CEOs talk (March 11, 2002)

HR strategies in times of upheaval

Change and resilience in a tight economy have been driving forces in corporate Canada’s HR initiatives over the past year. From the high-tech meltdown to upheaval in the public sector, the workforce has been under pressure. Canadian HR Reporter talked to the CEOs of several organizations about their HR strategies in this climate.


COURTNEY PRATT
President and CEO
Toronto Hydro Corporation


Following Ontario’s decision to deregulate the electricity market, Toronto Hydro Corporation was registered as a public company in 1999 and has two subsidiaries providing electricity and natural gas. The company employs approximately 1,700 people.

It’s a little more than two months away and it will mark the end of local power monopolies and the beginning of deregulated electricity — breaking from almost 100 years of history as a dominant government-controlled monopoly to an open, negotiable and competitive market. As of May 1, Ontario consumers will be bombarded with different choices from different players.

For Courtney Pratt, president and CEO of Toronto Hydro, it has been an important lesson in change management.

“We have to think much more now about providing competitive levels of service at competitive prices, so it’s a huge shift in mindset for the people in this organization, most of whom have worked here almost all their careers,” says Pratt.

That’s why his greatest concern is changing Toronto Hydro’s culture, and in the last year he’s been working closely with human resources. There has been a great deal of involvement from all dimensions of the HR function in this effort, he says.

“It’s a tremendous example of tying the HR objectives to the objectives of the company because if HR doesn’t deliver the goods, then we won’t deliver the goods...we really count on them to play a critical role,” he says.

As the former vice-president of HR for Noranda Inc., an international mining and metals company, Pratt understands what the HR department is capable of and how its actions impact employees. Now that the industry is restructuring, Toronto Hydro must too, and he says they are prepared.

Pratt, senior management and the HR team have implemented a number of strategies they hope will result in culture change. They have more of a focused system of incentive awards, are putting a heavy emphasis on training and development, and set up a business transformation process including a new enterprise resource planning system. With the new deregulated market, they also have to ensure first-rate customer service and responsiveness, and have the ability to deal with retailers across the province. The utility’s organization development group within HR has been front and centre in planning these changes and it’s been a huge value-added element, says Pratt.

“I look at the whole undertaking and in many ways it’s the best I’ve seen anywhere.”

But with change management as big as this, there are employees who refuse to buy-in. Pratt says they are definitely experiencing a fair-share of resisters. Whenever a company has to make changes, three groups of employees usually surface. You have a group of employees that are really on side with the change, there is a large group who are undecided and then you have another group completely resistant.

“My view is you need to focus on those who are committed to the change and make sure they play appropriate leadership roles and really focus on the chunk of employees who are undecided and move them over,” he explains. “I don’t mean to say we’re neglecting them (the resisters), we’re just not focusing a lot of our efforts on the minority of people who refuse to accept the change. In my mind, they’re not the key to success.”

And according to Pratt, the major key to success lies in the human dimension of the organization.

“That’s my starting point, no one has to sell me on that.”

The human element is discussed at each meeting, every step of the way, and much of his time is spent with key people in HR to keep up-to-date, he says.

“There’s a lot of ongoing dialogue about how we’re doing relative to what needs to be done. I’m really focused on how we can make things happen.”


JEFFREY CAMPBELL
CEO
Core Networks


Established in 1998, Halifax-based Core Networks employs about 80 people worldwide. The high-tech firm provides support for Internet service providers delivering high-speed access via cable modems.

It hasn’t been an easy time to be a high-tech firm. But that doesn’t mean sound HR practices get thrown out the window when the going gets tough — that’s the philosophy Core Networks took as it weathered the economic storm that started last year and has clouded the outlook for 2002.

“In a slowing economy, and a downturn globally, motivating and inspiring the workforce when things get tough is always a focus area and always a lot of work,” says Jeffrey Campbell, CEO of Core Networks. With that in mind, the organization has been focusing on team building and maintaining a solid work-life balance.

“It’s important to make sure to continue to do the after-hours, off-site stuff,” he says. “We’ve got a family skate coming up next week, (and it’s important to) make sure we keep those efforts going because people need to feel like they’re part of the team even more in an environment like this.”

That environment forced the young company to downsize slightly last fall, but a change in their recruitment strategy has led to revitalized growth and a positive outlook.

“We’d grown faster than some of our sales had in certain areas, so we did a little bit of adjusting there,” he says. “Our strategy has changed in the sense that we’re now recruiting in different areas. We’ve been very focused (recently) on sales, and people based in the U.S. and based closer to where the customers are.”

Campbell plots his strategy with the help of the head of HR at Core Networks, who is a familiar face for him.

“Employee number 10 is the director of HR,” he says. “She’s been with me a long time and we work fairly closely together. We stay in touch with e-mail, chats in the hall and on the phone and so forth. She’s an integral part of the executive team.”

The HR department has received its fair share of resumes lately, as the collapse of many high-tech companies has led to a flood of qualified candidates. This has given growing tech organizations the opportunity to be much pickier when looking for new staff.

“There’s a lot more people knocking, but we’re talking to a lot fewer candidates and we’re certainly being more selective,” says Campbell. “We’ve always had high standards, but we’re being careful. We’ve also had some hires that didn’t work out, so we’ve been burned a couple of times but we’ve really grown and improved our filtering process.”

Attracting qualified workers to Atlantic Canada can pose a bit of a challenge, but Campbell says it hasn’t been prohibitive.

“Quite honestly, Silicon Valley is not that attractive to a lot of people. Housing is expensive, there’s a lot of different pressures, the crime rate is different and so forth,” he says. “It’s not like California is necessarily better than Halifax, but it’s not top of people’s mind, not the first place people say ‘Hey, I want to go move to Halifax and live there.’”

Keeping a focus on HR and the infrastructure surrounding it is extremely important, especially when it comes to evaluating performance.

“It’s a constant struggle in any company to get reviews done and performance work and that kind of thing,” he says. “And as you’re growing, it’s especially hard. You can get away for a while with not getting it done, but at the end of the day you need to give people feedback and make sure that infrastructure is in place.”

Solid infrastructure like that helps HR from the first day of a new hire, something Campbell says is paramount to the organization’s success.

“When an employee arrives on the first day, everything’s in place so they get off and running quickly. Their desk is set up, the computer is set up, training time is booked and a buddy is in place to show them around. All that kind of good stuff that makes a winning organization.”


DELORES LAWRENCE
President and CEO
Nursing and Homemakers Inc.


Nursing and Homemakers Inc. is a Toronto-based health-care professional staffing agency. Established in 1985, NHI has 30 full-time staff and more than 1,200 part-time placements.

Nursing and Homemakers Inc. (NHI) is like the human resources extension of the clients they serve, according to NHI’s president and CEO, Delores Lawrence. The temp agency helps recruit people for various health- and home-care organizations, so the HR department plays double duty. They not only recruit for the company, but also for their clients.

The screening process has to be exemplary, Lawrence says. We have to make sure they have the proper skill sets through testing, interviewing and cross-checking credentials and references, making sure they’re qualified for the job.

“If we end up hiring lousy employees, if they don’t work out it makes us look bad,” says Lawrence. “If the area they’re going to work in requires someone who is highly specialized and they don’t have those qualifications, it’s like hiring a registered nurse to work in intensive care and they don’t know how to operate the ventilator.”

The same applies internally for HR when recruiting full-time staff. When you have people who don’t fit in well with the company, then they’re constantly going in and out of your company, and it becomes a revolving door.

So for Lawrence, retention of long-serving employees is one of her biggest concerns.

“I want to do everything possible to make (them) happy and some of the ways we do this is by offering shares and bonuses throughout the year. It’s a way of saying we do appreciate what they’re doing...because without them the company wouldn’t be around.”

It’s the workers at the lower levels who find it hard to stick around, says Lawrence. Many times it’s because those employees need to upgrade their educational requirements in order to move to the next level. So NHI recently introduced more internal training and development programs for employees to upgrade skills as another way of retaining them.

“It’s a moving economy so you have to keep up with all the changes that are taking place and the only way is through education, it’s lifelong learning.”

Lawrence says she’s noticed that young grads coming out of school don’t really have the adequate skills to thrive at NHI.

“They don’t necessarily have the training in terms of working for a company like ours. So we have to train those individuals and it could take six months in terms of the learning curve. We have to make sure we budget for education training (especially) when hiring new people,” says Lawrence.

Recruitment and staffing has been the major focus of NHI’s HR department recently because the company has been growing rapidly. Last year alone, NHI’s revenue increased about 30 per cent and they are on track to meet their target for a 25 per cent increase in 2002.

“We planned for this growth, and everyone is on side in terms of what’s required of them in their department.”

Lawrence meets with HR and senior managers on a weekly basis, and that keeps HR aligned with the corporate goals. Maintaining a strong connection is essential for the business, she says.

“We are a service industry to which HR is our biggest resource, we have to make sure everyone is happy and HR is a huge part of that.”

Although they strive to keep communication lines open across the organization, inevitably there are some breakdowns.

“Not all employees are aware of HR’s strategy and goals, we give them a package, but often times they don’t read it.” They try to communicate both verbally and in writing, distributing newsletters, for example. But many employees make excuses and claim they’re too busy to read it, she says.

As a result, starting in March, NHI will have an automated telephone service providing internal news for all employees. The 24-hour service will broadcast a monthly report of news and updates. Lawrence says she hopes this will help close the communication gap.


MAUREEN SHAW
President and CEO
The Industrial Accident and Prevention Association


IAPA is a not-for-profit organization specializing in health and safety consultation, training and awareness. It employs more than 200 employees with 12 offices across Ontario. The member-driven association has been in operation since 1917.

Maureen Shaw, president and CEO of the Industrial Accident and Prevention Association (IAPA), says with confidence that her HR department is attuned to what she wants.

“They know what Maureen wants,” she says with a laugh. “There’s no question about that.”

There’s also no question about Shaw’s heavy emphasis on communication. It’s very common for Shaw to be seen around the Toronto office chit-chatting about the latest IAPA news with human resources staff. They thrive on this open-door atmosphere, she says, and chatting over coffee isn’t hard since the HR department is right beside her office.

“So we have coffee and we talk, we have a very informal relationship (that way). But just in case we get bogged down and we don’t get a chance to talk, we do set up formal meetings to discuss strategic level things,” Shaw says.

This close relationship has evolved out of selecting the right HR director, she says. The HR director understands Shaw’s values and beliefs and advises her on what the best practices are in the world of HR. Having the right HR people makes it easier to select suitable employees, she says.

“Our HR director makes sure we’re recruiting people who have the same values and culture orientation that will fit with IAPA. I can buy all kinds of technical expertise and I can develop that (in an employee), but there are other strengths people bring to an organization that you can’t buy — they either have it or they don’t.”

For Shaw to keep the lines of internal communication open across the organization, she has meetings with all employees every six weeks and calls them water cooler chit-chats. This is convenient when senior management wants to share detailed information with staff, she explains. And to avoid “grapevine” gossip, every three weeks Shaw will produce her Friday update — a newsletter addressing the most current rumours that may be floating around the organization.

“I collect things that I hear before the rumour mill gets started. I let people know what’s really happening because each and every one of us has a set of lenses or filters of how we hear, understand and process things. So I deal with the issues as they’re happening so they don’t grow,” she says.

Since culture is so important to Shaw, it’s no surprise her most pressing “people issue” is ensuring IAPA is providing employees with an enriching environment.

“I want to make sure our people are treated with the values we hold dear, so that means I need to have confidence our whole organization understands those values and that management behaviour doesn’t undermine the value of putting people first.”

If they don’t walk the walk then it becomes pretty difficult to advise other companies, she says.

IAPA must have an environment conducive to creative thinking, encouraging ongoing development and learning and creating opportunities for staff to move up and crossways in the organization, says Shaw. That’s why she is proud of their Employee Contribution and Development Plan. They borrowed best practices from other organizations and it’s taken some time to develop, but they have a good program in place, she says. Everyone is contributing towards their own advancement by being involved in their own learning and development mostly through staff training programs.

Since IAPA employees advise clients on health and safety, Shaw says HR ensures their own health and safety policies are adequate and well designed. They look at very basic stuff, she says, ranging from violence and harassment in the workplace to safe driving procedures, and they make sure there is equity across the organization in how those policies are applied.


LLOYD CRAIG
President and CEO
Surrey Metro Savings Credit Union


Established in 1947, British Columbia’s Surrey Metro Savings has 650 full- and part-time staff across 17 branches and a call centre.

Getting customer service right means getting HR right, says Lloyd Craig, president and CEO of Surrey Metro Savings Credit Union.

“We’re working in an over-supplied industry against competition with a lot more scale and cost advantages. Our niche has to be not just geographic but serving our customers better. To do that we have to treat our staff with the dignity and respect they deserve, and then they will do the same with customers,” Craig says about the human-capital edge Surrey Metro Savings works to leverage.

Instilling the customer-service values that drive Surrey Metro Savings begins with a thorough orientation for new staff.

“The first day, I’m there talking about our vision and mission statements. I talk to them about the industry we’re in and tell them if change upsets them, they’re in the wrong business,” says Craig.

From orientation to ongoing training and a culture that supports work-life balance, HR plays a critical role at the financial institution. That’s why it’s important for the organization’s vice-president of HR to be a member of the senior management team, says Craig.

And, what qualities does Craig look for in an HR leader capable of fulfilling a senior role?

“The most important thing for the head of HR is an appreciation of the culture of the organization. Everything you try to do in HR will fit or not fit depending on culture,” he says.

While there are good sources of information detailing policies in use at smaller North American banks, Craig admits there are times when you have to go with a gut feeling about how a new HR initiative will match with the organization’s values and mission. And rather than rolling the idea out across the institution, a test at one branch can determine a program’s fit.

“Years ago we thought we had a good idea about a consistent dress code. Saying, ‘Here’s what you should wear to work,’ is a bit controversial so we said, ‘Let’s just do it in one branch.’ It didn’t work, staff didn’t like it and let us know, so we killed the idea. We’re big on that.”

Surrey Metro Savings has developed an extensive list of HR programs designed to support and create happy, healthy, engaged employees.

Under the Living Well program, employees accumulate points for their health and wellness activities, such as jogging, eating well or not smoking, and redeem them for incentive prizes.

Ideas Unlimited encourages employees to come up with revenue-creating or cost-savings ideas. If an idea is selected, the employee receives 15 per cent of the revenue or savings in the first year of the idea’s implementation.

A Staff Foundation makes cash gifts available to employees in dire straits, with no expectation of repayment. Other employee programs include: interest-free loans of up to $3,000 (repayable over three years) for the purchase of computer equipment, $1,000 interest free for a year to buy work clothes, unpaid leave for up to two months a year and scholarships for employees’ children.

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