mile for you, and you’ll get superior performance.”

A key component of this is training line managers to recognize performance based on quantifiable objectives such as KPIs. “That’s part of our core DNA, and all of our employees are used to having these conversations with their line managers,” says Heather.

MENDING THE EXECUTION GAP: NITRO The San Francisco-based document productivity company Nitro, on the other hand, has not abolished the annual performance review; they’ve merely repurposed it. Instead of using these meetings as a way to scrutinize past behaviour, managers take advantage of the yearly opportunity to explore future possibilities for each employee and discuss new avenues of growth together.

“It’s an opportunity for employees to talk about the future and where they want to be in our organization,” says COO Gina O’Reilly. “I like to view it almost as a celebration in many respects, discussing where employees envision themselves, whether that’s in a more advanced position or a new department.”

In order to sustain high performance standards throughout the year, Nitro worked with the Australian group XGAP to develop a program wherein each employee agreed to a 90-day contract detailing three to five specific objectives for the quarter. Each goal is pegged to a quantifiable outcome, which ranges from product sales to bug fixes to completion of the next step of a major project.

The contracts are visible to everyone in the organization, and supervisors have weekly one-on-one meetings to discuss progress and brainstorm solutions to any obstacles that may have arisen in the days prior.

“The 90-day contract is like the North Star guiding everyone to focus on what really matters,” says O’Reilly.

“And because of the visibility into everybody’s 90-day plan, it helps others to prioritize, because they might want to work together on something but didn’t realize what else that person was working on.”

COMMUNICATION IS KEY: CISCO As a company consistently top-rated in both the Fortune 100 and Fortune’s Best Place to Work lists, it is undeniable that Cisco is a global leader in employee engagement and labour productivity. While the company’s accomplishments are notable, its strategy isn’t complicated: communication and transparency serve as a vehicle for employees to connect with executive leadership and the business goals they set.

With 65,000 employees spread throughout the globe, this could present a challenge. But with the use of technology, Cisco leaders have found a way to champion new policies and initiatives, which are then cascaded down to every employee within a matter of days.

“I don’t pretend this is unique. Many successful companies communicate strategy and vision on a regular basis. Where we have a different offering is in how we do it,” says Heather.

When an announcement is made at Cisco’s headquarters in California, the event is live-streamed to every employee and made accessible on laptops, tablets, and smartphones. Any worker can post a question in real time on a corresponding chat function, which is answered publicly by a member of the senior executive team. Employees who live in a time zone where it is implausible to watch the event live are emailed a link to a video rebroadcast.

Within 48 hours of the California announcement, Heather and his team have then localized the strategy to fit the Canadian market, and by the end of the week goals are broken down and customized for each team and every individual employee.

“Whether you’re in finance, legal, sales, or professional services, you’ve seen the macro announcement at a corporate level, understand its impact, and know your role in making that goal specific in your area,” says Heather.

LIVE AND LEARN Finally, both leaders regard developmental oppor­ tunities as a prerequisite for employees who feel

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personally invested in their job performance. Cisco has recently re-examined its approach to L&D, stressing accountability and outcomes over the complacent acceptance that the programs alone are sufficient.

After a recent poll indicated that some employees felt learning initiatives had no clear objectives associated with each undertaking, any developmental opportunity is now carefully evaluated before employees are asked to participate.

In addition, employees are expected to apply what they’ve learned to their daily responsibilities, and report to managers what they’ve found to be effective or what approaches need improving. For example, a member of the sales team who was trained on an emerging technology may have phone calls assessed to see whether the worker communicated the new knowledge well to customers.

“It’s a simple technique; it’s not groundbreaking, and I’m not pretending it’s unique to Cisco,” says Heather. “But having that focus on execution and telling employees who are taking a learning and development course that they will be held accountable makes them want to actively take part in it and bring lessons back to the job to be successful.”

Nitro also emphasizes the importance of educational opportunities for its employees, both in the scholastic sense and in professional endeavours. The organization offers enrichment opportunities such as subsidized academic coursework, language classes, Nitro University training, and the chance to request any book in a company-sponsored Amazon order every month.

“A lot of people confuse great culture with beer, skittles, and ping-pong, but we’ve found that people care more about their career, whether they’re progressing, and ongoing learning and development,” says O’Reilly.

THE CULTURE COMPONENT Although Nitro prides itself on a culture of sustained productivity and achievement, it doesn’t neglect to expend resources on another prominent feature of performance management: fun. Recognizing that an incessant focus on performance can lead to employee burnout, the company regularly hosts events such as city-wide scavenger hunts, trivia nights, and a monthly wine club.

To maintain a healthy balance of initiatives, the firm boasts an organizational structure arranged in a pyramid of 3Fs, similar to Maslow’s hierarchy of needs: at the bottom are ‘Fundamentals’, such as salary and benefits; in the middle are meaningful ‘Fringe’ incentives such

“A lot of people confuse great culture with beer, skittles, and ping-pong, but we’ve found that people care more about their career, whether they’re progressing, and ongoing learning and development” Gina O’Reilly as career development and learning opportunities, and the “icing on the cake” at the top is ‘Fun’. This ensures that employees have the tools to succeed in their 90-day contracts, and enjoy the process of doing so.

“I think the most important thing for us, and the advice I would give to any other company, is that it’s really important to invest in employees, which is not always about having the best perks,” says O’Reilly. “At the end of the day, people are much more interested in their career and their future than whether or not you have a fully stocked beer fridge.”

But as the popularity of Nitro’s Beer Cart Fridays demonstrates, a little booze certainly doesn’t hurt.

TOP TIPS TO SUSTAIN HIGH PERFORMANCE Ensure employees are aware of the performance criteria, and the company and personal benefits of the high-performance culture Document the expected work standards Recruit employees who will be able to meet these standards Put processes in place to identify when standards have not been met Inform employees in a timely manner if their performance has not been satisfactory, and then take positive steps by providing training and mentoring opportunities Set targets that are appropriate and not tied to unrealistic expectations; targets should be regularly reviewed and adjusted as required

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IN PERSON / DEAN SOCKETT

IN PERSON:

DEAN SOCKETT

The Keg is renowned across North America for its mouthwatering steak, seafood and contemporary yet casual atmosphere, but the company is an industry leader in labour practices as well. Dean Sockett, director of HR, talks to HRD about mentorship, the economy, and his path from server to senior manager 46 | NOVEMBER 2014

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HR Director: When did you start working at The Keg? Dean Sockett: I actually started at The Keg in 1977, as a server. I had never heard of The Keg, but they were opening in Hamilton while I was studying at McMaster University, and I ended up staying through my third and fourth year of university as a server and bartender.

When I graduated, I didn’t know what I wanted to do – I thought about being a teacher, but jobs were tough to find and it really wasn’t for me. They suggested I get into management.

I started as an assistant manager. Then I became a kitchen manager and then a general manager, and finally an area manager. One day when I was at one of our special events, the VP of HR asked if I’d have lunch with him. I said, “Sure.” That’s when he said, “I’d like to bring you into HR.” I had the same reaction as I did when getting into management – I didn’t think HR was for me; I was an operations guy. I like being in stores and feeding off the energy of staff and guests. I didn’t see myself in an office position.

He told me, “That’s why we want you in HR. You get the people and you get the business, and you enjoy it.” I said, “OK, I’ll do it for a year.” That was 22 years ago.

awarded with all-inclusive clubs for one week and travel vouchers valued at $2,000.

We also have huge baseball tournaments in every major market. In Toronto, for example, we had 32 teams enter this year’s Ontario tournament alone.

HRD: The Keg is committed to continuous learning.

How do you support training and educational initiatives for your staff?

DS: We spend a fair bit of time on this, and we’re actually launching a new website called Kegger for Life, which looks at people who have worked at The Keg or still do, and all the skills they’ve developed – not just in the work function but also useful for life: how to be responsible, how to be accountable; what it’s like to be a team member and know that people are counting on you. When I ask staff what is it about The Keg that makes them stay here, they say, ‘yes, it’s a great time,’ but we also mentor them and help them grow as individuals. Sometimes they’ll take that skill set and use it elsewhere, like banking, but often they stay with us. In fact, about 80 per cent of managers started out working in the kitchen or serving. And as we’ve developed the brand, we’ve begun to offer more sophisticated opportunities, such as the wine training program WSET, and sponsored two managers to obtain an MBA.

HRD: How many workers are currently employed

by The Keg Steakhouse and Bar? DS: We have roughly 8,000 employees throughout

HRD: What is the best advice you have ever received?

DS: This one is dead easy: the guy who got me into

North America. We’re in 105 locations, which are pretty much half franchise-owned and half corporate-owned.

HR, the VP at the time, was talking to me about the decisions we make and the impact they have on people’s lives. He taught me this test that I still use: if you put your decision on the front page of the news, and the average Joe reads what happened and what your decision was, would they understand it and would you be comfortable with your name at the bottom of it? Could you accept: I, Dean Sockett, did this? That’s a great thing to think about in terms of decision-making: would you want the public to know you did that, and would you be comfortable in how that reflects on you and your company?

HRD: The Keg continually offers fun employee perks. Can you outline what you do?

DS: We make sure to celebrate our successes. One way we do this is through something called the Keg Cup, which is a ski race that takes place every year. We invite staff and management to two places – Blue Mountain for those on the East Coast and Apex Mountain for those on the West – and we have two days of ski races. What’s also becoming more popular is our lip sync competition. It’s basically a party, and we have 1,000 people attend in Ontario and 600 in British Columbia. Everyone enters an air band or lip syncing competition, and the prizes are amazing. We’ve seen winners

DEAN SOCKETT CAREER TIMELINE Qualifications 1975–1979

McMaster University BPE

Work summary 1977–1979

Server bartender

1979–1981

Assistant manager

1981–1985

General manager

1985–1993

Area manager

1993–1997

Regional HR manager

HRD: What do you usually order off the menu?

DS: My favourite thing is to start with a Keg Escargot, then a 14-ounce New Yorker cooked Chicago rare with peppercorn sauce and a side of crab. It’s a big meal, but it’s outstanding.

1997–2014

HR director

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LAST WORD / ATS

THE LAST WORD

Death of the applicant tracking system?

AT S

Is it time to say farewell to the ATS?

Gary Taylor is an HR director who has worked for Australian, South African and British multinationals on two continents, including in the Middle East. He is registered as a Master HR Practitioner with the South African Board for People Practice, and served as the vice president of the Institute of People Management.

When Recruiter.com predicted the death of the ATS, the online applicant tracking system technology used by most corporates, it caused quite a backlash. The strongest shock came from the vendors themselves, who have done very well out of the transformation of this aspect of recruitment.

Many of us remember the days of job adverts in newspapers, which elicited a deluge of CVs arriving in the inbox of the recruiter, who would have to personally read each CV (averaging 20 seconds) to shortlist. With the advent of online employment boards in the 1990s, global applicants were simply clogging the pipeline, and a smarter solution had to be found. The large ERP vendors, as well as niche ATS players, sprang to the rescue.

The ATS was designed to: »» import and export applicant data by scanning CVs and populating a single-format database »» streamline the hiring process through keyword searches and knock-out questions »» improve reporting and analytics »» archive candidate information for future talent searches The ATS was designed by software experts for corporate clients, and clearly entailed a shift from an applicant-centric to an employer-centric approach.

Few of the HR directors or CIOs who bought the systems had ever used or intended to use the sausage machine – they saw the quick demo during the sales presentation and were enthused by the HRIS person’s endorsement and encouraged by talk of greater efficiency in recruitment.

Some of the problems that have arisen include: »» Despite the claim that the smart ATS autopopulates the system, applicants who upload their CVs can spend 20 minutes or more trying to fix the mess of auto-population. If you have two titles at one employer, expect the ATS to get confused. Count on 100 clicks to get yourself loaded.

»» Most systems are US-centric too, so you could be forced to give a five-digit zip code or social security number, even if you are not applying for a US job. GPA results are compulsory, even if not applicable in your education system. »» Candidates now have to compile ATS-friendly CVs. Unless you have included every keyword possibly required, your carefully crafted CV will never be read by a human. Boolean search will decide if it gets through.

Top candidates are not always prepared to spend half an hour or more giving reasons why they should work for you. Many Gen Y applicants are passive candidates who are not necessarily dying to prove to you why they are better than the 20,000 foreign candidates who apply for every job going. If your HR staff who do the ATS specs for your jobs don’t get it right, you stand a very good chance of bypassing highpotential talent who have the wrong keywords.

We have always known it, but Forbes magazine contributor Joel Trammel cautioned against the current wave of employer-centricity, pointing out that “the employer also has to sell itself to the employee”, and this is more important in what we do than what we say. Having a pretty PR blurb on the Careers tab of your website will not compensate for a poor applicant experience of the ATS. Do I really need to have three questions and three answers to help me if I forget my password? I can’t even remember my first pet!

Fortunately, commercial interests have driven significant upgrades in ATS systems, and we are getting better but are not transformative yet. It is still the employer’s need for screening, database searches, analytics and even CRM campaigns that drives developments, ahead of the applicant experience.

Something’s gotta give.

Gary Taylor

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