Perspective Best practice in people management

Key role of people management

Walt Disney once said: You can dream, create, design and build the most wonderful place in the world... but it requires people to make the dream a reality. People management plays a key role in implementing total quality management. People management can be analyzed by investigating: leadership which includes top-management commitment, the way in which the company shows its appreciation for employees good work and the support it gives to them; people management which includes training and development, involvement, communication, empowerment, teamwork and the system of appraisal; and people satisfaction which includes the feedback mechanisms and action plan.

Abstract The number of companies attempting to benchmark the activities of their human-resource department that is, to compare it with different organizations considered to be the best in their class is growing. Discusses best practice in the area of people management, based on a benchmarking study of ve UK companies Elida Gibbs, Post Ofce Counters, the Nationwide Building Society, the National Westminster Bank and Birds Eye Walls.

Change programme at Elida Gibbs

Elida Gibbs Ltd, part of the Unilever Group, is Britains largest manufacturer of massmarket toiletries. The companys mission is to be the leader in all it does. It aims to achieve total competitiveness through total quality. The companys change programme was driven by the board members acting as an executive steering group. Training programmes for employees were attended by a board member or senior manager. Managers act as role models by: promoting awareness of total quality through training; involving themselves in improvement initiatives; emphasizing leadership, employee-development and teambuilding skills; taking part in a department lead team, chaired by the head of department, which acts as a reference point for help and information about total-quality initiatives; holding monthly team briengs; and walking the job, to improve communication outside formal circles. A performance-pay scheme links an individuals reward to company and local measures. Company measures are determined by the board and related to corporate goals. Local measures are suggested by individuals and teams, related to their area of work. 179

Management Development Review Volume 10 Number 4/5 1997 pp. 179182 MCB University Press ISSN 0962-2519

Best practice in people management

Management Development Review Volume 10 Number 4/5 1997 179182

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Recognition schems
Departmental lead teams make recognition a stimulating part of everyday work. Local recognition can earn employees a quality badge, free meals, radio, theatre tickets or a letter of appreciation. Corporate recognition can be through a presentation or mention in the company newsletter. A chairmans award has been introduced to encourage innovation. Winners, who can be teams or individuals, are selected by the chairman. They receive a trophy and wide publicity. Elida Gibbs recognizes the key role of its people in bringing about change. The company has set up an employee-development and communication group. It consists of the personnel director and a senior representative of each core business, and is directly responsible to the board. The group aims to: improve performance by developing total quality techniques, training programmes and appraisal systems; support managers in carrying out their new roles of learning and people development (there is no training department); and build communication mechanisms to ensure that the workforce is informed, involved and committed.

attitude survey is carried out by an independent organization.

Teamworking at Birds Eye Walls

Birds Eye Walls Ice Cream is a business unit within the food company Birds Eye Walls. The rms mission statement is Working Together for the Best. The companys Teamworking initiative aims to harness the knowledge and creativity of all employees. A manufacturing manager is now responsible for performance improvement of one, two or three production lines, working in three shifts. Each manufacturing unit is like a miniature factory, responsible for its own improvement activities, equipment performance and training. Facilitators have been appointed to encourage teams in their improvement programmes. Managers and team leaders are responsible for the training of their subordinates. Employees must gain their team leaders agreement to any training. Managers are encouraged to develop skills in handling people. The annual appraisal system is team-based and includes a bonus scheme. Communication with teams is through regular team meetings, performance-review meetings, briengs and resource meetings. There are house journals, a company newsletter and an internal television service.

Training plays a major role

Training is a major feature of the total quality initiative. Some 1.3 per cent of turnover is devoted to training. This is about four times the UK industry average. The target of six days training per employee per year has been exceeded. Elida Gibbs has discovered that, in general, its British workers have poorer education and lower vocational skills than their European counterparts. Correspondingly more training is needed at British plants. An advisory service is provided on learning opportunities. There are facilities for private and group study. Employees can create their own training action plans. Training is available at the plants on-site learning centre and on external courses. The approval of managers is not needed for an employee to undertake training. Teams and individuals are encouraged to take more responsibility within their own areas of work. Appraisal systems include selfappraisal and upward appraisal. A bi-annual

Service improvements at NatWest Bank

UK Branch Business (UKBB) at the National Westminster Bank is one of the big ve highstreet banks. It operates more than 2,000 branches across Britain. Business units within the group include: retail banking, corporate banking, cards, mortgage, insurance brokerage, and life insurance and investment. UKBBs service-improvement programme aims to meet or exceed customers requirements at the lowest cost to ourselves. Managers demonstrate leadership of the programme in four key areas: commitment, leading a team, recognition and communications. Newsletters, meetings and conferences are used to stress the programmes importance. Managers were trained to manage the program and then took on the role of training others. All managers are responsible for implementing service-action-team activities. Teams are given the freedom to decide and

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implement ideas which will lead to improvement. Employees help to set up objectives, identify improvement opportunities, draw up improvement plans and measure progress. More than 1,200 improvement ideas surfaced within the rst six months of the programme. Subordinates work with their immediate bosses to get a better view of the business. Bosses assume the role of subordinate to get a feel of the problems faced by the workforce. A more open and less bureaucratic style of management is practiced than is traditional in banking. Subordinates take part in an upward appraisal system. Recognition is given regularly and consistently, with managers taking the lead.

A team-based empowerment workshop is being piloted to introduce and encourage a culture of empowerment. Employees are already empowered to act on improvement opportunities. Each division has its own communication plan, based on best practice as recommended by the central communication team. Forms of communication are a monthly news brieng, talking-shop sessions, focus-group discussions and staff-attitude and local diagnostic surveys.

Nationwides Diamond Club

Nationwide Building Society operates more than 700 branches throughout Britain, and has around 5,600 staff. Team-bonus and exceeding-expectation awards are given to teams and individuals respectively. Branches which perform well become members of the Diamond Club. Quality managers have been appointed at every regional ofce to co-ordinate improvement projects. Messages from the top are cascaded down through area and branch managers. The chief executive presents the annual corporate plan on video, and takes part in roadshows to meet employees. Staff are invited to informal gatherings with top management. Senior executives spend time at the branches talking to customers and staff. A newsletter is produced. Area managers are empowered to carry out any improvement projects they see t. Involvement in quality-improvement teams is optional, although peer pressure comes into play. Almost all training is carried out inhouse. Staff-attitude surveys take place annually. In order to identify areas of best practice, a scale of 0-5 was developed and the various companies were awarded marks. The results, with the names of the companies disguised, appear in Table I.

Post Ofce Counters puts the customer rst

Central Services Group, Post Ofce Counters Ltd, is an internal supplier of expert services and central operations serving some 20,000 outlets in Britain. Its divisions are: business services consultancy, client transaction processing, nance executive, human-resources consultancy, property holdings, systems consultancy and audit. The organizations total quality management programme is called Customer First.

Key role of leadership

Leadership plays a key role in bringing about cultural change. The managing director and heads of divisions spend around 10 per cent of their time in annual listening sessions with each quality-improvement team. Team leaders receive six-monthly feedback on their leadership from their teams. Each division has its own recognition scheme. Recognition is on the agenda of every monthly-review meeting between the managing director and heads of division. Staff attitudes are surveyed annually. Service-level agreements are made with customers and suppliers. Joint improvement activities often ow from these. The objectives of individual employees are agreed in a twoway process and reviewed and updated at half-yearly counselling. Some parts of the organization have monthly one-to-one reviews. Individual objectives are based on a cascading of team and business targets. Local managers decide which training is appropriate for their staff.

How benchmarking can help

Benchmarking human-resource management practices helps companies to identify opportunities for improvement and to attract, retain and mobilize talent. It is likely to play an increasing role in the years ahead. The growing interest in benchmarking human-resource management is shown by the emergence of the Benchmarking HRD

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Table I Areas of best practice

Benchmarking criteria 1. Leadership Top management commitment Recognition/appreciation policy Resources/assistance support Aggregate for leadership 2. People management (PM) Policy in PM Management structures supporting PM policy Training and development Involvement Communication Empowerment Teamwork Appraisal system Aggregate for PM 3. People satisfaction (PS) Methods used Feedback mechanism and action plan Aggregate for PS Total aggregate

Company Company Company Company Company A C B E D 4 5 4 13 5 5 5 4 4 5 4 4 36 4 4 8 57 5 4 5 14 5 3 4 5 5 4 5 5 36 5 5 10 60 4 4 3 11 4 3 3 3 4 3 2 2 24 3 4 7 42 4 4 3 11 3 3 3 3 3 3 3 2 23 3 3 6 40 4 2 4 10 3 2 4 4 4 4 4 2 27 3 3 6 43

Forum, under the auspices of the US Society for Training and Development, and the Australian Human Resource Benchmarking Programme, under the Saratoga Institute. Rank Xerox has a Best in Europe programme. Human-resource management benchmarking in Japan takes place through the transfer of employees between companies (shukko) and

through industrial cooperation (such as zaibatsus). Clearly, it is an idea whose time has come.
This is a prcis of a paper prepared by A. Hamzah Malaysia and Professor Mohamed Zairi, of the University of Bradford Management Centre, Bradford, UK.

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