Saturday, 16 July 2016

Leading HR through Brexit

A few weeks after Brexit, what might an HRD with operations in the UK be focussing on?

Leadership demands vision. One of the glaring gaps through the whole referendum campaign was the lack of a compelling or coherent picture of what the future would look like – either way. Painting pictures based on the dangers of making the wrong decision is not what gains sufficient or enthusiastic followers. So the first key task of the HRD is to ensure leaders with UK operations set out a clear vision of what Brexit means for the business. Then broadcast it loudly within the organisation. For those with unclear options on that journey, then they should at least show the decision points on that roadmap. Above all, avoid the stagnation of uncertainty.

If access to overseas people is going to become more restricted, this has significant implications. Studies suggest the impact on ‘blue collar’ workers of free labour movement within the EU has suppressed wages by 2%. The reverse of this is that employers will face upward pressure on labour rates, ahead of general inflation.
Whilst a 10% drop in the currency may give some temporary profit relief to exporters, this cannot remove the never ending pressure of improving productivity for real underlying sustainability. This means that businesses must not delay in investing in technologies, equipment and skills to build their futures, with the HRD providing the analysis of skills needed and the resources to deliver. The UK will need to grow more of its own. (Talent Futures has some rich material on talent strategy and transitions.)

Perhaps less obvious is the scope for de-skilling in operations by reducing variety and complexity. It may well be time to re-think who does what and take opportunities to up-skill team members with enriched responsibilities. Fuller jobs could allow enhanced rewards and help on the journey of higher skills, better paid people. The current drive in the UK on apprenticeships may also give opportunities here, both in redesigning how new entrants are brought into the organisation and also in raising established employees’ skill sets.

Our HRD might also want to reflect on the importance of knowing what people think – really think and are prepared to share. The weakness of the political polls must bring into question some of the current processes in use for measuring employees’ views and feelings. A wise HRD would review intensely the state of employee surveys and the like. It becomes an area for a whole fresh approach.

Again, there’s a great body of work that can help here from Talent Futures on talent management.

The return of employee representatives on supervisory boards to give an employee voice is also now back on the agenda in the UK. The origins of this idea can, perhaps ironically, be placed back in the model of West Germany which reached its high water mark in the UK with The Bullock Report 1977 in the industrial hiatus of those times. (Henderson, Joan: A Guide to the Bullock Report, Industrial Society, 1977)

Employee representatives on boards may be imposed by legislation but a shrewd HRD may consider that an early home-grown model implemented in advance is likely to be more suitable than one imposed subsequently by legislation. In other words, taking the initiative and reaching an agreement with an organisation’s existing Unions or similar associations and appointing a suitable voice from the senior echelons of the Union, probably as a non Executive member.

Brexit is seen by many as a sign of protest against the decision makers, who are seen as faceless and self-serving The reward levels of senior executives will come under immediate focus. Most robust processes have a comparison between the CEO’s rewards and the average of the ‘blue collar’ as a basis. The HRD needs to ensure the current practice passes the ‘smell test’. If it does not, it’s time for some difficult conversations.

Even if the HRD gets passed that challenge, there’s still  a discordant echo. In the aftermath of the result, tensions were raised between nationals, generations, regions and races. How does this fit with the organisation’s approach on diversity and inclusion? If the organisation is part of an international group, what relationships got wounded or severed? How will a Brit fit in European meetings? How will mainland Europeans feel in UK owned companies? Our mythical HRD may well look to create some team enhancing activities for the senior teams who need to work together on international business objectives. These would bring out the values of the organisation; allow individuals to share what’s important personally to them; and show how binding them together makes a stronger whole.   For suitable approaches see the Talent Futures material on team development.

Opportunities are there for those who can move fast and take advantage of the openings that will arise during change. The laurels of success will be placed on the heads of those who can be creative and innovative whilst competently balancing the risks.

 Our HRD will now see the great chance. As a champion of delivering change, our heroic HRD must seize these opportunities.
Stephen Spencer
Talent Futures

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