30th Nov 2011
It is only natural that HR professionals are interested in better ways of managing the workforce.
As a result, scarcely a week goes by without an advertisement or article on the topic of retention, engagement, motivation and/or talent management appearing somewhere.
Systems are recommended to HR departments to help them understand, measure and generate improvement and IT is pushed as the central means of gathering and analysing crucial data. The underlying message appears to be that to do their job properly, HR practitioners simply must have access to reams of detailed information.
But some years ago now, I worked with a flourishing business, which took the stance that statistics and their subsequent analysis were both unnecessary and distracting.
The company, which hired out equipment, had been started by two brothers, but was bought out by a big firm that paid a handsome sum for it. The two men were young and too full of energy and ambition to even think about retiring, however.
They felt that they knew a bit about dealing with customers and the public, but were keen to focus on selling ‘big ticket’ items rather than operate a service business that dealt with small transactions and lots of customers.
So they settled on an area of which they had little knowledge, but which they thought was often badly run and did not look after customers and staff well. They researched the big companies in that market and decided to build a new business based on the the best practices of each.
The idea was that ‘we’ll use A’s approach for commercialism; B’s approach to design; C’s to procurement’ and so on. They also understood that the quality and attitude of the workforce that they took on would be key to their success.
The two brothers were enthusiastic. They started small in a Nissen hut and installed a row of desks down one side for admin and office workers and accounts people. They sat at a desk at the end of the row, facing their people.
I did not know them personally until they had been in business for about 10 years, but one of their first employees told me about the leak in the hut’s roof, the bucket underneath it and the roar of laughter that always occurred when someone knocked it over. Health and safety was not a priority in those days – that came later.
The two directors worked under the same conditions as everyone else. They treated their employees, their suppliers and anyone else that they dealt with as friends. It was a philosophy of business that was rare among other firms in that sector.
The company became very successful. I got to know it when it had a much bigger workforce, a substantial - and sound - office building, proper accounts, technical and commercial departments, professional buyers, manufacturing, sub-contractors and installers.
Open management style
There was also someone to maintain staff records, who had been sent on a course in order to understand what was required to stay within the bounds of employment law. The business grew and prospered and developed a larger management team, but the two brothers never lost touch with their people and continued with their open style of management.
They were approachable and wanted to know their people’s views first-hand rather than having them filtered and consolidated. For example, the latest management accounts were routinely posted to the noticeboard and staff asked what they thought. If an individual said that they did not understand the figures, their manager would be questioned as to why his people did not understand how the business made its money and they would be sent on a course.
While this may sound like a fairy story, it was real enough, but did not have a happy ending. The business grew, the founding directors aged and an economic slowdown seriously hurt the business.
It merged, on favourable terms, with a well-respected public company in the same sector. But the move meant an end to accounts on office notice boards. It was no longer possible to disclose such information to employees in case it affected the share price.
It was also necessary to adopt formal HR policies and procedures and the two founding directors were no longer as accessible, or even as visible, as they had been. Inevitably, some of the former workforce moved on and one of the original senior managers said to me: ‘Well, I suppose it couldn’t go on, but it was fun while it lasted.’
But my question is, why couldn’t it have lasted? Why couldn’t that open, informal style of management have been translated into something workable in a larger company? What do you think?
John Pope is founder of management consultancy, John Pope Associates.