Date: 19/07/11 Duration: 00:24:38

In this podcast Dr Jill Miller, CIPD Research Adviser, Jonathan Cormack, Group Head of Organisation Development at Standard Chartered Bank, Dharmendra Kanani, England Director, BIG Lottery and Julie Hesslegrove, General manager at Xerox discuss agility - one of the drivers for sustainable success.

Philippa Lamb: The ability to be continually change-ready is one of the eight key factors that contribute to the most successful organisations and if leaders and followers can be permanently agile then the organisation has a greater chance of sustainable success. That’s according to Shaping the Future, a major research programme from the CIPD, which examines what drives sustainable organisation performance and what those drivers look like in practice. But what does being agile really mean and what does it take to get there?

We’ll be hearing from Big Lottery, Standard Chartered and Xerox, each of whom are actively trying to create an agile workforce. First though, Doctor Jill Miller, CIPD Advisor and author of the Shaping the Future research and her definition of agility.

Dr Jill Miller: We refer to agility as the way an organisation can continually adapt and move and change. Shaping the Future has highlighted agility as something that organisations really need to embed into everything they do.

PL: When it comes to embedding agility in an organisation Jill says that regardless of shape, size and sector there are some universal lessons.

Dr JM: Well I think there’s some common things that every organisation can do to make themselves more agile and this involves looking at their processes and their systems to check that they’re as simple as possible without having extra processes you don’t need but also that they’re not too restrictive so that people can flex and adapt when the challenges and the opportunities come along. But what I think what’s most important is looking at an organisations’ people and to make sure they have a change-ready mindset.

PL: Standard Chartered is an international bank employing 85,000 people around the world. Jonathan Cormack is the Group Head of Organisation Development.

Jonathan Cormack: I like the dictionary definition of agility, you know, the body position, coordination, strength, that kind of thing. For us, we’ve been a really fast growing organisation adding about 8,000-10,000 people every year and so agility for us is retaining the strengths of what we see as a highly networked culture but also doing that in a way that’s quite systematic as we grow.

PL: The bank garnered praise during the global financial crash for being agile and continuing to grow.

JC: It’s a good example of where I think Standard Chartered did agility really well. For instance, in the banking crisis, inevitably a number of really good people around the world were displaced from their jobs in the collapse of the banks and the retrenchment of other banks. We were really agile in reaching out to those people and saying ‘Hey, Standard Chartered’s still growing, we’d really love to have a conversation on whether you’d like to join our organisation’.

PL: So you were quick into the recruiting.

JC: Really quick. Really quick. We got a specific project team together and very deliberately went after those people that we wanted to join our bank.

PL: But being agile isn’t just about a moment in time or a single change process. Being agile is an ongoing state, a journey that never ends. Standard Chartered is very aware that complacency is the primary pitfall in the journey towards agility but Jonathan Cormack reckons there’s three vital elements to counter this.

JC: One is about have a crystal clear strategy where everybody’s very clear on the outcomes that we require. A second one is having quite a special kind of leadership style I think; a leadership style that sets really clear outcomes and then gives people the flexibility and empowerment to get on and deliver it so that those closest to the action are the ones that are taking the decisions. The third thing, if you’re really empowering people to do that you need a really strong set of culture and values and I think that some of our values particularly resonate with having an agile organisation.

PL: What sort of things are you thinking of?

JC: Well if I pick three in particular; we’ve got five values, they’re all relevant but to just choose three. Creativity, we really value and we reward people who are creative and bring in creative solutions. The second one would be responsive and we have got a really responsive culture. I said we’re very networked. People will reach out to other people in the organisation who they’ve never met and those people will be responsive and help them. I think the third one would be courageous, having the courage to actually take empowerment and do something useful with it to deliver on an outcome.

PL: Julie Hesselgrove is General Manager at Xerox. She oversees Xerox client executive for a major government contract that they won three years ago. When it comes to agility she wants to do more than respond effectively to external change. For her it’s about driving real change within the organisation too.

Julie Hesselgrove: I think the most important thing is to reflect here on the real world in as much as whatever you set out to do and whatever you think might happen, invariably there’s always something that comes along the way to either change requirements in our environment because our client changing their requirements or indeed something internal within our own corporate structure that forces change. It’s that need to not only react to change, external circumstances, and indeed be able to be proactive about generating change as well.

PL: Working hand in hand with a major government department means that Julie has the client to think of too and she sees helping them to become more agile as part of her role as well.

JH: In terms of what we do for our clients, our job – and I see our job very much as assisting them to change and improve the way that they operate. We work for a large public sector organisation, a central government department whose agenda will be very familiar to everybody in terms of some of the challenges that they faced recently over the past 12 months but equally over previous years with best value and spend constraints etc. The service that we provide to our customers is to help them on that change journey so it’s important within our organisation that we too are exponents of change, both being able to change as individuals but present change in a structured and effective way to our client. So to come back to the question in terms of agility, it’s having that ability to react appropriately when circumstances around you change in an unplanned way but equally to develop transformation and change in a planned way as well.

PL: Let’s move onto how you equip your people to do that because thinking about the government contract you’ve mentioned, I mean the change arc you’ve been through with that must have been extraordinary. I think you started pre-recession didn’t you, you then went through global crash, you’re now contending with huge government cuts; how do you equip your people to serve a client that’s going through that sort of change?

JH: I mean that’s an excellent question and for us our people are the key to that change and making change real. Our contract is a seven year contract and we have effectively been through a start up as a small business. Now we’re reaching a stage of relative maturity and stability, which of itself is another stage of a journey. It’s important in that journey that you keep people feeling comfortable, confident, engaged, aligned with not only where you’ve been but importantly where you’re going and acknowledging that at year four in a seven year contract you will be in a very, very different place to where you were in year one and almost certainly where you will be in year six and seven. So setting that ethos that says our world will change and our people are key enablers to helping us change and helping people feel comfortable with change, both personally, professionally and the opportunity but also the uncertainty and risk that that brings for individuals is really important I feel.

PL: So for both Jonathan and Julie employee empowerment is key to achieving agility but of course devolving authority down the hierarchy brings risks with it but does engendering agility mean that you have to be prepared to cope with the inevitable mistakes people will make when you give them real responsibility.

JC: Yes and I wouldn’t say we’re perfect at that but you’re absolutely right, that would be the theory, and I wouldn’t say we’re perfect on empowering people at every level either. Like any organisation we have controls and procedures so it’s certainly something we work at.

PL: Is it something particularly difficult for a bank to get its arms round that concept do you think? For compliance reasons if nothing else I suppose is the thought in my head.

JC: Yes in some ways and I think there’s the argument that you need to be able to see the wood for the trees. So for example, with any policy we have we say it has to be able to be written on two sides of paper so you can see we’re trying to simplify. Yes, you have to have a rigid control environment or a strict control environment but make it a simple one rather than be monitoring a million things but not focusing on the five things that if they go badly wrong could really damage us.

PL: So agility’s not about micro managing.

JC: No, definitely not about micro managing. I think it’s about real empowerment and I think empowerment’s a phrase that’s over used at the moment and I think that setting a very clear outcome, telling people what resources they have to achieve it and then holding somebody accountable for that outcome. That’s what real empowerment’s about.

PL: In this sort of economic climate organisations and individuals are less willing to take risks. Julie Hesselgrove is trying to empower her 100+ employees into being proactive decision makers whilst their environment, embedded in a contract with a government department, is one of pay freezes and public sector cuts. So where does that leave her plans for agility? Is the process in danger of suffering from an understandably more cautious workforce?

JH: Potentially, if not managed actively and not being led from the front. The concept of a risk free environment, no idea is a bad idea, coming forward with options, contributing and participating in change. One of the things that we’ve done practically, and it has been a little bit of a push initiative, is encouraging teams to come up with ideas and then have them solve the problems. Not all of the ideas that have been come up with are groundbreaking or particularly radical but it’s just creating a culture where people feel confident and are working with their colleagues cross-functionally, perhaps in areas where they’re not subject-matter experts, to contribute and play a role and equally seeing the organisation having the trust in their ideas to implement them is really valuable. It’s the practice, practice route, you know - do it once, do it twice and then you know what? The third time it’s probably coming a little bit naturally and you’re not thinking about it and we’ve seen that happen over the past two years with some of the business improvement technique projects as we’ve christened them come to the fore. Initially it was a bit of a tops down initiative, you can come up with an idea, we’ll put a team together to solve the problem. Initially that was quite a push, people felt a little bit uncomfortable behaviourally and trust-wise but now we’re on the third iteration of that process and we’re now seeing a level of maturity and willingness and confidence in participating in that process so that our list of potential improvements is getting longer, the willingness of our team members to participate and take part in those is becoming greater so we’re starting to see more of a pull from the organisation than what, previously, was a push through that initiative and we encourage all of our people to participate in those business improvement techniques. In fact so much so [it’s] everybody’s personal objective, one of their personal objectives is aligned to that as an objective. Initially we set the ‘you will do at least one a year’ kind of tops down mandate but eventually people are getting more and more engaged and they’re actually doing more than one now.

PL: So this is about embedding it as part of the long-term thinking?

JH: Absolutely, so it’s actually giving them skills for their future as well as our organisation’s future as well. There’s a reciprocal benefit in developing those skills and investing time in those types of initiatives.

PL: The idea that if you empower everyone in the organisation you become a better functioning and more effective outfit at every level is appealing but does every employee want to be empowered? Indeed, can all people across all cultures, borders and levels be empowered? Jonathan Cormack.

JC: You can imagine that in different cultures different individuals are able to receive empowerment in a different way; some people don’t like empowerment.

PL: So how do you contend with that then? Do you just accept that in certain regions when you’re dealing with certain cultures it’s not something you can embed perhaps as securely as you can in others?

JC: I think it’s different and I firmly believe it comes down to individual differences. My view is that an individual can transcend a national culture so, therefore, if we recruit the right kind of people who are courageous, creative, responsive, trustworthy and real international people those are our five values then they will be able to receive empowerment. I’ve observed that people don’t always accept empowerment even at quite senior levels in an organisation.

PL: It’s interesting you say that because I suppose from what you read about agility now there is this idea being sold that it is something that everyone can embrace. It doesn’t sound as if you’re quite in agreement with that.

JC: No I don’t because I think it requires people who are prepared to give and people who are prepared to take empowerment and I guess in the past we might have looked at organisational structures and organisation design and maybe quite mechanistic processes to build agility. I’m increasingly of the mind that it’s more about behaviours.

PL: So it’s state of mind; you can train people to a degree, you can introduce systems, but it is a state of mind.

JC: Yeah and I suppose also you can encourage people so maybe it might be true to say that within all of us there’s the ambition to be creative, to be courageous those kind of things and therefore it’s about having the right leaders that are prepared to encourage people to get up and have a go.

PL: So given the leadership is inspiring enough, does everyone have the potential to be agile? I put that to Julie Hesselgrove. Do you feel that you can embed that sort of mindset and skill set in everyone who works for you?

JH: I think as a leader you’ve got to believe that you can and I think that that needs to be an aspiration. It’s fair to say that with any change, when we started this we recognised the early adopters, we recognised the evangelists, the people that got behind it quickly and inevitably you’ve probably got 20% crudely but it’s the old 80/20 rule isn’t it? 20% of those will go with you and of the 80% you’ve probably got 20% that’ll probably do it and then the rest that kind of sit in the middle. Slowly I think our barometer’s shifted so we’ve now got a greater portion engaged in that process. The extent to which you’ll always get the hard to reach 20% with you is always the challenge but again I believe that if you take the majority then the others will either come with you or will select out.

PL: ...and leave you.

JH: Absolutely so ultimately you get there one way or the other. And, do you know what? It’s not for everybody. People engage with their world of work and their colleagues in very, very different ways and it’s not for everybody.

PL: But it’s about creating an environment where if you’re not on the bus it feels an uncomfortable place to be.

JH: Absolutely, absolutely. As opposed to the majority not sitting on the bus and looking at those that are so it’s a more inclusive process. Ultimately people do have the right to either get on board or self select out.

PL: Big Lottery gives out charitable funds to the tune of £1m every single say but two years ago they decided that the size and scale of the organisation had inadvertently reduced its agility. Dharmendra Kanani is Director of Big Lottery England.

Dharmendra Kanani: What’s happened over the years is that that machine has taken away judgement, taken away flexibility, taken away the ability for people to interact with each other, both internally but also externally. Part of the agility is trying to find ways in which we have heard from our staff surveys annually that they love being here, but actually the system and some of our processes dumb down their judgement - don’t help them make connections across the piece and don’t enable them to provide a better service which they know they can.

PL: Now that’s interesting. Your people know how they want to be, they know how they want to work better, they’re telling you. How have you made that happen or how are you making that happen for them?

DK: I think one of the most important things about our change management process, and you’ve heard this many times, people say change is constant and it is, it is a reality and a living/breathing organism is made up of a series of events, constant events which keep the blood flow of organisations going and that’s our people. Our funding management system that we have currently is based on a workflow system that tells every member of staff what they should do at the next stage.

PL: Okay so very structured.

DK: It’s very structured. It minimises risk, it minimises failure in process and gets the job done of a particular kind. But does it provide job satisfaction? Does it provide the best result in terms of funding? Possibly no, it could be much, much more improved and so we made a decision to go for a new system. We worked with a group of staff and we asked them if you were to change the system what would it look like? We canvassed the views of staff and that created the first kind of blue print of the kind of organisation we should have. For us, it’s being able to make sure that we replay that story authentically, don’t pull any punches. You know, being really clear that we are maintaining our ambition to be a more intelligent, cheaper, faster, better funder, a more light-footed, agile, flexible organisation.

PL: Yes I’m intrigued by what you’ve been saying. It sounds as if you are very good at drawing on local expertise throughout your organisation, so you listen to what people do in their day job and it feeds back up into your strategy in a genuine way.

DK: Absolutely. I think one of the things we are really committed to doing – and we’ve learnt this is the right way to do it actually, we’re not perfect, we’ve made mistakes like many organisations – but actually I think that if you are clear or as clear as you can be about where you want to go as an organisation and you believe that the people are your only resource to get you there you need to be able to work from their starting point. Not in a glib, romantic way but in a sense that you’re being really clear about the change you want to achieve and the fact that actually people will all have to play their part in that change process.

PL: The key factor in being agile for Big Lottery is to listen to their people.

DK: Now more than ever in the period ahead of us we need to keep a hold on our values as an organisation in terms of our values towards people. The kind of organisation we want to be and not think that we can do something around improving customer efficiency whilst we treat our staff really badly.

PL: So it’s applying emotional intelligence to commercial outcomes.

DK: It’s completely about balancing the understanding of why people come to work, i.e. the emotional connection of what you do with the rational aspect of delivery and those two you don’t separate out in two different boxes. You do that at your cost.

PL: Trying to measure agility isn’t easy but the CIPD has put together a tool to help. CIPD Advisor, Dr Jill Miller.

Dr JM: Agility is a very difficult concept to measure and within our practical tool we do have a diagnostic which organisations can use to see how agile they are, looking at how agile their systems, processes, people within their context are. Also it’s also quite obvious to an organisation when they’re not agile.

PL: It sounds from what you’re saying the point to really grasp is that this is an ongoing process isn’t it? You cannot make your organisation agile and then feel ‘job done’, it’s something you have to keep evolving constantly.

Dr JM: Yeah I think definitely organisations needs to make sure they’re constantly having a check up to see how agile they are, especially as the economic context is continually changing. It’s very important that organisations don’t step in to the steady state and go back to sort of the comfortable state of things.

PL: There’s a danger that if you feel like you have agility cracked then complacency can creep in but is there also a danger that the quest for agility can make an organisation too reactive to events? I asked Jonathan Cormack if agility for Standard Chartered had become too much about knee jerk short-termism.

JC: I prefer to say being opportunistic and if I look back at occasions where we’ve been really agile I think it’s where we’ve seen an opportunity and responded to it and that’s why I think a clear strategy’s important. For the last ten years we’ve been crystal clear that we want to be the best international bank in Asia, Africa and the Middle East. We’ve been really clear on our markets and we’ve been really clear on that strategy and I think once you’re clear on that you can be infinitely opportunistic because you’re clear on the overall outcome, the overall direction that the bank wants to go and that’s what stops it being short-termist.

PL: Okay I’m with you, so agility within a dedicated long-term structure?

JC: Yes.

PL: At Xerox, three years into a seven year contract Julie Hesselgrove feels they haven’t yet reached the end of the journey, that when it comes to staying agile the horizon is always receding.

JH: There’s always more to do. There’s always more to do and it is getting beyond continuous improvement I think for us. We’ve spent probably the best part of two years now with the business improvement team based approach, which we’re now starting to see as ,I said earlier, more of a push from the business than a pull, but we need to continue that to bring on new clients, bring on new services and continue to help our people feel comfortable with change because it’s not something that you can ever rest on your laurels with I think. You’ve got to keep on the journey, you never quite reach the end.

PL: Has your own thinking about change and agility evolved over the last two or three years?

JH: I think it has, yeah. I think you build a greater empathy and a greater understanding with people, whether or not they be your own people or whether or not be within your client environment as well and understanding that empathy and understanding change from someone else’s perspective is probably the greatest thing you can do to actually deliver sustainable change, I think.

PL: So agility is a vital behaviour and culture trait that organisations need, not only to embrace, but also embed firmly in all planning and activities for the business. A change-ready mindset with the right skills and structures in place which are sufficiently flexible to allow for change will create true agility.

That’s it for this week. You’ll find links to the topics we’ve discussed in the show notes at where you’ll also find the Shaping the Future research and the new diagnostic tool to help you assess your own organisation’s agility.

We’d really welcome your feedback on this podcast and the other CIPD podcasts so please do click the new give us some feedback link on the podcast homepage.

Next time we’ll be discussing youth unemployment and the business case for recruiting amongst the young jobless, join me then.

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