Four Groups Blog

Welcome to the first update for 2010. In the spirit of new beginnings, in this issue we will look at how the debate around organisational performance is widening. We’ll also look at how after 18 months of economic chaos, the fundamentals of organisational behaviour and what everyone has taken for granted about motivation and engagement could have played a key role in recent events. We’ll also touch on the following themes;

• Mergers, Acquisitions and Human Capital
• Motivation and Engagement
• Myths surrounding Top Talent
• New Ways to Engage via Social Network Analysis
• Limits of Understanding around Managerial Behaviour
• Passion and Purpose
• Innovation Constraints
• Managing Tacit Knowledge

Articles are included from the likes of Deliotte, Gary Hamel, Henry Minzberg, HR Magazine, Karen Stephenson, McKinsey and Strategy + Business.

Tag Cloud

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I’ve just read the great piece from Jon Husband at the FASTForward blog and its made me think a great deal about Enterprise 2.0 (E2) stuff and how this compares to other new technologies and methods that we’ve seen play out in the last 20/30 years.

My thinking is as follows;

• E2 can be framed both as a technology and as a cultural shift
• Its takeup is clearly very different from hard technologies e.g. email, personal computers, blackberries, databases etc.
• Adoption is also very different from technological/methodological hybrids e.g. CRM, BRP(?), ERP and JIT amongst others
• Likewise, the debate about top down and bottom up drivers of adoption is new(ish)
• E2 seeks a different culture from command and control in which to thrive

Thus;

• Given the potentially disruptive nature of E2
• Its perceived low cost of technology
• The apparent need to be integrated into processes (see Howlett for example!)
• Its material ‘distributed’ impact on culture and values (what can’t be E2′ed?)

It will either;

Take hold on a case by case basis, varying from organisation to organisation and function to function, eventually fulfilling its potential and bringing about a subtle change in culture, the credit for which will vary dramatically and some will claim it was their idea from day!

or

Fail to take hold as the organisation seeks to control and police (in the nicest possible way of course!) the various elements of E2

Therefore;

• E2 is a bit of a slippery eel, who knows where it will go next
• E2 doesn’t lend itself to linear outcomes and cost/benefit analysis (hard but not impossible!)
• Claiming credit and gaining influence for E2 is anyone’s guess

As Jon writes himself;

I am not aware of significant work in the general area of changes to mainstream HR practices as a result of embarking on the path towards Enterprise 2.0.  I will be delighted to learn from any of you of examples and / or issues I may have missed or glossed over.

My guess is that we’ll be waiting quite a while…

Rather than bandwagoning around E2, I think that setting out to claim a element of an organisation that can be improved and has thus far been overlooked will reap richer rewards.

Many thanks to Anne Marie for the brainstorm

Gary Hamel recently wrote about a

survey that found that only 20% of employees are truly engaged in their work — heart and soul

and yet he goes on to say that

I talk to a lot of CEOs, and every one professes a commitment to building a “high performance” organization

So why this huge, 80% discrepancy? I think Dan McCarthy get’s pretty close when he talks about helping leaders to ‘connect the dots’, writing that

the biggest reason why we can’t seem to see what’s right in front of us is that our own “worldviews”, or “paradigms” obstruct our vision.

Other people have suggested similar things, Julian Birkinshaw at London Business School, Richard Donkin, Umair Haque and Lynda Gratton have all talked about new perspectives on management.

Why the 80% Discrepancy?

In my mind, the 80% discrepancy between what CEO’s say they want and what their employees report is due to the methods and means (i.e. the paradigm) available to help manage people. The methods and approaches that are used to bring out the best in people are very different to those which are used to run everything else in a business.

What do I mean by this? If you look at the history of organisations (Managing Value Based Organsiations by Dr. Bruce Hoag is one very thorough view), you tend to find the following themes emerging;

• The methods and technologies to do things define people’s day job
• These approaches are more useful if they are objective and can scale
• Subjective approaches are rarely as valuable or important
• New approaches only endure if they have advantages over the old ones
• People with P&L responsibility have the greatest power to decide things
• They also gain the greatest recognition from their decisions (if they go well)!

If we look at current examples of new methods and technologies, many suggest improvements for the organisations which choose to apply them. Improving knowledge management, green strategies, engineering influencing design, full body scanners, more powerful computers and improvements in transportation all correspond to the themes above.

How is this Different to how People are Managed and Empowered?

The biggest difference between the examples above and how people are managed and empowered is between;

• Approaches that are objective or subjective
• Approaches that are perceived to be valuable or not
• Approaches that improve P&L or not

If one looks at the myriad of methods and approaches that contribute to the management of people, it is hard to find any that fulfil the three criteria above completely. This is why there is no shortage of information along the lines of;

• Besides the transformation, why are there massive gaps in HR?
• It’s time for new thinking.  It’s time to take note of new ideas
• HR = Hardly Relevant
• Critical HR Challenges for 2010
• Are Current Selection Tools up to the Task?

While there are many good things happening in people management and HR, I ultimately believe that right now, practitioner’s own world views remain unchanged. Hence the status quo endures, depsite calls for something different.

While practical, micro-level details may well be expanded upon later, I think the recognition of the different paradigms above might be a starting point, or perhaps a stepping stone on a bigger journey…

Two ideas to consider…

1. Focusing on the ‘unstructured, intangible and typically unmeasured’ will lead to the greatest increase in profits and problem solving over the coming years.
2. Benefiting from working on the ‘unstructured’ will only be fully realised when it is possible to see this in the context of new technologies, processes and practices. In other words, the emergence of a new paradigm or theoretical approach.

‘Unstructured, Intangible and Typically Unmeasured’

Gartner and others have suggested that

as much as 60% of an organization’s processes are unstructured – and probably also unmonitored, unmanaged, unknown and unruly

In a similar vein, John Hagel of Deloitte writes that

In a rapidly changing world, the knowledge that matters the most is tacit knowledge… Accessing this kind of knowledge requires long-term trust based relationships and a deep understanding of context

The CIPD then offers us the following

The intangible value of an organisation which lies in the people it employs is gaining recognition by accountants and investors, and it is generally now accepted that this has implications for long term sustained performance

There are of course many more examples, one of the most recent being the contrast between Israeli and US airport security. The Israeli’s focus on intangible, human factors, having established successful processes, while the US still focus on the tangible, to the detriment of the more subtle¹.

If only 40% of processes within organisations have been mapped, or are formal enough to commit to ERP programs, for example, that leaves the majority of an organisation’s activity which might be better tackled from a different perspective.

New Technologies, Processes and Practices

The obvious candidate to fulfil the brave new world of intangibles is Enterprise 2.0 and its collection of internet technologies. While the potential exists for E2.0 to be open, democratic, disruptive and transformative, the jury is still very much out on this.

By way of contrast, perhaps Gary Hamel best sums up the status quo. Quoting research from Towers Perrin on engagement, he writes

barely one-fifth (21%) of employees are truly engaged in their work, in the sense that they would “go the extra mile” for their employer. Nearly four out of ten (38%) are mostly or entirely disengaged, while the rest are in the tepid middle. There’s no way to sugarcoat it—this data represents a stinging indictment of the legacy management practices found in most companies

Interestingly, Gary’s recommendations aren’t a million miles away from other recent suggestions on the subject

We’ve got to get management’s dirty little secret out of the HR closet and into the boardroom. And second, if we’re going to improve engagement, we have to start by admitting that the real problem isn’t irksome, monotonous work, but stony-hearted, spirit-deflating managers

These thoughts reminded me of a point made by Rick where he writes

That the HR function needs to become more strategic is a mantra I first heard over twenty years ago when I started working in HR…

Just because senior executives are starting to see the importance of managing human resources it doesn’t mean that they will give Human Resource managers a seat at the top table. It might even be that the HR function never becomes strategic at all and that HR professionals are relegated to a support role while someone else does all the interesting stuff

I think Mark and Seth’s points light the way ahead, but I wonder how long it will be before people management benefits from something as exciting as ‘artists taking over from the technicians‘…

Footnote

1. Finding spending comparisons between Israel and the US is easier said than done.

Looking at 2010 and beyond, HR and people management activities will only increase their value, recognition and influence through the application of new technologies or methodologies.

The first factor which determines the success of this is the ability of something to enhance the economic contribution of people management activities.

The second factor is the ability of the new approach to change people’s day to day activities for the better.

Put another way, the acid test of any new method or technology is its ability to convey a sense of intuitive value within minutes, deliver something meaningful in a few hours and ensure that these benefits are sustained over the quarters and years.

What History Teaches Us

Looking back over history, there are many examples of new technologies and methodologies which both increased value and changed processes.

• Henry Ford’s Production Line
• Containerisation and Transportation
• Just in Time Manufacturing and Supply Chains
• Derivatives and Securitisation
• Enterprise Resource Planning
• Personal Computers
• Six Sigma
• The Internet
• Mobile Phones

In the main, all of the above have enhanced the economics of the organisations who have employed them. Likewise, they have been significant enough to change the operations of a function or organisation and potentially create a strategy that a CEO can take to shareholders.

It is also worth noting that despite the relative age of the examples above, all are still all very much in use today.

Creating a Context

Naturally at this time of year, there is no shortage of conversations with thoughts for the coming year, along with reviews of both 2009 and the decade that has just passed.

Researching the HR Profession of the Future

Perhaps the most significant contribution to the conversation came from the CIPD and Jackie Orme’s speech in November.

That link between culture, leadership and sustainable performance is exactly the focus of our Next Generation HR research… In particular, the need to deliver both short- and long-term results in a way that protects the future. We’ve got an impressive and varied array of organisations taking part in the research. Some are on the stage this afternoon. But they’re all helping us to identify the beginnings of the big shifts that will help define the HR profession of the future.

While these ideas have merit and the research is aways going to increase relaibility, I think the real opportunity lies elsewhere. Likewise, a small survey by Jon Ingham suggests that there are other things to take into account including Social Business and HR 2.0, amonst others.

HR and Technology

What is missing from this is a focus on new technologies or methodologies which impact both the economics and processes of an organisation who adopts them.

There has been a lot of talk around social media and HR. The implications being seen as potentially very positive and transformative. While social media and Enterprise 2.0 is potentially highly disruptive, its very nature suggests that it alone won’t re-cast people management or the perceived value it offers. For me, it is a case of ‘watch this space‘.

Laurie, Michael and Dennis all get this and Steve examines things through the broader lense of ROI (we need more powerful equipment – did someone just turn on the LHC?).

JP then chimes in with an idea that combines the technological (platforms) with the intrisicly human (trust).

Stewardship, my word for 2010, is based on platforms. Those platforms need to be underpinned by trust. Not the trust of physics but the trust of biology. Because that is how value is going to be generated.

Now that’s more like it…

Happy New Year!