John Pope shares his opinion and thoughts on the dangers of senior management undermining HR policies and procedures, to the detriment of employee morale.
Do organisations deliberately try to undermine the basis of HR? I had always thought that they wanted happy, engaged staff who were committed, to a reasonable extent, to the success of the organisation. And I thought that organisations really meant it when they said ‘our most important assets are people, our employees and our customers’. Well, I suppose I am now a bit naïve, not having been an employee for many years.
Take this example
A couple of months ago one of the major banks announced, through the media, that it was closing its subsidiary, formerly a building society. The announcement was on the early morning news, the number of jobs to be lost was also mentioned. Some of the staff of that subsidiary were rung by their well-meaning friends and so were able to tell their colleagues when they got into work.
It gets worse. My branch started to get depositors arriving asking if their money was still safe – an understandable concern after the Northern Rock affair. At about noon the staff at that branch were told it would be closed. Details of the closure were scant. There will be a redundancy package though I doubt it will be very generous for frontline staff.
Now, in some ways, I sympathise with the main board. They have, no doubt, commercial reasons for withdrawing from an activity they had bought about 12 years ago. They had paid heavily for it then but it had, in the end, been a poor investment, though not quite as bad as its recent takeover of another bank. In planning the closure and its announcement they would have considered the technical problems of moving the customers from the society to the bank, and the IT issues. They would have needed to consider the effect on the bank’s share price, the impression made on the stock market and many other aspects.
Did anyone speak up at the main board meeting about the HR implications, ask how the plan would be announced to the staff? Did anyone from marketing speak up for the customers and ask how they would feel about being transferred to the local branch of the bank?
I know a little about this, I have banked with them for over 50 years. I have visited their training centres, discussed issues of management development and advised them on performance assessment. They have their own university where the ‘right things’ are taught by very professional trainers who believe in what they say; there are many distance-learning packages, some very advanced to help managers apply good management practices.
The official policy
Banks, like other big organisations, hold conferences. I do not know what was discussed at their last conference. It might well have included speeches on ‘these challenging times’; ‘looking after our customers’; perhaps even on ‘strengthening staff engagement’. I am not sure that the phrase ‘our people are our greatest asset’ has been used on the training programmes, but I am sure that line managers are told to be open and honest with their staff and keep them well informed. So why are these lessons lost at senior level? What a waste of training time and effort. And what damage to the reputation of HR, from this clear difference between what is said and what is done.
And now the damage has been done – well, the damage to the credibility of the principles and policies has been done. So what can HR do about it? There are several approaches:
- Ask that an official explanation be made at a sufficiently senior level: ‘We are sorry but we had to do it this way and act quickly because there had been a leak’, or ‘we had to get the news out before the Stock Exchange opened’
- Ask for an apology: ‘We broke our principles, we fouled up. That is not the way we should have done things’
- Ask for a re-statement of principles
Ignoring the clear inconsistency is not an option if confidence is to be restored.
Where are the roots of the problem?
There can be many roots to the problem of the difference between what the policy is and how well it is applied. And those who have the task of explaining the policy or applying the principles have to find ways of dealing with that problem. The problem arises because people, at all levels, will happily ‘sign up’ to a policy or commitments without understanding exactly what they are committing themselves to do. They make the rules and then break them: or they make the rules, see that someone avoids the rules but is successful, and allows that to go un-reprimanded.
What could HR do? They could review with senior managers on what people are told when they join, what they are taught in their initial training, the contents of key learning packages, the values, standards and principles that the organisation intends to live by. In effect, they could check how current policy is transmitted to people, and then decide if it is just a ‘wish list’ or is to be taken seriously.
And they could take a firm line on major breaches of official policy.
John Pope has been a management consultant for over 40 years and has worked to improve the development and performance of managers and management teams at all levels for most of his career. For more information, visit: www.johnpopeassociates.co.uk. His book ‘Winning Consultancy Business’ was published in July. He can be contacted at [email protected]
2 Responses
The Difficulties of Communicating with Staff
Thanks for your comment.
I certainly appreciate the difficulties in giving staff important news while still meeting the Stock market’s requirements, especially when staff are dispersed. All the more reason therefore for an organization to have well prepared procedures for doing so. In an age when every ‘outstation’ and department has e-mail or is on the intranet it.should be possible to reach almost everyone at the same time. And while those decisions to make major changes affecting staff are being made someone at very senior level should be asking the question ‘ So what, when and how shall we tell our people ?’ To leave it to leak out is cowardly and equivalent to leaving a letter for your partner to find on the kitchen table saying that you have gone off to live with someone else.
I am sorry to say that the way the planned closure has been handled since the original annoubncement to the media has only added to the rumours and confusion among the staff ‘ Our most important assets.’
Announcing Redundancies in Listed Companies
Perhaps the banking example given in John’s article is an example of bad practice. However, major redundancy announcements in large UK listed companies are a nightmare. If the closure programme could have an impact on the share price, and the closure of a bank’s subsidiary would, then it has to be announced to the stock market first. This is a huge barrier to effective communication. The stock market in London opens before most people arrive at work, so the best you can do is prepare carefully worded press statements and plan to tell everyone as much as possible as soon as they get to work. With multiple locations and varying shift patterns it is a complex task. Local and national media will seek different information and may spin the news differently. Some of the answers that employees and other stakeholders want may not be available as the company may not have worked out the detail of the redundancy programme as collective and individual consultations will be ongoing.