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There is a great need to widen the pool from which non-executive directors are appointed to quoted companies, financial institutions, semi0state bodies and state agencies. The days of nominating pals, colleagues and former senior state employees as a boardroom ‘grunt a month’ should be ended.
Read article here: need to reform selection of non-executive directors
OUR public service faces new challenges of retaining professionalism and motivation after the series of income cuts from the 7% pension levy last March and 2009 income tax levy to this month’s Budget pay-cuts of generally between 5% and 8%.
In particular the health sector has come through many challenges over the past five years with successes in community care, cancer treatment and primary health services. A new challenge is the personal one of retaining individual motivation on lower net incomes.
Employment specialists see widespread reduced earnings as damaging the ‘psychological contract’ which lies at the basis of most employment relations. In many employments people would respond by taking whatever opportunities open to them to find an alternative job either here of abroad.
The health service is slightly different in that most of the 105,000 people working in the service also have a commitment to patient services which is often much stronger than mere ‘customer focus’ in the private sector. There is frequently more of a team focus which knits the capabilities of different people in ensuring patient services than among those who operate in individualist roles.
In these challenging times, the call for effective people management has never been louder. HR managers are amongst those on the frontline when it comes to maintaining that delicate employer/employee relationship – the so-called ‘psychological contract’ – and delivering high performance in a period where reduced incomes, potential redundancies and other belt-tightening measures may become fairly common, even in the public service.
Across the public and private sector graduated reductions, with the higher paid taking a larger percentage cut, has been a common feature so that all HSE people share a common concern. In addition the extensive negotiations on modernising and improving efficiencies in the public service – from education and justice to health and local authority sectors – late last year may provide a basis for rebuilding public services in tandem with improved exchequer finances.
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THE recession has brought us an unexpected insight into management approaches in that organisations with efficient employee engagement appear to have weathered the commercial storms and managed to adapt more effectively than traditional, authoritative ‘command and control’ workplaces.
In recent weeks I met a former senior personnel manager with one of our very troubled financial institutions. He told me a shocking but both amusing and insightful story. In 2007 some of the firm’s senior executives suggested that the HR Department drop the annual ‘climate surveys’ as the attitudes and responses from staff were “disappointing and unsettling”. Apparently many staff were voicing concern over how targets were being achieved and the way many customer accounts were being aggressively managed to boost revenues.
The response of ‘we don’t like what we are hearing so let’s shut them up’ reflects the weak management at senior levels and the persistence in maintaining that a “soft landing” was on the horizon rather than a crash to rival that of 1929. There are fewer better ways of disengaging employees that by asking they views, pretending you take them seriously and then ignoring them.
The management and organisational guru, Henry Mintzberg has warned that a managerial mindset persists which “demeans human beings as human resources and human capital” or just another factor of production much like a “factory hand” in the early 20th century. That, despite two decades of guff about social partnership, is what is often holding back high-performance in many Irish workplaces though some multinational companies, high-skill enterprises and even a few state agencies have successfully developed and sustained high levels of employee engagement.
With the national social partnership structures in ruins there is a renewed focus on organisations addressing their own issues like reward systems and skills development rather than ‘outsourcing’ them to social partners such as trade union or employer lobby groups.
Employee engagement is seen as a combination of commitment to the organisation and its values plus a willingness to help out colleagues. According to the Chartered Institute of Personnel and Development “it goes beyond job satisfaction and is not simply motivation. Engagement is something the employee has to offer: it cannot be ‘required’ as part of the employment contract.”
Unfortunately it does not come at short notice and can easily be undermined during a period of dramatic change such as an economic recession. The companies which have adapted well have been those where senior managers have empowered line managers to encourage feedback and discussion and where “shared values” are really shared and discussed. Uncertainty about job security, pressures of work and family life commitments and financial concerns can all undermine people’s willingness to “go that extra mile”.
Essentially it is much easier to ensure high levels of engagement and performance when business is booming, targets are being exceeded and serious bonus payments are on the horizon. The tricky part is to ensure that situation continues in a recession as the benefits of high-levels of engagement may be even more necessary to be well positioned for recovery.
Professor John Purcell of Bath University, who has led much of the recent work on the discretionary contributions at work, has been monitoring what he calls “Black Monday” stories. These are examples of cases where the effects of the recession have been badly handled leading to a collapse of confidence, breaches of trust and withdrawal of engagement.
On the other hand he has produced evidence of improved motivation, morale and shared values in companies which have successfully cut staff numbers and pay rates based on before and after key engagement indicators. The special ingredient was open, two-way communication and ensuring that everyone know what problems were being faced and securing widespread agreement on how to face up to them. That is a long way from protracted negotiations, union ballots for industrial action and them Labour Relations Commission intervention to help save face or government-level pleas to salvage employment and investment.
Engagement strategies are not an easy option. One senior executive commented in a recent management review that: “Balance sheets don’t answer back. The risk of listening is that you may hear things that you don’t want to hear”. Exactly – and this is what frightened my banking friend’s bosses.
But the prize is better attitudes, improved behaviours and enhanced outcomes. It is a two-way street in which a business values its employees and they value the business’s success. The correlation between higher levels of engagement with fewer absences, better mental and physical health, open communication, higher productivity, customer satisfaction, empowerment and innovation, is fairly well proven by now though which levers produce specific results or outcomes is more open to question.
These are not new insights in that over the past few decades alternating hard and soft management styles have come into and out of fashion. The problem with recession is that few senior managers have the confidence to make a major shift in style and approach.
A review of preparedness for recovery in recent weeks by a former Towers Perrin change and performance specialist, David Macleod highlighted four key factors needed for employee engagement. These are:
Leadership – employees have a clear line of sight between their job and the strong strategic narrative provided by senior management who clearly can communicate where the organisation is aiming for.
Managers – are allowed to facilitate and empower rather than restrict and control staff and they show respect and appreciation while also rewarding the capabilities of those they manage.
Voice – employees’ views are sought, are listened to and responses are clear and wide-ranging to enhance two-way communications.
Integrity – behaviour throughout the organisation is consistent with stated values leading to trust rather than cynicism or ‘double-standards’.
It does not necessitate employing expensive consultants or elaborate surveys but, like dieting to lose weight, demands personal resolve and a determination to change and amend existing behaviours.
Many organisations have damaged their internal credibility in how they have adapted to the recession according to Ben Willmott, CIPD’s senior adviser on public policy. He said that “survivors of redundancy programmes left ‘punch drunk’ by the process may not have the levels of motivation and commitment needed for their employers to capitalise on any recovery. Many disillusioned employees will vote with their feet and leave as soon as the labour market picks up.
“Our research highlights a fundamental lack of trust in senior management among many employees, largely due to the lack of meaningful consultation and effective communication during major change.” Willmott added that clear communication from employers and consultation meant employees were more likely to understand the need for change and stay motivated and committed.
